CNL Restaurant Properties Inc · POS AM · On 7/26/96

Filed On 7/26/96   ·   SEC File 33-78790   ·   Accession Number 910650-96-11

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                                                       Registration No. 33-78790

 As filed with the Securities and Exchange Commission on July 26, 1996

        SECURITIES AND EXCHANGE COMMISSION
       Washington, D.C.  20549

        POST-EFFECTIVE AMENDMENT NO. SIX

    TO

     FORM S-11

      REGISTRATION STATEMENT
   UNDER

    THE SECURITIES ACT OF 1933, AS AMENDED

CNL AMERICAN PROPERTIES FUND, INC.
(Exact Name of Registrant as Specified in Charter)

400 East South Street, Suite 500
 Orlando, Florida  32801
Telephone:  (407) 422-1574
(Address of principal executive offices)

COPIES TO:

  Thomas H. McCormick, ESQUIRE
EDMUND D. GRAFF, ESQUIRE
 Shaw, Pittman, Potts & Trowbridge
 2300 N Street, N.W.
 Washington, D.C.  20037

CNL American Porperties Fund, Inc.    

Supplement No. 6, dated July 26, 1996   
to the Prospectus, dated April 26, 1996   

      This  Supplement  is  part of, and should be read in conjunction with, the
Prospectus dated April 26, 1996.  This Supplement replaces all prior Supplements
to  the  Prospectus.    Capitalized  terms used in this Supplement have the same
meaning as in the Prospectus unless otherwise stated herein.                    

      Information  as  to proposed properties for which the Company has received
initial commitments and as to the number and types of Properties acquired by the
Company  is  presented as of July 16, 1996, and all references to commitments or
Property  acquisitions  should be read in that context.  Proposed properties for
which the Company receives initial commitments, as well as property acquisitions
that occur after July 16, 1996, will be reported in a subsequent Supplement.    

THE OFFERING

      As  of  July  16,  1996,  the  Company had received aggregate subscription
proceeds  of  $80,598,079  (8,059,808 Shares) from 4,663 stockholders, including
$243,167  (24,317  Shares) issued pursuant to the Reinvestment Plan.  As of July
16,  1996,  the  Company  had invested or committed for investment approximately
$66,000,000  of such proceeds in 72 Properties (including one Property through a
joint  venture  arrangement which consists of land and building, five Properties
which  consist of building only, 33 Properties which consist of land only and 33
Properties  which consist of land and building), in providing mortgage financing
to  the  tenants  of  the  33  Properties  consisting  of  land  only and to pay
Acquisition  Fees  and Acquisition Expenses, leaving approximately $4,200,000 in
offering proceeds available for investment in Properties and Mortgage Loans.  As
of July 16, 1996, the Company had incurred $3,626,914 in Acquisition Fees to the
Advisor.                                                                        

BUSINESS

PROPERTY ACQUISITIONS                                                           

      Between  April  10,  1996  and  July  16,  1996,  the  Company acquired 24
Properties,  including two Properties consisting of building only, 12 Properties
consisting of land and building and ten Properties consisting of land only.  The
Properties are one TGI Friday's Property (in Hamden, Connecticut), three Wendy's
Properties  (one in each of Knoxville and Sevierville, Tennessee, and Camarillo,
California),  one  Golden Corral Property (in Port Richey, Florida), two Denny's
Properties  (one  in  each of Hillsboro and McKinney, Texas), four Boston Market
Properties  (one  in  each  of  Ellisville,  Missouri; Golden Valley, Minnesota;
Corvallis,  Oregon;  and  Rockwall,  Texas),  two Jack in the Box Properties (in
Humble  and Houston, Texas), one Arby's (in Kendallville, Indiana) and ten Pizza
Hut Properties (one in each of Beaver, Bluefield, Huntington, Hurricane, Milton,
Ronceverte,  Beckley,  Belle and Cross Lanes, West Virginia, and Marietta, Ohio)
(hereinafter  referred  to  as the "Ten Pizza Hut Properties").  For information
regarding the 48 Properties acquired by the Company prior to April 10, 1996, see
the Prospectus dated April 26, 1996.                                            

      The Denny's Property in McKinney, Texas, was acquired from an Affiliate of
the  Company.    The  Affiliate  had purchased and temporarily held title to the
Property  in order to facilitate the acquisition of the Property by the Company.
The  Property  was acquired by the Company for a purchase price of $977,256 from
an  Affiliate  of the Company.  The Property was acquired at a cost equal to the
cost of the Property to the Affiliate (including carrying costs) due to the fact
that these amounts were less than the Property's appraised value.               

      In  connection  with  the  purchase  of  the  TGI Friday's and the Wendy's
Properties  in  Hamden,  Connecticut,  and Sevierville, Tennessee, respectively,
which  are  building  only, the Company, as lessor, entered into long-term lease
agreements with unaffiliated lessees.  The general terms of the lease agreements
are  described in the section of the Prospectus entitled "Business - Description
of Property Leases."  In connection with the purchase of these Properties, which
a r e   to  be  constructed,  the  Company  has  entered  into  development  and
indemnification and put agreements with the lessees.  The general terms of these
agreements  are  described in the section of the Prospectus entitled "Business -
Site Selection and Acquisition of Properties - Construction and Renovation."  In
connection  with these acquisitions, the Company has also entered into tri-party
agreements  with  the  lessees  and  the  owners  of  the  land.   The tri-party
agreements  provide  that the ground lessees are responsible for all obligations
under  the  ground  leases and provide certain rights to the Company relating to
the  maintenance  of its interests in the buildings in the event of a default by
the lessees under the terms of the ground leases.                               

      In  connection  with  the purchase of the Wendy's Properties in Knoxville,
Tennessee,  and  Camarillo,  California, the Golden Corral Property, the Denny's
Properties, the Boston Market Properties, the Jack in the Box Properties and the
Arby's  Property,  which  are  land and building, the Company, as lessor entered
into long-term lease agreements with unaffiliated lessees.  The general terms of
the  lease  agreements  are  described in the section of the Prospectus entitled
"Business  - Description of Property Leases."  For the Properties that are to be
constructed,  the  Company  has entered into development and indemnification and
put  agreements  with  the  lessees.   The general terms of these agreements are
described  in  the section of the Prospectus entitled "Business - Site Selection
and Acquisition of Properties - Construction and Renovation."                   

      In  connection with the Ten Pizza Hut Properties, which are land only, the
Company acquired the land and is leasing these ten parcels to the lessee, Castle
Hill  Holdings  VI, L.L.C. ("Castle Hill"), pursuant to a master lease agreement
(the  "Master  Lease  Agreement").   Castle Hill has subleased the Ten Pizza Hut
Properties  to one of its affiliates, Midland Food Services L.L.C., which is the
operator  of  the  restaurants.  The general terms of the Master Lease Agreement
are  similar  to  those  described  in  the  section  of the Prospectus entitled
"Business  -  Description  of Property Leases."  If the lessee does not exercise
its  option  to  purchase  the  Properties  upon termination of the Master Lease
Agreement,  the sublessee and lessee will surrender possession of the Properties
to  the  Company, together with any improvements on such Properties.  The lessee
owns  the buildings located on the Ten Pizza Hut Properties.  In connection with
the  acquisition  of the Ten Pizza Hut Properties, the Company provided mortgage
financing of $3,888,000 to the lessee pursuant to a Mortgage Loan evidenced by a
master mortgage note (the "Master Mortgage Note") which is collateralized by the
building improvements on the Ten Pizza Hut Properties.  The Master Mortgage Note
bears  interest at a rate of 10.75% per annum and principal and interest are due
in  equal  monthly installments over 20 years starting July 1, 1996.  The Master
Mortgage  Note  equals  approximately  85  percent of the appraised value of the
related  buildings.   Management believes that, due to the fact that the Company
owns  the  underlying  land  relating to the Ten Pizza Hut Properties and due to
other  underwriting  criteria,  the  Company  has  sufficient collateral for the
Master Mortgage Note.                                                           

      As  of  July  16,  1996, the Company had initial commitments to acquire 14
properties,  including  two  properties  which  consist  of building only and 12
properties which consist of land and building.  The acquisition of each of these
properties  is  subject to the fulfillment of certain conditions, including, but
not  limited  to,  a  satisfactory  environmental survey and property appraisal.
There  can  be  no assurance that any or all of the conditions will be satisfied
or,  if  satisfied, that one or more of these properties will be acquired by the
Company.   If acquired, the leases of all 14 of these properties are expected to
be  entered  into on substantially the same terms described in the Prospectus in
the  section  entitled  "Business  -  Description of Property Leases," except as
described below.                                                                

      In  connection  with  the  Golden  Corral  and  the  Wendy's properties in
Brooklyn, Ohio, and San Diego, California, respectively, the Company anticipates
owning  only  the  buildings  and not the underlying land.  However, the Company
anticipates  entering  into  tri-party  agreements  with  the  lessees  and  the
landlords  of  the land in order to provide the Company with certain rights with
respect to the land on which the buildings are located.                         

      Set  forth  below are summarized terms expected to apply to the leases for
each  of  the  properties.  More detailed information relating to a property and
its  related  lease  will  be  provided at such time, if any, as the property is
acquired.                                                                       

                                                        · Enlarge/Download Table

                             Lease Term and                                                                            
Property                     Renewal Options         Minimum Annual Rent        Percentage Rent      Option to Purchase
                                                                                                                       

Golden Corral (2)       14 years; no renewal       14.214% of the            for each lease year,   upon the expiration
Brooklyn, OH            options                    Company's total cost      (i) 4% of annual       of the lease (4)   
Existing restaurant                                to purchase the           gross sales minus                         
                                                   building; increases by    (ii) the minimum                          
                                                   10% after the fifth       annual rent for such                      
                                                   lease year and after      lease year (3)                            
                                                   every five years                                                    
                                                   thereafter during the                                               
                                                   lease term                                                          

Applebee's              20 years; two five-year    11% of Total Cost (1);    for each lease year,   at any time after  
Montclair, CA           renewal options            increases by 10% after    (i) 5% of annual       the fifth lease    
Restaurant to be                                   the fifth lease year      gross sales minus      year (5)           
constructed                                        and after every five      (ii) the minimum                          
                                                   years thereafter          annual rent for such                      
                                                   during the lease term     lease year                                

Boston Market           15 years; five five-year   10.38% of Total Cost      for each lease year    at any time after  
Richmond, VA            renewal options            (1); increases by 10%     after the fifth lease  the fifth lease    
Existing restaurant                                after the fifth lease     year, (i) 5% of        year               
                                                   year and after every      annual gross sales                        
                                                   five years thereafter     minus (ii) the                            
                                                   during the lease term     minimum annual rent                       
                                                                             for such lease year                       

Ryan's Family Steak     20 years; two five-year    10.875% of Total Cost     for each lease year,   at any time after  
House                   renewal options            (1); increases by 12%     (i) 5% of annual       the tenth lease    
Spring Hill, FL                                    after the fifth lease     gross sales minus      year               
Restaurant to be                                   year and after every      (ii) the minimum                          
constructed                                        five years thereafter     annual rent for such                      
                                                   during the lease term     lease year                                

Boston Market           15 years; five five-year   10.38% of Total Cost      for each lease year    at any time after  
Atlanta, GA             renewal options            (1); increases by 10%     after the fifth lease  the fifth lease    
Restaurant to be                                   after the fifth lease     year, (i) 5% of        year               
constructed                                        year and after every      annual gross sales                        
                                                   five years thereafter     minus (ii) the                            
                                                   during the lease term     minimum annual rent                       
                                                                             for such lease year                       

Boston Market           15 years; five five-year   10.38% of Total Cost      for each lease year    at any time after  
Merced, CA              renewal options            (1); increases by 10%     after the fifth lease  the fifth lease    
Restaurant to be                                   after the fifth lease     year (i) 5% of annual  year               
constructed                                        year and after every      gross sales minus                         
                                                   five years thereafter     (ii) the minimum                          
                                                   during the lease term     annual rent for such                      
                                                                             lease year                                

Jack in the Box         18 years; four five-year   10.75% of Total Cost      for each lease year,   at any time after  
Houston, TX (#2)        renewal options            (1); increases by 8%      (i) 5% of annual       the seventh lease  
Restaurant to be                                   after the fifth lease     gross sales minus      year               
constructed                                        year and by 10% after     (ii) the minimum                          
                                                   every five years          annual rent for such                      
                                                   thereafter during the     lease year                                
                                                   lease term                                                          

Jack in the Box         18 years; four five-year   10.75% of Total Cost      for each lease year,   at any time after  
Humble, TX (#2)         renewal options            (1); increases by 8%      (i) 5% of annual       the seventh lease  
Restaurant to be                                   after the fifth lease     gross sales minus      year               
constructed                                        year and by 10% after     (ii) the minimum                          
                                                   every five years          annual rent for such                      
                                                   thereafter during the     lease year                                
                                                   lease term                                                          

Shoney's                20 years; two five-year    11.75% of Total Cost      for each lease year,   at any time after  
Fort Myers, FL          renewal options            (1); increases by 10%     (i) 6% of annual       the seventh lease  
Restaurant to be                                   after the fifth lease     gross sales minus      year               
constructed                                        year and after every      (ii) the minimum                          
                                                   five years thereafter     annual rent for such                      
                                                   during the lease term     lease year                                

Wendy's                 20 years; two five-year    10.25% of Total Cost      for each lease year,   at any time after  
Madisonville, TN        renewal options            (1); increases to         (i) 6% of annual       the seventh lease  
Restaurant to be                                   10.76% of Total Cost      gross sales minus      year               
constructed                                        during the fourth         (ii) the minimum                          
                                                   through sixth lease       annual rent for such                      
                                                   years, 11.95% of Total    lease year                                
                                                   Cost during the                                                     
                                                   seventh through tenth                                               
                                                   lease years, 12.70% of                                              
                                                   Total Cost during the                                               
                                                   eleventh through                                                    
                                                   fifteenth lease years,                                              
                                                   and 13.97% of Total                                                 
                                                   Cost during the                                                     
                                                   sixteenth through                                                   
                                                   twentieth lease years                                               

Wendy's (2)             15 years; three five-      13.26% of Total Cost      for each lease year,   upon the expiration
San Diego, CA           year renewal options       (1); increases by 8%      (i) 6% of annual       of the initial term
Restaurant to be                                   after the fifth lease     gross sales times the  of the lease and   
constructed                                        year and after every      Building Overage       during any renewal 
                                                   five years thereafter     Multiplier (6) minus   period thereafter  
                                                   during the lease term     (ii) the minimum       (4)                
                                                                             annual rent for such                      
                                                                             lease year                                

Burger King             20 years; two five-year    11% of Total Cost (1)     for each lease year,   None               
Chattanooga, TN         renewal options                                      (i) 8.5% of annual                        
Restaurant to be                                                             gross sales minus                         
constructed                                                                  (ii) the minimum                          
                                                                             annual rent for such                      
                                                                             lease year                                

Burger King             20 years; two five-year    11% of Total Cost (1)     for each lease year,   None               
Chicago, IL             renewal options                                      (i) 8.5% of annual                        
Restaurant to be                                                             gross sales minus                         
constructed                                                                  (ii) the minimum                          
                                                                             annual rent for such                      
                                                                             lease year                                

Boston Market           15 years; five five-year   10.38% of Total Cost      for each lease year    at any time after  
Upland, CA              renewal options            (1); increases by 10%     after the fifth lease  the fifth lease    
Restaurant to be                                   after the fifth lease     year (i) 5% of annual  year               
constructed                                        year and after every      gross sales minus                         
                                                   five years thereafter     (ii) the minimum                          
                                                   during the lease term     annual rent for such                      
                                                                             lease year                                

<FN>                                                                                                                   

FOOTNOTES:                                                                                                             

(1)   The  "Total  Cost"  is  equal  to the sum of (i) the purchase price of the                                       
      property,  (ii) closing costs, and (iii) actual development costs incurred                                       
      under the development agreement.                                                                                 

(2)   The  Company  anticipates owning the building only for this property.  The                                       
      C o mpany  will  not  own  the  underlying  land;  although,  the  Company                                       
      anticipates  entering  into  a tri-party agreement with the lessee and the                                       
      landlord  of  the land in order to provide the Company with certain rights                                       
      with respect to the land on which the building is located.                                                       

(3)   Percentage rent shall be calculated on a calendar year basis (January 1 to                                       
      December 31).                                                                                                    

(4)   In  the  event  that  the  aggregate amount of percentage rent paid by the                                       
      lessee to the Company over the term of the lease shall equal or exceed 15%                                       
      of  the purchase price paid by the Company, then the option purchase price                                       
      shall  equal  one dollar.  In the event that the aggregate percentage rent                                       
      paid  shall  be  less  than 15% of the purchase price paid by the Company,                                       
      then  the  option  purchase price shall equal the difference of 15% of the                                       
      purchase price, less the aggregate percentage rent paid to the landlord by                                       
      the lessee under the lease.                                                                                      

(5)   The  lessee  also  has  the  option  to  purchase  the  property after the                                       
      seller/lessee  operates  at least five Applebee's restaurants owned by the                                       
      Company.                                                                                                         

(6)   The "Building Overage Multiplier" is calculated as follows:                                                      

            B u ilding   Overage   Multiplier   =   (purchase   price   of   the                                       
            building)/[purchase  price  of the building + (annual rent due under                                       
            the land lease/land lease cap rate)]                                                                       

      The  following table sets forth the location of the 24 Properties acquired
by  the  Company,  including  the  Ten Pizza Hut Properties in which the Company
acquired the land only, 12 Properties in which the Company acquired the land and
building and the two Properties in which the Company acquired the building only,
from April 10, 1996 through July 16, 1996, a description of the competition, and
a summary of the principal terms of the acquisition and lease of each Property. 

                                                        · Enlarge/Download Table
                              PROPERTY ACQUISITIONS                                                                               
                    From April 10, 1996 through July 16, 1996                                                                     


                                                        Lease                                                                     
                                               Date     Expira-                 Minimum                             Option        
Property Location and            Purchase   Acquired    tion and            Annual Rent (2)       Percentage     To Purchase      
Competition                        Price                Renewal                                   Rent                            
                                 (1)                    Options                                                                   
                                                                                                                                  
TGI FRIDAY'S                     (3)        04/24/96    09/2008; no     15.043% of Total Cost     None           at any time      
(the "Hamden Property")                     (3)         renewal         (4); increases by 10%                    after the        
Restaurant to be constructed                            options         after the fifth lease                    third lease      
                                                                        year and after every                     year (5)         
The Hamden Property is located                                          five years thereafter                                     
at the southeast quadrant of                                            during the lease term                                     
Skiff Street and Route 10 in                                                                                                      
Hamden, New Haven County,                                                                                                         
Connecticut, in an area of                                                                                                        
mixed retail, commercial, and                                                                                                     
residential development.                                                                                                          
Other fast-food and family-                                                                                                       
style restaurants located in                                                                                                      
proximity to the Hamden                                                                                                           
Property include a China                                                                                                          
Buffet, a Chili's, a Red                                                                                                          
Lobster, a McDonald's, a                                                                                                          
Wendy's, and several local                                                                                                        
restaurants.                                                                                                                      

WENDY'S (14)                     $322,292     05/08/96  05/2016; two    10.25% of Total Cost;     for each       at any           
(the "Knoxville Property")       (excluding             five-year       increases to 10.76% of    lease year,    time             
Restaurant to be constructed     closing                renewal         Total Cost during the     (i) 6% of      after the        
                                 and                    options         fourth through sixth      annual gross   seventh          
The Knoxville Property is        development                            lease years, increases    sales minus    lease            
located on the north side of     costs)                                 to 11.95% of Total        (ii) the       year             
Western Avenue in Knoxville,     (3)                                    Cost during the           minimum                         
Knox County, Tennessee, in an                                           seventh through tenth     annual rent                     
area of mixed retail,                                                   lease years, increases    for such                        
commercial, and residential                                             to 12.70% of Total        lease year                      
development.  Other fast-food                                           Cost during the                                           
and family-style restaurants                                            eleventh through                                          
located in proximity to the                                             fifteenth lease years                                     
Knoxville Property include a                                            and increases to                                          
KFC, a McDonald's, a Taco                                               13.97% of Total Cost                                      
Bell, a Kenny Rogers Roasters,                                          during the sixteenth                                      
a Long John Silver's, a                                                 through twentieth                                         
Krystal, a Hardee's, a                                                  lease years (4)                                           
Shoney's, and several local                                                                                                       
restaurants.                                                                                                                      

GOLDEN CORRAL                    $586,687   05/08/96    10/2011; two    11.25% of Total Cost      for each       during the       
(the "Port Richey Property")     (excluding             five-year       (4); increases by 8%      lease year,    eighth and       
Restaurant to be constructed     closing                renewal         after the fifth lease     commencing     ninth lease      
                                 and                    options         year and after every      in the         years only       
The Port Richey Property is      development                            five years thereafter     second lease   (7)              
located on the southeast         costs)                                 during the lease term     year (i) 5%                     
quadrant of the intersection     (3)                                                              of annual                       
of U.S. 19 and Stone Road,                                                                        gross sales                     
Port Richey, Pasco County,                                                                        minus (ii)                      
Florida, in an area of mixed                                                                      the minimum                     
retail, commercial, and                                                                           annual rent                     
residential development.                                                                          for such                        
Other fast-food and family-                                                                       lease year                      
style restaurants located  in                                                                     (6)                             
proximity to the Port Richey                                                                                                      
Property include a Boston                                                                                                         
Market, a Morrison's, a Burger                                                                                                    
King, a Checkers, a Bob Evans,                                                                                                    
a Wendy's, a KFC, a Chili's,                                                                                                      
and several local restaurants.                                                                                                    

TEN PIZZA HUT PROPERTIES -       $1,512,000   05/17/96  05/2016; two    $166,320; increases by    None           at any           
Land only - (8)(10) located in                          ten-year        10% after the fifth                      time             
Beaver, West Virginia (the       (excluding             renewal         and tenth lease years                    after the        
"Beaver Property"), Bluefield,   closing                options         and 12% after the                        seventh          
West Virginia (the "Bluefield    costs)                                 fifteenth lease year                     lease            
Property"), Huntington, West                                            (9)                                      year             
Virginia (the"Hunting- ton                                                                                                        
Property"), Hurricane, West                                                                                                       
Virginia (the "Hurricane                                                                                                          
Property"), Milton, West                                                                                                          
Virginia (the "Milton                                                                                                             
Property"), Ronceverte, West                                                                                                      
Virginia (the "Ronceverte                                                                                                         
Property"),  Beckley, West                                                                                                        
Virginia (the "Beckley                                                                                                            
Property"), Belle, West                                                                                                           
Virginia (the "Belle                                                                                                              
Property"), Cross Lanes, West                                                                                                     
Virginia (the "Cross Lanes                                                                                                        
Property") and Marietta, Ohio                                                                                                     
(the "Marietta Property").                                                                                                        

The Beaver Property is located                                                                                                    
on the north side of U.S.                                                                                                         
Route 19 in Beaver, Raleigh                                                                                                       
County, West Virginia, in an                                                                                                      
area of mixed retail,                                                                                                             
commercial, and residential                                                                                                       
development.  Other fast-food                                                                                                     
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Beaver Property include a                                                                                                         
McDonald's, a Hardee's, a                                                                                                         
Wendy's, and a Long John                                                                                                          
Silver's.                                                                                                                         

The Bluefield Property is                                                                                                         
located on the north side of                                                                                                      
Bluefield Avenue in Bluefield,                                                                                                    
Mercer County, West Virginia,                                                                                                     
in an area of mixed retail,                                                                                                       
commercial, and residential                                                                                                       
development.  Other fast-food                                                                                                     
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Bluefield Property include a                                                                                                      
McDonald's, a Hardee's, a                                                                                                         
Captain D's, and a Shoney's.                                                                                                      
(11)                                                                                                                              

The Huntington Property is                                                                                                        
located on the south side of                                                                                                      
Madison Avenue in Huntington,                                                                                                     
Cabell County, West Virginia,                                                                                                     
in an area of mixed retail,                                                                                                       
commercial, and residential                                                                                                       
development.  Other fast-food                                                                                                     
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Huntington Property include an                                                                                                    
Arby's, three Burger Kings, a                                                                                                     
Chi Chi's, two Dairy Queens, a                                                                                                    
Hardee's, a KFC, a Long John                                                                                                      
Silver's, two McDonald's, a                                                                                                       
Papa John's, a Rax, a Red                                                                                                         
Lobster, a Steak & Ale, a Taco                                                                                                    
Bell, and several local                                                                                                           
restaurants.                                                                                                                      

The Hurricane Property is                                                                                                         
located on the southwest side                                                                                                     
of Hurricane Creek Road in                                                                                                        
Hurricane, Putnam County, West                                                                                                    
Virginia, in an area of mixed                                                                                                     
retail, commercial, and                                                                                                           
residential development. Other                                                                                                    
fast-food and family-style                                                                                                        
restaurants located in                                                                                                            
proximity to the Hurricane                                                                                                        
Property include a McDonald's,                                                                                                    
a Subway Sandwich Shop, and                                                                                                       
several local restaurants.                                                                                                        
(11)                                                                                                                              

The Milton Property is located                                                                                                    
on the northeast corner of                                                                                                        
East Main Street and Brickyard                                                                                                    
Avenue in Milton, Cabell                                                                                                          
County, West Virginia, in an                                                                                                      
area of mixed retail,                                                                                                             
commercial, and residential                                                                                                       
development.  Other fast-food                                                                                                     
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Milton Property include a                                                                                                         
McDonald's, a Subway Sandwich                                                                                                     
Shop, a Dairy Queen, and                                                                                                          
several local restaurants.                                                                                                        

The Ronceverte Property is                                                                                                        
located on the north side of                                                                                                      
Seneca Trail in Ronceverte,                                                                                                       
Greenbrier County, West                                                                                                           
Virginia, in an area of mixed                                                                                                     
retail, commercial, and                                                                                                           
residential development. Other                                                                                                    
fast-food and family-style                                                                                                        
restaurants located in                                                                                                            
proximity to the Ronceverte                                                                                                       
Property include a KFC, a Long                                                                                                    
John Silver's, a Subway                                                                                                           
Sandwich Shop, and several                                                                                                        
local restaurants.                                                                                                                

The Beckley Property is                                                                                                           
located on the north side of                                                                                                      
Harper Road in Beckley,                                                                                                           
Raleigh County, West Virginia,                                                                                                    
in an area of mixed retail,                                                                                                       
commercial, and residential                                                                                                       
development.  Other fast-food                                                                                                     
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Beckley Property include a                                                                                                        
McDonald's, a Long John                                                                                                           
Silver's, a Wendy's, a                                                                                                            
Shoney's, a Bob Evans, a                                                                                                          
Subway Sandwich Shop, a                                                                                                           
Hardee's, and several local                                                                                                       
restaurants.                                                                                                                      

The Belle Property is located                                                                                                     
on the southwest side of                                                                                                          
Dupont Avenue in Belle,                                                                                                           
Kanawha County, West Virginia,                                                                                                    
in an area of mixed retail,                                                                                                       
commercial, and residential                                                                                                       
development.  Other fast-food                                                                                                     
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Belle Property  include                                                                                                           
several local restaurants.                                                                                                        

The Cross Lanes Property is                                                                                                       
located on the northwest side                                                                                                     
of Goff Mountain Road in Cross                                                                                                    
Lanes, Kanawha County, West                                                                                                       
Virginia, in an area of mixed                                                                                                     
retail, commercial, and                                                                                                           
residential development.                                                                                                          
Other fast-food and family-                                                                                                       
style restaurants located in                                                                                                      
proximity to the Cross Lanes                                                                                                      
Property include a Hardee's, a                                                                                                    
Papa John's, a Captain D's, a                                                                                                     
McDonald's, a Taco Bell, a Bob                                                                                                    
Evans, a Wendy's, a Shoney's a                                                                                                    
KFC, and several local                                                                                                            
restaurants.                                                                                                                      

The Marietta Property is                                                                                                          
located on the east side of                                                                                                       
Acme Street in Marietta,                                                                                                          
Washington County, Ohio, in an                                                                                                    
area of mixed retail,                                                                                                             
commercial, and residential                                                                                                       
development. Other fast-food                                                                                                      
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Marietta Property include a                                                                                                       
Burger King, a Captain D's, a                                                                                                     
Dairy Queen, an Elby's Big                                                                                                        
Boy, a KFC, a Long John                                                                                                           
Silver's, a McDonald's, a Papa                                                                                                    
John's, a Subway Sandwich                                                                                                         
Shop, a Taco Bell, a Wendy's,                                                                                                     
and several local restaurants.                                                                                                    
(11)                                                                                                                              

DENNY'S                          $367,672     06/05/96  06/2016; two    10.625% of Total Cost     for each       during           
(the "Hillsboro Property")       (excluding             five-year       (4); increases by 11%     lease year,    the              
Restaurant to be constructed     closing                renewal         after the fifth lease     (i) 5% of      eighth,          
                                 and                    options         year and after every      annual gross   tenth,           
The Hillsboro Property is        development                            five years thereafter     sales minus    and              
located on the south side of     costs)                                 during the lease term     (ii) the       twelfth          
Highway 22 in Hillsboro, Hill    (3)                                                              minimum        lease            
County, Texas, in an area of                                                                      annual rent    years            
mixed retail, commercial, and                                                                     for such       only             
residential development.                                                                          lease year                      
Other fast-food and family-                                                                                                       
style restaurants located in                                                                                                      
proximity to the Hillsboro                                                                                                        
Property include a McDonald's,                                                                                                    
an Arby's, a Whataburger, a                                                                                                       
KFC, a Golden Corral, and a                                                                                                       
Grandy's.                                                                                                                         

DENNY'S                          $977,256   06/05/96    12/2015; two    $104,013; increases by    for each       during the       
(the "McKinney Property")        (excluding             five-year       11% after the fifth       lease year,    eighth,          
Existing restaurant              closing                renewal         lease year and after      (i) 5% of      tenth, and       
                                 costs)                 options         every five years          annual gross   twelfth          
The McKinney Property is                                                thereafter during the     sales minus    lease years      
located at the southwest                                                lease term                (ii) the       only             
quadrant of the intersection                                                                      minimum                         
of White Avenue and U.S. 75 in                                                                    annual rent                     
McKinney, Collin County,                                                                          for such                        
Texas, in an area of mixed                                                                        lease year                      
retail, commercial, and                                                                           (6)                             
residential development.                                                                                                          
Other fast-food and family-                                                                                                       
style restaurants located in                                                                                                      
proximity to the McKinney                                                                                                         
Property include an                                                                                                               
Applebee's, an Arby's, a                                                                                                          
Boston Market, a Jack in the                                                                                                      
Box, a Chili's, a Dairy Queen,                                                                                                    
an IHOP, a Golden Corral, a                                                                                                       
Pizza Hut, and several local                                                                                                      
restaurants.                                                                                                                      

WENDY'S (14)                     $586,143     06/05/96  06/2016; two    10.25% of Total Cost;     for each       at any           
(the "Camarillo Property")       (excluding             five-year       increases to 10.76% of    lease year,    time             
Restaurant to be constructed     closing                renewal         Total Cost during the     (i) 6% of      after the        
                                 and                    options         fourth through sixth      annual gross   seventh          
The Camarillo Property is        development                            lease years, increases    sales minus    lease            
located at the southwest         costs)                                 to 11.95% of Total        (ii) the       year             
quadrant of Las Posas Road and   (3)                                    Cost during the           minimum                         
the Ventura Freeway in                                                  seventh through tenth     annual rent                     
Camarillo, Ventura County,                                              lease years, increases    for such                        
California, in an area of                                               to 12.70% of Total        lease year                      
mixed retail, commercial, and                                           Cost during the                                           
residential development.                                                eleventh through                                          
Other fast-food and family-                                             fifteenth lease years                                     
style restaurants located in                                            and increases to                                          
proximity to the Camarillo                                              13.97% of Total Cost                                      
Property include an                                                     during the sixteenth                                      
Applebee's, a Del Taco, a                                               through twentieth                                         
McDonald's, and several local                                           lease years (4)                                           
restaurants.                                                                                                                      

WENDY'S (14)                     $66,153    06/05/96    05/2015; two    12.204% of Total Cost     for each       upon the         
(the "Sevierville Property")     (excluding (3)         five-year       (4); increases by 8%      lease year,    expiration       
Restaurant to be constructed     closing                renewal         after the fifth lease     (i) 6% of      of the           
                                 and                    options         year and after every      annual gross   initial term     
The Sevierville Property is      development            followed by     five years thereafter     sales times    of the lease     
located on the west side of      costs)                 one fifteen-    during the lease term     the Building   and during       
Highway 441 in Sevierville,      (3)                    year renewal                              Overage        any renewal      
Sevier County, Tennessee, in                            option                                    Multiplier     period           
an area of mixed retail,                                                                          (12) minus     thereafter       
commercial, and residential                                                                       (ii) the       (13)             
development.  Other fast-food                                                                     minimum                         
and family-style restaurants                                                                      annual rent                     
located in proximity to the                                                                       for such                        
Sevierville Property include a                                                                    lease year                      
Damon's Ribs, an IHOP, a Ruby                                                                                                     
Tuesday's, and several local                                                                                                      
restaurants.                                                                                                                      

BOSTON MARKET (15)               $408,879     06/18/96  06/2011;        10.40% of Total Cost      for each       at any           
(the "Ellisville Property")      (excluding             five five-      (4); increases by 10%     lease year     time             
Restaurant to be constructed     closing                year renewal    after the fifth lease     after the      after the        
                                 and                    options         year and after every      fifth lease    fifth            
The Ellisville Property is       development                            five years thereafter     year, (i) 5%   lease            
located on the north side of     costs)                                 during the lease term     of annual      year             
Manchester Road, in              (3)                                                              gross sales                     
Ellisville, St.  Louis County,                                                                    minus (ii)                      
Missouri, in an area of mixed                                                                     the minimum                     
retail, commercial, and                                                                           annual rent                     
residential development.                                                                          for such                        
Other fast-food and family-                                                                       lease year                      
style restaurants located in                                                                                                      
proximity to the Ellisville                                                                                                       
Property include a KFC, a                                                                                                         
Burger King, a Ponderosa, a                                                                                                       
Taco Bell, a McDonald's, a                                                                                                        
Long John Silver's, a Pizza                                                                                                       
Hut, a Hardee's, a Steak and                                                                                                      
Shake, a Red Lobster, and                                                                                                         
several local restaurants.                                                                                                        

