SPRINGHILL LAKE INVESTORS LTD PARTNERSHIP - 10-K Annual Report

Back to GetFilings.com

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-K

(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934

For the fiscal year ended December 31, 2004

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

For the transition period from _________to _________

Commission file number 0-14569

SPRINGHILL LAKE INVESTORS LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)

Maryland 04-2848939
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

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

Registrant's telephone number (864) 239-1000

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

None

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

Units of Limited Partnership Interest
(Title of class)

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No___

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

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rate 12b-2). Yes ___ No _X__

State the aggregate market value of the voting partnership interests held by
non-affiliates computed by reference to the price at which the partnership
interests were sold, or the average bid and asked prices of such partnership
interests, as of December 31, 2004. No market exists for the limited partnership
interests of the Registrant, and, therefore, no aggregate market value can be
determined.

DOCUMENTS INCORPORATED BY REFERENCE
NONE

The matters discussed in this report contain certain forward-looking statements,
including, without limitation, statements regarding future financial performance
and the effect of government regulations. Actual results may differ materially
from those described in the forward-looking statements and will be affected by a
variety of risks and factors including, without limitation: national and local
economic conditions; the terms of governmental regulations that affect the
Registrant and interpretations of those regulations; the competitive environment
in which the Registrant operates; financing risks, including the risk that cash
flows from operations may be insufficient to meet required payments of principal
and interest; real estate risks, including variations of real estate values and
the general economic climate in local markets and competition for tenants in
such markets; litigation, including costs associated with prosecuting and
defending claims and any adverse outcomes, and possible environmental
liabilities. Readers should carefully review the Registrant's financial
statements and the notes thereto, as well as the risk factors described in the
documents the Registrant files from time to time with the Securities and
Exchange Commission.

PART I

Item 1. Description of Business

Springhill Lake Investors Limited Partnership (the "Registrant" or the
"Partnership") was organized as a Maryland limited partnership under the
Maryland Revised Uniform Limited Partnership Act on December 28, 1984, for the
purpose of investing as a general partner in Springhill Lake Limited
Partnerships I through IX and Springhill Commercial Limited Partnership
(collectively, the "Operating Partnerships"), each of which is a Maryland
limited partnership owning a section of a garden apartment complex in Greenbelt,
Maryland (the "Project" or "Property"). The Registrant is the sole General
Partner of each Operating Partnership. The Limited Partner of each Operating
Partnership is Theodore N. Lerner ("Lerner"), a former general partner of the
Operating Partnerships whose interest was converted to that of a limited partner
on January 16, 1985 in conjunction with the Registrant's acquisition of its
interest in the Operating Partnerships. The Managing General Partner of the
Registrant is AIMCO/Springhill Lake Investors GP, LLC ("AIMCO LLC" or "Managing
General Partner"), a wholly owned subsidiary of AIMCO Properties, L.P., an
affiliate of Apartment Investment and Management Company ("AIMCO"), a publicly
traded real estate investment trust. The Partnership Agreement provides that the
Partnership and Operating Partnerships are to terminate on December 31, 2035
unless terminated prior to such date.

On December 11, 2003, AIMCO Properties, L.P., a Delaware limited partnership,
entered into a Redemption and Contribution Agreement (the "Redemption and
Contribution Agreement") with First Winthrop Corporation, a Delaware corporation
("FWC") and the sole shareholder of Three Winthrop Properties, Inc.
("Winthrop"), the former managing general partner of the Partnership, with
respect to the acquisition of its general partner interest in the Partnership
(the "MGP Interest") by an affiliate of AIMCO Properties, L.P., the operating
partnership of AIMCO.

As of the time of the execution of the Redemption and Contribution Agreement and
until such time as the transfer of the MGP Interest from Winthrop to AIMCO LLC
became effective, NHP Management Company ("NHP"), an affiliate of AIMCO
Properties, L.P., was vested with the authority to, subject to certain
limitations, cause Winthrop to take such actions as it deemed necessary and
advisable in connection with the activities of the Partnership. The transfer of
the MGP Interest from Winthrop to AIMCO LLC became effective on March 31, 2004.
As used herein, the term "Managing General Partner" shall mean Winthrop, with
respect to matters occurring prior to March 31, 2004 and AIMCO LLC for matters
occurring from and after March 31, 2004.