BOSTON MARKET (15)               $603,386   06/19/96    06/2011;        10.40% of Total Cost      for each       at any time      
(the "Golden Valley Property")   (excluding             five five-      (4); increases by 10%     lease year     after the        
Restaurant to be constructed     closing                year renewal    after the fifth lease     after the      fifth lease      
                                 and                    options         year and after every      fifth lease    year             
The Golden Valley Property is    development                            five years thereafter     year, (i) 5%                    
located on the north side of     costs)                                 during the lease term     of annual                       
Highway 55 at Rhode Island       (3)                                                              gross sales                     
Avenue in Golden Valley,                                                                          minus (ii)                      
Hennepin County, Minnesota, in                                                                    the minimum                     
an area of mixed retail,                                                                          annual rent                     
commercial, and residential                                                                       for such                        
development.  Other fast-food                                                                     lease year                      
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Golden Valley Property include                                                                                                    
a McDonald's, a Perkins, and                                                                                                      
several local restaurants.                                                                                                        

JACK IN THE BOX (16)             $396,646     06/19/96  06/2014;        10.75% of Total Cost      for each       at any           
(the "Humble #1 Property")       (excluding             four five-      (4); increases by 8%      lease year,    time             
Restaurant to be constructed     closing                year renewal    after the fifth lease     (i) 5% of      after the        
                                 and                    options         year and by 10% after     annual gross   seventh          
The Humble #1 Property is        development                            every five years          sales minus    lease            
located at the north side of     costs)                                 thereafter during the     (ii) the       year             
FM 1960 East in Humble, Harris   (3)                                    lease term                minimum                         
County, Texas, in an area of                                                                      annual rent                     
mixed retail, commercial, and                                                                     for such                        
residential development.                                                                          lease year                      
Other fast-food and family-                                                                       (6)                             
style restaurants located in                                                                                                      
proximity to the Humble                                                                                                           
Property include a KFC, a                                                                                                         
McDonald's, a Taco Bell, a                                                                                                        
Wendy's, and a Burger King.                                                                                                       

BOSTON MARKET                    $350,358     07/09/96  07/2011;        10.38% of Total Cost      for each       at any           
(the "Corvallis Property")       (excluding             five five-      (4); increases by 10%     lease year     time             
Restaurant to be constructed     closing                year renewal    after the fifth lease     after the      after the        
                                 and                    options         year and after every      fifth lease    fifth            
                                 development                            five years thereafter     year, (i) 5%   lease            
The Corvallis Property is        costs)                                 during the lease term     of annual      year             
located at the southeast         (3)                                                              gross sales                     
quadrant of the intersection                                                                      minus (ii)                      
of Highway 99 and Northeast                                                                       the minimum                     
Circle Boulevard in Corvallis,                                                                    annual rent                     
Benton County, Oregon, in an                                                                      for such                        
area of mixed retail,                                                                             lease year                      
commercial, and residential                                                                                                       
development.  Other fast-food                                                                                                     
and family-style restaurants                                                                                                      
located in proximity to the                                                                                                       
Corvallis Property include a                                                                                                      
KFC, a Wendy's, a Subway                                                                                                          
Sandwich Shop, a Sizzler, a                                                                                                       
McDonald's, a Burger King, a                                                                                                      
Taco Bell, and several local                                                                                                      
restaurants.                                                                                                                      

JACK IN THE BOX (16)             $343,160     07/09/96   07/2014;        10.75% of Total Cost      for each       at any          
(the "Houston #1 Property")      (excluding             four five-      (4); increases by 8%      lease year,    time             
Restaurant to be constructed     closing                year renewal    after the fifth lease     (i) 5% of      after the        
                                 and                    options         year and by 10% after     annual gross   seventh          
The Houston #1 Property is       development                            every five years          sales minus    lease            
located on the east side of      costs)                                 thereafter during the     (ii) the       year             
Veterans Memorial Drive with     (3)                                    lease term                minimum                         
an access easement on Beltway                                                                     annual rent                     
8 in Houston, Harris County,                                                                      for such                        
Texas, in an area of mixed                                                                        lease year                      
retail, commercial, and                                                                           (6)                             
residential development.                                                                                                          
Other fast-food and family-                                                                                                       
style restaurants located in                                                                                                      
proximity to the Houston #1                                                                                                       
Property include a                                                                                                                
Whataburger, an Arby's, a KFC,                                                                                                    
a Burger King, and several                                                                                                        
local restaurants.                                                                                                                

ARBY'S                           $739,628     07/10/96  07/2016; two    $75,812; increases by     for each       during           
(the "Kendallville Property")    (excluding             five-year       4.14% after the third     lease year,    the              
Existing restaurant              g closing              renewal         lease year and after      (i) 4% of      seventh          
                                 costs)                 options         every three years         annual gross   and tenth        
The Kendallville Property is                                            thereafter during the     sales minus    lease            
located on the north side of                                            lease term                (ii) the       years            
West North Street in                                                                              minimum        only             
Kendallville, Noble County,                                                                       annual rent                     
Indiana, in an area of mixed                                                                      for such                        
retail, commercial and                                                                            lease year                      
residential development.                                                                                                          
Other fast-food and family-                                                                                                       
style restaurants located in                                                                                                      
proximity to the Kendallville                                                                                                     
Property include a KFC, a                                                                                                         
McDonald's, a Wendy's, a Pizza                                                                                                    
Hut, a Subway Sandwich Shop,                                                                                                      
and several local restaurants                                                                                                     

BOSTON MARKET                    $499,820     07/15/96  07/2011;        10.38% of Total Cost      for each       at any           
(the "Rockwall Property")        (excluding             five five-      (4); increases by 10%     lease year     time             
Restaurant to be constructed     closing                year renewal    after the fifth lease     after the      after the        
                                 and                    options         year and after every      fifth lease    fifth            
The Rockwall Property is         development                            five years thereafter     year, (i) 4%   lease            
located on the northeast         costs)                                 during the lease term     of annual      year             
corner of FM 740 and the to be   (3)                                                              gross sales                     
constructed Steger Town Drive                                                                     minus (ii)                      
in Rockwall, Rockwall County,                                                                     the minimum                     
Texas, in an area of mixed                                                                        annual rent                     
retail, commercial, and                                                                           for such                        
residential development.                                                                          lease year                      
Other fast-food and family-                                                                                                       
style restaurants located in                                                                                                      
proximity to the Rockwall                                                                                                         
Property include an Arby's, a                                                                                                     
Jack in the Box, a Dairy                                                                                                          
Queen, a KFC, a McDonald's, a                                                                                                     
Pizza Hut, a Sonic Drive-In, a                                                                                                    
Whataburger, a Wendy's, a                                                                                                         
Chili's, a Taco Bell, and                                                                                                         
several local restaurants.                                                                                                        

<FN>                                                                                                                              
FOOTNOTES:                                                                                                                        

(1)   The  estimated  federal  income  tax basis of the depreciable portion (the                                                  
      building portion) of each of the Properties acquired, and for construction                                                  
      Properties, once the buildings are constructed, is set forth below:                                                         

         Property                          Federal  Tax Basis                Property                          Federal  Tax  Basis

         Hamden Property                        $1,195,000                   Ellisville Property                     635,000      
         Knoxville Property                        510,000                   Golden Valley Property                  529,000      
         Port Richey Property                    1,208,000                   Humble #1 Property                      610,000      
         Hillsboro Property                        742,000                   Corvallis Property                      624,000      
         McKinney Property                         627,000                   Houston #1 Property                     620,000      
         Camarillo Property                        672,000                   Kendallville Property                   304,000      
         Sevierville Property                      519,000                   Rockwall Property                       422,000      

(2)   Minimum  annual  rent  for  each  of  the Properties became payable on the                                                  
      effective  date  of  the lease, except as indicated below.  For the Hamden                                                  
      and  Port  Richey  Properties,  minimum  annual  rent  will become due and                                                  
      payable  on  the  earlier of (i) the date the certificate of occupancy for                                                  
      the  restaurant is issued, (ii) the date the restaurant opens for business                                                  
      to  the  public  or  (iii) 150 days after execution of the lease.  For the                                                  
      Knoxville,  Camarillo and Sevierville Properties, minimum annual rent will                                                  
      become  due  and  payable on (i) the date the certificate of occupancy for                                                  
      the  restaurant is issued, (ii) the date the restaurant opens for business                                                  
      to  the  public,  (iii)  120 days after execution of the lease or (iv) the                                                  
      date  the  tenant  receives  from  the  landlord  its final funding of the                                                  
      construction  costs.  For the Hillsboro Property, minimum annual rent will                                                  
      become  due  and payable on the earlier of (i) the date the certificate of                                                  
      occupancy for the restaurant is issued, (ii) the date the restaurant opens                                                  
      for business to the public or (iii) 180 days after execution of the lease.                                                  
      For  the  Corvallis,    Ellisville, Golden Valley and Rockwall Properties,                                                  
      minimum  annual rent will become due and payable on the earlier of (i) 180                                                  
      days  after  execution  of  the lease or (ii) the date the tenant receives                                                  
      from  the  landlord  its final funding of the construction costs.  For the                                                  
      Humble  #1  and Houston #1 Properties, minimum annual rent will become due                                                  
      and  payable  on  the  earlier  of  (i)  the date the restaurant opens for                                                  
      business  to the public or (ii) 180 days after the execution of the lease.                                                  
      During  the  period commencing with the effective date of the lease to the                                                  
      date  minimum annual rent becomes payable for the Knoxville, Camarillo and                                                  
      Sevierville  Properties,  as described above, the tenant shall pay monthly                                                  
      "interim  rent"  equal  to  10.25%  per  annum of the amount funded by the                                                  
      C o mpany  in  connection  with  the  purchase  and  construction  of  the                                                  
      Properties.    During the period commencing with the effective date of the                                                  
      lease  to  the  date  minimum  rent  becomes payable for the Corvallis and                                                  
      Rockwall  Properties,  as  described  above,  the tenant shall pay monthly                                                  
      "interim  rent"  equal  to  10.38%  per  annum of the amount funded by the                                                  
      C o mpany  in  connection  with  the  purchase  and  construction  of  the                                                  
      Properties.    During the period commencing with the effective date of the                                                  
      lease  to  the  date  minimum  rent becomes payable for the Ellisville and                                                  
      Golden Valley Properties, as described above, the tenant shall pay monthly                                                  
      "interim  rent"  equal  to  10.40%  per  annum of the amount funded by the                                                  
      C o mpany  in  connection  with  the  purchase  and  construction  of  the                                                  
      Properties.    During the period commencing with the effective date of the                                                  
      lease  to  the  date minimum annual rent becomes payable for the Humble #1                                                  
      and  Houston  #1  Properties,  as  described  above,  the tenant shall pay                                                  
      monthly  "interim  rent" equal to 10.75% per annum of the amount funded by                                                  
      the  Company  in  connection  with  the  purchase  and construction of the                                                  
      Properties.                                                                                                                 

(3)   The  Company  accepted  an  assignment  of an interest in the ground lease                                                  
      relating to the Hamden and Sevierville Properties effective April 24, 1996                                                  
      and June 5, 1996, respectively, in consideration of its funding of certain                                                  
      preliminary   development  costs  and  its  agreement  to  fund  remaining                                                  
      development  costs  not  in  excess  of  the amounts specified below.  The                                                  
      development  agreements  for  the  Properties  which are to be constructed                                                  
      provide  that  construction  must be completed no later than the dates set                                                  
      forth  below.    The  maximum cost to the Company, (including the purchase                                                  
      price  of the land (if applicable), development costs (if applicable), and                                                  
      closing  and  acquisition  costs)  is not expected to, but may, exceed the                                                  
      amounts set forth below:                                                                                                    

         Property                          Estimated Maximum Cost                Estimated Final Completion Date                  

         Hamden Property                    $1,200,972                           September 21, 1996                               
         Knoxville Property                    830,966                           September 5, 1996                                
         Port Richey Property                1,675,000                           October 5, 1996                                  

         Hillsboro Property                  1,119,248                           December 2, 1996                                 
         Camarillo Property                  1,264,789                           October 3, 1996                                  
         Sevierville Property                  517,571                           October 3, 1996                                  
         Ellisville Property                 1,026,746                           December 15, 1996                                
         Golden Valley Property              1,128,899                           December 16, 1996                                
         Humble #1 Property                    949,413                           December 16, 1996                                

         Corvallis  Property                   952,684                           January 5, 1997                                  
         Houston #1 Property                   926,397                           January 5, 1997                                  
         Rockwall Property                     795,087                           January 11, 1997                                 

(4)   The  "Total  Cost"  is  equal  to the sum of (i) the purchase price of the                                                  
      Property,  (ii) closing costs, and (iii) actual development costs incurred                                                  
      under  the  development  agreement,  and  in  the case of the Hamden, Port                                                  
      Richey  and  Hillsboro  Properties,  (iv)  "construction  financing costs"                                                  
      during the development period.                                                                                              

(5)   If the lessee exercises its purchase option after the third lease year and                                                  
      before  the  eleventh  lease  year,  the  purchase price to be paid by the                                                  
      lessee shall be equal to the net present value of the monthly lease rental                                                  
      payments  for  the  remainder  of  the  lease term (including previous and                                                  
      scheduled  rent  increases) discounted at the lesser of (i) 11% per annum,                                                  
      or  (ii)  the then-current annual yield on 7-year Treasury securities plus                                                  
      4.5%, plus the full amount of any late fees, default interest, enforcement                                                  
      costs  or  other  sums  otherwise  due  or payable by the lessee under the                                                  
      lease.  If the lessee exercises its option after the tenth lease year, the                                                  
      purchase  price to be paid by the lessee shall be equal to the net present                                                  
      value  of  the  monthly lease payments for the remainder of the lease term                                                  
      (based,  however,  for  purposes hereof on the initial monthly installment                                                  
      amount   of  annual  rental  and  not  including  previous  and  scheduled                                                  
      increases)  discounted  at 11% per annum, plus the full amount of any late                                                  
      fees,  default  interest, enforcement costs or other sums otherwise due or                                                  
      payable by the lessee under the lease.                                                                                      

(6)   Percentage rent shall be calculated on a calendar year basis (January 1 to                                                  
      December 31).                                                                                                               

(7)   If   the  Property  is  not  producing  percentage  rent  and  the  lessee                                                  
      determines,  in  good faith, that the restaurant has become uneconomic and                                                  
      unsuitable  the  lessee  may  elect,  during the first through seventh and                                                  
      again during the tenth through 15th lease years:                                                                            

      (i)   to purchase the Property for a purchase price, net of closing costs,                                                  
      equal  to the greater of (a) the then fair-market value of the Property as                                                  
      determined  by  an  independent  appraisal,  or  (b) 100% of the Company's                                                  
      o r iginal  cost  for  the  Property  if  the  Company  is  successful  in                                                  
      effectuating  the  lessee's  purchase  through  a  tax-free  ``like-kind''                                                  
      exchange,  or  120%  of  the Company's original cost for the Property if a                                                  
      tax-free, ``like-kind'' exchange is not effectuated; or                                                                     

      (ii)  to sublet the Property as described in the section of the Prospectus                                                  
      entitled ``Description of Property Leases - Assignment and Sublease;'' or                                                   

      (iii)    to  substitute  the Property for another Golden Corral restaurant                                                  
      property  on  terms  similar  to  those  described  in  the section of the                                                  
      Prospectus  entitled  ``Description  of  Property Leases - Substitution of                                                  
      Properties.''                                                                                                               

(8)   The  lease  relating  to  this Property is a land lease only.  The Company                                                  
      entered  into  a  Mortgage  Loan  evidenced  by a Master Mortgage Note for                                                  
      $3,888,000  collateralized  by building improvements.  The Master Mortgage                                                  
      Note  bears  interest  at  a  rate  of  10.75% per annum and principal and                                                  
      interest  will  be  collected  in equal monthly installments over 20 years                                                  
      beginning in July 1996.                                                                                                     

(9)   If the lessee exercises one or both of its renewal options, minimum annual                                                  
      rent  will increase by 12% after the expiration of the original lease term                                                  
      and after five years thereafter during any subsequent lease term.                                                           

(10)  The  Company  entered  into  a  Master  Lease  Agreement  for  the Beaver,                                                  
      Bluefield,  Huntington,  Hurricane,  Milton,  Ronceverte,  Beckley, Belle,                                                  
      Cross Lanes and Marietta Properties.                                                                                        

(11)  The  Company  and  the  lessee  entered  into  remediation  and  indemnity                                                  
      agreements  on  May  17, 1996, with the seller of the land and an adjacent                                                  
      site  owner/operator  (the  "Indemnitors")  due  to  Phase  I and Phase II                                                  
      environmental  testing results indicating that there were action levels of                                                  
      environmental  contamination  on  the  Bluefield,  Hurricane  and Marrieta                                                  
      Properties  relating  to  underground  gasoline  storage  tanks  from  one                                                  
      property  adjacent to the Hurricane Property and past use of the other two                                                  
      P r operties.    Under  the  remediation  and  indemnity  agreements,  the                                                  
      Indemnitors  have agreed to notify all applicable federal, state, or local                                                  
      government  agencies or authorities of the environmental contamination, to                                                  
      undertake all remediation work on these sites at no expense to the Company                                                  
      or  lessee,  and  to  indemnify, defend and hold harmless the Company, the                                                  
      lessee  and  investors from losses arising out of or related to any claim,                                                  
      action,  proceeding,  lawsuit,  notice  of  violation  or  demand  by  any                                                  
      (i)  governmental  authority  in  connection  with  the  presence  of  any                                                  
      environmental contamination, (ii) failure of the Indemnitors to notify any                                                  
      applicable  governmental  authorities,  (iii)  remediation  work, and (iv)                                                  
      claim, action, proceeding, lawsuit, or demand by third parties who are not                                                  
      the  successors  in  interest  of  the  indemnified  parties  and  are not                                                  
      affiliated  with  the  indemnified  parties.  If as to any of the affected                                                  
      sites,  the  remediation  work  is not satisfactorily completed within two                                                  
      years  after  the effective date, such that the Company is willing, in its                                                  
      discretion, to remain the owner of a particular affected site, the Company                                                  
      may  "put" the particular affected site back to the seller, and the seller                                                  
      will purchase the Company's ownership interest in the affected site.                                                        

(12)  The "Building Overage Multiplier" is calculated as follows:                                                                 

            B u ilding   Overage   Multiplier   =   (purchase   price   of   the                                                  
            building)/[purchase  price  of the building + (annual rent due under                                                  
            the land lease/land lease cap rate)]                                                                                  

(13)  In  the  event  that  the  aggregate amount of percentage rent paid by the                                                  
      lessee to the Company over the term of the lease shall equal or exceed 15%                                                  
      of  the purchase price paid by the Company, then the option purchase price                                                  
      shall  equal  one dollar.  In the event that the aggregate percentage rent                                                  
      paid  shall  be  less  than 15% of the purchase price paid by the Company,                                                  
      then  the  option  purchase price shall equal the difference of 15% of the                                                  
      purchase price, less the aggregate percentage rent paid to the landlord by                                                  
      the lessee under the lease.                                                                                                 

(14)  The  lessee of the Knoxville, Camarillo, and Sevierville Properties is the                                                  
      same unaffiliated lessee.                                                                                                   

(15)  The  lessee  of  the  Ellisville  and Golden Valley Properties is the same                                                  
      unaffiliated lessee.                                                                                                        

(16)  The  lessee  of  the  Humble  #1  and  Houston  #1  Properties is the same                                                  
      unaffiliated lessee.                                                                                                        

BORROWING AND SECURED EQUIPMENT LEASES                                          

      Between  April  10,  1996  and  July  16, 1996, the Company obtained three
advances totaling $1,642,788 under its $15,000,000 Loan.  The advances are fully
amortizing  term  loans repayable over six years and bear interest at a rate per
annum  equal  to  215  basis  points  above  the Reserve Adjusted LIBOR Rate (as
defined  in  the  Loan).    The  proceeds  of  the advances were used to acquire
Equipment  for three restaurant properties at a cost of approximately $1,609,000
and to pay Secured Equipment Lease Servicing Fees of $32,175 to the Advisor.  In
connection  with  the  acquisition of the Equipment for one restaurant property,
the  Company,  as  lessor,  entered  into  a  Secured  Equipment  Lease  with an
unaffiliated lessee that leases the restaurant property from an Affiliate of the
Advisor.  The following table sets forth a summary of the principal terms of the
acquisition and lease of the Equipment.                                         

                                                        · Enlarge/Download Table

                                           SECURED EQUIPMENT LEASES                                              
                                   From April 10, 1996 through July 16, 1996                                     

                                                                                                           Option
Description                   Purchase Price   Date Acquired       Lease       Annual Rent (2)  To Purchase      
                              (1)                             Expiration                                         
                                                                                                                 

EQUIPMENT FOR GOLDEN          $538,790            06/14/96         06/2003         $109,617          (3)         
CORRAL RESTAURANT IN          (excluding                                                                         
MIDDLEBURG HEIGHTS, OHIO      closing costs                                                                      
(5)                           and Secured                                                                        
(The "Middleburg Heights      Equipment                                                                          
Secured Equipment Lease")     Lease                                                                              
                              Servicing Fee)                                                                     

EQUIPMENT FOR GOLDEN          $560,411            07/02/96         07/2003         $113,994          (3)         
CORRAL RESTAURANT IN          (excluding                                                                         
BROOKLYN,                     closing costs                                                                      
OHIO (5) (The "Brooklyn       and Secured                                                                        
Secured Equipment Lease")     Equipment                                                                          
                              Lease                                                                              
                              Servicing Fee)                                                                     

EQUIPMENT FOR TGI             $509,573            07/15/96         07/2001         $132,664          (4)         
FRIDAY'S                      (excluding                                                                         
RESTAURANT IN HAZLET, NEW     closing costs                                                                      
JERSEY                        and Secured                                                                        
(The "Hazlet Secured          Equipment                                                                          
Equipment Lease")             Lease                                                                              
                              Servicing Fee)                                                                     

<FN>                                                                                                             
(1)   The Secured Equipment Lease is expected to be treated as a loan secured by                                 
      personal property for federal income tax purposes.                                                         

(2)   Rental payments due under the Secured Equipment Lease are payable monthly,                                 
      commencing on the effective date of the lease.                                                             

(3)   At the end of the lease term, if no event of default has occurred under                                    
      the terms of the Secured Equipment Lease, the lessee will have the option                                  
      to purchase the Equipment for $1.                                                                          

(4)   Lessee may purchase the Equipment prior to the expiration of the Secured                                   
      Equipment Lease, at the then present value of the remaining rental                                         
      payments, discounted at a rate of ten percent per annum.                                                   

(5)   The lessee of the Middleburg Heights and Brooklyn Secured Equipment Leases                                 
      is the same unaffiliated lessee.                                                                           

 MANAGEMENT COMPENSATION

FEES AND EXPENSES PAID TO THE                                                   
ADVISOR AND ITS AFFILIATES                                                      

      SELLING  COMMISSIONS  AND  MARKETING  SUPPORT  AND  DUE  DILIGENCE EXPENSE
REIMBURSEMENT  FEE.    In  connection  with the formation of the Company and the
offering  of the Shares, the Managing Dealer will receive Selling Commissions of
7.5%  (a  maximum of $11,250,000 if 15,000,000 Shares are sold), and a marketing
support  and  due  diligence  expense  reimbursement  fee  of 0.5% (a maximum of
$750,000  if  15,000,000  Shares  are sold), of the total amount raised from the
sale  of  Shares,  computed  at  $10.00  per Share sold ("Gross Proceeds").  The
Managing  Dealer  in  turn may reallow Selling Commissions of up to 7% on Shares
sold,  and  all  or  a  portion  of the 0.5% marketing support and due diligence
expense  reimbursement fee to certain Soliciting Dealers, who are not Affiliates
of  the  Company.  As of March 31, 1996, the Company had incurred $4,128,141 for
S e lling  Commissions  due  to  the  Managing  Dealer,  a  substantial  portion
($3,909,808)  of which has been paid as commissions to other Soliciting Dealers.
In  addition,  as  of  March  31,  1996,  the  Company  had incurred $275,210 in
marketing  support  and  due  diligence  expense  reimbursement  fees due to the
Managing Dealer.  A portion of these fees has been reallowed to other Soliciting
Dealers, and all due diligence expenses will be paid from such fees.            

      SOLICITING  DEALER  SERVICING  FEE.    The Company will incur a Soliciting
Dealer  Servicing  Fee  in  the amount of .20% of Invested Capital (a maximum of
$300,000  if  15,000,000  Shares are sold).  The Soliciting Dealer Servicing Fee
will  be  payable  on December 31 of each year, commencing on December 31 of the
year  following the year in which the offering terminates, and generally will be
payable  to  the  Managing Dealer, which in turn may reallow all or a portion of
such  fee  to  Soliciting  Dealers  whose clients held Shares on such date.  The
Company  has determined, however, that the Company may pay the Soliciting Dealer
Servicing  Fee  directly  to any Soliciting Dealer exempt from registration as a
broker-dealer and whose clients held Shares on such date.  As of March 31, 1996,
no such fees had been incurred by the Company.                                  

      ACQUISITION FEES.  The Advisor is entitled to receive acquisition fees for
services  in  identifying  the  Properties  and  structuring  the  terms  of the
acquisition  and  leases  of  the  Properties  equal  to 4.5% of Gross Proceeds,
payable  by  the Company as Acquisition Fees.  As of March 31, 1996, the Company
had  incurred  $2,476,885  in  such  acquisition  fees  payable  to the Advisor.
Acquisition  fees  incurred by the Company as of March 31, 1996, are included as
part  of  the  cost of land and buildings on operating leases, net investment in
direct financing lease and other assets.                                        

      DEVELOPMENT/CONSTRUCTION MANAGEMENT FEES TO AFFILIATES OF THE COMPANY.  In
connection  with  the  acquisition  of  Properties that have been constructed or
renovated   by  Affiliates,  the  Company  will  incur  development/construction
management fees of generally 5% to 10% of the cost of constructing or renovating
a Property, payable to Affiliates of the Company as Acquisition Fees.  Such fees
will  be  included in the purchase price of Properties purchased from developers
that  are  Affiliates  of  the  Company.    See  "Business  - Site Selection and
Acquisition of Properties."  Development/construction management fees, which are
based  on the number of Properties purchased from developers that are Affiliates
of  the  Company,  the cost of construction or renovation of such Properties and
the  percentage  amount of each development/construction management fee, are not
determinable at this time.  As of March 31, 1996, no such fees had been incurred
by the Company.                                                                 

      CONSTRUCTION  FINANCING  FEES TO AFFILIATES OF THE COMPANY.  In connection
with  the  acquisition of Properties from affiliated or unaffiliated developers,
to  whom  Affiliates  of  the  Company have provided construction financing, the
Company  will  incur  construction  financing fees, payable to Affiliates of the
Company  as Acquisition Fees.  Such fees will be in an amount equal to generally
1%  to  2%  of  the  total  amount  of each loan plus the difference between the
Affiliate  -  lender's  cost  of funds and the amount of interest charged to the
developer  with such difference determined by applying an annual percentage rate
of  generally  1.5% to 3% throughout the duration of the loan to the outstanding
amount  of  the  loan.    Such  fees  will  be included in the purchase price of
Properties  purchased  from developers that receive such loans.  See "Business -
Site  Selection  and  Acquisition of Properties."  Construction loan fees, which
are  based  on  the  number  of  Properties  for which Affiliates of the Company
provide  construction  financing,  the amount and duration of such loans and the
amount  of  each  construction financing fee, are not determinable at this time.
As of March 31, 1996, no such fees had been incurred by the Company.            

      The  total  of  all  Acquisition  Fees  and  Acquisition Expenses shall be
reasonable  and  shall not exceed an amount equal to 6% of the Real Estate Asset
Value  of  a  Property  unless a majority of the Board of Directors, including a
majority   of  the  Independent  Directors,  not  otherwise  interested  in  the
transaction  approves  fees in excess of these limits subject to a determination
that  the  transaction  is  commercially competitive, fair and reasonable to the
Company.                                                                        

      ASSET  MANAGEMENT  FEE.   For managing the Properties, the Advisor will be
entitled to receive a monthly Asset Management Fee of one-twelfth of .60% of the
Company's  Real  Estate Asset Value (generally, the total amount invested in the
Properties,  exclusive  of  Acquisition Fees and Acquisition Expenses) as of the
end  of  the  preceding  month.   As of March 31, 1996, the Company had incurred
$61,239  of  such fees, $6,266 of which has been capitalized as part of the cost
of building for Properties under construction.                                  

      MORTGAGE MANAGEMENT FEE.  For managing mortgage loans, the Advisor will be
entitled  to receive a monthly Mortgage Management Fee of one-twelfth of .60% of
the  total principal amount of the Mortgage Loans as of the end of the preceding
month.  As of March 31, 1996, the Company had incurred $8,475 of such fees.     

      SECURED  EQUIPMENT LEASE SERVICING FEE.  For negotiating Secured Equipment
Leases  and supervising the Secured Equipment Lease program, the Advisor will be
entitled  to  receive  from  the  Company  a  one-time  Secured  Equipment Lease
Servicing  Fee  of 2% of the purchase price of the Equipment that is the subject
of  a  Secured  Equipment  Lease.    As of March 31, 1996, no such fees had been
incurred by the Company.                                                        

      REAL  ESTATE DISPOSITION FEE.  Prior to Listing, the Advisor may receive a
real  estate  disposition  fee  of  3%  of  the gross sales price of one or more
Properties for providing substantial services in connection with the Sale, which
will   be  deferred  and  subordinated  until  the  stockholders  have  received
Distributions  equal  to the sum of 100% of the stockholders' aggregate Invested
Capital  plus an aggregate, annual, cumulative, noncompounded 8% return on their
Invested  Capital,  excluding Distributions attributable to proceeds of the Sale
of a Property (the "Stockholders' 8% Return").  Upon Listing, if the Advisor has
accrued but not been paid such real estate disposition fee, then for purposes of
d e t e rmining  whether  the  subordination  conditions  have  been  satisfied,
stockholders  will  be deemed to have received a Distribution in an amount equal
to the product of the total number of Shares outstanding and the average closing
prices of the Shares over a period, beginning 180 days after Listing, of 30 days
during which the Shares are traded.  See "The Advisor and The Advisory Agreement
-The  Advisory Agreement."  As of March 31, 1996, no such fees had been incurred
by the Company.                                                                 

      SUBORDINATED  SHARE  OF  NET  SALES PROCEEDS.  A subordinated share of Net
Sales  Proceeds  will  be  paid  to  the  Advisor  upon  the Sale of one or more
Properties  or  Secured  Equipment Leases in an amount equal to 10% of Net Sales
Proceeds.  This amount will be subordinated and paid only after the stockholders
have  received  Distributions  equal  to  the  sum  of 100% of the stockholders'
aggregate  Invested  Capital, plus the Stockholders' 8% Return.  As of March 31,
1996, no such amounts had been incurred by the Company.                         

      ADMINISTRATIVE  AND  OTHER  EXPENSES.  The Advisor provides accounting and
administrative  services  (including  accounting  and administrative services in
connection  with  the  Offering of Shares) to the Company on a day-to-day basis.
As  of  March 31, 1996, the Company had incurred $942,218 of such costs that are
included in stock issuance costs and $142,048 of such costs that are included in
general and administrative expenses.                                            

      REIMBURSEMENT  OF  OUT-OF-POCKET EXPENSES.  The Advisor and its Affiliates
are  entitled  to  receive  reimbursement,  at cost, for expenses they incur for
Organizational   and  Offering  Expenses,  Acquisition  Expenses  and  Operating
Expenses.    As  of  March 31, 1996, the Advisor and its Affiliates had incurred
$2,830,495,  $183,489,  and $123,676 on behalf of the Company for Organizational
a n d    O ffering  Expenses,  Acquisition  Expenses,  and  Operating  Expenses,
respectively.                                                                   

 SELECTED FINANCIAL DATA

      The  following  table  sets  forth  certain  financial information for CNL
American  Properties  Fund,  Inc.,  and  should  be  read  in  conjunction  with
"Management's  Discussion  and  Analysis  of  Financial Condition and Results of
Operations"  and  the  Financial  Statements  included  in  Exhibit  B  to  this
Prospectus Supplement and Exhibit B to the Prospectus.                          

                                                        May 2,
                                                        1994 (Date
                              Quarter Ended              of Inception)
                             March 31,    Year Ended     through
                                  1996        December 31,  December 31,
                          (Unaudited)       1995          1994

 Revenues                        $1,059,879   $   659,131 $          -
 Net earnings                       744,588       368,779            -
 Cash distributions declared (1)    768,133       638,618            -
 Funds from operations (2)          840,123       470,592            -
 Earnings per Share                    0.16          0.19            -
Cash distributions declared                                         
   per Share                           0.17          0.34            -
 Funds from operations per Share(2)    0.18          0.25            -
Weighted average number of Shares                                   
    outstanding (3)               4,649,040     1,898,350            -

     March 31,
                                    1996      December 31,  December 31,
                             (Unaudited)     1995           1994

  Total assets                   $48,909,495   $33,603,084      $929,585
 Long-term obligations               53,500            -             -
  Total equity                    46,745,744    31,980,648       200,000

      (1)   Approximately  ten  percent  and  40  percent  of cash distributions
            ($0.02 and $0.14 per Share) for the quarter ended March 31, 1996 and
            the  year ended December 31, 1995, respectively, represents a return
            o f   capital  in  accordance  with  generally  accepted  accounting
            principles  ("GAAP").    Cash  distributions  treated as a return of
            capital  on  a GAAP basis represent the amount of cash distributions
            in  excess of accumulated net earnings on a GAAP basis.  The Company
            has  not  treated such amount as a return of capital for purposes of
            calculating the stockholders' Invested Capital and the Stockholders'
8% Return, as described in the Prospectus.              

      (2)   Funds  from  operations  are net earnings, excluding depreciation of
            $94,530  and  $100,318  and  amortization  expense  of joint venture
            capitalized  costs  of  $1,005  and  $1,495  for  the  quarter ended
            March  31,  1996 and the year ended December 31, 1995, respectively.
            Funds  from operations are generally considered by industry analysts
            to  be  the  most  appropriate  measure  of  performance  and do not
            necessarily  represent  cash  provided  by  operating  activities in
            accordance with generally accepted accounting principles and are not
    necessarily indicative of cash available to meed cash needs.

      (3)   The  weighted average number of Shares outstanding is based upon the
period the Company was operational.                     

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

INTRODUCTION                                                                    

      The  Company  is a Maryland corporation that was organized on May 2, 1994,
to  acquire  Properties,  directly  or  indirectly  through Joint Venture or co-
tenancy  arrangements,  to  be  leased  on  a  long-term,  "triple-net" basis to
operators  of  certain  Restaurant Chains.  In addition, the Company may provide
Mortgage  Loans  for  the purchase of buildings, generally by tenants that lease
the  underlying  land from the Company.  To a lesser extent, the Company intends
to  offer  Secured  Equipment Leases to operators of Restaurant Chains.  Secured
Equipment  Leases  will be funded from the proceeds of the Loan, in an amount up
to 10% of Gross Proceeds from the offering, which the Company has obtained.     

      As  of  March  31,  1996,  the  Company owned 43 Properties (including one
Property  through a joint venture arrangement),  four  of  which  were  under   
construction at March 31, 1996.  Of the 43  Properties,  three  consisted  of   
building only, 20 consisted of land only and 20 consisted of land and building. 

LIQUIDITY AND CAPITAL RESOURCES                                                 

      In  April  1995, the Company commenced an offering of its Shares of common
stock.   As of March 31, 1996, the Company had received subscription proceeds of
$55,041,881  (5,504,188  shares)  from  the offering, including $128,151 (12,815
shares) through the Reinvestment Plan.                                          

      As  of  March  31,  1996, net proceeds to the Company from its offering of
S h a res  and  capital  contributions  from  the  Advisor  after  deduction  of
Selling Commissions, marketing support and due diligence expense reimbursement  
fees and                                                                        
Organizational  and  Offering  Expenses,  totalled $47,039,128.  As of March 31,
1996,  approximately  $42,800,000  had  been  used  to  invest, or committed for
investment,  in  43  Properties  (four of which were undeveloped land on which a
restaurant  was  being  constructed),  including  one  Property owned by a Joint
Venture,  three  Properties  consisting  of  building  only  and  20  Properties
consisting  of  land  only, in providing mortgage financing of $8,475,000 to the
tenant  of the 20 Properties consisting of land only and to pay Acquisition Fees
to  the  Advisor  totalling  $2,476,885  and  certain Acquisition Expenses.  The
Company  acquired  ten  of the 43 Properties from Affiliates for purchase prices
t o t alling  approximately  $7,442,000.    The  Affiliates  had  purchased  and
temporarily   held  title  to  these  Properties  in  order  to  facilitate  the
acquisition  of  the Properties by the Company.  Each Property was acquired at a
cost  no  greater  than  the lesser of the cost of the Property to the Affiliate
(including  carrying  costs)  or  the  Property's  appraised value.  The Company
expects  to  use  Net  Offering  Proceeds  from  the  sale of Shares to purchase
additional  Properties,  to  fund  construction costs relating to the Properties
under  construction  and to make Mortgage Loans.  The Company expects to use the
proceeds  of  the Loan to fund the Secured Equipment Lease program, as described
above.  The number of Properties to be acquired and Mortgage Loans to be entered
into  will  depend  upon  the  amount  of Net Offering Proceeds available to the
Company.                                                                        

      The  Company  has entered into various development agreements with tenants
which  provide  terms  and  specifications for the construction of buildings the
tenants  have  agreed  to  lease once construction is completed.  The agreements
provide  a  maximum amount of development costs (including the purchase price of
the  land  and  closing costs) to be paid by the Company.  The aggregate maximum
development  costs  the  Company  had  agreed  to  pay as of March 31, 1996, was
approximately  $5,817,200,  of  which approximately $2,613,400 in land and other
costs  had been incurred as of March 31, 1996.  The buildings under construction
as  of  March  31,  1996,  are  expected  to  be operational by August 1996.  In
connection  with  the purchase of each Property, the Company, as lessor, entered
into a long-term lease agreement.                                               

      During  the  period  April  1,  1996  through  July  16, 1996, the Company
acquired  29  additional  Properties  (two  Properties  consisting  of  land and
building,  14 Properties consisting of undeveloped land on which restaurants are
being constructed and 13 Properties consisting of land only) for cash at a total
cost  of approximately $9,606,000, excluding development and closing costs.  The
development  costs  (including the purchase of the land and closing costs) to be
paid  by  the  Company  relating  to  the  14  Properties under construction are
estimated to be approximately $14,874,000.  The buildings under construction are
expected  to  be  operational by January 1997.  With regard to the 13 Properties
consisting  of  land  only, the Company is leasing three of the parcels together
with  20  other  land  parcels  to  a  single  lessee pursuant to a master lease
agreement.    The  remaining  ten  parcels  are  also  leased to a single lessee
pursuant  to a master lease agreement.  The lessees own the buildings located on
the 33 Properties.                                                              

      In  addition,  during  the period April 1, 1996 through July 16, 1996, the
Company  entered  into  a  Mortgage  Loan  in  the  principal sum of $3,888,000,
collateralized  by  a  mortgage  on  the  buildings  relating  to  ten Pizza Hut
Properties.   The Mortgage Loan bears interest at a rate of 10.75% per annum and
is being collected in 240 equal monthly installments of $39,472.                

      The  Company  presently is negotiating to acquire additional Properties or
invest  in  additional Mortgage Loans, but as of July 16, 1996, had not acquired
any such Properties or invested in any such Mortgage Loans.                     

      As  of  July  16,  1996, the Company had received subscription proceeds of
$80,598,079  (8,059,808  Shares)  from  4,663  stockholders,  including $243,167
(24,317  Shares) issued pursuant to the Reinvestment Plan.  As of July 16, 1996,
the Company had invested, or committed for investment, approximately $66,000,000
of  such  proceeds  in  72  Properties,  in  providing mortgage financing to the
tenants of the 33 Properties consisting of land only through two Mortgage Loans,
and  to  pay  Acquisition  Fees  and Acquisition Expenses, leaving approximately
$4,200,000  in  Net Offering Proceeds available for investment in Properties and
Mortgage  Loans.    As  of July 16, 1996, the Company had incurred $3,626,914 in
Acquisition Fees due to the Advisor.                                            

      On  March  5, 1996, the Company entered into a line of credit and security
agreement  (the  "Loan")  with a bank to be used by the Company to offer Secured
Equipment  Leases.    The Loan provides that the Company will be able to receive
advances  of  up  to $15,000,000 until March 4, 1998.  Generally, advances under
the  Loan  will  be  fully amortizing term loans repayable in terms equal to the
duration  of  the  Secured  Equipment  Leases,  but  in no event greater than 72
months.   In addition, advances for short-term needs (to acquire equipment to be
leased  under  Secured Equipment Leases) may be requested in an aggregate amount
which does not exceed the Revolving Sublimit (defined in the Loan as $1,000,000)
and such advances may be repaid and readvanced; provided, however, that advances
made  pursuant  to  the  Revolving Sublimit shall be converted to term loans the
earlier of (i) the end of each 60 day period following the closing date (defined
in  the  Loan  as  March 5, 1996), or (ii) when the aggregate amount outstanding
equals  or  exceeds  $1,000,000.    Interest  on  advances  made pursuant to the
Revolving  Sublimit  shall  be  paid monthly in arrears.  In addition, principal
amounts under advances pursuant to the Revolving Sublimit, if not sooner paid or
converted  into  term  loans,  shall  be paid, together with any unpaid interest
relating  to  such  advances,  to  the  bank  on  March 5, 1998.  Generally, all
advances  under the Loan will bear interest at either (i) a rate per annum equal
to  215  basis  points  above the Reserve Adjusted LIBOR Rate (as defined in the
Loan)  or  (ii)  a  rate per annum equal to the bank's prime rate, whichever the
Company  selects at the time advances are made.  As a condition of obtaining the
Loan,  the  Company agreed to grant to the bank a first security interest in the
Secured  Equipment  Leases.  In connection with the Loan, the Company incurred a
commitment  fee,  legal  fees and closing costs of $53,500 relating to the Loan.
As  of  March  31,  1996,  $53,500  had been advanced under the Loan to fund the
commitment  fee,  legal fees and closing costs related to the Loan.  The Company
intends  to  limit  advances  under  the  Loan  to  10% of Gross Proceeds of the
offering.                                                                       

      Between  April  1,  1996  and  July  16,  1996, the Company obtained three
advances totaling $1,642,788 under its $15,000,000 Loan.  The advances are fully
amortizing  term  loans repayable over six years and bear interest at a rate per
annum  equal  to  215  basis  points  above  the Reserve Adjusted LIBOR Rate (as
defined  in  the  Loan).    The  proceeds  of  the advances were used to acquire
Equipment  for three restaurant properties at a cost of approximately $1,609,000
and to pay Secured Equipment Lease Servicing Fees of $32,175 to the Advisor.  In
connection  with  the  acquisition of the Equipment for one restaurant property,
the  Company,  as  lessor,  entered  into  a  Secured  Equipment  Lease  with an
unaffiliated lessee that leases the restaurant property from an Affiliate of the
Advisor.                                                                        

      Properties  are  and  will  be  leased on a triple-net basis, meaning that
tenants  are  generally  required  to  pay all repairs and maintenance, property
taxes,  insurance  and utilities.  Rental payments under the leases are expected
to exceed the Company's operating expenses.  For these reasons, no short-term or
long-term liquidity problems currently are anticipated by management.           

      Until  Properties are acquired, or Mortgage Loans are entered into, by the
Company, all offering proceeds are held in short-term, highly liquid investments
which  management  believes  to  have  appropriate  safety  of  principal.  This
investment strategy provides high liquidity in order to facilitate the Company's
use of these funds to acquire Properties at such time as Properties suitable for
acquisition  are  located  or  to  fund  Mortgage Loans.  At March 31, 1996, the
Company  had  $8,775,306  invested in such short-term investments as compared to
$11,508,445 at December 31, 1995.  The decrease in the amount invested in short-
term  investments  reflects  acquisition and lending activity during the quarter
ended  March  31,  1996.    These  funds  will be used primarily to purchase and
develop  or  renovate  Properties  (directly or indirectly through joint venture
arrangements),  to  make  Mortgage  Loans,  to pay organization and offering and
acquisition  costs,  to  pay  Distributions  to  stockholders,  to  meet Company
expenses and, in management's discretion, to create cash reserves.              

      During  the  quarters  ended  March  31,  1996 and 1995, Affiliates of the
Company  incurred  on  behalf of the Company $264,484 and $69,035, respectively,
for  certain  Organizational  and  Offering  Expenses.   In addition, during the
quarter  ended  March  31, 1996, Affiliates of the Company incurred on behalf of
the  Company  $51,860  for  certain Acquisition Expenses and $69,442 for certain
Operating Expenses.  As of March 31, 1996, the Company owed the Advisor $150,140
for such amounts and accounting and administrative expenses.  In addition, as of
March  31,  1996,  the  Company  owed  the  Advisor  $143,485  and  $20,515  for
Acquisition Fees and Asset Management Fees, respectively.  As of April 30, 1996,
the  Company  had reimbursed all such amounts.  The Advisor has agreed to pay or
reimburse  to  the Company all Organizational and Offering Expenses in excess of
three  percent  of  gross  offering  proceeds.    Other liabilities to unrelated
parties  increased  to $1,313,711 at March 31, 1996, from $1,173,776 at December
31,  1995,  primarily  as a result of the accrual of construction costs incurred
and unpaid as of March 31, 1996.                                                

      During  the  quarter ended March 31, 1996, the Company generated cash from
operations  (which  includes  cash  received from tenants and interest and other
income  received,  less cash paid for operating expenses) of $710,678.  Based on
current  and  anticipated  future  cash  from  operations  the  Company declared
Distributions to the stockholders of $768,133 during the quarter ended March 31,
1996.    No  Distributions were paid or declared for the quarter ended March 31,
1995.    On  April  1, 1996,  May 1, 1996 and June 1, 1996, the Company declared
Distributions  to  its  stockholders  totalling $323,748, $368,153 and $408,475,
respectively,  payable  in June 1996.  In addition, on July 1, 1996, the Company
declared  distributions  to  its  stockholders  totalling  $458,646  payable  in
September  1996.  For the quarter ended March 31, 1996, approximately 90 percent
of  the  Distributions  received  by stockholders were considered to be ordinary
income and 10 percent were considered a return of capital for federal income tax
purposes.    However,  no  amounts  distributed  or  to  be  distributed  to the
stockholders  as  of  April 30, 1996, are required to be or have been treated by
the Company as a return of capital for purposes of calculating the stockholders'
return on their Invested Capital.                                               

      Management   believes  that  the  Properties  are  adequately  covered  by
insurance.   During 1995, the Advisor obtained contingent liability and property
coverage  for  the  Company.    This  insurance policy is intended to reduce the
Company's  exposure  in the unlikely event a tenant's insurance policy lapses or
is  insufficient  to  cover  a  claim  relating  to the Property.  The Company's
investment  strategy  of  acquiring  Properties  for cash and leasing them under
triple-net  leases  to  operators  who  meet  specified  financial  standards is
expected  to minimize the Company's Operating Expenses.  Accordingly, management
believes  that  any anticipated decrease in the Company's liquidity in 1996, due
to  its investment of available Net Offering Proceeds in Properties and Mortgage
Loans,  will not have an adverse effect on the Company's operations.  During the
operational  stage,  management believes that the leases will generate cash flow
in  excess  of  Operating  Expenses.  Since the leases are expected generally to
have  an  initial  term  of  15  to 20 years, with two or more five-year renewal
options,  and  provide  for  specified percentage rent in addition to the annual
base  rent  and,  in certain cases, increases in the base rent or the percentage
rent  at  specified times during the terms of the leases, it is anticipated that
rental income will increase over time.                                          

      Due  to  anticipated  low Operating Expenses, rental income expected to be
obtained  from Properties after they are acquired, and the fact that as of April
30,  1996,  no  significant amounts had been borrowed under the Loan for Secured
Equipment Leases and that the Company had not entered into any Secured Equipment
Leases,  management  does  not  believe  that  working  capital reserves will be
necessary  at  this  time.    Management  has  the right to cause the Company to
maintain  reserves  if,  in  their  discretion, they determine such reserves are
required to meet the Company's working capital needs.                           

      Management  expects  that  the  cash  generated  from  operations  will be
adequate to pay Operating Expenses.                                             

RESULTS OF OPERATIONS                                                           

      No significant operations commenced until the Company received the minimum
offering proceeds of $1,500,000 on June 1, 1995.                                

      As  of  March 31, 1996, the Company and its consolidated joint venture had
purchased  43 Properties (including one which is owned through a Joint Venture),
including three  Properties  consisting  of  building only, 20 Properties       
consisting of land  only, and 20 properties consisting of land and building, and
had entered into lease agreements relating to these Properties.  The            
leases  provide  for  minimum  base  annual  rental payments (payable in monthly
installments)  ranging from approximately $89,700 to $413,700.  In addition, the
leases  generally  provide  for  percentage  rent  based on sales in excess of a
specified  amount.   The majority of the leases also provide that, commencing in
generally the sixth lease year, the annual base rent required under the terms of
the leases will increase.                                                       

      During  the quarter ended March 31, 1996, the Company and its consolidated
joint  venture, CNL/Corral South Joint Venture, earned $799,081 in rental income
from  operating leases and earned income from the direct financing lease from 41
Properties  (excluding  two of the Properties under construction as of March 31,
1996).    Because  the  Company did not commence significant operations until it
received the minimum offering proceeds on June 1, 1995, and has not yet acquired
all  of its Properties, revenues for the quarter ended March 31, 1996, represent
only  a  portion of revenues which the Company is expected to earn during a full
quarter in which the Company's Properties are operational.                      

      During  the  quarter  ended  March  31, 1996, five lessees of the Company,
Golden  Corral  Corporation, Corral South Store I, Inc., Castle Hill Holdings V,
LLC, Foodmaker, Inc. and Northstar Restaurants, Inc., each contributed more than
ten  percent of the Company's total rental income. Golden Corral Corporation was
the  lessee under leases relating to six restaurants, Corral South Store I, Inc.
was the lessee under a lease relating to one restaurant, Castle Hill Holdings V,
LLC was the  lessee under leases relating to 20 restaurants, Foodmaker, Inc. was
the  lessee under leases relating to two restaurants, and Northstar Restaurants,
Inc.  was the  lessee  under  leases  relating to three restaurants.  During the
quarter  ended  March  31,  1996,  the  Company also earned $184,949 in interest
income  from  a mortgage note receivable under which Castle Hill Holdings V, LLC
is  the  borrower.    In  addition, four Restaurant Chains, Golden Corral Family
Steakhouse,  Pizza  Hut,  Jack  in the Box and Boston Market, each accounted for
more  than  ten  percent of the Company's total rental income during the quarter
ended  March 31, 1996.  Because the Company has not completed its acquisition of
Properties  as  yet, it is not possible to determine which lessees or Restaurant
Chains  will  contribute  more  than  ten percent of the Company's rental income
during  the  remainder  of 1996 and subsequent years.  In the event that certain
lessees,  borrowers or Restaurant Chains contribute more than ten percent of the
Company's  total  income  in  the  current and future years, any failure of such
lessees,  borrowers  or Restaurants Chains could materially affect the Company's
income.                                                                         

      During  the  quarter  ended  March  31,  1996,  the Company entered into a
Mortgage  Loan  in the principal sum of $8,475,000, collateralized by a mortgage
on  the buildings relating to 20 Pizza Hut Properties and three additional Pizza
Hut  buildings.   The Mortgage Loan bears interest at a rate of 10.75% per annum
and  is  being  collected  in  240  equal  monthly  installments of $86,041.  In
connection therewith, the Company earned $184,949 in interest income relating to
such  Mortgage  Loan  during the quarter ended March 31, 1996.  In addition, the
Company  also earned $74,600 in interest income from investments in money market
accounts  or  other  short-term,  highly liquid investments.  Interest income is
expected  to  increase  as  the  Company invests subscription proceeds in highly
liquid  investments  pending  the  acquisition  of  Properties.  However, as Net
Offering  Proceeds  are  invested in Properties and used to make mortgage loans,
interest  income  from investments in money market accounts or other short-term,
highly liquid investments is expected to decrease.                              

      Operating  expenses, including depreciation and amortization expense, were
$300,539  for  the  quarter ended March 31, 1996.  Operating expenses, including
depreciation  and  amortization  expense,  also  represent  only  a  portion  of
operating  expenses which the Company is expected to incur during a full quarter
in  which  the  Company's  Properties  are  operational.    The dollar amount of
operating  expenses  is  expected to increase as the Company acquires additional
Properties.                                                                     

THE ADVISOR AND THE ADVISORY AGREEMENT

THE ADVISORY AGREEMENT                                                          

     The  Advisory  Agreement  was  renewed  for a period of one year with the
unanimous approval of the Board of Directors, including the Independent         
Directors, and shall expire  on  April  19, 1997, subject to successive one-year
renewals upon mutual consent of the parties.                                    

 ADDENDUM TO
 EXHIBIT B

 FINANCIAL INFORMATION

The updated pro forma financial statements and the unaudited financial          
statements of CNL American Properties Fund, Inc. contained in this addendum     
should be read in conjunction with Exhibit B to the attached prospectus         
dated April 26, 1996.                                                           

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY

 INDEX TO UPDATED FINANCIAL STATEMENTS

                                                                  Page

Pro Forma Consolidated Financial Information (unaudited):                       

Pro Forma Consolidated Balance Sheet as of March 31, 1996           B-2   

Pro Forma Consolidated Statement of Earnings for the                      
quarter ended March 31, 1996                                     B-3

Pro Forma Consolidated Statement of Earnings for the                      
year ended December 31, 1995                                     B-4

Notes to Pro Forma Consolidated Financial Statements for                  
the quarter ended March 31, 1996 and the year ended                 
December 31, 1995                                                B-5

Updated Unaudited Condensed Consolidated Financial Statements:                  

Condensed Consolidated Balance Sheets as of March 31,                     
1996 and December 31, 1995                                       B-9

Condensed Consolidated Statements of Earnings for the                     
 quarters ended March 31, 1996 and 1995                           B-10

Condensed Consolidated Statements of Stockholders'                        
Equity for the quarter ended March 31, 1996 and the                 
 year ended December 31, 1995                                     B-11

Condensed Consolidated Statements of Cash Flows for                       
 the quarters ended March 31, 1996 and 1995                       B-12

Notes to Condensed Consolidated Financial Statements                      
  for the quarters ended March 31, 1996 and 1995                  B-14

PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

      The  following  Pro  Forma Consolidated Balance Sheet of the Company gives
effect to (i) property acquisition transactions from inception through March 31,
1996,  including  the receipt of $55,041,881 in gross offering proceeds from the
sale  of  5,504,188  shares  of  common  stock pursuant to a Form S-11 under the
Securities  Act  of  1933,  as  amended,  effective  March  29,  1995,  and  the
application  of such proceeds to purchase 43 properties (including 19 properties
which  consist  of  land  and  building,  one  property  through a joint venture
arrangement  which consists of land and building, three properties which consist
of  building only and 20 properties consisting of land only), four of which were
under  construction  at  March  31,  1996,  to provide mortgage financing to the
lessee  of  the 20 properties consisting of land only, and to pay organizational
and  offering expenses, acquisition fees and miscellaneous acquisition expenses,
(ii)  the  receipt  of  $25,556,198  in gross offering proceeds from the sale of
2,555,620  additional  shares  of  common  stock during the period April 1, 1996
through July 16, 1996, and (iii) the application of such funds and $3,897,309 of
cash  and  cash  equivalents  at  March  31,  1996,  to  purchase  29 additional
properties  acquired  during the period April 1, 1996 through July 16, 1996 (two
of  which  are  under construction and consist of building only, 12 of which are
under construction and consist of land and building, 13 properties which consist
of  land  only  and  two properties which consists of land and building), to pay
additional  costs  for the four properties under construction at March 31, 1996,
to provide mortgage financing to the lessee of ten properties consisting of land
only,   and  to  pay  offering  expenses,  acquisition  fees  and  miscellaneous
acquisition expenses, all as reflected in the pro forma adjustments described in
the  related  notes.    The Pro Forma Consolidated Balance Sheet as of March 31,
1996,    includes  the  transactions  described in (i) above from its historical
consolidated  balance sheet, adjusted to give effect to the transactions in (ii)
and (iii) above, as if they had occurred on March 31, 1996.                     

      The  Pro  Forma  Consolidated Statements of Earnings for the quarter ended
March  31,  1996  and  the  year ended December 31, 1995, include the historical
operating  results  of  the  properties described in (i) above from the dates of
their  acquisitions  plus  operating  results for the seven of the 72 properties
that  were  owned  by the Company as of July 16, 1996, and had a previous rental
history  prior  to  the  Company's  acquisition of such properties, from (A) the
later  of  (1)  the date the property became operational as a rental property by
the   previous  owner  or  (2)  June  2,  1995  (the  date  the  Company  became
operational),  to  (B)  the earlier of (1) the date the property was acquired by
the  Company  or  (2)  the  end of the pro forma period presented.  No pro forma
adjustments  have been made to the Pro Forma Consolidated Statements of Earnings
for the remaining 65 properties owned by the Company as of July 16, 1996, due to
the fact that these properties did not have a previous rental history.          

      This  pro  forma  consolidated  financial  information  is  presented  for
informational  purposes  only  and  does  not  purport  to  be indicative of the
Company's  financial results or condition if the various events and transactions
reflected  therein  had  occurred  on  the  dates,  or been in effect during the
periods,  indicated.    This pro forma consolidated financial information should
not  be viewed as predictive of the Company's financial results or conditions in
the future.                                                                     

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
MARCH 31, 1996

                                 Pro Forma
           ASSETS               Historical     Adjustments     Pro Forma

Land and buildings on operating                                                 
leases, less accumulated                                                    
depreciation                      $28,313,474  $16,059,451 (a)  $44,372,925 
Net investment in direct                                                        
financing leases (c)                1,360,414    6,264,957 (a)    7,625,371 
Cash and cash equivalents             8,775,306   (3,707,897)(a)                
                                                 (189,412)(b)    4,877,997
Receivables                             462,110                       462,110   
Mortgage note receivable              8,540,712    3,888,000 (a)   12,428,712   
Prepaid expenses                         37,275                        37,275   
Organization costs, less accumulated                                            
amortization                           16,682                        16,682 
Loan costs, less accumulated                                                    
amortization                           51,559                        51,559 
Accrued rental income                   152,047                       152,047   
Other assets                          1,199,916        14,886(a)    1,214,802   
                                 -----------   -----------     -----------

                                 $48,909,495   $22,329,985     $71,239,480
                                 ===========  ============     ===========

LIABILITIES AND STOCKHOLDERS' EQUITY                                            

Liabilities:                                                                    
Note payable                      $    53,659                   $    53,659 
Accrued construction costs payable  1,197,682  $(1,005,913)(a)              
                                                (191,769)(b)           -
Accounts payable and accrued expenses 106,333                       106,333 
Escrowed real estate taxes payable      9,696                         9,696 
Due to related parties                415,418                       415,418 
Deferred financing income              29,366       13,608 (a)       42,974 
Rents paid in advance                  58,268                        58,268 
                                 -----------  -----------      -----------
   Total liabilities               1,870,422   (1,184,074)         686,348
                                 -----------  -----------      -----------

Minority interest                       293,329        2,357 (b)      295,686   
                                 -----------  -----------      -----------

Stockholders' equity:                                                           
Preferred stock, without par value.                                         
Authorized and unissued 3,000,000                                       
shares                                   -                             -
Excess shares, $.01 par value per                                           
share.  Authorized and unissued                                         
23,000,000 shares                        -                             -
Common stock, $.01 par value per share.                                     
Authorized 20,000,000 shares; issued                                    
and outstanding 5,524,188 shares;                                       
issued and outstanding, as adjusted,                                    
 8,079,808 shares                     55,242       25,556 (a)       80,798
Capital in excess of par value     46,983,886   23,486,146 (a)   70,470,032 
Accumulated distributions in excess                                         
  of net earnings                    (293,384)                     (293,384)
                                 -----------  -----------      -----------
                                  46,745,744   23,511,702       70,257,446
                                 -----------  -----------      -----------

                                 $48,909,495  $22,329,985      $71,239,480
                                 =========== ============      ===========

See accompanying notes to unaudited pro forma consolidated financial statements.

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF EARNINGS
MARCH 31, 1996

                                   Pro Forma
                                  Historical    Adjustments    Pro Forma

Revenues:                                                                       
Rental income from                                                          
 operating leases                  $  763,155   $   41,157 (1)  $  804,312
Earned income from                                                          
 direct financing lease (2)            35,926                       35,926
Interest and other income              260,798      (12,544)(3)     248,254 
                                   ----------   ----------      ----------
                                    1,059,879       28,613       1,088,492
                                   ----------   ----------      ----------

Expenses:                                                                       
General operating and                                                       
 administrative                       128,948                      128,948
Professional services                   29,692                       29,692 
Asset and mortgage management                                               
 fees to related party                 40,370        2,714 (4)      43,084
State and other taxes                    2,898        1,129 (5)       4,027 
Interest expense                           159                          159 
Depreciation and amortization           98,472        3,300 (6)     101,772 
                                   ----------   ----------      ----------
                                      300,539        7,143         307,682
                                   ----------   ----------      ----------

Earnings Before Minority                                                        
Interest in Earnings of                                                     
Consolidated Joint Venture             759,340       21,470         780,810 

Minority Interest in Earnings of                                                
Consolidated Joint Venture             (14,752)                     (14,752)
                                   ----------   ----------      ----------

Net Earnings                          $  744,588   $   21,470      $  766,058   
                                   ==========   ==========      ==========

Earnings Per Share of                                                           
Common Stock                        $      .16                   $      .16 
                                   ==========                   ==========

Weighted Average Number of                                                      
Shares of Common Stock                                                      
Outstanding                          4,649,040                    4,649,040 
                                   ==========                   ==========

See accompanying notes to unaudited pro forma consolidated financial statements.

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF EARNINGS
YEAR ENDED DECEMBER 31, 1995

                                 Pro Forma
                                  Historical  Adjustments    Pro Forma

Revenues:                                                                       
Rental income from                                                          
operating leases                    $ 498,817   $ 96,945 (1)   $ 595,762
Earned income from direct                                                   
financing leases (2)                   28,935                     28,935
Contingent rental income                 12,024                     12,024  
Interest income                         119,355    (29,664)(3)      89,691  
                                      ---------  ---------       ---------
                                      659,131     67,281         726,412
                                      ---------  ---------       ---------

Expenses:                                                                       
General operating and                                                       
administrative                        134,759                    134,759
Professional services                     8,119                      8,119  
Asset management fee to                                                     
related party                          23,078      4,368 (4)      27,446
State taxes                              20,189      1,769 (5)      21,958  
Depreciation and amortization           104,131     14,700 (6)     118,831  
                                      ---------  ---------       ---------
                                      290,276     20,837         311,113
                                      ---------  ---------       ---------

Earnings Before Minority                                                        
Interest in Earnings of                                                     
Consolidated Joint Venture              368,855     46,444         415,299  

Minority Interest in Earnings                                                   
of Consolidated Joint Venture               (76)                       (76) 
                                      ---------  ---------       ---------

Net Earnings                            $ 368,779  $  46,444       $ 415,223    
                                      ========= ==========       =========

Earnings Per Share of                                                           
Common Stock (7)                      $     .19                   $     .22 
                                      =========                  =========

Weighted Average Number                                                         
of Shares of Common Stock                                                   
Outstanding (7)                        1,898,350                  1,905,970 
                                      =========                  =========

See accompanying notes to unaudited pro forma consolidated financial statements.

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
FOR THE QUARTER ENDED MARCH 31, 1996
AND THE YEAR ENDED DECEMBER 31, 1995

Pro Forma Consolidated Balance Sheet:                                           

(a)   Represents  gross  proceeds  of $25,556,198 from the issuance of 2,555,620
      shares  of  common  stock during the period April 1, 1996 through July 16,
      1996,  proceeds  of $13,608 of deferred financing income (loan origination
      and  commitment  fees,  net  of  legal  fees) from the $3,888,000 mortgage
      financing  described below, and $3,707,897 of cash and cash equivalents at
      March  31,  1996,  used  (i)  to acquire 29 properties for $18,104,131 (of
      which  13  properties  consist  of  land  only,  two properties consist of
      building  only  and  14  properties consist of land and building), (ii) to
      fund  estimated  construction costs of $4,091,047 ($1,005,913 of which was
      accrued  as construction costs payable at March 31, 1996) relating to four
      wholly-owned properties under construction at March 31, 1996, (iii) to pay
      acquisition  fees  of  $1,150,029  ($1,135,143  of  which was allocated to
      properties and $14,886 of which was classified as other assets and will be
      allocated  to  future  properties),  (iv)  to  pay selling commissions and
      offering  expenses  (stock  issuance costs) of $2,044,496, which have been
      netted  against capital in excess of par value and (v) to provide mortgage
      financing  in  the  amount  of  $3,888,000 to the lessee of ten properties
consisting of land only.                                            

      The  pro  forma  adjustments to land and buildings on operating leases and
      net  investment  in  direct  financing  leases  as  a  result of the above
transactions were as follows:                                       

                                                                · Download Table
                                         Estimated                                 
                                      purchase price                               
                                     (including con-                               
                                      struction and        Acquisition             
                                      closing costs)           fees                
                                      and additional        allocated              
                                    construction costs     to property        Total
                                                                                   

Three Pizza Huts (land only)                                                       
  in Ohio                            $   489,117        $    26,203     $   515,320
Burger King in Indian Head                                                         
  Park, IL                             1,272,725             68,182       1,340,907
Burger King in Highland, IN            1,212,558             64,958       1,277,516
TGI Friday's in Hamden, CT             1,134,628             60,784       1,195,412
Wendy's in Knoxville, TN                 790,984             42,375         833,359
Golden Corral in Port Richey, FL       1,705,448             91,364       1,796,812
Ten Pizza Huts (land only)                                                         
  in West Virginia and Ohio            1,487,000             79,661       1,566,661
Denny's in Hillsboro, TX               1,053,088             56,416       1,109,504
Denny's in McKinney, TX                  978,944             52,443       1,031,387
Wendy's in Camarillo, CA               1,204,026             64,502       1,268,528
Wendy's in Sevierville, TN               492,636             26,391         519,027
Boston Market in Ellisville, MO          977,279             52,354       1,029,633
Boston Market in Golden Valley, MN     1,074,707             57,574       1,132,281
Jack in the Box in Humble, TX            933,868             50,029         983,897
Boston Market in Corvallis, OR           906,684             48,573         955,257
Jack in the Box in Houston, TX           893,681             47,876         941,557
Arby's in Kendallville, IN               738,326             39,553         777,879
Boston Market in Rockwall, TX            758,432             40,630         799,062
Four wholly owned properties                                                       
  under construction at                                                            
  March 31, 1996                       3,085,134            165,275       3,250,409
                                     -----------        -----------     -----------

                                     $21,189,265        $ 1,135,143     $22,324,408
                                     ===========        ===========     ===========

Adjustment classified                                                              
  as follows:                                                                      
    Land and buildings on                                                          
      operating leases                                                  $16,059,451
    Net investment in                                                              
      direct financing                                                             
      leases                                                              6,264,957
                                                                        -----------

                                                                        $22,324,408
                                                                        ===========

Pro Forma Consolidated Balance Sheet - Continued:                               

(b)   Represents  the use of $189,412 of the Company's net offering proceeds and
      the  assumed receipt of $2,357 in capital contributions from the Company's
      co-venture  partner  in  accordance  with  the  joint venture agreement of
      CNL/Corral  South  Joint  Venture, to fund estimated construction costs of
      $191,769 accrued as construction costs payable at March 31, 1996, relating
      to  the  one  property of the joint venture.  The Company accounts for its
      84.69%  interest  in  the accounts of CNL/Corral South Joint Venture under
      the  full consolidation method.  All significant intercompany accounts and
transactions have been eliminated.                                  

(c)   In  accordance  with  generally  accepted accounting principles, leases in
      which the present value of future minimum lease payments equals or exceeds
      90  percent  of  the value of the related properties are treated as direct
      financing leases rather than as land and buildings.  The categorization of
      the  leases  has  no  effect  on  rental  revenues received.  The building
      portions  of  eight  of  the  properties  have  been  classified as direct
financing leases.                                                   

Pro Forma Consolidated Statements of Earnings:                                  

(1)   Represents  rental  income  from  operating  leases and earned income from
      direct financing leases for the seven of the 72 properties acquired during
      the  period  June  2, 1995 (the date the Company began operations) through
      July 16, 1996 which had a previous rental history prior to the acquisition
      of  the  property  by  the  Company  (the "Pro Forma Properties"), for the
      period  commencing  (A)  the  later of (i) the date the Pro Forma Property
      became operational as a rental property by the previous owner or (ii) June
      2,  1995  (the date the Company became operational), to (B) the earlier of
      (i)  the  date  the Pro Forma Property was acquired by the Company or (ii)
      the  end  of  the pro forma period presented.  Each of the seven Pro Forma
      P r operties  was  acquired  from  an  affiliate  who  had  purchased  and
      temporarily held title to the property.  The noncancellable leases for the
      Pro  Forma  Properties  in place during the period the affiliate owned the
      properties  were  assigned to the Company at the time the Company acquired
      the  properties.    The  following  presents the actual date the Pro Forma
      Properties  were  acquired  by the Company as compared to the date the Pro
      Forma Properties were treated as becoming operational as a rental property
for purposes of the Pro Forma Consolidated Statements of Earnings.  