The Registrant was initially capitalized with nominal capital contributions from
its General Partners. In April 1985, the Registrant completed a private offering
of 649 units of limited partnership interest (the "Units") pursuant to
Regulation D under the Securities Act of 1933 and the terms of the Confidential
Memorandum dated January 16, 1985. The Registrant raised $40,562,500 in capital
contributions from investors who were admitted to the Registrant as limited
partners ("Limited Partners"). Since its initial offering, the Registrant has
not received, nor are limited partners required to make, additional capital
contributions.

The Registrant purchased its interest in the Operating Partnerships on January
16, 1985, for approximately $73,515,000. The Registrant's interest in the
Operating Partnerships entitles it to 87.26% of profits and losses for tax
purposes, 87.26% of the Operating Partnerships' cash flow (after certain
priority distributions), and 85% of the proceeds of a sale or disposition of the
Project (after certain priority distributions).

The only business of the Partnership is investing as a general partner in the
Operating Partnerships, and as such, to cause the Operating Partnerships to own
and operate the Project, until such time as a sale, if any, of all or a portion
of the Project appears to be advantageous to the Registrant and is permitted
under the terms of the Operating Partnerships' Partnership Agreements. See "Item
2. Description of Property" for further information on the project owned by the
Operating Partnerships.

The Partnership has no employees. Management and administrative services are
performed by the Managing General Partner and by agents retained by the Managing
General Partner.

The Partnership receives income from its interest in the Project and is
responsible for operating expenses, capital improvements and debt service
payments under mortgage obligations secured by the property. The Partnership
financed its investment primarily through non-recourse debt. Therefore, in the
event of default, the lender can generally look only to the subject property for
recovery of amounts due.

Risk Factors

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

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

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

From time to time, the Federal Bureau of Investigation, or FBI, and the United
States Department of Homeland Security issue alerts regarding potential
terrorist threats involving apartment buildings. Threats of future terrorist
attacks, such as those announced by the FBI and the Department of Homeland
Security, could have a negative effect on rent and occupancy levels at the
Partnership's property. The effect that future terrorist activities or threats
of such activities could have on the Partnership's operations is uncertain and
unpredictable. If the Partnership were to incur a loss at a property as a result
of an act of terrorism, the Partnership could lose all or a portion of the
capital invested in the property, as well as the future revenue from the
property. In this regard, the Partnership has purchased insurance to cover acts
of terrorism. The Managing General Partner does not anticipate that these costs
will have a negative effect on the Partnership's consolidated financial
condition or results of operations.

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

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

A further description of the Partnership's business is included in "Management's
Discussion and Analysis of Financial Condition and Results of Operation"
included in "Item 7." of this Form 10-K.

Item 2. Description of Property

The following table sets forth the Registrant's investment in property:

Date of
Property Purchase Type of Ownership Use

Springhill Lake Apartments 10/84 Fee ownership subject Apartment
Greenbelt, Maryland to a first mortgage. 2,899 units

The Project was initially acquired by the Operating Partnerships in October 1984
for an initial cost of $73,316,500. The Project consists of 2,899 apartment and
townhouse units and a four-store shopping center situated on 154 acres of
landscaped grounds. The Project also contains a clubhouse/community center, two
Olympic-size swimming pools and six tennis courts.

Schedule of Property

Set forth below for the Registrant's property is the gross carrying value,
accumulated depreciation, depreciable life, method of depreciation and federal
tax basis.

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

Springhill Lake $133,465 $87,489 5-30 yrs S/L $31,884

See "Item 8. Financial Statements, Note A" for a description of the
Partnership's capitalization and depreciation policies.

Schedule of Property Indebtedness

The following table sets forth certain information relating to the loan
encumbering the Partnership's property.