                                                      Date Pro Forma
                                        Date Placed    Property Became
                                       in Service     Operational as
                                      By the Company   Rental Property

Jack in the Box in                                      
      Los Angeles, CA                 June 1995        June 1995

Kenny Rogers Roasters in                                
      Grand Rapids, MI               August 1995       June 1995

Kenny Rogers Roasters in                                
      Franklin, TN                   August 1995       June 1995

     Denny's in Pasadena, TX        September 1995     August 1995

     Denny's in Shawnee, OK         September 1995     August 1995

      Denny's in Grand Rapids, MI      March 1996     September 1995

      Denny's in McKinney, TX           June 1996      December 1995

Pro Forma Consolidated Statements of Earnings - Continued:                      

      In accordance with generally accepted accounting principles, lease revenue
      from  leases  accounted  for under the operating method is recognized over
      the  terms  of  the  leases.    For  operating leases providing escalating
      guaranteed minimum rents, income is reported on a straight-line basis over
      the  terms  of  the  leases.  For leases accounted for as direct financing
      leases,  future  minimum lease payments are recorded as a receivable.  The
      difference  between  the receivable and the estimated residual values less
      the  cost  of the properties is recorded as unearned income.  The unearned
      income  is  amortized  over  the lease terms to provide a constant rate of
      return.    Accordingly,  pro forma rental income from operating leases and
      earned  income from direct financing leases does not necessarily represent
      rental  payments  that would have been received if the properties had been
operational for the full pro forma period.                          

      Generally,  the  leases  provide  for  the  payment  of percentage rent in
      addition  to  base  rental  income.    However,  due  to  the fact that no
      percentage  rent  was  due  under  the leases for the Pro Forma Properties
      during  the  portion  of  1996  and 1995 that the previous owners held the
      properties,  no pro forma adjustment was made for percentage rental income
      for the quarter ended March 31, 1996 and the year ended December 31, 1995.

(2)   See  Note  (c)  under  "Pro  Forma Consolidated Balance Sheet" above for a
description of direct financing leases.                             

(3)   Represents adjustment to interest income due to the decrease in the amount
      of  cash  available for investment in interest bearing accounts during the
      periods  commencing  (A)  on  the  later  of  (i)  the dates the Pro Forma
      Properties  became operational as rental properties by the previous owners
      or  (ii)  June  2, 1995 (the date the Company became operational), through
      (B)  the  earlier of (i) the actual dates of acquisition by the Company or
      the end of the pro forma period presented, as described in Note (1) above.
      The  estimated  pro  forma adjustment is based upon the fact that interest
      income  on interest bearing accounts was earned at a rate of approximately
      four  percent  per annum by the Company during the quarter ended March 31,
1996 and the year ended December 31, 1995.                          

(4)   Represents  incremental  increase in asset management fees relating to the
      Pro Forma Properties for the period commencing (A) on the later of (i) the
      date  the  Pro Forma Properties became operational as rental properties by
      the  previous  owners  or  (ii)  June 2, 1995 (the date the Company became
      operational),  through  (B)  the  earlier  of  (i)  the date the Pro Forma
      Properties  were  acquired by the Company or (ii) the end of the pro forma
      period  presented,  as described in Note (1) above.  Asset management fees
      are  equal to 0.60% of the Company's Real Estate Asset Value (estimated to
      be  approximately  $6,219,000  and $5,241,000 for the Pro Forma Properties
      for the quarter ended March 31, 1996 and the year ended December 31, 1995,
respectively), as defined in the Company's prospectus.              

(5)   Represents adjustment to state tax expense due to the incremental increase
      in rental revenues of Pro Forma Properties.  Estimated pro forma state tax
      expense  was  calculated based on an analysis of state laws of the various
      states  in  which  the Company has acquired the Pro Forma Properties.  The
      estimated  pro forma state taxes consist primarily of income and franchise
      taxes ranging from zero to approximately five percent of the Company's pro
      forma  rental income of each Pro Forma Property.  Due to the fact that the
      Company's  leases are triple net, the Company has not included any amounts
for real estate taxes in the pro forma statement of earnings.       

Pro Forma Consolidated Statements of Earnings - Continued:                      

(6)   Represents  incremental  increase  in depreciation expense of the building
      portions  of  the  Pro Forma  Properties accounted for as operating leases
     using the straight-line method over an estimated useful life of 30 years.

(7)   Historical  earnings  per  share  were  calculated based upon the weighted
      average  number  of  shares of common stock outstanding during the quarter
      ended  March  31, 1996, and during the period the Company was operational,
      June  2,  1995  (the  date following when the Company received the minimum
      offering  proceeds  and  funds were released from escrow) through December
31, 1995.                                                           

      As  a result of three of the six Pro Forma Properties being treated in the
      Pro  Forma  Consolidated Statement of Earnings for the year ended December
      31,  1995,  as  placed  in  service  on June 2, 1995 (the date the Company
      became  operational),  the Company assumed approximately 347,100 shares of
      common  stock  were sold, and the net offering proceeds were available for
      investment,  on  June 2, 1996.  Due to the fact that approximately 184,800
      of  these  shares  of common stock were actually sold subsequently, during
      the period June 3, 1995 through June 20, 1995, the weighted average number
      of  shares  outstanding  for the pro forma period was adjusted.  Pro forma
      earnings  per share were calculated based upon the weighted average number
      of  shares of common stock outstanding, as adjusted, during the period the
Company was operational, June 2, 1995 through December 31, 1995.    

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
 CONDENSED CONSOLIDATED BALANCE SHEETS

                                               March 31,    December 31,
       ASSETS                                1996           1995

Land and buildings on operating leases,                                         
less accumulated depreciation                   $28,313,474   $19,723,726   
Net investment in direct financing lease            1,360,414     1,373,882     
Cash and cash equivalents                           8,775,306    11,508,445     
Receivables                                           462,110       113,613     
Mortgage note receivable                            8,540,712            -      
Prepaid expenses                                       37,275         8,090     
Organization costs, less accumulated                                            
amortization of $3,318 and $2,318                    16,682        17,682   
Loan costs, less accumulated amorti-                                            
zation of $1,941 at March 31, 1996                   51,559            -    
Accrued rental income                                 152,047        39,142     
Other assets                                        1,199,916       818,504     
                                             -----------   -----------

                                             $48,909,495   $33,603,084
                                             ===========   ===========

LIABILITIES AND STOCKHOLDERS' EQUITY                                        

Note payable                                      $    53,659   $        -      
Accrued construction costs payable                  1,197,682     1,058,825     
Accounts payable and accrued expenses                 106,333        79,904     
Escrowed real estate taxes payable                      9,696         9,696     
Due to related parties                                415,418       248,584     
Deferred financing income                              29,366            -      
Rents paid in advance                                  58,268        25,351     
                                             -----------   -----------

 Total liabilities                             1,870,422     1,422,360
                                             -----------   -----------

Minority interest                                     293,329       200,076     
                                             -----------   -----------

Commitments (Note 13)                                                           

Stockholders' equity:                                                           
Preferred stock, without par value.                                         
Authorized and unissued 3,000,000                                       
shares                                                 -             -  
Excess shares, $.01 par value per share.                                    
Authorized and unissued 23,000,000                                      
shares                                                 -             -  
Common stock, $.01 par value per share.                                     
Authorized 20,000,000 shares, issued                                    
and outstanding 5,524,188 and 3,865,416,                                
respectively                                       55,242        38,654 
Capital in excess of par value                   46,983,886    32,211,833   
Accumulated distributions in excess of                                      
net earnings                                     (293,384)     (269,839)
                                             -----------   -----------
 Total stockholders' equity                   46,745,744    31,980,648
                                             -----------   -----------

                                             $48,909,495   $33,603,084
                                             ===========   ===========

See accompanying notes to condensed consolidated
 financial statements.

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
 CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

                                               Quarter Ended

                                               March 31,
                                               1996           1995
                                                      ----------     -----------
Revenues:                                                                       
Rental income from operating                                                
leases                                        $  763,155     $       -  
Earned income from direct                                                   
financing lease                                   35,926             -  
Interest and other income                          260,798             -    
                                              ----------      ----------
                                             1,059,879             -
                                              ----------      ----------

Expenses:                                                                       
General operating and                                                       
administrative                                   128,948             -  
Professional services                               29,692             -    
Asset and mortgage manage-                                                  
ment fees to related party                        40,370             -  
State and other taxes                                2,898             -    
Interest expense                                       159             -    
Depreciation and amorti-                                                    
zation                                            98,472             -  
                                              ----------      ----------
                                               300,539             -
                                              ----------      ----------

Earnings Before Minority Interest                                               
in Income of Consolidated Joint                                             
Venture                                            759,340             -    

Minority Interest in Income of                                                  
Consolidated Joint Venture                         (14,752)            -    
                                              ----------      ----------

Net Earnings                                      $  744,588     $       -      
                                              ==========      ==========

Earnings Per Share of Common                                                    
Stock                                           $      .16      $       -   
                                              ==========      ==========

Weighted Average Number of                                                      
Shares of Common Stock                                                      
Outstanding                                      4,649,040              -   
                                              ==========      ==========

See accompanying notes to condensed consolidated
 financial statements.

                                                        · Enlarge/Download Table
                       CNL AMERICAN PROPERTIES FUND, INC.                                                         
                                 AND SUBSIDIARY                                                                   
            CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY                                             
                        QUARTER ENDED MARCH 31, 1996 AND                                                          
                          YEAR ENDED DECEMBER 31, 1995                                                            

                                                                                     Accumulated                  
                                                                                    distributions                 
                                            Common stock               Capital in     in excess                   
                                      Number           Par             excess of        of net                    
                                    of shares         value            par value       earnings         Total     
                                                                                                                  

Balance at                                                                                                        
  December 31, 1994                     20,000       $   200          $   199,800    $      -        $   200,000  

Subscriptions                                                                                                     
  received for                                                                                                    
  common stock                                                                                                    
  through public                                                                                                  
  offering and                                                                                                    
  distribution                                                                                                    
  reinvestment plan                  3,845,416        38,454           38,415,704           -         38,454,158  

Stock issuance costs                        -             -            (6,403,671)         -         (6,403,671 ) 

Net earnings                                -             -                    -       368,779           368,779  

Distributions                                                                                                     
  declared ($.03                                                                                                  
  to $.06 per                                                                                                     
  share)                                    -             -                    -      (638,618 )        (638,618 )
                                    ----------       -------         -----------    ---------      -----------    

Balance at                                                                                                        
  December 31, 1995                  3,865,416        38,654           32,211,833     (269,839 )      31,980,648  

Subscriptions                                                                                                     
  received for                                                                                                    
  common stock                                                                                                    
  through public                                                                                                  
  offering and                                                                                                    
  distribution                                                                                                    
  reinvestment plan                  1,658,772        16,588           16,571,135           -         16,587,723  

Stock issuance costs                        -             -            (1,799,082)         -         (1,799,082 ) 

Net earnings                                -             -                    -       744,588           744,588  

Distributions                                                                                                     
  declared ($.06                                                                                                  
  per share)                                -             -                    -      (768,133 )        (768,133 )
                                    ----------       -------         -----------    ---------      -----------    

Balance at                                                                                                        
  March 31, 1996                     5,524,188       $55,242          $46,983,886    $(293,384 )     $46,745,744  
                                    ==========       =======          ===========    =========      ===========   


See accompanying notes to condensed consolidated
 financial statements.

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                               Quarter Ended

                                               March 31,
                                            1996              1995
                                            ------------      ------------
Increase (Decrease) in Cash and Cash                                            
Equivalents:                                                                

Net cash provided by operating                                              
activities                                 $    710,678      $         -
                                            ------------      ------------

Cash Flows From Investing Activities:                               
Additions to land and buildings                                 
      on operating leases                    (8,886,922)               -
Investment in direct financing                                  
      lease                                     (10,000)               -
Investment in mortgage note                                     
      receivable                             (8,475,000)               -
Collection of deferred financing                                
      income                                     29,663                -
Collection of mortgage note                                     
      payments                                   10,119                -
Increase in other assets                   (230,181)            
                                                                       -
                                            ------------      ------------
Net cash used in investing                              
          activities                        (17,562,321)               -
                                            ------------      ------------

Cash Flows From Financing Activities:                               
Reimbursement of acquisition and                                
stock issuance costs paid by                                
related parties on behalf of                                
      the Company                              (265,491)               -
Proceeds of borrowing on line                                   
      of credit                                  53,500                -
    Payment of loan costs                       (53,500)               -
Contribution from minority                                      
interest of consolidated                                    
      joint venture                              92,519                -
Subscriptions received from                                     
      stockholders                           16,587,723                -
    Distribution to minority interest           (14,018)               -
    Distributions to stockholders              (771,465)               -
    Payment of stock issuance costs          (1,515,764)               -
    Other                                         5,000                -
                                            ------------      ------------
Net cash provided by                                    
          financing activities               14,118,504                -
                                            ------------      ------------

Net Decrease in Cash and Cash Equivalents        (2,733,139)               -    

Cash and Cash Equivalents at Beginning                                          
of Quarter                                     11,508,445               945 
                                            ------------      ------------

Cash and Cash Equivalents at End                                                
of Quarter                                   $  8,775,306      $        945 
                                            ============      ============

See accompanying notes to condensed consolidated
 financial statements.

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

                                               Quarter Ended

                                               March 31,
                                            1996              1995
                                            ------------      ------------
Supplemental Schedule of Non-Cash                                               
Investing and Financing Activities:                                         

Related parties paid certain                                            
acquisition, organization and                                       
stock issuance costs on behalf                                      
of the Company as follows:                                          
    Acquisition costs                      $     51,860      $         -
     Organization costs                               -             20,000
     Stock issuance costs                        264,484            49,035
                                            ------------      ------------

                                            $    316,344      $     69,035
                                            ============      ============
Land, building and other costs                                          
incurred and unpaid at end of                                       
  quarter                                  $  1,355,767      $         -
                                            ============      ============

Commissions, marketing support and                                      
due diligence expense reimbursement                                 
fee, and other stock issuance costs                                 
   incurred and unpaid at end of quarter    $    195,420      $    525,439
                                            ============      ============

See accompanying notes to condensed consolidated
 financial statements.

CNL AMERICAN PROPERTIES FUND, INC.
AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
QUARTERS ENDED MARCH 31, 1996 AND 1995

1.    Organization and Nature of Business:                                      

      CNL  American  Properties  Fund,  Inc.  (the  "Company")  was organized in
      Maryland  on  May  2,  1994,  for  the  purpose  of acquiring, directly or
      indirectly  through  joint  venture or co-tenancy arrangements, restaurant
      properties  (the  "Properties")  to  be  leased on a long-term, triple-net
      basis  to  operators  of  certain national and regional fast-food, family-
      style  and  casual  dining  restaurant  chains.    To a lesser extent, the
      Company  intends  to  offer  furniture,  fixtures  and equipment financing
      ("Secured  Equipment  Leases") to operators of restaurant chains.  Secured
      Equipment  Leases  will be funded from the proceeds of a loan of up to ten
percent of the gross offering proceeds.                             

2.    Basis of Presentation:                                                    

      The  accompanying  unaudited  condensed  consolidated financial statements
      have been prepared in accordance with the instructions to Form 10-Q and do
      not  include  all  of  the  information  and  note disclosures required by
      generally  accepted  accounting  principles.    The  financial  statements
      reflect all adjustments, consisting of normal recurring adjustments, which
      are,  in  the  opinion of management, necessary to a fair statement of the
      results  for  the  interim  periods  presented.  Operating results for the
      quarter  ended  March  31, 1996, may not be indicative of the results that
      may  be  expected  for  the  year ending December 31, 1996.  Amounts as of
      December 31, 1995, included in the financial statements, have been derived
from audited financial statements as of that date.                  

      These  unaudited  financial  statements should be read in conjunction with
      the  financial statements and notes thereto included in the Company's Form
10-K for the year ended December 31, 1995.                          

      The  Company  was  a development stage enterprise from May 2, 1994 through
      June  1, 1995.  Since operations had not begun, activities through June 1,
1995, were devoted to organization of the Company.                  

      The  Company  accounts  for  its 84.69% interest in CNL/Corral South Joint
      Venture  using the consolidation method.  Minority interest represents the
      minority  joint venture partner's proportionate share of the equity in the
      Company's  consolidated  joint  venture.    All  significant  intercompany
accounts and transactions have been eliminated.                     

      Effective  January  1,  1996,  the  Company adopted Statement of Financial
      Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived
      Assets  and  for  Long-Lived  Assets  to  Be  Disposed Of."  The Statement
      requires  that an entity review long-lived assets and certain identifiable
      intangibles,  to  be  held  and  used,  for impairment  whenever events or
      changes  in  circumstances  indicate that the carrying amount of the asset
      may  not be recoverable.  Adoption of this standard had no material effect
on the Company's financial position or results of operations.       

3.    Leases:                                                                   

      The  Company  leases  its  land  and  buildings  primarily to operators or
      franchisees  of  national  and regional fast-food, family-style and casual
      dining  restaurants.  The leases are accounted for under the provisions of
      Statement  of  Financial  Accounting  Standards  No.  13,  "Accounting for
      Leases."   The leases relating to 42 of the Company's Properties have been
      classified  as  operating  leases  (including  the leases relating to four
      properties under construction as of March 31, 1996) and the lease relating
to one Property has been classified as a direct financing lease.    

4.    Land and Buildings on Operating Leases:                                   

 Land and buildings on operating leases consisted of the following at:

                                        March 31,   December 31,
                                     1996         1995

    Land                               $14,872,121   $ 8,890,471
    Buildings                           12,705,708    10,049,032
                                       -----------   -----------
                                        27,577,829    18,939,503
     Less accumulated depreciation         (194,849)     (100,318)
                                       -----------   -----------
                                        27,382,980    18,839,185
    Construction in progress               930,494       884,541
                                       -----------   -----------

                                       $28,313,474   $19,723,726
                                       ===========   ===========

      Some leases provide for escalating guaranteed minimum rents throughout the
      lease term.  Income from these scheduled rent increases is recognized on a
      straight-line  basis  over the terms of the leases.  For the quarter ended
  March 31, 1996, the Company recognized $112,905 of such rental income.

      The  following  is  a  schedule  of  future  minimum  lease payments to be
received on the noncancellable operating leases at March 31, 1996:  

    1996                                             $ 1,993,738
    1997                                               2,711,955
    1998                                               2,716,736
    1999                                               2,723,430
    2000                                               2,738,584
    Thereafter                                        38,247,056
                                                     -----------

                                                     $51,131,499
                                                     ===========

      These  amounts  do not include minimum lease payments that will become due
when Properties under development are completed (See Note 13).      

5.    Net Investment in Direct Financing Lease:                                 

      The  following  lists  the  components  of  the  net  investment in direct
financing lease at:                                                 

                                         March 31,    December 31,
                                       1996           1995

Minimum lease payments                                  
      receivable                       $ 2,480,522   $ 2,498,881
    Estimated residual value                    -        343,740
     Less unearned income                (1,120,108)   (1,468,739)
                                       -----------   -----------

Net investment in direct                                
      financing lease                  $ 1,360,414   $ 1,373,882
                                       ===========   ===========

      The  following  is  a  schedule  of  future  minimum  lease payments to be
received on the direct financing lease at March 31, 1996:           

    1996                                              $  148,848
    1997                                                 198,463
    1998                                                 198,463
    1999                                                 198,463
    2000                                                 201,771
    Thereafter                                         1,534,514
                                                      ----------

                                                      $2,480,522
                                                      ==========

6.    Mortgage Note Receivable:                                                 

      In  January  1996, in connection with the acquisition of land for 20 Pizza
      Hut  restaurants  in  Ohio and Michigan, the Company accepted a promissory
      note  in  the principal sum of $8,475,000, collateralized by a mortgage on
      the  buildings  on  20 Pizza Hut Properties and three additional Pizza Hut
      buildings.    The  promissory  note bears interest at a rate of 10.75% per
      annum and is being collected in 240 equal monthly installments of $86,041.
      As  of  March  31, 1996, $8,540,712 was outstanding relating to this note,
including $75,831 in accrued interest.                              

      Statement  of  Financial  Accounting Standards No. 107, "Disclosures About
      Fair  Value  of  Financial  Instruments,"  requires disclosure of the fair
      value  of  significant  financial instruments.  Management believes, based
      upon  the  current  terms,  that the estimated fair value of the Company's
   mortgage note receivable is $8,540,712, the same as its carrying value.

7.    Other Assets:                                                             

Other assets consisted of the following at:                         

                                          March 31,   December 31,
                                        1996          1995

Acquisition fees and miscel-                            
laneous acquisition expenses                        
to be allocated to future                           
      properties                        $1,141,953    $  806,504
    Other                                   57,963        12,000
                                        ----------    ----------

                                        $1,199,916    $  818,504
                                        ==========    ==========

8.    Note Payable:                                                             

      On  March  5, 1996, the Company entered into a line of credit and security
      agreement  (the  "Loan")  with  a  bank to be used by the Company to offer
      Secured Equipment Leases.  The Loan provides that the Company will be able
      to  receive advances of up to $15,000,000 until March 4, 1998.  Generally,
      advances  under  the Loan will be fully amortizing term loans repayable in
      terms  equal  to  the  duration of the Secured Equipment Leases, but in no
      event  greater than 72 months.  In addition, advances for short-term needs
      (to  acquire equipment to be leased under Secured Equipment Leases) may be
      requested  in  an  aggregate  amount  which  does not exceed the Revolving
      Sublimit  (defined  in  the  Loan  as $1,000,000) and such advances may be
      repaid  and  readvanced; provided, however, that advances made pursuant to
the Revolving Sublimit shall be                                     
      converted  to  term loans the earlier of (i) the end of each 60 day period
      following the closing date (defined in the Loan as March 5, 1996), or (ii)
      when  the  aggregate  amount  outstanding  equals  or  exceeds $1,000,000.
      Interest on advances made pursuant to the Revolving Sublimit shall be paid
      monthly  in  arrears.    In  addition,  principal  amounts  under advances
      pursuant  to  the Revolving Sublimit, if not sooner paid or converted into
      term  loans,  shall be paid, together with any unpaid interest relating to
      such  advances,  to  the  bank  on March 5, 1998.  Generally, all advances
      under  the Loan will bear interest at either (i) a rate per annum equal to
      215  basis points above the Reserve Adjusted LIBOR Rate (as defined in the
      Loan)  or  (ii) a rate per annum equal to the bank's prime rate, whichever
      the  Company  selects  at  the  time advances are made.  As a condition of
      obtaining  the  Loan,  the  Company  agreed  to  grant to the bank a first
      security interest in the Secured Equipment Leases.  In connection with the
      Loan,  the Company incurred a commitment fee, legal fees and closing costs
      of  $53,500  relating to the Loan.  As of March 31, 1996, the note payable
      includes  $53,500  which  had  been  advanced  under  the Loan to fund the
      commitment  fee,  legal  fees  and closing costs related to the Loan, plus
      accrued interest of $159.  The Company intends to limit advances under the
Loan to 10% of gross proceeds of the offering.                      

9.    Stock Issuance Costs:                                                     

      The  Company  has  incurred  certain  expenses  of its offering of shares,
      including   commissions,  marketing  support  and  due  diligence  expense
      reimbursement  fees,  filing  fees, legal, accounting, printing and escrow
      fees,  which  have  been deducted from the gross proceeds of the offering.
      Preliminary  costs  incurred  prior to raising capital were advanced by an
      affiliate  of the Company, CNL Fund Advisors, Inc.  (the "Advisor").   The
      Advisor  has  agreed  to  pay  all  organizational  and  offering expenses
      (excluding  commissions  and  marketing  support and due diligence expense
      reimbursement  fees)  which  exceed  three  percent  of the gross offering
proceeds received from the sale of shares of the Company.           

      As  of  March  31,  1996 and December 31, 1995, the Company had incurred a
      total  of  $8,222,753  and $6,423,671, respectively, in organizational and
      offering  costs,  including  $4,403,350  and  $3,076,333, respectively, in
      commissions  and marketing support and due diligence expense reimbursement
      fees  (see  Note  11).    Of  these  amounts  $8,202,753  and  $6,403,671,
      respectively,  has  been  treated  as stock issuance costs and $20,000 has
      been  treated  as  organization costs.  The stock issuance costs have been
      charged to stockholders' equity subject to the three percent cap described
above.                                                              

10.   Distributions:                                                            

      Distributions  declared  for  the  quarter ended March 31, 1996, represent
      approximately  $690,000  of  ordinary  income and approximately $78,000 of
      return  of  capital  to  stockholders for federal income tax purposes.  No
      amounts  distributed  to  the stockholders for the quarter ended March 31,
      1996,  are  required to be or have been treated by the Company as a return
      of  capital  for purposes of calculating the stockholders' return on their
      invested  capital.  The characterization for tax purposes of distributions
      declared  for  the  quarter ended March 31, 1996, may not be indicative of
   the results that may be expected for the year ending December 31, 1996.

11.   Related Party Transactions:                                               

      During  the  quarter ended March 31, 1996, the Company incurred $1,244,079
      in  selling  commissions  due  to  CNL  Securities  Corp.  for services in
      connection  with  the  offering  of shares.  A substantial portion of this
      amount  ($1,227,505)  was  or will be paid as commissions to other broker-
dealers.                                                            

      In  addition,  CNL  Securities  Corp.  is  entitled to receive a marketing
      support  and  due diligence expense reimbursement fee equal to 0.5% of the
      total  amount  raised  from  the sale of shares, a portion of which may be
      reallowed  to  other  broker-dealers.   During the quarter ended March 31,
1996, the Company incurred $82,939 of such fees.                    

      The  Advisor  is  entitled  to  receive  acquisition  fees for services in
      identifying  the  Properties  and structuring the terms of the acquisition
      and leases of the Properties equal to 4.5% of the total amount raised from
      the  sale of shares.  During the quarter ended March 31, 1996, the Company
incurred $746,448 of such fees.                                     

      The  Company  and  the  Advisor  have  entered  into an advisory agreement
      pursuant  to which the Advisor will receive a monthly asset management fee
      of  one-twelfth  of  0.60%  of  the  Company's  real  estate  asset  value
      (generally,  the  total amount invested in the Properties as of the end of
      the  preceding  month,  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  the Advisor.  All or any portion of the management fee not taken as to
      any  fiscal  year  shall  be deferred without interest and may be taken in
      such  other  fiscal year as the Advisor shall determine.  In addition, the
      advisory  agreement  provides  that  the  Advisor  will  receive a monthly
      mortgage  management  fee  of  one-twelfth  of .60% of the Company's total
      principal  amount  of  the  mortgage  loans as of the end of the preceding
      month.  As  of  March  31,  1996,  the  Company  incurred $33,289 in asset
      management  fees,  $1,394  of which was capitalized as part of the cost of
      building   for  Properties  under  construction  and  $8,475  in  mortgage
management fees.                                                    

      The  Advisor  and  its  affiliates  provide  accounting and administrative
      services  to the Company (including accounting and administrative services
      in connection with the offering of shares) on a day-to-day basis.  For the
      quarters  ended  March  31, 1996 and 1995, the expenses incurred for these
services were classified as follows:                                

                                          1996          1995

    Deferred offering costs               $     -       $ 43,410
   Stock issuance costs                   185,113            -
General operating and                                   
     administrative expenses               74,032            -
                                          --------      --------

                                          $259,145      $ 43,410
                                          ========      ========

      During the quarter ended March 31, 1996, the Company acquired one Property
      for  approximately  $820,625  from  an  affiliate  of  the  Company.   The
      affiliate  had  purchased  and  temporarily  held title to the Property in
      order  to  facilitate the acquisition of the Property by the Company.  The
      Property  was acquired at a cost no greater than the lesser of the cost of
      the Property to the affiliate (including carrying costs) or the Property's
appraised value.                                                    

The due to related parties consisted of the following at:           

                                            March 31,     December 31,
                                          1996            1995

Due to the Advisor:                                     
Expenditures incurred                               
on behalf of the                                
Company and accounting                          
and administrative                              
        services                          $150,140      $108,316
      Acquisition fees                     143,485        45,118
Asset and mortgage                                  
        management fees                     20,515         9,108
      Distributions                             -          3,332
                                          --------      --------
                                           314,140       165,874
                                          --------      --------

Due to CNL Securities Corp:                             
      Commissions                           94,947        75,197
Marketing support and due                           
diligence expense reim-                         
        bursement fees                       6,331         5,013
                                          --------      --------
                                           101,278        80,210
                                          --------      --------

    Other                                       -          2,500
                                          --------      --------

                                          $415,418      $248,584
                                          ========      ========

12.   Concentration of Credit Risk:                                             

      The  following  schedule  presents  total  rental  and  earned income from
      individual  lessees,  or  affiliated  groups of lessees, each representing
      more  than ten percent of the Company's total rental and earned income for
the quarter ended March 31, 1996:                                   

    Golden Corral Corporation                           $207,664
    Corral South Store I, Inc.                           102,779
    Castle Hill Holdings V, LLC                           97,576
    Foodmaker, Inc.                                       82,633
    Northstar Restaurants, Inc.                           82,341

      During  the quarter ended March 31, 1996, the Company also earned $184,949
      in interest income from a mortgage note receivable under which Castle Hill
Holdings V, LLC is the borrower.                                    

      In  addition,  the  following  schedule  presents  total rental and earned
      income  from individual restaurant chains, each representing more than ten
      percent  of  the  Company's total rental and earned income for the quarter
ended March 31, 1996:                                               

Golden Corral Family Steakhouse                         
      Restaurants                                       $371,290
    Pizza Hut                                             97,576
    Jack in the Box                                       82,633
    Boston Market                                         82,341

      Although  the  Company's  Properties  are  geographically  diverse and the
      Company's lessees operate a variety of restaurant concepts, failure of any
      one  of  these  restaurant chains or any lessee that contributes more than
      ten  percent of the Company's rental income could significantly impact the
      results  of  operations of the Company.  However, management believes that
      the  risk  of  such a default is reduced due to the essential or important
 nature of these Properties for the on-going operations of the lessee.

      It  is  expected  that  the  percentage  of total rental and earned income
      contributed  by  these  lessees  and  restaurant  chains  will decrease as
      additional  Properties  are  acquired  and  leased  in 1996 and subsequent
years.                                                              

13.   Commitments:                                                              

      The  Company  has entered into various development agreements with tenants
      which  provide  terms and specifications for the construction of buildings
      the  tenants  have  agreed  to  lease once construction is completed.  The
      agreements  provide  a  maximum amount of development costs (including the
      purchase  price  of the land and closing costs) to be paid by the Company.
      The  aggregate  maximum development costs the Company has agreed to pay is
      approximately  $5,817,200,  of  which approximately $2,613,400 in land and
      other  costs  had  been  incurred  as  of  March  31, 1996.  The buildings
      currently  under  construction  are  expected  to be operational by August
      1996.    In connection with the purchase of each Property, the Company, as
lessor, entered into a long-term lease agreement.                   

14.   Subsequent Events:                                                        

      During  the period April 1, 1996 through May 9, 1996, the Company received
      subscription  proceeds  for  an  additional 997,797 shares ($9,977,971) of
common stock.                                                       

      On  April  1,  1996 and May 1, 1996, the Company declared distributions of
      $323,748  and $368,153, respectively, or $.0583 per share of common stock,
      payable  in  June 1996, to stockholders of record on April 1, 1996 and May
1, 1996, respectively.                                              

      During  the period April 1, 1996 through May 9, 1996, the Company acquired
      eight  Properties (five of which are undeveloped land on which restaurants
      are  being  constructed  and  three  of which are land only) for cash at a
      total  cost of approximately $2,755,000, excluding closing and development
      costs.   In connection with the purchase of each Property, the Company, as
      lessor,  entered  into a long-term lease agreement.  The development costs
      (including  the  purchase of the land and closing costs) to be paid by the
      Company  relating  to the five properties under construction are estimated
      to  be  approximately  $6,193,000.    The buildings under construction are
expected to be operational by October 1996.                         

 ADDENDUM TO
 EXHIBIT E

PRO FORMA ESTIMATE OF TAXABLE INCOME
 BEFORE DIVIDENDS PAID DEDUCTION

The pro forma estimate of taxable income contained in this addendum should      
be read in conjunction with Exhibit E to the attached prospectus, dated         
April 26, 1996.                                                                 

 PRO FORMA ESTIMATE OF TAXABLE INCOME BEFORE DIVIDENDS PAID DEDUCTION OF
CNL AMERICAN PROPERTIES FUND, INC.
GENERATED FROM THE OPERATIONS OF PROPERTIES ACQUIRED FROM APRIL 10, 1996
 THROUGH JULY 16, 1996
 FOR A 12-MONTH PERIOD (UNAUDITED)

      The following schedule represents pro forma unaudited estimates of taxable
income before dividends paid deduction of each Property acquired by the Company 
from April 10, 1996 through July 16, 1996, for the 12-month period commencing on
the date of the inception of the respective lease on such Property.  The        
schedule should be read in light of the accompanying footnotes.                 

      These estimates do not purport to present actual or expected operations of
the Company for any period in the future.  These estimates were prepared on the 
basis described in the accompanying notes which should be read in conjunction   
herewith.  No single lessee or group of affiliated lessees lease Properties or  
has borrowed funds from the Company with an aggregate purchase price in excess  
of 20% of the expected total net offering proceeds of the Company.              