Principal Principal Principal
Balance At Balance At Stated Balance
December 31, Interest Period Maturity Due At
Property 2004 2003 Rate Amortized Date Maturity (1)
(in thousands) (in thousands)
Springhill Lake

1st mortgage $113,500 $110,386 (2) (3) 08/11 $113,500

(1) See "Item 8. Financial Statements and Supplementary Data - Note E" for
information with respect to the Registrant's ability to prepay this loan
and other specific details about the loan.

(2) Adjustable rate based on the Freddie Mac discounted mortgage-backed
security index plus 63 basis points. The rate at December 31, 2004 was
2.728% and will reset monthly.

(3) Interest only payments on loan at December 31, 2004.

On July 22, 2004, the Partnership refinanced the mortgage encumbering Springhill
Lake Apartments. The new mortgage of $113,500,000 replaced existing mortgage
indebtedness of approximately $109,007,000. The new mortgage bears interest at a
variable rate and has a balloon payment of $113,500,000 due on August 1, 2011.
The interest rate on the variable rate loan is the Freddie Mac discounted
mortgage-backed security index plus 63 basis points. The rate was 2.728% at
December 31, 2004. After repayment of the existing mortgage, payment of closing
costs, and funding of a $675,000 repair escrow account and operating reserves,
the Partnership received net proceeds of approximately $3,294,000. The
Partnership also received a refund of approximately $7,085,000 relating to the
repair escrow required by the previous lender. Total capitalized loan costs
associated with this refinancing were approximately $526,000 during the year
ended December 31, 2004. The Partnership recognized a loss on the early
extinguishment of debt of approximately $918,000 due to the write off of
approximately $904,000 of unamortized loan costs and a prepayment penalty of
approximately $14,000 during the year ending December 31, 2004.

The mortgage note payable is non-recourse and is secured by a pledge of the
Partnership's interest in the operating partnerships, and joint and several
guarantees by the operating partnerships which, in turn, are secured by an
indemnity first mortgage on the operating partnerships and a pledge of the stock
of Springfield Facilities, Inc., an affiliate. Further, the property may not be
sold subject to existing indebtedness.

Rental Rates and Occupancy

Average annual rental rate and occupancy for 2004 and 2003 for the property:

Average Annual Average Annual
Rental Rate Occupancy
(per unit)
Property 2004 2003 2004 2003

Springhill Lake $11,275 $11,001 95% 96%

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

Schedule of Real Estate Taxes and Rates

Real estate taxes and rates in 2004 for the property were:

2004 2004
Billing Rate
(in thousands)

Springhill Lake $2,335 1.91%

The Property has a fiscal year different than the real estate tax year;
therefore, real estate tax expense as stated in the Partnership's Consolidated
Statement of Operations does not agree to the 2004 billings.

Capital Improvements

The Partnership completed approximately $4,847,000 in capital improvements at
Springhill Lake Apartments during the year ended December 31, 2004, consisting
primarily of structural improvements, appliance, water and sewer upgrades, roof
and floor covering replacements, air conditioning and cabinet upgrades and
heating and electrical improvements. Approximately $28,000 of these additions
were related to a September 2003 casualty. These improvements were funded from
operations, insurance proceeds and replacement reserves. The Partnership
regularly evaluates the capital improvement needs of the property for the
upcoming year. During 2005 the Partnership anticipates completing the repairs
and improvements at the property required to be made in connection with the July
2004 refinancing of the mortgage encumbering the property. In connection with
the refinancing, approximately $675,000 was deposited in an escrow account to
fund such repairs and improvements. At December 31, 2004, the balance in the
escrow account was approximately $535,000. Additional improvements and routine
capital expenditures are anticipated during 2005. Such capital expenditures will
depend on the physical condition of the property as well as replacement reserves
and anticipated cash flow generated by the property. The additional capital
expenditures will be incurred only if cash is available from operations or from
Partnership reserves. To the extent that capital improvements are completed the
Partnership's distributable cash flow, if any, may be adversely affected at
least in the short term.