                                                        · Enlarge/Download Table

                                       TGI Friday's                   Wendy's              Golden Corral              Ten Pizza    
                                       Hamden, CT (7)            Knoxville, TN (7)(8)     Port Richey, FL (7)       Hut Properties 
                                                                                                                                   

Pro Forma Estimate of Taxable                                                                                                      
  Income Before Dividends Paid                                                                                                     
  Deduction:                                                                                                                       

Base Rent (1)                          $  173,714                   $   81,898            $  196,972                 $  166,320    
Interest Income (2)                            -                            -                     -                     415,686    
                                       ----------                   ----------            ----------                 ----------    
    Total Revenues                        173,714                       81,898               196,972                    582,006    
                                       ----------                   ----------            ----------                 ----------    

Asset Management Fees (3)                  (6,808)                      (4,746)              (10,233)                    (8,922)   
Mortgage Management Fee (4)                    -                            -                     -                     (23,167)   
General and Administrative                                                                                                         
  Expenses (5)                            (10,770)                      (5,078)              (12,212)                   (36,084)   
                                       ----------                   ----------            ----------                 ----------    
    Total Operating Expenses              (17,578)                      (9,824)              (22,445)                   (68,173)   
                                       ----------                   ----------            ----------                 ----------    

Estimated Cash Available from                                                                                                      
  Operations                              156,136                       72,074               174,527                     513,833   

Depreciation and Amortization                                                                                                      
  Expense (6)                             (30,652)                     (13,081)              (30,970)                    (10,498)  
                                       ----------                   ----------            ----------                  ----------   

Pro Forma Estimate of Taxable                                                                                                      
  Income Before Dividends Paid                                                                                                     
  Deduction of the Company             $  125,484                   $   58,993            $  143,557                  $  503,335   
                                       ==========                   ==========            ==========                  ==========   

                                                                  See Footnotes                                                    

                                            Denny's               Denny's                  Wendy's                  Wendy's        
                                       Hillsboro, TX (7)       McKinney, TX          Camarillo, CA (7)(8)    Sevierville, TN(7)(8) 

Pro Forma Estimate of Taxable                                                                                                      
  Income Before Dividends Paid                                                                                                     
  Deduction:                                                                                                                       

Base Rent (1)                            $  114,346                $  104,013                $  124,655              $   60,735    
Interest Income (2)                              -                         -                         -                       -     

                                         ----------               ----------               ----------              ----------      
    Total Revenues                          114,346                   104,013                   124,655                  60,735    
                                         ----------               ----------               ----------              ----------      

Asset Management Fees (3)                    (6,319)                  (5,874)                  (7,224 )                (2,956 )    
Mortgage Management Fee (4)                      -                         -                         -                       -     
General and Administrative                                                                                                         
  Expenses (5)                               (7,089)                  (6,449)                  (7,729 )                (3,766 )    
                                         ----------               ----------               ----------              ----------      
    Total Operating Expenses                (13,408)                 (12,323)                 (14,953 )                (6,722 )    
                                         ----------               ----------               ----------              ----------      

Estimated Cash Available from                                                                                                      
  Operations                                100,938                    91,690                   109,702                  54,013    

Depreciation and Amortization                                                                                                      
  Expense (6)                               (19,022)                 (16,066)                 (17,220 )               (13,308 )    
                                         ----------               ----------               ----------              ----------      

Pro Forma Estimate of Taxable                                                                                                      
  Income Before Dividends Paid                                                                                                     
  Deduction of the Company               $   81,916                $   75,624                $   92,482              $   40,705    
                                         ==========               ==========               ==========              ==========      

                                                                                See Footnotes                                      

                                     Boston Market              Boston Market               Jack in the Box          Boston Market 
                                 Ellisville, MO (7)(9)    Golden Valley, MN (7)(9)      Humble #1, TX (7)(10)     Corvallis, OR (7)
Pro Forma Estimate                                                                                                                 
  of Taxable                                                                                                                       
  Income Before Dividends                                                                                                          
  Paid Deduction:                                                                                                                  

Base Rent (1)                        $  102,675                $  112,890                    $   100,061               $   95,085  
Interest Income (2)                         -                         -                              -                         -   
                                      ----------               ----------                    ----------               ----------   
    Total Revenues                      102,675                   112,890                        100,061                   95,085  
                                      ----------               ----------                    ----------               ----------   

Asset Management Fees (3)                (5,864 )                  (6,448 )                       (5,603 )                 (5,440 )
Mortgage Management Fee (4)                                                                                                        
                                             -                                                                                     
                                                                       -                             -                           - 
General and Administrative                                                                                                         
  Expenses (5)                           (6,366 )                  (6,999 )                       (6,204 )                 (5,895 )
                                      ----------               -----------                   ----------                ---------   
    Total Operating Expenses            (12,230 )                 (13,447 )                      (11,807 )                (11,335 )
                                      ----------               ----------                    ----------                ----------  

Estimated Cash Available from                                                                                                      
  Operations                             90,445                    99,443                         88,254                   83,750  

Depreciation and Amortization                                                                                                      
  Expense (6)                           (16,272 )                 (13,561 )                      (15,646                           
                                                                                                         )                (16,006 )
                                      ----------               -----------                   ----------               ----------   

Pro Forma Estimate of Taxable                                                                                                      
  Income Before Dividends Paid                                                                                                     
  Deduction of the Company           $   74,173                $   85,882                     $   72,608               $   67,744  
                                      ==========               ==========                    ==========               ==========   

                                                                    See Footnotes                                                  

                                   Jack in the Box                  Arby's                 Boston Market                           

                               Houston #1, TX (7) (10)          Kendallville, IN         Rockwall, TX (7)       Total              

Pro Forma Estimate                                                                                                                 
  of Taxable                                                                                                                       
  Income Before Dividends                                                                                                          
  Paid Deduction:                                                                                                                  

Base Rent (1)                   $   95,757                    $    75,812                 $   79,356         $1,684,289            

Interest Income (2)                    -                               -                          -             415,686            
                   ------------------------                   -----------                 ----------        ----------             
    Total Revenues                  95,757                         75,812                     79,356          2,099,975            
                  -------------------------                   -----------                 ----------------- ----------             

Asset Management Fees (3)           (5,362 )                       (4,430 )                   (4,551 )          (90,780 )          
Mortgage Management Fee (4)             -                              -                           -            (23,167 )          

General and Administrative                                                                                                         
  Expenses (5)                      (5,937 )                       (4,700 )                    (4,920 )         (130,198 )         
                                 ----------                    ----------                  ---------  ----------------             
    Total Operating Expenses       (11,299 )                       (9,130 )                    (9,471 )         (244,145 )         
                                 ----------                    ----------                  ----------       ----------             

Estimated Cash Available from                                                                                                      
  Operations                        84,458                         66,682                     69,885          1,855,830            

Depreciation and Amortization                                                                                                      
  Expense (6)                      (15,890 )                       (7,794 )                   (10,183 )         (246,799 )         
                                 ----------                    ----------                  ---------  ----------------             

Pro Forma Estimate of Taxable                                                                                                      

  Income Before Dividends Paid                                                                                                     
  Deduction of the Company      $   68,568                     $   58,888                   $  59,072         $1,609,031           
                                 ==========                    ==========                  ===========================             

                                                                    See Footnotes                                                  

<FN>                                                                                                                               

FOOTNOTES:                                                                                                                         

(1)   Base rent does not include percentage rents which become due if specified                                                    
      levels of gross receipts are achieved.                                                                                       

(2)   The Company entered into a Master Mortgage Note agreement for $3,888,000,                                                    
      collateralized by building improvements located on the Ten Pizza Hut                                                         
      Properties.  The Master Mortgage Note bears interest at a rate of 10.75%                                                     
      per annum and principal and interest will be collected in equal monthly                                                      
      installments over 20 years beginning in July 1996.  Amount does not                                                          
      include $19,440 of loan commitment fees and $19,440 in loan origination                                                      
      fees collected by the Company at closing from the borrower.                                                                  

(3)   The Properties will be managed pursuant to an advisory agreement between                                                     
      the Company and CNL Fund Advisors, Inc. (the "Advisor"), pursuant to which                                                   
      the Advisor will receive monthly asset management fees in an amount equal                                                    
      to one-twelfth of .60% of the Company's Real Estate Asset Value as of the                                                    
      end of the preceding month as defined in such agreement.  See "Management                                                    
      Compensation."                                                                                                               

(4)   For managing the Mortgage Loans, the Advisor will be entitled to receive a                                                   
      monthly mortgage management fee of one-twelfth of .60% of the total                                                          
      principal amount of the Mortgage Loans as of the end of the preceding                                                        
      month.  See "Management Compensation."                                                                                       

(5)   Estimated at 6.2% of gross rental income and interest income based on the                                                    
      previous experience of Affiliates of the Advisor with 17 public limited                                                      
      partnerships which own properties similar to those owned by the Company.                                                     
      Amount does not include soliciting dealer servicing fee due to the fact                                                      
      that such fee will not be incurred until December 31 of the year following                                                   
      the year in which the offering terminates.                                                                                   

(6)   The estimated federal tax basis of the depreciable portion (the building                                                     
      portion) of the Properties has been depreciated on the straight-line                                                         
      method over 39 years.  In connection with the Ten Pizza Hut Properties,                                                      
      acquisition fees allocated to the Master Mortgage Note have been amortized                                                   
      on a straight-line basis over the life of the agreement (20 years).                                                          

(7)   The Company accepted an assignment of an interest in the ground lease                                                        
      relating to the Hamden and Sevierville Properties effective April 24, 1996                                                   
      and June 5, 1996, respectively, in consideration of its funding of certain                                                   
      preliminary development costs and its agreement to fund remaining                                                            
      development.  The development agreements for the Properties which are to                                                     
      be constructed provide that construction must be completed no later than                                                     
      the dates set forth below:                                                                                                   

         Property                 Estimated Final Completion Date   Property                  Estimated Final Completion Date      

         Hamden Property          September 21, 1996                Ellisville Property               December 15, 1996            
         Knoxville Property       September 5, 1996                 Golden Valley Property            December 16, 1996            
         Port Richey Property     October 5, 1996                   Humble #1 Property                December 16, 1996            
         Hillsboro Property       December 2, 1996                  Corvallis Property                January 5, 1997              
         Camarillo Property       October 3, 1996                   Houston #1 Property               January 5, 1997              
         Sevierville Property     October 3, 1996                   Rockwall Property                 January 11, 1997             

(8)   The lessee of the Knoxville, Camarillo, and Sevierville Properties is the                                                    
      same unaffiliated lessee.                                                                                                    

(9)   The lessee of the Ellisville and Golden Valley Properties is the same                                                        
      unaffiliated lessee.                                                                                                         

(10)  The lessee of the Humble #1 and Houston #1 Properties is the same                                                            
      unaffiliated lessee.                                                                                                         


CNL AMERICAN PROPERTIES FUND, INC.
SHARES OF COMMON STOCK

Minimum Purchase   250 Shares ($2,500)
  100 Shares ($1,000) for IRAs and Keogh and Pension Plans
(Minimum purchase may be higher in certain states)

CNL AMERICAN PROPERTIES FUND, INC. (the  Company ) is a Maryland    
corporation which intends to qualify and remain qualified for federal income tax
purposes as a real estate investment trust (a  REIT ).  THE COMPANY MAY SELL UP 
TO 16,500,000 SHARES FOR A MAXIMUM OF $165,000,000.  The Company has been formed
primarily to acquire restaurant properties (the  Properties ) located across the
United States to be leased on a long-term,  triple-net  basis to creditworthy   
operators of selected national and regional fast-food, family-style, and casual 
dining restaurant chains (the  Restaurant Chains ).  Under the Company's triple-
net leases, the tenant will be responsible for property costs associated with   
ongoing operations, including repairs, maintenance, property taxes, utilities,  
and insurance.  In addition, the leases will be structured to require the tenant
to pay (i) base annual rent, with automatic increases in the base rent, and (ii)
percentage rent based on certain restaurant sales above a specified level.  The 
Company may provide financing (the  Mortgage Loans ) for the purchase of        
buildings, generally by tenants that lease the underlying land from the Company.
To a lesser extent, the Company intends to offer furniture, fixture and         
equipment financing ( Secured Equipment Leases ) to operators of Restaurant     
Chains.  Secured Equipment Leases will be funded from the proceeds of a loan in 
an amount up to 10% of Gross Proceeds (the  Loan ) which the Company has        
obtained.  The Company is not a mutual fund or other type of investment company 
within the meaning of the Investment Company Act of 1940, and is not subject to 
regulation thereunder.  The Company is not affiliated with the United States    
Government.                                                                     

THERE ARE SIGNIFICANT RISKS ASSOCIATED WITH AN INVESTMENT IN THE COMPANY (SEE   
RISK FACTORS ), INCLUDING THE FOLLOWING:                                      

o  Both the number of Properties that the Company will acquire and the          
diversification of its investments will be reduced to the extent that the 
total proceeds of the offering are less than $165,000,000.  As of April 9,
1996, the total offering proceeds were $57,887,405.                       
o  The Company will rely on CNL Fund Advisors, Inc. (the  Advisor ) with respect
  to all investment decisions subject to approval by the Board of Directors in
certain circumstances.  The experience of the Advisor and Directors of the
Company with mortgage financing and equipment leasing is limited.         
o  The Advisor and its Affiliates are or will be engaged in other activities    
that will result in potential conflicts of interest with the services that
the Advisor will provide to the Company.                                  
o  The Company owned, as of April 9, 1996, 48 Properties of the anticipated     
 total of 140 to 160 Properties, and investors, therefore, will not have the
 opportunity to evaluate all the Properties that the Company eventually will
acquire.                                                                  
o  There is currently no public trading market for the Shares, and there is no  
assurance that one will develop.                                          
o  If the Shares are not listed on a national securities exchange or over-the-  
  counter market ( Listing ) within ten years of commencement of the offering,
   as to which there can be no assurance, the Company will commence orderly sale
  of its assets and the distribution of the proceeds.  Listing does not assure
liquidity.                                                                
o  Market and economic conditions that the Company cannot control will have an  
effect (either positive or negative) on the value of the Company's        
   investments and the amount of cash that the Company receives from tenants and
lessees.                                                                  
o  Prior to meeting certain conditions, the Company may incur debt, including   
   debt to make Distributions to stockholders, but will not encumber Properties.

     THE COMPANY'S PRIMARY INVESTMENT OBJECTIVES are to preserve, protect, and
enhance the Company's assets while (i) making Distributions commencing in the   
initial year of Company operations; (ii) obtaining fixed income through the     
receipt of base rent, and increasing the Company's income (and Distributions)   
and providing protection against inflation through automatic increases in base  
rent and receipt of percentage rent, and obtaining fixed income through the     
receipt of payments from Secured Equipment Leases; (iii) qualifying as a REIT   
for federal income tax purposes; and (iv) providing stockholders of the Company 
with liquidity of their investment within five to ten years after commencement  
of the offering, either in whole or in part, through (a) Listing, or (b) the    
commencement of orderly sales of the Company's assets and distribution of the   
proceeds thereof (outside the ordinary course of business and consistent with   
its objective of qualifying as a REIT).  There can be no assurance that these   
investment objectives will be met.                                              

  This Prospectus describes an investment in Shares of the Company.  The
Company will use stockholders' funds to purchase the Properties and make        
Mortgage Loans and will borrow money to fund Secured Equipment Leases.  No      
stockholder may hold more than 9.8% of the total Shares.  Of the proceeds from  
the sale of Shares, approximately 84% (in the event $150,000,000 or more is     
raised) will be used to acquire Properties and make Mortgage Loans, and         
approximately 9% will be paid in fees and expenses to Affiliates of the Company 
for their services; the balance will be used to pay other expenses of the       
offering.  The Company has registered an offering of 16,500,000 Shares, with    
1,500,000 of such Shares available only to stockholders purchasing Shares in    
this initial public offering who receive a copy of this Prospectus and who elect
to participate in the Company's reinvestment plan (the  Reinvestment Plan ).    
Any participation in such plan by a person who becomes a stockholder otherwise  
than by participating in this offering must be made pursuant to a solicitation  
under a separate prospectus.  See  Summary of Reinvestment Plan.   Prior        
programs sponsored by Affiliates of the Company and the Advisor are in limited  
partnership form.  See  Prior Performance Information.                          

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND    
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES   
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE      
ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY REPRESENTATION TO THE CONTRARY IS 
A CRIMINAL OFFENSE.                                                             

                                                        · Enlarge/Download Table

==============================================================================================================================
                                                                     Price to             Selling                Proceeds to  
                                                                       Public        Commissions(1)               Company(2)  
                                                                                                                              
Per Share     . . . . . . . . . . . . . . . . . . . . .                                                                       
                                                             $          10.00      $          0.75             $         9.25 
Total Minimum   . . . . . . . . . . . . . . . . . . . .                                                                       
                                                             $      1,500,000      $       112,500             $    1,387,500 
Total Maximum(3)  . . . . . . . . . . . . . . . . . . .                                                                       
                                                             $    165,000,000      $    12,375,000             $  152,625,000 
==============================================================================================================================

                                                   (footnotes on following page)

(1)         CNL Securities Corp. (the  Managing Dealer ) will receive Selling   
       Commissions of 7.5% on sales of Shares, subject to reduction in
          certain circumstances.  The Managing Dealer, which is an Affiliate
           of the Company, may engage other broker-dealers that are members of
     the National Association of Securities Dealers, Inc. or other
          entities exempt from broker-dealer registration (collectively, the
             Soliciting Dealers ) to sell Shares and reallow to them commissions
        of up to 7% with respect to Shares which they sell.  The amounts
     indicated for Selling Commissions assume that reduced Selling
       Commissions are not paid in connection with the purchase of any
            Shares and do not include a 0.5% marketing support and due diligence
          expense reimbursement fee payable to the Managing Dealer, all or a
        portion of which may be reallowed to certain Soliciting Dealers.
          Such amounts also do not include a Soliciting Dealer Servicing Fee
      payable to the Managing Dealer by the Company (see  Management
     Compensation ), all or a portion of which may be reallowed to
certain Soliciting Dealers.  See  The Offering   Plan of
       Distribution  for a discussion of the circumstances under which
        reduced Selling Commissions may be paid and a description of the
     marketing support and due diligence expense reimbursement fee
payable to the Managing Dealer.                         

(2)         Before deducting (i) organizational and offering expenses of the    
         Company estimated to be 3% of gross offering proceeds computed at
          $10.00 per Share sold ( Gross Proceeds ) on the sale of 15,000,000
       Shares and (ii) the marketing support and due diligence expense
        reimbursement fee.  Organizational and offering expenses exclude
       Selling Commissions and the marketing support and due diligence
       reimbursement fee.  The Advisor will pay all organizational and
offering expenses which exceed 3% of the Gross Proceeds.

(3)         Assumes that the Managing Dealer exercises its option to sell an    
additional 5,000,000 Shares in the event the offering is
           oversubscribed.  Also includes 1,500,000 Shares which may be issued
            pursuant to the Company's Reinvestment Plan.  Those stockholders who
     elect to participate in the Reinvestment Plan will have their
Distributions reinvested in additional Shares.          

     NEITHER THE ATTORNEY GENERAL OF THE STATE OF NEW YORK NOR THE
ATTORNEY GENERAL OF THE STATE OF NEW JERSEY OR THE BUREAU OF SECURITIES OF THE  
STATE OF NEW JERSEY HAS PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING.  ANY 
REPRESENTATION TO THE CONTRARY IS UNLAWFUL.                                     

     All subscription funds for Shares will be deposited in an interest-
bearing escrow account with SouthTrust Estate & Trust Company, Inc., which will 
act as the escrow agent for this offering.  As of June 1, 1995, the Company had 
received aggregate subscription proceeds of $1,955,500, which exceeded the      
minimum offering amount of $1,500,000, and $1,836,500 of the funds (excluding   
funds received from Iowa, Minnesota, New York, Ohio and Pennsylvania investors) 
were released from escrow.  As of April 9, 1996, the Company had received       
aggregate subscription proceeds of $57,887,405 (5,788,741 Shares) from 3,440    
stockholders, including $128,151 (12,815 Shares) issued pursuant to the         
Reinvestment Plan.  The Company has elected to extend the offering of Shares    
until a date no later than March 29, 1997 (two years after the initial date of  
this Prospectus), in states that permit such extension.                         

        NO PERSON HAS BEEN AUTHORIZED IN CONNECTION WITH THIS OFFERING TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN    
THIS PROSPECTUS.  THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION  
IN ANY STATE IN WHICH SUCH OFFER OR SALE WOULD BE UNLAWFUL, AND NO SUBSCRIPTION 
WILL BE ACCEPTED FROM ANY PERSON WHO DOES NOT MEET THE SUITABILITY STANDARDS SET
FORTH HEREIN.  NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE HEREUNDER   
SHALL CREATE, UNDER ANY CIRCUMSTANCES, AN IMPLICATION THAT THERE HAS BEEN NO    
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.  IF, HOWEVER, ANY   
MATERIAL CHANGE OCCURS WHILE THIS PROSPECTUS IS REQUIRED BY LAW TO BE DELIVERED,
THIS PROSPECTUS WILL BE AMENDED OR SUPPLEMENTED ACCORDINGLY.                    

THE USE OF FORECASTS IN THIS OFFERING IS PROHIBITED.  ANY     
REPRESENTATIONS 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 COMPANY IS PROHIBITED.                

 TABLE OF CONTENTS

                                                                        Page

SUMMARY OF THE OFFERING                                                    1    
RISK FACTORS                                                               9    
  Investment Risks                                                     9
   Real Estate and Financing Risks                                      12
   Tax Risks                                                            15
SUITABILITY STANDARDS AND HOW TO SUBSCRIBE                                 17   
ESTIMATED USE OF PROCEEDS                                                  19   
MANAGEMENT COMPENSATION                                                    20   
CONFLICTS OF INTEREST                                                      26   
   Prior and Future Programs                                            26
   Acquisition of Properties                                            26
   Sales of Properties                                                  27
   Joint Investment With An Affiliated Program                          27
   Competition for Management Time                                      27
   Compensation of the Advisor                                          28
   Relationship with Managing Dealer                                    28
   Legal Representation                                                 28
   Certain Conflict Resolution Procedures                               28
SUMMARY OF REINVESTMENT PLAN                                               30   
REDEMPTION OF SHARES                                                       32   
BUSINESS                                                                   34   
   General                                                              34
   Property Acquisitions                                                37
   Site Selection and Acquisition of Properties                         70
   Standards for Investment in Properties                               73
   Description of Properties                                            74
   Description of Property Leases                                       75
   Joint Venture Arrangements                                           78
   Mortgage Loans                                                       79
   Management Services                                                  80
   Borrowing                                                            80
   Sale of Properties, Mortgage Loans, and Secured Equipment Leases     81
   Franchise Regulation                                                 82
   Competition                                                          82
   Regulation of Mortgage Loans and Secured Equipment Leases            82
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION                     
 OF THE COMPANY                                                         82
MANAGEMENT                                                                 87   
   General                                                              87
   Fiduciary Responsibility of the Board of Directors                   87
   Directors and Executive Officers                                     88
   Independent Directors                                                90
   Committees of the Board of Directors                                 90
   Compensation of Directors and Executive Officers                     91
   Management Compensation                                              91
THE ADVISOR AND THE ADVISORY AGREEMENT                                     91   
   The Advisor                                                          91
   The Advisory Agreement                                               91
PRIOR PERFORMANCE INFORMATION                                              94   
INVESTMENT OBJECTIVES AND POLICIES                                         98   
   General                                                              98
   Certain Investment Limitations                                       99
DISTRIBUTION POLICY                                                       100   
   General                                                             100
   Distributions                                                       101
SUMMARY OF THE ARTICLES OF INCORPORATION AND BYLAWS                       101   
   General                                                             101
   Description of Capital Stock                                        102
   Board of Directors                                                  102
   Stockholder Meetings                                                103
Advance Notice for Stockholder Nominations for                      
     Directors and Proposals of New Business                           103
   Amendments to the Articles of Incorporation                         103
   Mergers, Combinations, and Sale of Assets                           103
   Termination of the Company and REIT Status                          103
   Restriction of Ownership                                            104
   Responsibility of Directors                                         105
   Limitation of Liability and Indemnification                         105
   Removal of Directors                                                106
   Inspection of Books and Records                                     106
   Restrictions on  Roll-Up  Transactions                              106
FEDERAL INCOME TAX CONSIDERATIONS                                         107   
   Introduction                                                        107
   Taxation of the Company                                             107
   Taxation of Stockholders                                            112
   State and Local Taxes                                               115
   Characterization of Property Leases                                 115
   Characterization of Secured Equipment Leases                        116
   Investment in Joint Ventures                                        116
REPORTS TO STOCKHOLDERS                                                   117   
THE OFFERING                                                              118   
   General                                                             118
   Plan of Distribution                                                118
   Subscription Procedures                                             120
   Escrow Arrangements                                                 122
   ERISA Considerations                                                122
   Determination of Offering Price                                     124
SUPPLEMENTAL SALES MATERIAL                                               124   
LEGAL OPINIONS                                                            124   
EXPERTS                                                                   124   
ADDITIONAL INFORMATION                                                    124   
DEFINITIONS                                                               125   

Form of Amended Reinvestment Plan                                   Exhibit A   
Financial Information                                               Exhibit B   
Prior Performance Tables                                            Exhibit C   
Subscription Agreement                                              Exhibit D   
Pro Forma Estimate of Taxable Income                                Exhibit E   

 SUMMARY OF THE OFFERING

   THIS SECTION SUMMARIZES CERTAIN INFORMATION CONTAINED ELSEWHERE IN THIS
PROSPECTUS AND IS INTENDED FOR QUICK REFERENCE ONLY.  THIS IS NOT A COMPLETE    
DESCRIPTION OF THE INVESTMENT.  POTENTIAL STOCKHOLDERS MUST READ AND EVALUATE   
THE FULL TEXT OF THIS PROSPECTUS AND ALL SUPPORTING DOCUMENTS ATTACHED AS       
EXHIBITS HERETO IN ORDER TO EVALUATE AN INVESTMENT IN THE COMPANY.  THE         
FOLLOWING SUMMARY THEREFORE IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE    
FULL TEXT OF THIS PROSPECTUS AND THE SUPPORTING DOCUMENTS.                      

CNL AMERICAN PROPERTIES FUND, INC.                                              

CNL American Properties Fund, Inc. (the  Company) is a Maryland     
corporation which intends to qualify and remain qualified for federal income tax
purposes as a real estate investment trust (a  REIT ).  The Company's address is
400 East South Street, Suite 500, Orlando, Florida 32801, telephone             
(407) 422-1574 or toll free (800) 522-3863.                                     

  The Company has acquired and intends to continue to acquire restaurant
properties (the  Properties ) located across the United States.  The Properties 
will be leased to creditworthy operators of selected national and regional      
restaurant chains, primarily fast-food, family-style, and casual dining chains  
(the  Restaurant Chains ).  The Company expects to structure its leases of the  
Properties to provide for payment of base annual rents with automatic increases 
and percentage rents based on gross sales.  All leases will be on a long-term   
(generally, 15 to 20 years, plus renewal options for an additional 10 to 20     
years),  triple-net  basis, which means that the tenant will be responsible for 
repairs, maintenance, property taxes, utilities, and insurance.  The Company has
provided and intends to continue to provide financing (the  Mortgage Loans ) for
the purchase of buildings, generally by tenants that lease the underlying land  
from the Company.  The Company expects that the economic effects of the Mortgage
Loans will be similar to those of its leases (generally with full repayment in  
15 to 20 years).  The Company also will offer furniture, fixtures and equipment 
( Equipment ) financing to operators of Restaurant Chains pursuant to which the 
Company will provide, through direct financing leases, the Equipment            
(collectively, the  Secured Equipment Leases ).  No offering proceeds will be   
used for the purpose of funding Secured Equipment Leases.  The Company has      
obtained a $15,000,000 line of credit (the  Loan ) to be used by the Company to 
fund Secured Equipment Leases.  The Loan provides that the Company will be able 
to receive advances under the line of credit until March 4, 1998.  Generally,   
advances under the Loan will be fully amortizing term loans repayable over      
periods of time equal to the duration of the Secured Equipment Leases, but in no
event greater than 72 months.  The Company intends to limit advances under the  
Loan to 10% of Gross Proceeds of the offering.  See  Business  for a description
of the types of Restaurant Chains that may be selected by the Advisor, the      
Property selection and acquisition processes, the nature of the Mortgage Loans  
and Secured Equipment Leases and a description of the Loan.                     

    Under the Company's Articles of Incorporation, the Company automatically
will terminate and dissolve on December 31, 2005 unless the shares of Common    
Stock of the Company, including the shares offered hereby (the  Shares ), are   
listed on a national securities exchange or over-the-counter market ( Listing ),
in which event the Company automatically will become a perpetual life entity.   
If Listing does not occur within ten years after commencement of the offering,  
the Company will undertake, outside the ordinary course of business and         
consistent with its objective of qualifying as a REIT, the orderly Sale of the  
Company's assets, the distribution of Net Sales Proceeds of such Sales to       
stockholders and the limitation of its activities to those related to its       
orderly liquidation, unless the stockholders owning a majority of the Shares    
elect to amend the Articles of Incorporation to extend the duration of the      
Company.  See  Risk Factors   Real Estate and Financing Risks  for a complete   
discussion of risks relating to future disposition of the Company's assets.  If 
Listing occurs (which is not assured), then the Board of Directors may elect to 
cause the Company to encumber any or all of the Company's Properties in         
connection with any borrowing.  The Board of Directors anticipates that such    
borrowing, in the aggregate, will not exceed 50% of Real Estate Asset Value,    
although the maximum amount the Company may borrow is 300% of Net Assets (an    
amount which the Company anticipates will correspond to approximately 75% of    
Real Estate Asset Value).  In general, Net Assets are the Company's total assets
(other than intangibles), calculated at cost, less total liabilities.  As a     
perpetual life entity following Listing, the Company would not be required to   
dissolve and return capital to stockholders.  If Listing occurs, in order to    
liquidate their investment stockholders would have to sell their Shares in the  
market on which the Shares are traded.  Listing is no assurance of liquidity.   
See  Risk Factors   Investment Risks  for a discussion of risks associated with 
the lack of liquidity of the Shares and with borrowing.  In addition, following 
Listing the Company intends to reinvest proceeds from Sales of Properties rather
than distribute such proceeds to stockholders.                                  

RISK FACTORS                                                                    

   The  Risk Factors  section discusses in detail the more important risks
associated with an investment in the Company, including risks associated with an
investment in a real estate investment trust such as the Company, risks         
associated with an investment in real estate such as the Properties, risks      
associated with the Mortgage Loans, risks associated with Secured Equipment     
Leases, and tax risks.  These risks include:                                    

o     Risks of reduced diversification in the Company's investments if the      
Company does not raise $165,000,000 from sales of Shares.           

o     Risks of reliance on CNL Fund Advisors, Inc. (the  Advisor ) and the Board
    of Directors, which together will have responsibility for the management
of the Company and its investments, subject to the ability of the   
stockholders to elect the Directors.                                

o     Risks relating to the fact that the services to be performed by the       
Advisor and its Affiliates for the Company in connection with the   
    offering, the selection and acquisition of the Properties, the making of
     Mortgage Loans, the administration of the Secured Equipment Lease program
and the general operation of the Company will result in conflicts of
interest.                                                           

o     Risks related to the fact that, because as of April 9, 1996, the Company  
owned only 48 Properties of the anticipated total of 140 to 160     
Properties, stockholders therefore will not have the opportunity to 
 evaluate all the Properties that the Company eventually will acquire.

o     Risks that stockholders who must sell their Shares will not be able to    
sell them quickly because it is not anticipated that there will be a
public market for the Shares in the near term, and there can be no  
assurance that the Listing will occur.                              

o     Market risks associated with investments in real estate, which means that 
the amount of cash the Company will receive from tenants, lessees or
borrowers cannot be predicted.                                      

o     Risks that the Company, prior to meeting certain conditions, may incur    
debt, including debt to make Distributions, but will not encumber   
Properties.                                                         

o     Risks of defaults by tenants, lessees or borrowers resulting in decreased 
income.                                                             

o     Risks relating to the fact that the vote of stockholders owning at least a
      majority but less than all of the Shares will bind all of the stockholders
as to matters such as the election of Directors and amendment of the
Company's governing documents.                                      

o     Risks that restrictions on ownership of more than 9.8% of the shares of   
     the Company's Common Stock (the  Common Stock ) by any single stockholder
      or certain related stockholders may have the effect of inhibiting a change
   in control of the Company even if such a change is in the interest of a
majority of the stockholders.                                       

o     Risks that the Company may not qualify or remain qualified as a REIT for  
     federal income tax purposes, which could result in subjecting the Company
  to federal income tax on its taxable income at regular corporate rates
   and, in turn, thereby reducing the amount of funds available for paying
Distributions to stockholders.                                      

ESTIMATED USE OF PROCEEDS                                                       

  The Company is using the proceeds of the sale of the Shares to acquire
Properties, to make Mortgage Loans, generally in connection with such           
acquisitions, and to pay expenses relating to the organization of the Company   
and the sale of the Shares.  Management of the Company and the Advisor have     
estimated an average purchase price of $800,000 to $900,000 per Property based  
on their past experience in acquiring similar properties and in light of current
market conditions, although prices of Properties may be lower or higher.  See   
Business   Property Acquisitions  for a description of the Properties the     
Company has acquired and the Mortgage Loan the Company has made as of April 9,  
1996.  Assuming CNL Securities Corp. (the  Managing Dealer ) exercises its      
option to increase the offering from 10,000,000 Shares ($100,000,000) to up to  
15,000,000 Shares ($150,000,000) and 15,000,000 Shares are sold, the Company    
will acquire approximately 140 to 160 Properties.  In addition, the Company has 
registered an offering of an additional 1,500,000 Shares ($15,000,000) available
only to stockholders who receive a copy of this Prospectus and who elect to     
participate in the Company's reinvestment plan (the  Reinvestment Plan ).  See  
Estimated Use of Proceeds  and  Business   General  for a more detailed         
description of the anticipated use of offering proceeds.  Secured Equipment     
Leases will be funded solely from the proceeds of the Loan and the number of    
Secured Equipment Leases will not depend on the amount raised in the offering.  

CONFLICTS OF INTEREST                                                           

  Certain officers and Directors of the Company who are also officers or
directors of the Advisor will experience conflicts of interest in their         
management of the Company.  These arise principally from their involvement in   
other activities that will conflict with those of the Company and include       
matters related to (i) allocation of properties and management time and services
between the Company and various partnerships and other entities, (ii) the timing
and terms of the sale of a Property, (iii) negotiation and funding of Mortgage  
Loans, (iv) administration of the Secured Equipment Lease program,              
(v) investments with Affiliates of the Advisor, (vi) compensation of the        
Advisor, (vii) the Company's relationship with the Managing Dealer, which is an 
Affiliate of the Company and the Advisor, and (viii) the fact that the Company's
securities and tax counsel also serves as securities and tax counsel for certain
Affiliates of the Company, and that neither the Company nor the stockholders    
will have separate counsel.                                                     

The Directors of the Company who are independent of the Advisor (the
Independent Directors) are responsible for monitoring the activities of the     
Advisor and must approve all of the Advisor's actions that involve a potential  
conflict other than certain such actions specifically permitted by the Articles 
of Incorporation.  The  Conflicts of Interest  section discusses in more detail 
the more significant of these potential conflicts of interest, as well as the   
procedures that have been established to resolve a number of these potential    
conflicts.                                                                      

MANAGEMENT                                                                      

    The Company has retained the Advisor, pursuant to an advisory agreement,
to handle the day-to-day operations of the Company, to select the Company's real
estate investments, and to administer its Secured Equipment Lease program.  The 
five members of the Board of Directors will oversee the management of the       
Company.  Three of the Directors of the Company are independent of the Advisor  
and have responsibility for reviewing its performance.  The Directors are       
elected to the Board of Directors annually by the stockholders.                 

 All of the officers and directors of the Advisor also are officers or
Directors of the Company.  The Advisor will have responsibility for             
(i) selecting the Properties that the Company will acquire, formulating and     
evaluating the terms of each proposed acquisition, and arranging for the        
acquisition of the Property by the Company, (ii) identifying potential lessees  
for the Properties and potential borrowers for the Mortgage Loans, and          
formulating, evaluating, and negotiating the terms of each lease of a Property  
and each Mortgage Loan, and (iii) locating and identifying potential lessees and
formulating, evaluating, and negotiating the terms of each Secured Equipment    
Lease.  All of the foregoing actions are subject to approval by the Board of    
Directors.  The Advisor also will have the authority, subject to approval by a  
majority of the Board of Directors, including a majority of the Independent     
Directors, to select Properties for Sale in keeping with the Company's          
investment objectives and based on an analysis of economic conditions both      
nationally and in the vicinity of the Property being considered for Sale.       

     The Company's Articles of Incorporation provide that, if Listing does not
occur within ten years from the commencement of this offering, the Company will 
commence orderly Sales of its assets and distribute the proceeds thereof.  In   
that case, the Company will engage only in activities related to its orderly    
liquidation unless the stockholders elect otherwise.                            

See  Management  and  The Advisor and the Advisory Agreement  for a 
description of the business background of the individuals responsible for the   
management of the Company and the Advisor, as well as for a description of the  
services that the Advisor will provide.                                         

MANAGEMENT COMPENSATION                                                         

      The Advisor, the Managing Dealer, and other Affiliates of the Advisor will
receive compensation for services they will perform for the Company and also    
will receive expense reimbursements from the Company for expenses they pay on   
behalf of the Company.  See  Management Compensation  for a description of      
compensation paid to the Advisor and Affiliates as of December 31, 1995.  The   
following paragraphs summarize the more significant items of compensation.      

   In connection with the formation of the Company and the offering of the
Shares, the Managing Dealer will receive Selling Commissions of 7.5% (a maximum 
of $11,250,000 if 15,000,000 Shares are sold), and a marketing support and due  
diligence expense reimbursement fee of 0.5% (a maximum of $750,000 if 15,000,000
Shares are sold), of the total amount raised from the sale of Shares, computed  
at $10.00 per Share sold ( Gross Proceeds ).  The Managing Dealer in turn may   
reallow Selling Commissions of up to 7% on Shares sold, and all or a portion of 
the 0.5% marketing support and due diligence expense reimbursement fee to       
certain Soliciting Dealers, who are not Affiliates of the Company.  In addition,
the Company will incur a Soliciting Dealer Servicing Fee in the amount of .20%  
of Invested Capital (as defined below) (a maximum of $300,000 if 15,000,000     
Shares are sold).  The Soliciting Dealer Servicing Fee will be payable on       
December 31 of each year, commencing on December 31 of the year following the   
year in which the offering terminates, and generally will be payable to the     
Managing Dealer, which in turn may reallow all or a portion of such fee to      
Soliciting Dealers whose clients held Shares on such date.  The Company also may
pay the Soliciting Dealer Servicing Fee directly to any Soliciting Dealer exempt
from registration as a broker-dealer and whose clients held Shares on such date.
In general, the stockholders' investment in the Company ( Invested Capital ) is 
the number of Shares they own, multiplied by $10.00 per Share, reduced by the   
portion of all prior Distributions received by stockholders from the Sale of one
or more Properties and by any amounts paid by the Company to repurchase Shares  
pursuant to the redemption plan.                                                

For identifying the Properties and structuring the terms of the     
acquisition and leases of the Properties, the Advisor will receive Acquisition  
Fees equal to 4.5% of Gross Proceeds (a maximum of $6,750,000 if 15,000,000     
Shares are sold) from the sale of Shares.                                       

In connection with the acquisition of Properties that have been     
constructed or renovated by Affiliates, subject in each case to the approval of 
a majority of the Board of Directors including a majority of the Independent    
Directors, the Company will incur Development/Construction Management Fees of   
generally 5% to 10% of the cost of constructing or renovating a Property,       
payable to Affiliates of the Company as Acquisition Fees.  Such fees will be    
included in the purchase price of Properties purchased from developers that are 
Affiliates of the Company.  See  Business - Site Selection and Acquisition of   
Properties.   Development/Construction Management Fees, which are based on the  
number of Properties purchased from developers that are Affiliates of the       
Company, the cost of construction or renovation of such Properties, and the     
percentage amount of each development/construction management fee, are not      
determinable at this time.                                                      

In connection with the acquisition of Properties from affiliated or 
unaffiliated developers, subject in each case to the approval of a majority of  
the Board of Directors including a majority of the Independent Directors, to    
whom Affiliates of the Company have provided construction financing, the Company
will incur Construction Financing Fees, payable to Affiliates of the Company as 
Acquisition Fees.  Such fees will be in an amount equal to generally 1% to 2% of
the total amount of each loan plus the difference between the Affiliate-lender's
cost of funds and the amount of interest charged to the developer, with such    
difference determined by applying an annual percentage rate of generally 1.5% to
3% throughout the duration of the loan to the outstanding amount of the loan.   
Such fees will be included in the purchase price of Properties purchased from   
developers that receive such loans.  See  Business - Site Selection and         
Acquisition of Properties.   Construction Financing Fees, which are based on the
number of Properties for which Affiliates of the Company provide construction   
financing, the amount and duration of such loans, and the amount of each        
construction financing fee, are not determinable at this time.                  

The total of all Acquisition Fees and Acquisition Expenses shall be 
reasonable and shall not exceed an amount equal to 6% of the Real Estate Asset  
Value of a Property, or in the case of a Mortgage Loan, 6% of the funds         
advanced, unless a majority of the Board of Directors, including a majority of  
the Independent Directors, not otherwise interested in the transaction approves 
fees in excess of these limits subject to a determination that the transaction  
is commercially competitive, fair and reasonable to the Company.                

  For managing the Properties, the Advisor will be entitled to receive a
monthly Asset Management Fee of one-twelfth of .60% of the Company's Real Estate
Asset Value (generally, the total amount invested in the Properties, exclusive  
of Acquisition Fees and Acquisition Expenses) as of the end of the preceding    
month.                                                                          

      For managing the Mortgage Loans, the Advisor will be entitled to receive a
monthly Mortgage Management Fee of one-twelfth of .60% of the total principal   
amount of the Mortgage Loans as of the end of the preceding month.              

For negotiating Secured Equipment Leases and supervising the Secured
Equipment Lease program, the Advisor will be entitled to receive from the       
Company a one-time Secured Equipment Lease Servicing Fee of 2% of the purchase  
price of the Equipment that is the subject of a Secured Equipment Lease.        

      Prior to Listing, the Advisor may receive a real estate disposition fee of
3% of the gross sales price of one or more Properties for providing substantial 
services in connection with the Sale, which will be deferred and subordinated   
until the stockholders have received Distributions equal to the sum of 100% of  
the stockholders' aggregate Invested Capital plus an aggregate, annual,         
cumulative, noncompounded 8% return on their Invested Capital, excluding        
Distributions attributable to proceeds of the Sale of a Property (the           
Stockholders' 8% Return ).  Upon Listing, if the Advisor has accrued but not  
been paid such real estate disposition fee, then for purposes of determining    
whether the subordination conditions have been satisfied, stockholders will be  
deemed to have received a Distribution in an amount equal to the product of the 
total number of Shares outstanding and the average closing prices of the Shares 
over a period, beginning 180 days after Listing, of 30 days during which the    
Shares are traded.  See  The Advisor and The Advisory Agreement   The Advisory  
Agreement.                                                                      

  A subordinated share of Net Sales Proceeds will be paid to the Advisor
upon the Sale of one or more Properties or Secured Equipment Leases in an amount
equal to 10% of Net Sales Proceeds.  This amount will be subordinated and paid  
only after the stockholders have received Distributions equal to the sum of 100%
of the stockholders' aggregate Invested Capital, plus the Stockholders' 8%      
Return.                                                                         

   Payment of certain fees is subject to conditions and restrictions or to
change under certain specified circumstances.  The Advisor and its Affiliates   
also may receive reimbursement for out-of-pocket expenses that they incur on    
behalf of the Company, subject to certain expense limitations, and a            
subordinated incentive fee if Listing occurs.                                   

SUMMARY OF REINVESTMENT PLAN                                                    

The Company has established the Reinvestment Plan pursuant to which 
stockholders may elect to have their cash Distributions from the Company        
automatically reinvested in Shares.  See  Summary of Reinvestment Plan,         
Federal Income Tax Considerations   Taxation of Stockholders,  and the form of
Reinvestment Plan accompanying this Prospectus as Exhibit A for more specific   
information about the Reinvestment Plan.  Expenses incurred in connection with  
the Reinvestment Plan, including Selling Commissions and marketing support and  
due diligence expense reimbursement fees, will be paid by the Company.  A person
who becomes a stockholder otherwise than by participating in this offering may  
purchase Shares through the Reinvestment Plan only after receipt of a separate  
prospectus relating solely to the Reinvestment Plan.                            

BUSINESS (PURCHASE AND SALE OF PROPERTIES AND OFFERING  OF MORTGAGE LOANS AND   
SECURED EQUIPMENT LEASES)                                                       

     PROPERTIES AND MORTGAGE LOANS.  The types of Properties which the Company
intends to purchase and lease to third parties, as well as a description of the 
Properties acquired by the Company as of April 9, 1996, appears in the section  
entitled  Business.   It is expected that the Company will invest in Properties 
of selected national and regional restaurant chains, primarily fast-food,       
family-style, and casual dining chains, the most rapidly growing segments of the
restaurant industry in recent years.  Management intends to structure the       
Company's investments to allow it to participate, to the maximum extent         
possible, in any sales growth in these industry segments, as reflected in the   
Properties that it owns.  The Properties, which typically are or will be        
freestanding and will be located across the United States, are or will be leased
on a  triple-net  basis to creditworthy operators of the Restaurant Chains to be
selected by the Advisor and approved by the Board of Directors.  The Properties 
may consist of both land and building, the land underlying the building with the
building owned by the tenant or a third party, or the building only with the    
land owned by a third party.  The Properties have been or will be purchased for 
cash and will not be encumbered by any liens.  If Listing occurs, however, the  
Board of Directors may elect to cause the Company to borrow funds in connection 
with the purchase of additional Properties or for other Company purposes and to 
encumber any or all of the Company's Properties in connection with any such     
borrowing.  The Board of Directors anticipates that, in the aggregate, borrowing
will not exceed 50% of Real Estate Asset Value, although the maximum amount of  
borrowing, in the absence of a satisfactory showing that a higher level of      
borrowing is appropriate (as determined by a majority of the Independent        
Directors), shall not exceed 300% of Net Assets (an amount which the Company    
anticipates will correspond to approximately 75% of Real Estate Asset Value).   
Management expects to acquire Properties in part with a view to diversification 
among Restaurant Chains and the geographic location of the Properties.  The     
Company estimates that it will acquire at least 140 to 160 Properties if the    
maximum of 15,000,000 Shares is sold, based on an estimated average purchase    
price of $800,000 to $900,000 per Property.                                     

   To a lesser extent the Company will offer Mortgage Loans to finance the
purchase of buildings by operators of Restaurant Chains.  In general, the       
Company intends to offer Mortgage Loans in circumstances in which the Company   
owns the land underlying the building to be financed and the borrower under the 
Mortgage Loan also enters into a long-term ground lease for the underlying land.
Management believes that this combined leasing and financing structure provides 
the benefit of allowing the Company to receive the return of its initial        
investment plus interest on each financed building, which is generally a        
depreciating asset, while retaining the ownership of the underlying land, which 
is generally an appreciating asset.  However, none of the prior programs        
organized by Affiliates of the Company has offered Mortgage Loans and the       
experience of the Advisor and Directors of the Company with mortgage financing  
is limited.  See  Risk Factors - Investment Risks - Risks Associated With       
Mortgage Loans.                                                                 

As of April 9, 1996, the Company owned 48 Properties (including 21  
Properties which consist of land and building, one Property through a joint     
venture arrangement which consists of land and building, three Properties which 
consist of a building only, and 23 Properties which consist of land only).  In  
addition, the Company had initial commitments to acquire 12 Properties          
(including one Property which is land and building, one Property which is       
building only, and 10 Properties which are land only).  The acquisition of each 
of these Properties is subject to the fulfillment of certain conditions.        
Although the Company believes that there is a reasonable probability that the   
Company will acquire these Properties, there can be no assurance that these     
conditions will be satisfied or that the Company will purchase one or more of   
these Properties.  The Company has undertaken to supplement this Prospectus     
during the offering period to describe the acquisition of Properties at such    
time as the Company believes that a reasonable probability exists that a        
Property will be acquired by the Company.  Based upon the experience of         
management of the Company and the Advisor and the proposed acquisition methods, 
a reasonable probability that the Company will acquire a Property normally will 
occur as of the date on which (i) a commitment letter is executed by a proposed 
lessee, (ii) a satisfactory credit underwriting for the proposed lessee has been
completed, and (iii) a satisfactory site inspection has been completed.  See    
Business   General.                                                             

  In connection with the acquisition of the 23 Properties which are land
only, the Company has made a single Mortgage Loan secured by the buildings and  
other improvements on such Properties.                                          

In connection with the initial commitments with the ten Properties  
consisting of land only, the Company anticipates providing mortgage financing to
the tenant which will be collateralized by the building improvements.  If the   
Mortgage Loan is executed, it is expected to be executed under substantially the
same terms described in  Business - Mortgage Loans.                             

  SECURED EQUIPMENT LEASES.  The Secured Equipment Leases will be funded
solely from the proceeds of the Loan.  The Company expects that the Secured     
Equipment Leases will be structured so that they will be treated as loans       
secured by personal property for federal income tax purposes.  The Company has  
neither identified any prospective operators of Restaurant Chains that will     
participate in such financing arrangements nor negotiated any specific terms of 
a Secured Equipment Lease.  See  Business   General.                            

The Company has established certain conflict resolution procedures  
relating to (i) transactions between the Company and the Advisor or its         
Affiliates, (ii) certain future offerings, and (iii) allocation of restaurant   
properties and Secured Equipment Leases among certain affiliated entities.  See 
Conflicts of Interest   Certain Conflict Resolution Procedures.                 

    For the first five to ten years after commencement of this offering, the
Company intends to reinvest in additional Properties and Mortgage Loans any     
proceeds of the Sale of a Property or Mortgage Loan that are not required to be 
distributed to stockholders in order to preserve the Company's status as a REIT 
for federal income tax purposes.  The proceeds from the Sale of Secured         
Equipment Leases will be used to fund additional Secured Equipment Leases, or to
reduce the Company's outstanding indebtedness on the Loan.  At or prior to the  
end of the ten-year period, the Company intends to provide stockholders of the  
Company with liquidity of their investment, either in whole or in part, through 
Listing (although there is no assurance of such liquidity), or by commencing    
orderly Sales of the Company's assets.  If Listing occurs, the Company intends  
to reinvest in additional Properties, Mortgage Loans, and Secured Equipment     
Leases any Net Sales Proceeds not required to be distributed to stockholders in 
order to preserve the Company's status as a REIT.  See  Business   General  and 
Business   Sale of Properties, Mortgage Loans, and Secured Equipment Leases.  

INVESTMENT OBJECTIVES AND POLICIES                                              

The Company's primary investment objectives are:                    

o     to preserve, protect, and enhance the Company's assets.       

 o     to make Distributions commencing in the initial year of Company
operations.                                             

     o     to obtain fixed income through the receipt of base rent, as well as
        to increase the Company's income (and Distributions) and provide
        protection against inflation through automatic increases in base
       rent and receipt of percentage rent, and to obtain fixed income
    through the receipt of payments on Secured Equipment Leases.

  o     to qualify and remain qualified as a REIT for federal income tax
purposes.                                               

o     to provide stockholders of the Company with liquidity of their
     investment within five to ten years after commencement of the
      offering, although liquidity cannot be assured thereby, either
           through (i) Listing or (ii) outside the ordinary course of business
      and consistent with its objective of qualifying as a REIT, the
 commencement of orderly Sales of the Company's assets and
distribution of the proceeds thereof.                   

The Company intends to meet these objectives by following certain   
investment policies discussed herein, as summarized on the preceding pages.  See
Business   General,   Business   Site Selection and Acquisition of Properties,  
Business   Description of Leases,  and  Investment Objectives and Policies  for 
a more complete description of the manner in which the structure of the         
Company's business will facilitate the Company's ability to meet its investment 
objectives.   There can be no assurance that these objectives will be met.  The 
Company's investment objectives are subject to review by the Independent        
Directors and may not be changed without the approval of stockholders owning a  
majority of the shares of outstanding Common Stock.                             

DESCRIPTION OF SHARES                                                           

    A stockholder's investment will be recorded on the books of the Company.
The Company will provide, upon the request of any stockholder wishing to        
transfer his or her Shares, a transfer form to be completed and executed by the 
stockholder and returned to the Company.  The Company will not issue share      
certificates.                                                                   

   After the termination of the offering, any stockholder may request that
the Company redeem for cash all or a significant portion of such stockholder's  
Shares.  The sole source of funds for any such requested redemption will be the 
net proceeds available from the sale of Shares pursuant to the Reinvestment     
Plan.  There can be no assurance that such net proceeds will be sufficient to   
permit the Company to redeem all such Shares presented for redemption.  See     
Redemption of Shares.                                                           

     An annual meeting of stockholders will be held each year for the election
of the Directors.  Other business matters may be presented at the annual meeting
or at special stockholder meetings.  Each Share is entitled to one vote on each 
matter to be voted on by stockholders, including the election of the Directors. 
Stockholders who do not vote with the majority of Shares entitled to vote on    
questions presented nonetheless will be bound by the majority vote.             

 Stockholder approval is required under Maryland law and the Company's
Articles of Incorporation and Bylaws for certain types of transactions.         
Generally, the Articles of Incorporation and Bylaws may be amended upon a       
majority vote of stockholders.  Stockholders holding a majority of the Shares   
must approve a merger or a sale or other disposition of substantially all of the
Company's assets other than in the ordinary course of business.  Stockholders   
objecting to the terms of a merger, sale, or other disposition of substantially 
all of the Company's assets have the right to petition a court for the appraisal
and payment of the fair value of their Shares in certain instances.   The       
affirmative vote of a majority of the Shares outstanding and entitled to vote is
required to approve the voluntary dissolution of the Company.                   

  In order to facilitate compliance with certain restrictions imposed on
REITs by the Internal Revenue Code of 1986, as amended (the  Code ), the        
Articles of Incorporation generally restrict direct or indirect ownership       
(applying certain attribution rules) of more than 9.8% of the outstanding shares
of Common Stock by one Person, as defined in the Articles of Incorporation.  See
Summary of the Articles of Incorporation and Bylaws   Restriction on          
Ownership.                                                                      

      For a more complete description of the Shares and the capital structure of
the Company, please refer to the  Summary of the Articles of Incorporation and  
Bylaws   Description of Capital Stock  section of the Prospectus.               

DISTRIBUTION POLICY                                                             

Consistent with the Company's objective of qualifying as a REIT, the
Company expects to calculate and declare Distributions monthly during the       
offering period, and quarterly thereafter, and make Distributions quarterly.    
Distributions were expected to commence not later than the close of the first   
full calendar quarter after the first release of funds from escrow to the       
Company, and in fact the Company declared Distributions in June 1995, and paid  
such Distributions in July 1995.  For the year ended December 31, 1995, the     
Company declared and paid Distributions totalling $638,618.  The Board of       
Directors, in its discretion, will determine the amount of the Distributions    
made by the Company, which amount will depend primarily on net cash from        
operations.  The Company intends to increase Distributions in accordance with   
increases in net cash from operations.  Consistent with the Company's objective 
of qualifying as a REIT, the Company expects to distribute at least 95% of its  
real estate investment trust taxable income, although the Board of Directors, in
its discretion, may increase that percentage as it deems appropriate.  If the   
cash available to the Company is insufficient to make Distributions, the Company
may obtain the needed cash by borrowing funds, issuing new securities, or       
selling assets.  These methods of obtaining cash could affect future            
Distributions by increasing operating costs or reducing income.  In such an     
event, it is possible that the Company could pay Distributions in excess of its 
earnings and profits and, accordingly, that such Distributions could constitute 
a return of capital for federal income tax purposes, although such Distributions
would not reduce stockholders' aggregate Invested Capital.  For the year ended  
December 31, 1995, 59.82% of the Distributions declared and paid were           
characterized as ordinary income and 40.18% as return of capital for federal    
income tax basis.  Due to the fact that the Company had not acquired all of its 
Properties and was still in its offering period as of December 31, 1995, the    
characterization of Distributions for federal income tax purposes is not        
considered by management to be necessarily representative of the                
characterization of Distributions in future years.                              

PRIOR PERFORMANCE OF AFFILIATES                                                 

     The  Prior Performance Information  section of this Prospectus contains a
narrative discussion of the public and private real estate limited partnerships 
sponsored by Affiliates of the Company and of the Advisor during the past ten   
years, including 17 public limited partnerships formed to invest in restaurants 
leased on a  triple-net  basis to operators of national and regional fast-food  
and family-style restaurant chains.  As of December 31, 1995, these             
partnerships, which purchase properties similar to those to be acquired by the  
Company, had purchased 628 fast-food and family-style restaurant properties.    
Based on an analysis of the operating results of the 79 real estate limited     
partnerships in which principals of the Company have served, individually or    
with others, as general partners, the Company believes that each of such        
partnerships has met, or currently is in the process of meeting, its principal  
investment objectives.  Certain statistical data relating to the public limited 
partnerships with investment objectives similar to those of the Company are     
contained in Exhibit C Prior Performance Tables.                                

TAX STATUS OF THE COMPANY                                                       

  The Company has made the election under Section 856(c) of the Internal
Revenue Code of 1986, as amended (the  Code ), to be taxed as a REIT under the  
Code beginning with its taxable year ending December 31, 1995.  As a REIT for   
federal income tax purposes, the Company generally will not be subject to       
federal income tax on income that it distributes to its stockholders.  Under the
Code, REITs are subject to numerous organizational and operational requirements,
including a requirement that they distribute at least 95% of their taxable      
income, as figured on an annual basis.  If the Company fails to qualify for     
taxation as a REIT in any taxable year, it will be subject to federal income tax
(including any applicable alternative minimum tax) on its taxable income at     
regular corporate rates and will not be permitted to qualify for treatment as a 
REIT for federal income tax purposes for four years following the year during   
which qualification is lost.  See  Risk Factors   Tax Risks  and  Federal Income
Tax Considerations.   Even if the Company qualifies as a REIT for federal income
tax purposes, it may be subject to certain federal, state, and local taxes on   
its income and property and to federal income and excise taxes on its           
undistributed income.  See  Federal Income Tax Considerations.                  

THE OFFERING                                                                    

  A maximum of 10,000,000 Shares ($100,000,000) in the Company are being
offered at a price of $10.00 per Share.  If the Managing Dealer exercises its   
option (in the event the offering is oversubscribed) to sell an additional      
5,000,000 Shares, a maximum of 15,000,000 ($150,000,000) Shares in the Company  
will be offered at a price of $10.00 per Share.  The Company also has registered
an offering of an additional 1,500,000 Shares ($15,000,000) that are available  
only to stockholders who receive a copy of this Prospectus and elect to         
participate in the Reinvestment Plan.  Any participation in such plan subsequent
to this offering must be made pursuant to solicitation under a separate         
prospectus.  See  Summary of Reinvestment Plan.                                 

 The Shares are being offered by the Managing Dealer and other broker-
dealers that are members of the National Association of Securities Dealers, Inc.
or exempt from broker-dealer registration (the  Soliciting Dealers ) on a  best 
efforts  basis, which means that no one is guaranteeing that any minimum number 
of Shares will be sold.  Both the Company and the Advisor are Affiliates of the 
Managing Dealer.  See  The Offering   Plan of Distribution.                     

    All subscription funds for Shares of the Company will be deposited in an
interest-bearing escrow account with SouthTrust Estate & Trust Company, Inc.    
See  The Offering  for a description of the current status of the offering.     

 A minimum investment of 250 Shares ($2,500) is required.  IRAs, Keogh
plans, and pension plans must make a minimum investment of at least 100 Shares  
($1,000), except for Iowa tax-exempt stockholders who must make a minimum       
investment of 250 Shares ($2,500).  For Minnesota stockholders only, IRAs and   
qualified plans must make a minimum investment of 200 Shares ($2,000).  In      
addition, Nebraska, New York, and North Carolina stockholders must make a       
minimum investment of 500 Shares ($5,000).  Following an initial subscription   
for at least the required minimum investment, any stockholder may make          
additional purchases in increments of one Share.  Maine stockholders, however,  
may not purchase additional Shares in amounts less than the applicable minimum  
investment except with respect to Shares purchased pursuant to the Reinvestment 
Plan.  See  The Offering   General,   The Offering   Subscription Procedures,   
and  Summary of Reinvestment Plan.                                              

DEFINITIONS                                                                     

 This Prospectus includes simplified terms and definitions to make the
Prospectus easier to understand.  These simplified terms and definitions do not 
include all of the details of the terms, however, and stockholders therefore    
should review the  Definitions  section for a more complete understanding.      

RISK FACTORS

The purchase of Shares involves significant risks and therefore is  
suitable only for persons who understand the possible consequences of an        
investment in the Company and who are able to bear the risk of loss of their    
investment.  Prospective stockholders should consider the following risks in    
addition to other information describing an investment in the Shares set forth  
elsewhere in this Prospectus.                                                   

INVESTMENT RISKS                                                                

 POSSIBLE LACK OF DIVERSIFICATION.  There can be no assurance that the
Company will sell the maximum number of Shares.  The potential profitability of 
the Company and its ability to diversify its investments, both geographically   
and by type of restaurant Properties purchased, will be limited by the amount of
funds at its disposal.                                                          

      RISKS OF RELIANCE ON MANAGEMENT.  Stockholders will be relying entirely on
the management ability of the Advisor and on the oversight of the Board of      
Directors.  Stockholders have no right or power to take part in the management  
of the Company, except through the exercise of their stockholder voting rights. 
Thus, no prospective stockholder should purchase any of the Shares offered      
hereby unless the prospective stockholder is willing to entrust all aspects of  
the management of the Company to the Advisor and the Board of Directors.  None  
of the prior programs organized by Affiliates of the Company has offered        
Mortgage Loans or Secured Equipment Leases.  See  Management  for a discussion  
of the experience of the directors of the Advisor and the Directors of the      
Company in real estate investments and Equipment financing.  Also see  Conflicts
of Interests  for a discussion of the potential for realization by the Advisor  
and its Affiliates of substantial commissions, fees, compensation, and other    
income and for a discussion of various other conflicts of interest.             

    RISKS OF RELIANCE ON ADVISOR.  The Advisor, with approval from the Board
of Directors, will be responsible for the daily management of the Company,      
including all acquisitions, dispositions, and financings.  The Advisor may be   
terminated by the Board of Directors, with or without cause, but only subject to
payment and release from all guarantees and other obligations incurred in       
connection with its role as Advisor.  See  Management Compensation.             

  RISK ASSOCIATED WITH LEVERAGE.  Other than the Loan or to preserve its
status as a REIT, the Company does not intend to borrow money and until Listing 
occurs, the Company will not encumber Properties in connection with any         
borrowing.  At all times, the maximum amount the Company may borrow is 300% of  
the Company's Net Assets, although the Board of Directors anticipates that the  
aggregate amount of any borrowing by the Company will not exceed 50% of Real    
Estate Asset Value.  The use of borrowing may present an element of risk in the 
event that the cash flow from lease payments on its Properties and payments on  
Secured Equipment Leases are insufficient to meet its debt obligations.  In     
addition, lenders to the Company may seek to impose restrictions on future      
borrowings, Distributions and operating policies of the Company.                

     CONFLICTS OF INTEREST.  As discussed in detail in  Conflicts of Interest,
the Company will be subject to conflicts of interest arising out of its         
relationship to the Advisor and its Affiliates.  Such conflicts include matters 
related to (i) allocation of Properties and management time and services between
the Company and various partnerships and other entities as to each of which the 
officers and directors of the Advisor and certain Directors and officers of the 
Company have management responsibilities, (ii) the timing and terms of the sale 
of a Property, (iii) negotiation and funding of Mortgage Loans, (iv) negotiation
and funding of Secured Equipment Leases, (v) investments with Affiliates of the 
Advisor, (vi) compensation to the Advisor, (vii) the Company's relationship with
the Managing Dealer (which is an Affiliate of the Company and the Advisor), and 
(viii) the fact that the Company's securities and tax counsel also serves as    
securities and tax counsel for certain Affiliates of the Company and that       
neither the Company nor the stockholders will have separate counsel.  See       
Conflicts of Interest.                                                          

    LACK OF LIQUIDITY OF SHARES.  Stockholders may not be able to sell their
Shares promptly at a desired price; therefore, the Shares should be considered  
as a long-term investment only.  Currently there is no public market for the    
Shares.  The Board of Directors, with or without the consent of the             
stockholders, may apply for Listing if the Board of Directors (including a      
majority of Independent Directors) determines Listing to be in the best         
interests of the stockholders.  There can be no assurance, however, that the    
Company will apply for Listing, that any such application will be made before   
the passage of a significant period of time, that any application will be       
accepted or, even if accepted, that a public trading market will develop.  In   
any event, the Articles of Incorporation provide that the Company will not apply
for Listing before the completion or termination of the offering.  In the event 
Listing occurs, Shares may be sold only through the national securities exchange
or the over-the-counter market on which the Shares are listed.                  

RISKS ASSOCIATED WITH MANAGEMENT OF JOINT VENTURES.  The Independent
Directors of the Company must approve all Joint Venture or general partnership  
arrangements to which the Company is a party.  Subject to such approval, the    
Company may enter into a Joint Venture with an unaffiliated party to purchase a 
Property, and the Joint Venture or general partnership agreement relating to    
that Joint Venture or partnership may provide that the Company will share       
management control of the Joint Venture with the unaffiliated party.  In the    
event the Joint Venture or general partnership agreement provides that the      
Company will have sole management control of the Joint Venture, such agreement  
may be ineffective as to a third party who has no notice of the agreement, and  
the Company therefore may be unable to control fully the activities of such     
Joint Venture.  In the event that the Company enters into a Joint Venture with  
another program sponsored by an Affiliate, it is anticipated that the Company   
will not have sole management control of the Joint Venture.                     

 LACK OF CONTROL OF PROPERTY MANAGEMENT.  The Company uses  triple-net
leases and, therefore, day-to-day management of the Properties will be the      
responsibility of the tenants of the Properties.  In general, the Company       
intends to enter into leasing agreements only with tenants having substantial   
prior experience in the restaurant industry, but there can be no assurance that 
the Company will be able to make such arrangements because, as of April 9, 1996,
the Company had purchased only 48 Properties.                                   

RISKS ASSOCIATED WITH MORTGAGE LOANS.  None of the prior programs   
organized by Affiliates of the Company has offered Mortgage Loans and the       
experience of the Advisor and Directors of the Company with mortgage financing  
is limited.  In the event that a borrower defaults on a Mortgage Loan, the      
Company may not be able to sell the real property which it holds as security for
the Mortgage Loan at a price that would enable the Company to recover the       
balance of the Mortgage Loan.  The Mortgage Loans may also be subject to        
regulation by federal, state and local authorities and subject to various laws  
and judicial and administrative decisions.  The Company may determine not to    
make Mortgage Loans in any jurisdiction in which it believes the Company has not
complied in all material respects with applicable requirements.                 

RISKS ASSOCIATED WITH SECURED EQUIPMENT LEASES.  None of the prior  
programs organized by Affiliates of the Company has offered Secured Equipment   
Leases and the experience of the Advisor and Directors of the Company with      
Equipment leasing is limited.  In the event that a lessee defaults on a Secured 
Equipment Lease, the Company may not be able to sell the subject Equipment at a 
price that would enable the Company to recover its costs associated with such   
Equipment.  The Secured Equipment Lease program may also be subject to          
regulation by federal, state and local authorities and subject to various laws  
and judicial and administrative decisions.  The Company may determine not to    
operate the Secured Equipment Lease program in any jurisdiction in which it     
believes the Company has not complied in all material respects with applicable  
requirements.  In addition, there are certain federal income tax risks          
associated with the Secured Equipment Lease program.  See     Tax Risks.        

BINDING NATURE OF MAJORITY STOCKHOLDER VOTE.  Stockholders may take 
certain actions, including approving most amendments to the Articles of         
Incorporation and Bylaws, by a vote of a majority of the Shares outstanding and 
entitled to vote.  Certain provisions designed to preserve the Company's status 
as a REIT cannot be amended without a  supermajority  vote of two-thirds of the 
Shares entitled to vote.  All actions taken, if approved by the holders of the  
requisite number of Shares, would be binding on all stockholders.  Certain of   
these provisions may discourage or make it more difficult for another party to  
acquire control of the Company or to effect a change in the operation of the    
Company.  The Board of Directors has the power to cause the issuance of         
additional Shares without obtaining stockholder approval.                       

    If Listing occurs, the business of the Company may continue indefinitely
without any specific time limitation by which the Company must distribute Net   
Sales Proceeds to the stockholders.  In that case, the stockholders would be    
dependent upon the sale of their Shares for the return of their investment in   
the Company.  There can be no assurance that the price a stockholder would      
receive in a sale on an exchange or in the over-the-counter market will be      
representative of the value of the assets owned by the Company or that it will  
equal or exceed the amount a stockholder paid for the Shares.                   

Under certain circumstances, the Company may prevent the ownership, 
transfer, and/or accumulation of Shares in order to protect the status of the   
Company as a REIT or, as otherwise deemed by the Board of Directors, to be in   
the best interests of the stockholders.  See  Summary of the Articles of        
Incorporation and Bylaws   Restriction of Ownership.                            

RESTRICTIONS ON TRANSFER RELATING TO REIT STATUS.  The Articles of  
Incorporation generally restrict direct or indirect ownership (applying certain 
attribution rules) of more than 9.8% of the outstanding Common Stock or 9.8% of 
any series of outstanding Preferred Stock by one Person (as defined in the      
Articles of Incorporation).  See  Summary of the Articles of Incorporation and  
Bylaws   Restriction of Ownership.                                              

LIMITED LIABILITY OF OFFICERS AND DIRECTORS.  The Articles of       
Incorporation and Bylaws provide that an officer or Director's liability to the 
Company, its stockholders, or third parties for monetary damages may be limited.
Generally, the Company is obligated under the Articles of Incorporation and the 
Bylaws to indemnify its officers and Directors against certain liabilities      
incurred in connection with their services in such capacities.  The Company has 
executed indemnification agreements with each officer and Director which will   
indemnify the officer or Director for any such liabilities that he or she       
incurs.  Such indemnification agreements could limit the legal remedies         
available to the Company and the stockholders against the Directors and Officers
of the Company.  See  Summary of the Articles of Incorporation and Bylaws       
Limitation of Director and Officer Liability.                                   

  RISKS FOR RETIREMENT PLAN STOCKHOLDERS.  The Company believes that the
assets of the Company will not be deemed, under ERISA, to be  plan assets  of   
any Plan that invests in the Shares, although it has not requested an opinion of
Counsel to that effect.  If the assets of the Company were deemed to be  plan   
assets  under ERISA (i) it is not clear that the exemptions from the  prohibited
transaction  rules under ERISA would be available for the Company's             
transactions, and (ii) the prudence standards of ERISA would apply to           
investments made by the Company (and might not be met).  ERISA makes plan       
fiduciaries personally responsible for any losses resulting to the plan from any
breach of fiduciary duty and the Code imposes nondeductible excise taxes on     
prohibited transactions.                                                        

     RISK OF INSUFFICIENT WORKING CAPITAL.  There can be no assurance that the
Company will have sufficient working capital.  As of December 31, 1995, the     
Company had stockholders' equity of $31,980,648.                                

      USE OF LEVERAGE TO MAKE DISTRIBUTIONS.  The Company may incur indebtedness
if necessary to satisfy the requirement that the Company distribute at least 95%
of its real estate investment trust taxable income or otherwise, as is necessary
or advisable to assure that the Company maintains its qualification as a REIT   
for federal income tax purposes.  In such an event, it is possible that the     
Company could make Distributions in excess of its earnings and profits and,     
accordingly, that such Distributions could constitute a return of capital for   
federal income tax purposes, although such Distributions would not reduce       
stockholders' aggregate Invested Capital.                                       

REAL ESTATE AND FINANCING RISKS                                                 

RISKS RELATED TO AN UNSPECIFIED PROPERTY OFFERING.  The Company has 
established certain criteria for evaluating Restaurant Chains, particular       
Properties, and the operators of the Properties proposed for investment by the  
Company.  See  Business   Standards for Investment  and  Business   General  for
a description of these criteria and the types of Properties in which the Company
intends to invest.  Because the Company, as of April 9, 1996, had acquired only 
48 Properties (see  Business - Property Acquisitions  for a description),       
prospective investors have no information to assist them in evaluating the      
merits of the additional 92 to 112 Properties expected  to be purchased or      
developed by the Company.  There is no limit on the number of restaurant        
Properties of a particular Restaurant Chain which the Company may acquire,      
although the Board of Directors currently does not anticipate that the Company  
will invest more than 25% of its Gross Proceeds in Properties of any one        
Restaurant Chain.                                                               

      No assurance can be given that the Company will be successful in obtaining
suitable investments on financially attractive terms or that, if investments are
made, the objectives of the Company will be achieved.  There also can be no     
assurance that all of the Properties will operate profitably or that defaults   
will not occur.  See  Management  and  Prior Performance Information,  however, 
for a description of the prior real estate experience of the Affiliates of the  
Company and the Advisor.                                                        

     The Advisor or its Affiliates from time to time expect to acquire land or
restaurant properties on a temporary basis with the intention of subsequently   
transferring the properties to one or more of the CNL Group, Inc. ( CNL )       
programs, including the Company, although the Company has adopted guidelines to 
minimize such conflicts.  This practice could represent a risk to the Company   
and result in increased potential conflicts of interest among the Company, the  
Advisor, its Affiliates and prior or future programs formed by Affiliates of the
Advisor.  See  Conflicts of Interest   Acquisition of Properties.               

POSSIBLE DELAYS IN INVESTMENT.  To the extent consistent with the   
Company's objective of qualifying as a REIT, the offering proceeds may remain   
uninvested for up to the later of two years from the initial date of this       
Prospectus or one year after termination of the offering, although it is        
expected that substantially all net offering proceeds will be invested prior to 
the end of such period.  See  Prior Performance Information  for a summary      
description of the investment experience of Affiliates and the Advisor in prior 
CNL programs, which is not necessarily indicative of the rate at which the      
proceeds of this offering will be invested.                                     

      An extended offering period, the inability of the Advisor to find suitable
Properties, or the fact that a program formed by Affiliates of the Advisor      
subsequent to the commencement of this offering currently is in the process of  
acquiring fast-food and family-style restaurant properties to substantially     
complete its acquisition program prior to the time that the Company has funds   
available to invest in Properties may result in delays in investment of Company 
funds in Properties and in the receipt of a return from real property           
investments.                                                                    

Revenues received by the Company pending investment in Properties or
making Mortgage Loans will be limited to the rates of return available on short-
term, highly liquid investments with appropriate safety of principal.  These    
rates of return, which affect the amount of cash available to make Distributions
to the stockholders, are expected to be lower than the Company would receive    
under its Property leases or Mortgage Loans.  Further, to the extent consistent 
with the Company's objective of qualifying as a REIT, any funds of the Company  
required to be invested in Properties and not so invested or reserved for       
Company purposes within the later of two years from the initial date of this    
Prospectus, or one year after the termination of the offering, will be          
distributed pro rata to the then stockholders of the Company in accordance with 
the Articles of Incorporation.                                                  

     RISKS OF ACQUIRING PROPERTIES UNDER CONSTRUCTION.  The Company intends to
acquire sites on which a particular restaurant to be owned by the Company is to 
be built as well as existing restaurants (including restaurants which require   
renovation).  To the extent that the Company acquires property on which         
improvements are to be constructed or completed or renovations are to be made,  
the Company may be subject to certain risks in connection with the developer's  
ability to control construction costs, and the timing of completion of          
construction, or to build in conformity with plans, specifications, and         
timetables.  The Company's agreements with the developer will provide certain   
safeguards designed to minimize these risks.  Further, in the event of a default
by a developer, the Company generally will have the right to require the tenant 
to repurchase the Property that is under development at a pre-established price 
designed to reimburse the Company for all costs incurred by the Company in      
connection with the acquisition and development of the Property.  There can be  
no assurance, however, that under such circumstances, the tenant will have      
sufficient funds to fulfill its obligations.  See  Business   Site Selection and
Acquisition Properties.                                                         

   RISKS OF JOINT INVESTMENT IN PROPERTIES.  In the event that the Company
enters into a Joint Venture with another program formed by Affiliates of the    
Advisor, there will be a potential risk of impasse in certain joint venture     
decisions since the approval of the Company and of each co-venturer is required 
for certain decisions.  In any Joint Venture with an affiliated program,        
however, the Company will have the right to buy the other co-venturer's interest
or to sell its own interest on specified terms and conditions in the event of an
impasse regarding a Sale.  Under such circumstances, it is possible that neither
party will have the funds necessary to consummate the transaction.  See         
Business   Joint Venture Arrangements.   In addition, the Company may         
experience difficulty in locating a third party purchaser for its Joint Venture 
interest and in obtaining a favorable sale price for such Joint Venture         
interest.                                                                       

     Investments in Joint Ventures may involve the risk that the Company's co-
venturer may have economic or business interests or goals which, at a particular
time, are inconsistent with the interests or goals of the Company, that such co-
venturer may be in a position to take action contrary to the Company's          
instructions, requests, policies or objectives, or that such co-venturer may    
experience financial difficulties.  Among other things, actions by a co-venturer
might subject property owned by the Joint Venture to liabilities in excess of   
those contemplated by the terms of the joint venture agreement or to other      
adverse consequences.                                                           

   RISKS RELATING TO THE ABILITY OF THE COMPANY TO LIQUIDATE.  The Company
intends, to the extent consistent with the its objective of qualifying as a     
REIT, to reinvest Net Sales Proceeds from the Sale of Properties, Mortgage      
Loans, and Secured Equipment Leases in additional Properties, Mortgage Loans,   
and Secured Equipment Leases for the first five to ten years after commencement 
of the offering.  If Listing occurs, the proceeds from Sales may be reinvested  
in other Properties, Mortgage Loans, or Secured Equipment Leases for an         
indefinite period of time.  Unless Listing occurs within ten years after        
commencement of the offering, the Company will undertake, to the extent         
consistent with the Company's objective of qualifying as a REIT, the orderly    
Sale of the Company's assets, the distribution of the Net Sales Proceeds of such
Sales to stockholders, and will engage only in activities related to its orderly
liquidation unless the stockholders elect otherwise.  Neither the Advisor nor   
the Board of Directors may be able to control the timing of Sales due to market 
conditions, and there can be no assurance that the Company will be able to sell 
its assets so as to return stockholders' aggregate Invested Capital, to generate
a profit for the stockholders, or to fully satisfy its obligations under the    
Loan.  Invested Capital, in the aggregate, will be returned to stockholders upon
disposition of the Properties only if the Properties are sold 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.  See  Federal Income Tax Considerations.   In the event    
that a purchase money obligation is taken in partial payment of the sales price 
of a Property, the proceeds of the Sale will be realized over a period of years.
Further, entering into Mortgage Loans with terms of 15 to 20 years and Secured  
Equipment Leases with terms of five to seven years may cause any intended       
liquidation of the Company to be delayed beyond the time of disposition of the  
Properties and until such time as the Mortgage Loans and Secured Equipment      
Leases expire or are sold.                                                      

      RISKS RELATING TO TENANT PURCHASE RIGHTS.  Certain tenants are expected to
have the right to purchase the Property from the Company, commencing a specified
number of years after the date of the lease, which may lessen the ability of the
Advisor and the Board of Directors to freely control the Sale of the Property.  
The leases also generally provide the tenant with a right of first refusal on   
any proposed sale provisions.  See  Business   Description of Leases   Right of 
Tenant to Purchase.   A tenant will have no obligation to purchase the          
restaurant it leases.                                                           

    RISKS OF REAL PROPERTY INVESTMENTS.  The value of leased Properties such
as those to be acquired by the Company, the ability of the tenants to pay rent  
on a timely basis, and the amount of the rent, may be adversely affected by     
certain changes in general or local economic or market conditions, increased    
costs of energy or food products, increased costs and shortages of labor,       
competitive factors, fuel shortages, quality of restaurant management, the      
ability of a Restaurant Chain to fulfill any obligations to operators of its    
restaurants, limited alternative uses for the building, changing consumer       
habits, condemnation or uninsured losses, changing demographics, changing       
traffic patterns, inability to remodel outmoded restaurants as required by the  
franchise or lease agreement, voluntary termination by a tenant of its          
obligations under a lease, and other factors.  Neither the Company nor the Board
of Directors can control these factors.                                         

    Each Property will have a single tenant, and tenants may lease more than
one Property.  Events such as the default or financial failure of a tenant      
therefore could cause one or more Properties to become vacant under certain     
circumstances.  Vacancies would reduce the cash receipts of the Company and, at 
least until the Company is able to re-lease any such Properties, could decrease 
their ultimate resale value.  The value of the Company's Properties will depend 
principally upon the value of the leases of the Properties.  Minor defaults by a
tenant may continue for some time before the Advisor or Board of Directors      
determines that it is in the interest of the Company to evict that tenant.      

      If a Property becomes vacant, the Company may be unable either to re-lease
the Property for the rent due under the prior lease or to re-lease the Property 
without incurring additional expenditures relating to the Property.  The Company
could experience delays in enforcing its rights against, and collecting rents   
(and, under certain circumstances, real estate taxes and insurance costs) due   
from, a defaulting tenant.                                                      

The Company will not be a party to any franchise agreement between a
Restaurant Chain and a tenant, and such agreement could therefore be modified or
canceled without notice to, or the prior consent of, the Company.  In that      
event, the tenant could be required to cease its operations at a Property,      
although the tenant's obligation to pay rent to the Company would continue.     
Before operations at the Property could resume, however, the Company would be   
required to locate a new tenant acceptable to a Restaurant Chain.               

   The inability of tenants to make lease payments or of borrowers to make
Mortgage Loan payments as a result of any of these factors could result in a    
decrease in the amount of cash available to make Distributions to the           
stockholders.                                                                   

      If the Company, as lessor, incurs any liability which is not fully covered
by insurance, the Company would be liable for such amounts, and returns to the  
stockholders could be reduced.  See  Business   Description of Leases           
Insurance, Taxes, Maintenance, and Repairs  for a description of the types of   
insurance that the leases of the Properties will require the tenant to obtain.  

    RISKS OF ADVERSE TRENDS IN RESTAURANT INDUSTRY.  The Properties in which
the Company intends to invest are expected to be operated by Restaurant Chains  
within the fast-food, family-style, or casual dining segments of the restaurant 
industry, and the Company does not intend to invest in other segments of the    
restaurant industry.  The success of the future operations of fast-food, family-
style, and casual dining segments will depend largely on their ability to adapt 
to dominant trends in the restaurant industry, including greater competitive    
pressures, increased consolidation of the leading fast-food chains, industry    
overbuilding, dependence on consumer spending and dining patterns and changing  
demographics, the introduction of new concepts and menu items, availability of  
labor, levels of food prices, and general economic conditions.  See  Business   
General  for a description of the size and nature of the restaurant industry and
current trends in the industry.  The success of a particular Restaurant Chain   
concept, the Restaurant Chain's ability to fulfill any obligations to operators 
of its restaurants, and trends in the fast-food, family-style, and casual dining
segments of the restaurant industry will affect the income that the Company     
derives from restaurants which are part of such Restaurant Chain.               

  RISKS RESULTING FROM COMPETITION.  The Company will compete with other
entities, including Affiliates, for the acquisition of restaurant sites and     
completed restaurants.  See  Conflicts of Interest   Prior and Future Programs. 
In addition, the restaurant business is highly competitive, and it is           
anticipated that any restaurant Property acquired by the Company will compete   
with other restaurants in the vicinity.  The extent to which the Company will be
entitled to receive rent, in the form of percentage rent, in excess of the base 
rent (including automatic increases in the base rent) for the Properties will   
depend in part on the ability of the tenants to compete successfully with other 
restaurants in the vicinity.  In addition, the Company will compete with other  
financing sources for suitable tenants and properties.                          

POSSIBLE ENVIRONMENTAL LIABILITIES.  Under various federal and state
environmental laws and regulations, a current or previous owner or operator of  
real estate may be required to investigate and clean up certain hazardous or    
toxic substances, asbestos-containing materials, or petroleum product releases  
at the property, and may be held liable to a governmental entity or to third    
parties for property damage and for investigation and cleanup costs incurred by 
such parties in connection with the contamination.  In addition, some           
environmental laws create a lien on the contaminated site in favor of the       
government for damages and costs it incurs in connection with the contamination.
The presence of contamination or the failure to remediate contaminations may    
adversely affect the owner's ability to sell or lease real estate or to borrow  
using the real estate as collateral.  The owner or operator of a site may be    
liable under common law to third parties for damages and injuries resulting from
environmental contamination emanating from the site.                            

All of the Properties will be acquired by the Company subject to    
satisfactory Phase I environmental assessments or satisfactory Phase II         
environmental assessments.  A Phase I or Phase II environmental assessment may  
be determined by the Board of Directors or the Advisor to be satisfactory if a  
problem exists and has not been resolved at the time the Property is acquired   
provided that the seller has agreed in writing to indemnify the Company.  There 
can be no assurance, however, that any seller will be able to pay under an      
indemnity obtained by the Company.  Further, no assurances can be given that all
environmental liabilities have been identified or that no prior owner, operator 
or current occupant has created an environmental condition not known to the     
Company.  Moreover, no assurances can be given that (i) future laws, ordinances 
or regulations will not impose any material environmental liability or (ii) the 
current environmental condition of the Properties will not be affected by       
tenants and occupants of the Properties, by the condition of land or operations 
in the vicinity of the Properties (such as the presence of underground storage  
tanks), or by third parties unrelated to the Company.                           

    RISKS RELATING TO UNSPECIFIED SECURED EQUIPMENT LEASES.  The Company, as
of the date of this Prospectus, has not entered into any arrangements that      
create a reasonable probability that the Company will extend a Secured Equipment
Lease to a particular operator, and therefore prospective stockholders have no  
information to assist them in evaluating the merits of the Secured Equipment    
Lease program or of any Secured Equipment Lease.  No assurance can be given that
the Company will be successful in identifying suitable operators or negotiating 
Secured Equipment Leases on financially attractive terms or that lessees will   
fulfill their obligations under Secured Equipment Leases.                       

TAX RISKS                                                                       

      EFFECT OF FAILURE TO QUALIFY AS A REIT.  The Company intends to operate so
as to qualify and remain qualified as a REIT for federal income tax purposes,   
commencing with its taxable year ending December 31, 1995.  A qualified REIT    
generally is not taxed at the corporate level on income it currently distributes
to its stockholders, so long as it distributes at least 95% of its real estate  
investment trust taxable income.  See  Federal Income Tax Considerations        
Taxation of the Company.   The Company expects to have qualified as a REIT in   
its taxable year ended December 31, 1995, but no assurance can be given that it 
did so qualify or that it will continue to qualify in the future.  In this      
regard, based on certain representations and assumptions, the Company has       
received an opinion of tax counsel to the Company ( Counsel ) to the effect that
the Company qualified as a REIT for the taxable year ended December 31, 1995,   
that the Company is organized in conformity with the requirements for           
qualification as a REIT, and that the Company's proposed method of operation    
will enable it to meet the requirements for qualification as a REIT for federal 
income tax purposes.  Qualification as a REIT, however, involves the application
of highly technical and complex Code provisions as to which there are only      
limited judicial and administrative interpretations.  Certain facts and         
circumstances which may be wholly or partially beyond the Company's control may 
affect its ability to qualify on an ongoing basis as a REIT.  In addition, no   
assurance can be given that future legislation, new regulations, administrative 
interpretations or court decisions will not significantly change the tax laws   
(or the application thereof) with respect to qualification as a REIT for federal
income tax purposes or the federal income tax consequences of such              
qualification.  The opinion of Counsel is not binding on the Internal Revenue   
Service ( IRS ) or the courts.                                                  

     RISKS RELATING TO THE SECURED EQUIPMENT LEASES.  In order to qualify as a
REIT for federal income tax purposes, not more than 25% of the Company's total  
assets may be represented by personal property, or loans secured by personal    
property on certain testing dates.  In addition, loans secured by personal      
property made to each borrower must represent less than 5% of the Company's     
total assets on such testing dates.  Counsel is of the opinion, based on certain
assumptions, that the Secured Equipment Leases will be treated as loans secured 
by personal property for federal income tax purposes.  The Company believes that
the value of the Secured Equipment Leases together with any personal property   
owned by the Company, will in the aggregate represent less than 25% of the      
Company's total assets and that the value of the Secured Equipment Leases       
entered into with any particular lessee will represent less than 5% of the      
Company's total assets.  Counsel has relied on the representations of the       
Company regarding such values in rendering its opinion as to the qualification  
of the Company as a REIT.  If the Company fails to satisfy the 25% test or the  
5% test either at the time of the offering or on any subsequent testing date,   
the Company will fail to qualify (or cease to qualify, as the case may be) as a 
REIT for federal income tax purposes.  In addition, if, contrary to the opinion 
of Counsel, the Secured Equipment Leases are not treated as loans, but are      
instead treated as leases for federal income tax purposes, income from the      
Secured Equipment Leases will generally not satisfy either the 95% or the 75%   
gross income tests for REIT qualification.  See  Federal Income Tax             
Considerations   Taxation of the Company, and    Characterization of the Secured
Equipment Leases.                                                               

  EFFECT OF REIT DISQUALIFICATION.  If, in any taxable year, the Company
were to fail to qualify as a REIT for federal income tax purposes, it would not 
be allowed a deduction for dividends to stockholders in computing taxable income
and would be subject to federal income tax (including any applicable alternative
minimum tax) on its taxable income at regular corporate rates.  In addition,    
unless entitled to relief under certain statutory provisions, the Company would 
be disqualified from treatment as a REIT for federal income tax purposes for the
four taxable years following the year during which REIT qualification is lost.  
The additional tax liability resulting from the failure to so qualify would     
significantly reduce the amount of funds available to make Distributions to     
stockholders.  Distributions to stockholders generally would be taxable as      
ordinary income to the extent of current and accumulated earnings and profits   
and, subject to certain limitations, would be eligible for the corporate        
dividends received deduction.  Although the Company intends to operate in a     
manner designed to permit it to qualify as a REIT for federal income tax        
purposes, it is possible that future economic, market, legal, tax, or other     
events or circumstances could cause it to fail to so qualify.  See  Federal     
Income Tax Considerations   Taxation of the Company.                            

    EFFECT OF DISTRIBUTION REQUIREMENTS.  The Company may be required, under
certain circumstances, to accrue as income for tax purposes interest, rent and  
other items treated as earned for tax purposes but not yet received.  In        
addition, the Company may be required not to accrue as expenses for tax purposes
certain items which actually have been paid or certain of the Company's         
deductions might be disallowed by the Service.  In any such event, the Company  
could have taxable income in excess of cash available for distribution.  If the 
Company has taxable income in excess of cash available for distribution, the    
Company could be required to borrow funds or liquidate investments on           
unfavorable terms in order to meet the distribution requirement applicable to a 
REIT.  See  Federal Income Tax Considerations   Taxation of the Company   Dis-  
tribution Requirements.                                                         

 RESTRICTIONS ON MAXIMUM SHARE OWNERSHIP.  In order for the Company to
qualify as a REIT, no more than 50% of the value of the outstanding equity      
securities may be owned, directly or indirectly (applying certain attribution   
rules), by five or fewer individuals (or certain entities) at any time during   
the last half of the Company's taxable year.  To ensure that the Company will   
not fail to qualify as a REIT under this test, the Company's Articles of        
Incorporation include certain provisions restricting the accumulation of Shares.
These restrictions may (i) discourage a change of control of the Company; (ii)  
deter individuals and entities from making tender offers for Shares, which      
offers may be attractive to stockholders; or (iii) limit the opportunity for    
stockholders to receive a premium for their Shares in the event a stockholder is
making purchases of Shares in order to acquire a block of Shares.               

OTHER TAX LIABILITIES.  Even if the Company qualifies as a REIT for 
federal income tax purposes, it may be subject to certain federal, state and    
local taxes on its income and property.  See  Federal Income Tax Considerations 
State and Local Taxes.                                                      

      CHANGES IN TAX LAWS.  The discussions of the federal income tax aspects of
the offering are based on current law, including the Code, the Regulations      
issued thereunder, certain administrative interpretations thereof, and court    
decisions.  Consequently, future events that modify or otherwise affect those   
provisions may result in treatment for federal income tax purposes of the       
Company and the stockholders that is materially and adversely different from    
that described in this Prospectus, both for taxable years arising before and    
after such events.  There is no assurance that future legislation and           
administrative interpretations will not be retroactive in effect.               

SUITABILITY STANDARDS AND HOW TO SUBSCRIBE

SUITABILITY STANDARDS                                                           

     The Shares offered hereby are suitable only as a long-term investment for
persons of adequate financial means who have no need for liquidity in this      
investment.  Initially, there is not expected to be any public market for the   
Shares, which means that it may be difficult to sell Shares.  See  Summary of   
the Articles of Incorporation and Bylaws   Restrictions on Ownership  for a     
description of the transfer requirements.  As a result, the Company has         
established suitability standards which require investors to have either (i) a  
net worth (exclusive of home, furnishings, and personal automobiles) of at least
$45,000 and an annual gross income of at least $45,000, or (ii) a net worth     
(exclusive of home, furnishings, and personal automobiles) of at least $150,000.

  Iowa, Maine, Missouri, New Hampshire, North Carolina, Pennsylvania and
Tennessee have established suitability standards different from those           
established by the Company, and Shares will be sold only to investors in those  
states who meet the special suitability standards set forth below.              

      IOWA, MISSOURI, NORTH CAROLINA AND TENNESSEE   The investor has either (i)
a net worth (exclusive of home, furnishings, and personal automobiles) of at    
least $60,000 and an annual gross income of at least $60,000, or (ii) a net     
worth (exclusive of home, furnishings, and personal automobiles) of at least    
$225,000.                                                                       

MAINE   The investor has either (i) a net worth (exclusive of home, 
furnishings, and personal automobiles) of at least $50,000 and an annual gross  
income of at least $50,000, or (ii) a net worth (exclusive of home, furnishings,
and personal automobiles) of at least $200,000.                                 

 NEW HAMPSHIRE   The investor has either (i) a net worth (exclusive of
home, furnishings, and personal automobiles) of at least $125,000 and an annual 
gross income of at least $50,000, or (ii) a net worth (exclusive of home,       
furnishings, and personal automobiles) of at least $250,000.                    

PENNSYLVANIA   The investor has (i) a net worth (exclusive of home, 
furnishings, and personal automobiles) of at least ten times the investor's     
investment in the Company, and (ii) either (a) a net worth (exclusive of home,  
furnishings, and personal automobiles) of at least $45,000 and an annual gross  
income of at least $45,000, or (b) a net worth (exclusive of home, furnishings, 
and personal automobiles) of at least $150,000.  Because the minimum offering of
Shares of the Company is less than $16,500,000, Pennsylvania investors are      
cautioned to evaluate carefully the Company's ability to fully accomplish its   
stated objectives and to inquire as to the current dollar volume of the         
Company's subscription proceeds.                                                

The foregoing suitability standards must be met by the investor who 
purchases the Shares.  If the investment is being made for a fiduciary account  
(such as an IRA, Keogh Plan, or corporate pension or profit-sharing plan), the  
beneficiary, the fiduciary account, or any donor or grantor that is the         
fiduciary of the account who directly or indirectly supplies the investment     
funds must meet such suitability standards.                                     

 In addition, under the laws of certain states, investors may transfer
their Shares only to persons who meet similar standards, and the Company may    
require certain assurances that such standards are met.  Investors should read  
carefully the requirements in connection with resales of Shares as set forth in 
the Articles of Incorporation and as summarized under  Summary of the Articles  
of Incorporation and Bylaws   Restrictions of Ownership.                        

    In purchasing Shares, custodians or trustees of employee pension benefit
plans or IRAs may be subject to the fiduciary duties imposed by the Employee    
Retirement Income Security Act of 1974 ( ERISA ) or other applicable laws and to
the prohibited transaction rules prescribed by ERISA and related provisions of  
the Code.  See  Federal Income Tax Considerations   Retirement Plan             
Stockholders.   In addition, prior to purchasing Shares, the trustee or         
custodian of an employee pension benefit plan or an IRA should determine that   
such an investment would be permissible under the governing instruments of such 
plan or account and applicable law.  For information regarding  unrelated       
business taxable income,  see  Federal Income Tax Considerations   Taxation of  
Stockholders   Tax-Exempt Stockholders.                                         

      In order to insure adherence to the suitability standards described above,
requisite suitability standards must be met, as set forth in the Subscription   
Agreement in one of the forms attached hereto as Exhibit D.  In addition,       
Soliciting Dealers who sell Shares have the responsibility to make every        
reasonable effort to determine that the purchase of Shares is a suitable and    
appropriate investment for an investor.  In making this determination, the      
Soliciting Dealers will rely on relevant information provided by the investor,  
including information as to the investor's age, investment objectives,          
investment experience, income, net worth, financial situation, other            
investments, and any other pertinent information.  See  The Offering            
Subscription Procedures.   Executed Subscription Agreements will be maintained  
in the Company's records for six years.                                         

HOW TO SUBSCRIBE                                                                

An investor who meets the suitability standards described above may 
subscribe for Shares by completing and executing the Subscription Agreement and 
delivering it to a Soliciting Dealer, together with a check for the full        
purchase price of the Shares subscribed for, payable to  SouthTrust Estate &    
Trust Company, Inc., Escrow Agent.   See  The Offering   Subscription           
Procedures.   Certain Soliciting Dealers who have  net capital,  as defined in  
the applicable federal securities regulations, of $250,000 or more may instruct 
their customers to make their checks for Shares subscribed for payable directly 
to the Soliciting Dealer.  Care should be taken to ensure that the Subscription 
Agreement is filled out correctly and completely.  Partnerships, individual     
fiduciaries signing on behalf of trusts, estates, and in other capacities, and  
persons signing on behalf of corporations and corporate trustees may be required
to obtain additional documents from Soliciting Dealers.  ANY SUBSCRIPTION MAY BE
REJECTED BY THE COMPANY IN WHOLE OR IN PART, REGARDLESS OF WHETHER THE          
SUBSCRIBER MEETS THE MINIMUM SUITABILITY STANDARDS.                             

    CERTAIN SOLICITING DEALERS MAY PERMIT INVESTORS WHO MEET THE SUITABILITY
STANDARDS DESCRIBED ABOVE TO SUBSCRIBE FOR SHARES BY TELEPHONIC ORDER TO THE    
SOLICITING DEALER.  THIS PROCEDURE MAY NOT BE AVAILABLE IN CERTAIN STATES.  SEE 
THE OFFERING   SUBSCRIPTION PROCEDURES  AND  THE OFFERING   PLAN OF           
DISTRIBUTION.                                                                   

 A MINIMUM INVESTMENT OF 250 SHARES ($2,500) IS REQUIRED.  IRAS, KEOGH
PLANS, AND PENSION PLANS MUST MAKE A MINIMUM INVESTMENT OF AT LEAST 100 SHARES  
($1,000), EXCEPT FOR IOWA TAX-EXEMPT INVESTORS WHO MUST MAKE A MINIMUM          
INVESTMENT OF 250 SHARES ($2,500).  FOR MINNESOTA INVESTORS ONLY, IRAS AND      
QUALIFIED PLANS MUST MAKE A MINIMUM INVESTMENT OF 200 SHARES ($2,000).  IN      
ADDITION, NEBRASKA, NEW YORK, AND NORTH CAROLINA INVESTORS MUST MAKE A MINIMUM  
INVESTMENT OF 500 SHARES ($5,000).  FOLLOWING AN INITIAL SUBSCRIPTION FOR AT    
LEAST THE REQUIRED MINIMUM INVESTMENT, ANY INVESTOR MAY MAKE ADDITIONAL         
PURCHASES IN INCREMENTS OF ONE SHARE.  MAINE INVESTORS, HOWEVER, MAY NOT MAKE   
ADDITIONAL PURCHASES IN AMOUNTS LESS THAN THE APPLICABLE MINIMUM INVESTMENT     
EXCEPT WITH RESPECT TO SHARES PURCHASED PURSUANT TO THE REINVESTMENT PLAN.  SEE 
 THE OFFERING   GENERAL,   THE OFFERING   SUBSCRIPTION PROCEDURES,  AND  SUMMARY
OF REINVESTMENT PLAN.                                                           

 ESTIMATED USE OF PROCEEDS

    THE TABLE SET FORTH BELOW SUMMARIZES CERTAIN INFORMATION RELATING TO THE
ANTICIPATED USE OF OFFERING PROCEEDS BY THE COMPANY, ASSUMING THAT 15,000,000   
SHARES (WHICH ASSUMES THAT THE MANAGING DEALER EXERCISES ITS OPTION, IF THE     
OFFERING IS OVERSUBSCRIBED, TO SELL AN ADDITIONAL 5,000,000 SHARES) ARE SOLD    
(5,775,926 SHARES HAD BEEN SOLD AS OF APRIL 9, 1996, EXCLUDING 12,815 SHARES    
ISSUED PURSUANT TO THE REINVESTMENT PLAN).  THE COMPANY ESTIMATES THAT 84% (IF  
$150,000,000 OR MORE IS RAISED) OF GROSS PROCEEDS WILL BE AVAILABLE FOR THE     
PURCHASE OF PROPERTIES AND THE MAKING OF MORTGAGE LOANS, AND APPROXIMATELY 9% OF
GROSS PROCEEDS WILL BE PAID IN FEES AND EXPENSES TO AFFILIATES OF THE COMPANY   
FOR THEIR SERVICES.  WHILE THE ESTIMATED USE OF PROCEEDS SET FORTH IN THE TABLE 
BELOW IS BELIEVED TO BE REASONABLE, THIS TABLE SHOULD BE VIEWED ONLY AS AN      
ESTIMATE OF THE USE OF PROCEEDS THAT MAY BE ACHIEVED.                           

                                                        · Enlarge/Download Table
                                                                                       MAXIMUM OFFERING(1)(2) 
                                                                                      AMOUNT           PERCENT

                                                                                                              
GROSS PROCEEDS TO THE COMPANY (3)     . . . . . . . . . . . . . .                 $150,000,000         100.0% 
LESS:                                                                                                         
   SELLING COMMISSIONS TO CNL                                                                                 
      SECURITIES CORP. (3)  . . . . . . . . . . . . . . . . . . .                   11,250,000           7.5% 
   MARKETING SUPPORT AND DUE DILIGENCE                                                                        
      EXPENSE REIMBURSEMENT FEE TO                                                                            
      CNL SECURITIES CORP. (3)  . . . . . . . . . . . . . . . . .                      750,000           0.5% 
   ORGANIZATIONAL AND OFFERING EXPENSES (4) . . . . . . . . . . .                    4,500,000           3.0% 
                                                                                  ------------         ------ 

NET PROCEEDS TO THE COMPANY . . . . . . . . . . . . . . . . . . .                  133,500,000          89.0% 
LESS:                                                                                                         
   ACQUISITION FEES TO THE ADVISOR (5)  . . . . . . . . . . . . .                    6,750,000           4.5% 
   ACQUISITION EXPENSES (6) . . . . . . . . . . . . . . . . . . .                      750,000           0.5% 
   INITIAL WORKING CAPITAL RESERVE  . . . . . . . . . . . . . . .                          (7)                
                                                                                  ------------         ------ 

CASH PAYMENT FOR PURCHASE OF PROPERTIES                                                                       
   AND MAKING OF MORTGAGE LOANS BY THE COMPANY (8)  . . . . . . .                 $126,000,000          84.0% 
                                                                                  ============         ====== 
<FN>                                                                                                          

FOOTNOTES:                                                                                                    

(1)   EXCLUDES THE PURCHASE OF 20,000 SHARES BY THE ADVISOR IN EXCHANGE FOR ITS                               
      $200,000 INVESTMENT IN THE COMPANY.  THE ADVISOR MAY, BUT IS NOT REQUIRED                               
      TO, PURCHASE ADDITIONAL SHARES OF THE COMPANY.  ALSO EXCLUDES 1,500,000                                 
      SHARES THAT MAY BE SOLD PURSUANT TO THE REINVESTMENT PLAN.                                              
(2)   OFFERING PROCEEDS WILL EXCEED $100,000,000 ONLY IF THE MANAGING DEALER                                  
      EXERCISES ITS OPTION TO SELL AN ADDITIONAL 5,000,000 SHARES IF THE                                      
      OFFERING IS OVERSUBSCRIBED.                                                                             
(3)   GROSS PROCEEDS OF THE OFFERING ARE CALCULATED AS IF ALL SHARES ARE SOLD AT                              
      $10.00 PER SHARE AND DO NOT TAKE INTO ACCOUNT ANY REDUCTION IN SELLING                                  
      COMMISSIONS.  SEE  THE OFFERING   PLAN OF DISTRIBUTION  FOR A DESCRIPTION                               
      OF THE CIRCUMSTANCES UNDER WHICH SELLING COMMISSIONS MAY BE REDUCED,                                    
      INCLUDING COMMISSION DISCOUNTS AVAILABLE FOR PURCHASES BY REGISTERED                                    
      REPRESENTATIVES OR PRINCIPALS OF THE MANAGING DEALER OR SOLICITING                                      
      DEALERS, CERTAIN DIRECTORS AND OFFICERS AND CERTAIN INVESTMENT ADVISERS.                                
      SELLING COMMISSIONS ARE CALCULATED ASSUMING THAT REDUCED COMMISSIONS ARE                                
      NOT PAID IN CONNECTION WITH THE PURCHASE OF ANY SHARES.  THE SHARES ARE                                 
      BEING OFFERED TO THE PUBLIC THROUGH CNL SECURITIES CORP., WHICH WILL                                    
      RECEIVE SELLING COMMISSIONS OF 7.5% ON ALL SALES OF SHARES AND WILL ACT AS                              
      MANAGING DEALER.  THE MANAGING DEALER IS AN AFFILIATE OF THE ADVISOR.                                   
      OTHER BROKER-DEALERS MAY BE ENGAGED AS SOLICITING DEALERS TO SELL SHARES                                
      AND REALLOWED SELLING COMMISSIONS OF UP TO 7% WITH RESPECT TO SHARES WHICH                              
      THEY SELL.  IN ADDITION, ALL OR A PORTION OF THE MARKETING SUPPORT AND DUE                              
      DILIGENCE EXPENSE REIMBURSEMENT FEE MAY BE REALLOWED TO CERTAIN SOLICITING                              
      DEALERS FOR EXPENSES INCURRED BY THEM IN SELLING THE SHARES, INCLUDING                                  
      REIMBURSEMENT FOR BONA FIDE EXPENSES INCURRED IN CONNECTION WITH DUE                                    
      DILIGENCE ACTIVITIES.  SEE  THE OFFERING   PLAN OF DISTRIBUTION  FOR A                                  
      MORE COMPLETE DESCRIPTION OF THIS FEE.                                                                  
(4)   ORGANIZATIONAL AND OFFERING EXPENSES INCLUDE LEGAL, ACCOUNTING, PRINTING,                               
      ESCROW, FILING, REGISTRATION, QUALIFICATION, AND OTHER EXPENSES OF THE                                  
      ORGANIZATION OF THE COMPANY AND THE OFFERING OF THE SHARES, BUT EXCLUDE                                 
      SELLING COMMISSIONS AND THE MARKETING SUPPORT AND DUE DILIGENCE EXPENSE                                 
      REIMBURSEMENT FEE.  THE ADVISOR WILL PAY ALL ORGANIZATIONAL AND OFFERING                                
      EXPENSES WHICH EXCEED 3% OF GROSS PROCEEDS.                                                             
(5)   ACQUISITION FEES INCLUDE ALL FEES AND COMMISSIONS PAID BY THE COMPANY TO                                
      ANY PERSON OR ENTITY IN CONNECTION WITH THE SELECTION OR ACQUISITION OF                                 
      ANY PROPERTY, INCLUDING DEVELOPMENT/CONSTRUCTION MANAGEMENT FEES TO                                     
      AFFILIATES, CONSTRUCTION FINANCING FEES TO AFFILIATES, AND OTHER                                        
      ACQUISITION FEES TO AFFILIATES OR NONAFFILIATES.  ACQUISITION FEES DO NOT                               
      INCLUDE ACQUISITION EXPENSES.                                                                           
(6)   REPRESENTS THAT PORTION OF ACQUISITION EXPENSES THAT ARE NEITHER                                        
      REIMBURSED TO THE COMPANY NOR INCLUDED IN THE PURCHASE PRICE OF THE                                     
      PROPERTIES, AND ON WHICH RENT IS NOT RECEIVED, BUT DOES NOT INCLUDE                                     
      CERTAIN ACQUISITION EXPENSES ASSOCIATED WITH PROPERTY ACQUISITIONS THAT                                 
      ARE PART OF THE PURCHASE PRICE OF THE PROPERTIES, THAT ARE INCLUDED IN THE                              
      BASIS OF THE PROPERTIES, AND ON WHICH RENT IS RECEIVED.  ACQUISITION                                    
      EXPENSES INCLUDE ANY AND ALL EXPENSES INCURRED BY THE COMPANY, THE                                      
      ADVISOR, OR ANY AFFILIATE OF THE ADVISOR IN CONNECTION WITH THE SELECTION                               
      OR ACQUISITION OF ANY PROPERTY, WHETHER OR NOT ACQUIRED, INCLUDING,                                     
      WITHOUT LIMITATION, LEGAL FEES AND EXPENSES, TRAVEL AND COMMUNICATION                                   
      EXPENSES, COSTS OF APPRAISALS, NONREFUNDABLE OPTION PAYMENTS ON PROPERTY                                
      NOT ACQUIRED, ACCOUNTING FEES AND EXPENSES, TAXES, AND TITLE INSURANCE,                                 
      BUT EXCLUDE ACQUISITION FEES.  THE PORTION OF ACQUISITION EXPENSES THAT IS                              
      ATTRIBUTABLE TO THE SELLER OF THE PROPERTIES AND PART OF THE PURCHASE                                   
      PRICE OF THE PROPERTIES IS ANTICIPATED TO RANGE BETWEEN 1% AND 2% OF GROSS                              
      PROCEEDS.                                                                                               
(7)   BECAUSE LEASES WILL BE ON A  TRIPLE-NET  BASIS, IT IS NOT ANTICIPATED THAT                              
      A PERMANENT RESERVE FOR MAINTENANCE AND REPAIRS WILL BE ESTABLISHED.                                    
      HOWEVER, TO THE EXTENT THAT THE COMPANY HAS INSUFFICIENT FUNDS FOR SUCH                                 
      PURPOSES, THE ADVISOR MAY CONTRIBUTE TO THE COMPANY AN AGGREGATE AMOUNT OF                              
      UP TO 1% OF THE NET OFFERING PROCEEDS AVAILABLE TO THE COMPANY FOR                                      
      MAINTENANCE AND REPAIRS.  THE ADVISOR ALSO MAY, BUT IS NOT REQUIRED TO,                                 
      ESTABLISH RESERVES FROM OFFERING PROCEEDS, OPERATING FUNDS, AND THE                                     
      AVAILABLE PROCEEDS OF ANY SALES OF PROPERTIES.                                                          
(8)   OFFERING PROCEEDS DESIGNATED FOR INVESTMENT IN PROPERTIES OR THE MAKING OF                              
      MORTGAGE LOANS TEMPORARILY MAY BE INVESTED IN SHORT-TERM, HIGHLY LIQUID                                 
      INVESTMENTS WITH APPROPRIATE SAFETY OF PRINCIPAL.                                                       

 MANAGEMENT COMPENSATION

     THE TABLE BELOW SUMMARIZES THE TYPES, RECIPIENTS, METHODS OF COMPUTATION,
AND ESTIMATED AMOUNTS OF ALL COMPENSATION, FEES, AND DISTRIBUTIONS TO BE PAID   
DIRECTLY OR INDIRECTLY BY THE COMPANY TO THE ADVISOR AND ITS AFFILIATES,        
EXCLUSIVE OF ANY DISTRIBUTIONS TO WHICH THE ADVISOR OR ITS AFFILIATES MAY BE    
ENTITLED BY REASON OF THEIR PURCHASE AND OWNERSHIP OF SHARES.  SEE  THE ADVISOR 
AND THE ADVISORY AGREEMENT.   FOR INFORMATION CONCERNING COMPENSATION TO THE    
DIRECTORS, SEE  MANAGEMENT.                                                     

      A MAXIMUM OF 10,000,000 SHARES ($100,000,000) MAY BE SOLD; HOWEVER, IF THE
MANAGING DEALER EXERCISES ITS OPTION (IN THE EVENT THE OFFERING IS              
OVERSUBSCRIBED) TO SELL AN ADDITIONAL 5,000,000 SHARES, A MAXIMUM OF 15,000,000 
SHARES ($150,000,000) MAY BE SOLD.  AN ADDITIONAL 1,500,000 SHARES ($15,000,000)
MAY BE SOLD TO STOCKHOLDERS WHO RECEIVE A COPY OF THIS PROSPECTUS AND WHO       
PURCHASE SHARES THROUGH THE REINVESTMENT PLAN.                                  

   THE FOLLOWING ARRANGEMENTS FOR COMPENSATION AND FEES TO THE 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  
THE ADVISOR OR ITS AFFILIATES UNDER MORE THAN ONE CATEGORY.                     

                                                        · Enlarge/Download Table

  TYPE OF                                                                               
  COMPEN-                                                                               
SATION                                                                                  
    AND                                                                 ESTIMATED       
RECIPIENT                 METHOD OF COMPUTATION                      MAXIMUM AMOUNT     

                           Organizational Stage                                         
                                                                                        
Selling     Selling  Commissions  of  7.5%  per  Share on all   $ 1 1 , 2 5 0,000     if
Commis-     Shares   sold,  subject to reduction under certain  15,000,000  Shares  are 
sions to    circumstances    as    described    in        The   sold;   $12,375,000   if
Managing    Offering      Plan  of Distribution.   Soliciting   1 6 , 500,000     Shares
Dealer and  Dealers  may  be reallowed Selling Commissions of   (including     1,500,000
Soliciting  up to 7% with respect to Shares they sell.          Shares  offered pursuant
Dealers                                                         to   the   Reinvestment 
                                                                Plan)      are     sold.
                                                                $2,884,062  at  December
                                                                31,  1995, $2,682,303 of
                                                                which  was  reallowed to
                                                                unaffiliated  Soliciting
                                                                Dealers.                

Marketing   Expense  allowance  of  0.5% of Gross Proceeds to   $750,000  if  15,000,000
support     the  Managing  Dealer,  all or a portion of which   Shares     are     sold;
and due     may  be  reallowed  to  Soliciting  Dealers.  The   $825,000  if  16,500,000
diligence   Managing Dealer will pay all sums attributable to   S h a res     (including
expense     bona fide due diligence expenses from this fee.     1,500,000 Shares offered
reimburse-                                                      pursuant      to     the
ment fee to                                                     Reinvestment  Plan)  are
Managing                                                        sold.      $192,271   at
Dealer and                                                      December 31, 1995.      
Soliciting                                                                              
Dealers                                                                                 

Reimburse-  Actual expenses incurred, except that the Advisor   T o tal  amount  is  not
ment to the will  pay  all  such  expenses in excess of 3% of   determinable   at   this
Advisor     Gross Proceeds.                                     time,   but   will   not
and its                                                         exceed   3%   of   Gross
Affiliates                                                      Proceeds.  $4,500,000 if
for                                                             15,000,000   Shares  are
Organiza-                                                       sold;    $4,950,000   if
tional and                                                      1 6 , 500,000     Shares
Offering                                                        (including     1,500,000
Expenses                                                        Shares  offered pursuant
                                                                to    the   Reinvestment
                                                                Plan)  are  sold.  As of
                                                                December    31,    1995,
                                                                Affiliates  had incurred
                                                                $ 2 , 5 4 6 , 011     in
                                                                O r ganizational     and
                                                                Offering   Expenses   on
                                                                behalf of the Company.  

                            Acquisition Stage                                           

Acqui-      4.5%  of  Gross Proceeds from the sale of Shares,   $6,750,000 if 15,000,000
sition      payable  to the Advisor as Acquisition Fees, plus   Shares     are     sold;
Fees to     reimbursement  to  the Advisor and its Affiliates   $7,425,000 if 16,500,000
the         for  expenses actually incurred.  The Acquisition   S h a res     (including
Advisor     Fee  shall  be reduced to the extent that, and if   1,500,000 Shares offered
and         necessary   to  limit, the total compensation paid  pursuant     to     the 
reimburse-  to all persons involved in the acquisition of any   Reinvestment  Plan)  are
ment  of    Property  to  the  amount  customarily charged in   sold.    $1,730,437  at 
Acqui-      arms-length  transactions  by  other  persons  or   December 31, 1995.      
sition Ex-  entities rendering similar services as an ongoing                           
penses to   public activity in the same geographical location   T h e  total  amount  of
the Ad-     and  for  comparable  types of Properties, and to   Acquisition    Expenses,
visor and   the  extent that other acquisition fees, finder's   which  are  based  on  a
its         fees,  real  estate commissions, or other similar   number    of    factors,
Affiliates  fees  or  commissions  are  paid by any person in   including  the  purchase
            connection with the transaction.                    price of the Properties,
                                                                are  not determinable at
                                                                t h i s  time.    As  of
                                                                December    31,    1995,
                                                                Affiliates  had incurred
                                                                $131,629  in Acquisition
                                                                Expenses  on  behalf  of
                                                                the Company.            

Development In  connection with the acquisition of Properties   The total amount of this
 / Con-     that   have  been  constructed  or  renovated  by   fee  will  depend on the
struction   Affiliates,  subject in each case to the approval   number   of   Properties
Manage-     of a majority of the Board of Directors including   p u r c h a sed     from
ment   Fees a  majority  of  the  Independent  Directors, the   developers   that   are 
to          Company    will   incur   Development/Construction  Affiliates    of    the 
Affiliates  Management   Fees  of  generally  5% to 10% of the  Company,  the  cost  of 
            cost  of  constructing  or renovating a Property,   c o n s t ruction     or
            p a y a ble  to  Affiliates  of  the  Company  as   renovation    of    such
            Acquisition  Fees.  Such fees will be included in   Properties    and    the
            the  purchase  price of Properties purchased from   percentage   amount   of
            developers  that  are  Affiliates of the Company.   e a c h       D e velop-
            See  Business - Site Selection and Acquisition of   m e n t / C o nstruction
            Properties.                                         M a nagement  Fee.    No
                                                                amounts had been paid or
                                                                accrued  at December 31,
                                                                1995.                   

Construc-   In  connection with the acquisition of Properties   The total amount of this
tion        f r om  affiliated  or  unaffiliated  developers,   fee  will  depend on the
Financing   subject  in  each  case  to  the  approval  of  a   number of Properties for
Fees    to  majority  of  the  Board of Directors including a   which  Affiliates of the
Affiliates  majority  of  the  Independent Directors, to whom   C o m p a ny     provide
            Affiliates   of   the   Company   have   provided   construction  financing,
            construction  financing,  the  Company will incur   the  amount and duration
            C o nstruction   Financing   Fees,   payable   to   of  such  loans  and the
            Affiliates  of  the  Company as Acquisition Fees.   a m ount     of     each
            Such fees will be in an amount equal to generally   Construction   Financing
            1%  to  2%  of the total amount of each loan plus   Fee.    No  amounts  had
            the  difference  between  the  Affiliate-lender's   been  paid or accrued at
            cost  of funds and the amount of interest charged   December 31, 1995.      
            to the developer, with such difference determined                           
            b y    applying  an  annual  percentage  rate  of                           
            generally  1.5%  to 3% throughout the duration of                           
            the  loan  to the outstanding amount of the loan.                           
            Such  fees will be included in the purchase price                           
            of  Properties  purchased  from  developers  that                           
            receive  such  loans.    See    Business  -  Site                           
            Selection and Acquisition of Properties.                                    
            The  total  of  all  Acquisition  Fees (including                           
            Development/Construction   Management   Fees   to                           
            Affiliates  and  Construction  Financing  Fees to                           
            Affiliates   described   above,   but   excluding                           
            Development/Construction  Management Fees paid to                           
            any  person  or  entity  not  affiliated with the                           
            Advisor in connection with the actual development                           
            and construction of any Property) and Acquisition                           
            Expenses shall be reasonable and shall not exceed                           
            an  amount  equal  to 6% of the Real Estate Asset                           
            Value of a Property, or in the case of a Mortgage                           
            Loan, 6% of the funds advanced, unless a majority                           
            of  the  Board of Directors, including a majority                           
            of   the  Independent  Directors,  not  otherwise                           
            interested  in  the  transaction approves fees in                           
            excess of these limits subject to a determination                           
            that the transaction is commercially competitive,                           
            fair and reasonable to the Company.                                         

                            Operational Stage                                           

Asset       A monthly Asset Management Fee in an amount equal   T o tal  amount  is  not
Management  to  one-twelfth  of  .60%  of  the Company's Real   determinable   at   this
Fee to the  Estate Asset Value as of the end of the preceding   time.  The amount of the
Advisor     month.    Specifically,  Real  Estate Asset Value   Asset   Management   Fee
            equals  the  amount  invested  in  the Properties   will  depend upon, among
            wholly  owned  by  the Company, determined on the   other  things,  the cost
            basis  of  cost,  plus, in the case of Properties   of  the  Properties.  As
            owned  by  any  Joint  Venture  or partnership in   of  December  31,  1995,
            which  the  Company  is a co-venturer or partner,   the Company had incurred
            the  portion  of the cost of such Properties paid   $27,950     in     asset
            by the Company, exclusive of Acquisition Fees and   management fees.        
            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 the Advisor.  All or                           
            any portion of the Asset Management Fee not taken                           
            as  to  any fiscal year shall be deferred without                           
            interest  and  may  be taken in such other fiscal                           
            year as the Advisor shall determine.                                        

Mortgage    A  monthly  Mortgage  Management Fee in an amount   T o tal  amount  is  not
Management  equal   to  one-twelfth  of  .60%  of  the  total   determinable   at   this
Fee         principal  amount of the Mortgage Loans as of the   time.  The amount of the
            end of the preceding month.                         Mortgage  Management Fee
                                                                will  depend upon, among
                                                                other things, the amount
                                                                and  the duration of the
                                                                M o rtgage  Loans.    No
                                                                amounts had been paid or
                                                                accrued  at December 31,
                                                                1995.                   

Reimburse-  Operating  Expenses (which, in general, are those   T o tal  amount  is  not
ment to the e x penses  relating  to  administration  of  the   determinable   at   this
Advisor     Company  on  an ongoing basis) will be reimbursed   time.    As  of December
and         by  the  Company.    To the extent that Operating   31, 1995, Affiliates had
Affiliates  Expenses   payable or reimbursable by the Company,  incurred   $54,234   in 
for         in   any  four  consecutive  fiscal  quarters (the  Operating  Expenses  on 
operating    Expense Year ), exceed (the  Excess Amount ) the   behalf of the Company.  
expenses    greater  of  2% of Average Invested Assets or 25%                           
            of  Net  Income (the  2%/25% Guidelines ) and the                           
            Independent  Directors determine that such excess                           
            e x p e nses  were  justified  based  on  unusual                           
            nonrecurring  factors which they deem sufficient,                           
            the   Excess  Amount  may  be  carried  over  and                           
            included  in  Operating  Expenses  in  subsequent                           
            Expense  Years,  and reimbursed to the Advisor in                           
            one or more of such years, but only to the extent                           
            such  reimbursement would not cause the Company's                           
            Operating   Expenses   to   exceed   the   2%/25%                           
            Guidelines  in  any Expense Year.  Within 60 days                           
            after  the  end  of  any  fiscal  quarter  of the                           
            Company  for  which total Operating Expenses (for                           
            the  Expense  Year) exceed the 2%/25% Guidelines,                           
            there shall be sent to the stockholders a written                           
            d i sclosure  of  such  fact,  together  with  an                           
            e x planation  of  the  factors  the  Independent                           
            Directors   considered   in   arriving   at   the                           
            c o n clusion  that  such  excess  expenses  were                           
            justified.                                                                  

Soliciting  An  annual  fee  of  .20%  of Invested Capital on   T o tal  amount  is  not
Dealer      December  31 of each year, commencing on December   determinable   at   this
Servicing   31  of  the  year following the year in which the   time.    Until such time
Fee to      offering  terminates,  generally  payable  to the   as  Properties are sold,
Managing    Managing  Dealer, which in turn may reallow all or  the  estimated  amounts 
Dealer      a portion of such fee to Soliciting Dealers whose   payable  to the Managing
            clients  hold  Shares  on such date.  The Company   Dealer  for  each of the
            has  determined, however, that the Company may pay  first    three    years 
            the   Soliciting  Dealer Servicing Fee directly to  following    year    of 
            any Soliciting Dealer exempt from registration as   termination    of    the
            a  broker-dealer and whose clients held Shares on   offering are expected to
            such  date.   In general, Invested Capital is the   b e      $300,000     if
            amount   of  cash  paid by the stockholders to the  15,000,000  Shares  are 
            Company  for  their  Shares,  reduced  by certain   sold;  and  $330,000  if
            prior  Distributions to the stockholders from the   1 6 , 500,000     Shares
            Sale   of  one  or  more  Properties  or  Secured   (including     1,500,000
            E q u i pment  Leases.    The  Soliciting  Dealer   Shares  offered pursuant
            Servicing   Fee will terminate as of the beginning  to   the   Reinvestment 
            of  any year in which the Company is liquidated or  Plan)  are  sold.    No 
            in  which Listing occurs, provided, however, that   amounts had been paid or
            any  previously accrued but unpaid portion of the   accrued  at December 31,
            Soliciting  Dealer  Servicing  Fee may be paid in   1995.                   
            such year or any subsequent year.                                           

Deferred,   A  deferred, subordinated real estate disposition   T o tal  amount  is  not
subordi-    fee, payable upon Sale of one or more Properties,   determinable   at   this
nated real  in  an amount equal to the lesser of (i) one-half   time.    The  amount  of
estate      of  a Competitive Real Estate Commission, or (ii)   this  fee, if it becomes
disposi-    3%  of  the  sales  price  of  such  Property  or   payable,   will   depend
tion fee    Properties.    Payment  of such fee shall be made   upon  the price at which
payable to  only if the Advisor provides a substantial amount   Properties are sold.  No
the         of  services  in  connection  with  the Sale of a   amounts had been paid or
Advisor     Property  or Properties and shall be subordinated   accrued  at December 31,
from a      to  receipt  by the stockholders of Distributions   1995.                   
Sale or     e q u al  to  the  sum  of  (i)  their  aggregate                           
Sales of a  Stockholders'  8% Return and (ii) their aggregate                           
Property    Invested  Capital.    If,  at the time of a Sale,                           
not  in     payment  of  the  disposition  fee  is  deferred                            
liquida-    because  the  subordination  conditions  have not                           
tion of the been satisfied, then the disposition fee shall be                           
Company     paid  at  such  later  time  as the subordination                           
            conditions  are  satisfied.  Upon Listing, if the                           
            Advisor  has  accrued but not been paid such real                           
            estate  disposition  fee,  then  for  purposes of                           
            determining  whether the subordination conditions                           
            have  been satisfied, stockholders will be deemed                           
            to  have  received  a  Distribution in the amount                           
            equal  to  the  product  of  the  total number of                           
            Shares  outstanding and the average closing price                           
            of  the  Shares over a period, beginning 180 days                           
            after Listing, of 30 days during which the Shares                           
            are traded.                                                                 

Subordi-    At  such  time,  if  any,  as Listing occurs, the   T o tal  amount  is  not
nated       Advisor  shall be paid the Subordinated Incentive   determinable   at   this
Incentive   Fee  in  an  amount equal to 10% of the amount by   time.    No  amounts had
Fee         which  (i)  the  market  value of the Company (as   been  paid or accrued at
payable to  defined  below) plus the total Distributions made   December 31, 1995.      
the         to  stockholders  from  the  Company's  inception                           
Advisor at  until the date of Listing exceeds (ii) the sum of                           
such time,  (A)  100%  of  Invested Capital and (B) the total                           
if any, as  Distributions  required  to be made to the stock-                           
Listing     holders  in  order  to  pay  the Stockholders' 8%                           
occurs      Return from inception through the date the market                           
            value is determined.  For purposes of calculating                           
            the  Subordinated Incentive Fee, the market value                           
            of the Company shall be the average closing price                           
            or  average  of  bid and asked price, as the case                           
            may be, over a period of 30 days during which the                           
            Shares  are traded with such period beginning 180                           
            days  after  Listing.  The Subordinated Incentive                           
            Fee  will  be  reduced by the amount of any prior                           
            payment   to   the   Advisor   of   a   deferred,                           
            subordinated  share  of Net Sales Proceeds from a                           
            Sale  or  Sales  of Property or Secured Equipment                           
            Lease.                                                                      

Deferred,   A  deferred,  subordinated  share equal to 10% of   T o tal  amount  is  not
subordi-    Net  Sales  Proceeds  from  a  Sale or Sales of a   determinable   at   this
nated share Property  or  Secured  Equipment  Lease remaining   time.    No  amounts had
of Net      a f t er   receipt   by   the   stockholders   of   been  paid or accrued at
Sales       Distributions   equal  to  the  sum  of  (i)  the   December 31, 1995.      
Proceeds    Stockholders' 8% Return and (ii) 100% of Invested                           
from a      Capital.    Following  Listing,  no  share of Net                           
Sale or     Sales Proceeds will be paid to the Advisor.                                 
Sales of a                                                                              
Property                                                                                
or Secured                                                                              
Equipment                                                                               
Lease not                                                                               
in                                                                                      
liquida-                                                                                
tion of the                                                                             
Company                                                                                 
payable to                                                                              
the                                                                                     
Advisor                                                                                 

Secured     A  fee paid to the Advisor out of the proceeds of   T o tal  amount  is  not
Equipment   the Loan for negotiating Secured Equipment Leases   determinable   at   this
Lease  Ser- and  supervising  the  Secured  Equipment  Lease    time.    No  amounts had
vicing Fee  program  equal to 2% of the purchase price of the   been  paid or accrued at
to the      Equipment subject to each Secured Equipment Lease   December 31, 1995.      
Advisor     and paid upon entering into such lease.                                     

Reimburse-  Repayment   by  the  Company  of  actual  expenses  Total    amounts    not 
ment to the incurred.                                           determinable   at   this
Advisor                                                         time.    No  amounts had
and                                                             been  paid or accrued at
Affiliates                                                      December 31, 1995.      
for                                                                                     
Mortgage                                                                                
Loan and                                                                                
Secured                                                                                 
Equipment                                                                               
Lease                                                                                   
Servicing                                                                               
expenses                                                                                

                            Liquidation Stage                                           

Deferred,   A  deferred, subordinated real estate disposition   T o tal  amount  is  not
subordi-    fee, payable upon Sale of one or more Properties,   determinable   at   this
nated real  in  an amount equal to the lesser of (i) one-half   time.    The  amount  of
estate      of  a Competitive Real Estate Commission, or (ii)   this  fee, if it becomes
disposi-    3%  of  the  sales  price  of  such  Property  or   payable,   will   depend
tion fee    Properties.    Payment  of such fee shall be made   upon  the price at which
payable to  only if the Advisor provides a substantial amount   Properties are sold.    
the         of  services  in  connection  with  the Sale of a                           
Advisor     Property  or Properties and shall be subordinated                           
from a      to  receipt  by the stockholders of Distributions                           
Sale or     e q u al  to  the  sum  of  (i)  their  aggregate                           
Sales in    Stockholders'  8% Return and (ii) their aggregate                           
liquida-    Invested  Capital.    If,  at the time of a Sale,                           
tion of the payment  of  the  disposition  fee  is  deferred                            
Company     because  the  subordination  conditions  have not                           
            been satisfied, then the disposition fee shall be                           
            paid  at  such  later  time  as the subordination                           
            conditions are satisfied.                                                   

Deferred,   A  deferred,  subordinated  share equal to 10% of   T o tal  amount  is  not
subordi-    Net  Sales  Proceeds  from  a  Sale or Sales of a   determinable   at   this
nated share Property  or  Secured  Equipment  Lease remaining   time.                   
of Net      a f t er   receipt   by   the   stockholders   of                           
Sales       Distributions   equal  to  the  sum  of  (i)  the                           
Proceeds    Stockholders' 8% Return and (ii) 100% of Invested                           
from a      Capital.    Following  Listing,  no  share of Net                           
Sale or     Sales Proceeds will be paid to the Advisor.                                 
Sales of a                                                                              
Property                                                                                
or Secured                                                                              
Equipment                                                                               
Lease in                                                                                
liquida-                                                                                
tion of the                                                                             
Company                                                                                 
payable to                                                                              
the                                                                                     
Advisor                                                                                 


 CONFLICTS OF INTEREST

    The Company will be subject to various conflicts of interest arising out
of its relationship to the Advisor and its Affiliates, as described below.      

  The following chart indicates the relationship between the Advisor and
those Affiliates that will provide services to the Company.                     

|------------------------------|            |-----------------------------|   
|   CNL AMERICAN PROPERTIES    |            |                             |   
|                              |            |        CNL GROUP, INC.      |   
|          FUND, INC.          |            |                             |   
|        (THE COMPANY)         |            |                             |   
|-------------------------|----|            |-----------------------------|   
    |                            |
    |                            |
(ADVISORY AGREEMENT)                 100%   
    |                            |
               |       ---------------------------------
               |       |                               |
              |------------------------|              |------------------|
              |CNL FUND ADVISORS, INC. |              |  CNL SECURITIES  |
              |  (ADVISOR TO COMPANY)  |              |      CORP.       |
              |------------------------|              |(MANAGING DEALER) |
                                                      |------------------|

PRIOR AND FUTURE PROGRAMS                                                       

     In the past, Affiliates of the Advisor have organized over 100 other real
estate investments, 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 the Company, and make additional real estate investments.  Some of  
these (including 17 public partnerships) involve and will involve Affiliates of 
the Advisor in the ownership, operation, leasing, and management of fast-food,  
family-style and casual dining, including restaurants that may be suitable for  
the Company.                                                                    

     Certain of these affiliated public or private real estate programs invest
or may invest solely in fast-food, casual dining, and family-style restaurants, 
may purchase properties concurrently with the Company and may lease fast-food,  
casual dining, and family-style restaurant properties to operators who also     
lease or operate certain of the Company's Properties.  These properties, if     
located in the vicinity of, or adjacent to, Properties acquired by the Company  
may affect the Properties' gross revenues.  Additionally, such other programs   
may offer financing to the same or similar entities as those targeted by the    
Company, thereby affecting the Company's Secured Equipment Lease program.  Such 
conflicts between the Company and affiliated programs may affect the value of   
the Company's investments as well as its Net Income.  The Company believes that 
the Advisor has established guidelines to minimize such conflicts.  See  Certain
Conflict Resolution Procedures  below.                                          

An Affiliate of the Advisor currently is purchasing properties for a
private program that was organized to purchase, lease and/or finance fast-food  
and family-style restaurant facilities, including furniture, fixtures, equipment
and start-up costs associated therewith.  Such program generally will purchase  
restaurant properties or an interest therein only when furniture, fixtures,     
equipment and start-up costs also will be supplied by the program.  It is not   
expected that the financing offered by such program will be segregable and,     
therefore, the program will not compete with the Company for lessees.  If the   
equipment arrangement offered by such program becomes segregable, a conflict    
could arise between such program and the Company for lessees.                   

ACQUISITION OF PROPERTIES                                                       

Affiliates of the Advisor regularly have opportunities to acquire   
restaurant properties of a type suitable for acquisition by the Company as a    
result of their existing relationships and past experience with various fast-   
food, family-style and casual dining restaurant chains and their franchisees.   
See  Business   General.   A purchaser who wishes to acquire one or more of     
these properties must do so within a relatively short period of time,           
occasionally at a time when the Company (due to insufficient funds, for example)
may be unable to make the acquisition.                                          

 In an effort to address these situations and preserve the acquisition
opportunities for the Company (and other entities with which the Advisor or its 
Affiliates are affiliated), Affiliates of the Advisor maintain lines of credit  
which enable them to acquire restaurant properties on an interim basis.         
Typically, no more than ten to 15 restaurant properties are temporarily owned by
Affiliates of the Advisor on this interim basis at any particular time.  These  
restaurant properties generally will be purchased from Affiliates of the        
Advisor, at their cost, by one or more existing or future public or private     
programs formed by Affiliates of the Advisor.                                   

      The Advisor could experience potential conflicts of interest in connection
with the negotiation of the purchase price and other terms of the acquisition of
a Property, as well as the terms of the lease of a Property, due to its         
relationship with its Affiliates and the ongoing business relationship of its   
Affiliates with operators of Restaurant Chains.                                 

    The Advisor or its Affiliates also may be subject to potential conflicts
of interest at such time as the Company wishes to acquire a property that also  
would be suitable for acquisition by an Affiliate of CNL.  Affiliates of the    
Advisor serve as Directors of the Company and, in this capacity, have a         
fiduciary obligation to act in the best interest of the stockholders of the     
Company and, as general partners or directors of CNL Affiliates, to act in the  
best interests of the stockholders in other programs with investments that may  
be similar to those of the Company and will use their best efforts to assure    
that the Company will be treated as favorably as any such other program.  See   
 Management   Fiduciary Responsibility of the Board of Directors.   In addition,
the Company has developed procedures to resolve potential conflicts of interest 
in the allocation of properties between the Company and certain of its          
Affiliates.  See  Certain Conflict Resolution Procedures  below.  The Company   
will supplement this Prospectus during the offering period to disclose the      
acquisition of a Property at such time as the Advisor believes that a reasonable
probability exists that the Company will acquire the Property, including an     
acquisition from the Advisor or its Affiliates.  See  Business - Property       
Acquisitions  for a description of the Properties that have been acquired by the
Company and the status of negotiations for additional Properties.               

SALES OF PROPERTIES                                                             

      A conflict also could arise in connection with the Advisor's determination
as to whether or not to sell a Property, since the interests of the Advisor and 
the stockholders may differ as a result of their distinct financial and tax     
positions and the compensation to which the Advisor or its Affiliates may be    
entitled upon the Sale of a Property.  See  Compensation of the Advisor,  below 
for a description of these compensation arrangements.  In order to resolve this 
potential conflict, the Board of Directors will be required to approve each Sale
of a Property.  In the unlikely event that the Company and another CNL program  
attempted to sell similar properties at the same time, a conflict could arise   
since the two programs potentially could compete with each other for a suitable 
purchaser.  In order to resolve this potential conflict, the Advisor has agreed 
not to approve the sale of any of the Company's Properties contemporaneously    
with the sale of a property owned by another CNL program if the two properties  
are part of the same Restaurant Chain and are within a three-mile radius of each
other, unless the Advisor and the principals of the other CNL program are able  
to locate a suitable purchaser for each property.                               

JOINT INVESTMENT WITH AN AFFILIATED PROGRAM                                     

      The Company may invest in Joint Ventures with another program sponsored by
the Advisor or its Affiliates if a majority of the Directors, including a       
majority of the Independent Directors, not otherwise interested in the          
transaction, determine that the investment in the Joint Venture is fair and     
reasonable to the Company and on substantially the same terms and conditions as 
those to be received by the co-venturer or co-venturers.                        

COMPETITION FOR MANAGEMENT TIME                                                 

The officers and directors of the Advisor and certain Directors and 
officers of the Company currently are engaged, and in the future will engage, in
the management of other business entities and properties and in other business  
activities.  They will devote only as much of their time to the business of the 
Company as they, in their judgment, determine is reasonably required, which will
be substantially less than their full time.  These officers and Directors of the
Company and officers and directors of the Advisor may experience conflicts of   
interest in allocating management time, services, and functions among the       
Company and the various partnerships, stockholder programs (public or private), 
and any other business ventures in which any of them are or may become involved.

COMPENSATION OF THE ADVISOR                                                     

    The Advisor has been and will be engaged to perform various services for
the Company and has and will receive fees and compensation for such services.   
None of the agreements for such services were the result of arm's-length        
negotiations.  All such agreements, including the Advisory Agreement, require   
approval by a majority of the Board of Directors, including a majority of the   
Independent Directors, not otherwise interested in such transactions, as being  
fair and reasonable to the Company and on terms and conditions no less favorable
than those which could be obtained from unaf