Item 3. Legal Proceedings

As previously disclosed, AIMCO Properties L.P. and NHP Management Company, both
affiliates of the Managing General Partner, are defendants in an action in the
United States District Court, District of Columbia. The plaintiffs have styled
their complaint as a collective action under the Fair Labor Standards Act
("FLSA") and seek to certify state subclasses in California, Maryland, and the
District of Columbia. Specifically, the plaintiffs contend that AIMCO Properties
L.P. failed to compensate maintenance workers for time that they were required
to be "on-call". Additionally, plaintiffs allege AIMCO Properties L.P. failed to
comply with the FLSA in compensating maintenance workers for time that they
worked in responding to a call while "on-call". The defendants have filed an
answer to the amended complaint denying the substantive allegations. Discovery
relating to the certification of the collective action has concluded and
briefing on the matter is currently underway. Although the outcome of any
litigation is uncertain, AIMCO Properties, L.P. does not believe that the
ultimate outcome will have a material adverse effect on its financial condition
or results of operations. Similarly, the Managing General Partner does not
believe that the ultimate outcome will have a material adverse effect on the
Partnership's consolidated financial condition or results of operations.

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

During the quarter ended December 31, 2004, no matter was submitted to a vote of
unit holders through the solicitation of proxies or otherwise.

PART II

Item 5. Market for the Partnership Equity and Related Partner Matters

The Partnership, a publicly-held limited partnership, offered and sold 649
limited partnership units aggregating $40,562,500. The Partnership currently has
145 holders of record owning an aggregate of 649 Units. Affiliates of the
Managing General Partner owned 522.65 units or 80.53% of the outstanding units
at December 31, 2004. No public trading market has developed for the Units, and
it is not anticipated that such a market will develop in the future.

The Partnership distributed the following amounts during the years ended
December 31, 2004, 2003, and 2002 (in thousands, except per unit data):

Year Ended Per Limited Year Ended Per Limited Year Ended Per Limited
December 31, Partnership December 31, Partnership December 31, Partnership
2004 Unit 2003 Unit 2002 Unit

Refinance $ 7,744 (2) $11,932 $ 2,818 (1) $ 4,342 $45,840 (1) $70,632
Operations 10,865 15,904 3,932 5,755 5,966 8,733
Total $18,609 $27,836 $ 6,750 $10,097 $51,806 $79,365

(1) Proceeds from the November 2002 refinancing of the mortgage encumbering
Springhill Lake Apartments.
(2) Proceeds from the July 2004 refinancing of the mortgage encumbering
Springhill Lake Apartments.

Future cash distributions will depend on the levels of net cash generated from
operations, the timing of the debt maturity, property sale and/or refinancing.
The Partnership's cash available for distribution is reviewed on a monthly
basis. There can be no assurance that the Partnership will generate sufficient
funds from operations after required capital improvement expenditures to permit
additional distributions to its partners during 2005 or subsequent periods. See
"Item 2. Description of Property - Capital Improvements" for information
relating to anticipated capital expenditures at the property.

Other

AIMCO and its affiliates owned 522.65 limited partnership units (the "Units") in
the Partnership representing 80.53% of the outstanding Units at December 31,
2004. A number of these Units were acquired pursuant to tender offers made by
AIMCO or its affiliates. It is possible that AIMCO or its affiliates will
acquire additional Units in exchange for cash or a combination of cash and units
in AIMCO Properties, L.P., the operating partnership of AIMCO, either through
private purchases or tender offers. Pursuant to the Partnership Agreement,
unitholders holding a majority of the Units are entitled to take action with
respect to a variety of matters that include, but are not limited to, voting on
certain amendments to the Partnership Agreement and voting to remove the
Managing General Partner. As a result of its ownership of 80.53% of the
outstanding Units, AIMCO and its affiliates are in a position to control all
voting decisions with respect to the Partnership. Although the Managing General
Partner owes fiduciary duties to the limited partners of the Partnership, the
Managing General Partner also owes fiduciary duties to AIMCO as its sole
stockholder. As a result, the duties of the Managing General Partner, as
managing general partner, to the Partnership and its limited partners may come
into conflict with the duties of the Managing General Partner to AIMCO as its
sole stockholder.

Item 6. Selected Financial Data (in thousands, except unit data)

2004 2003 2002 2001 2000
Total revenues from

rental operations $ 32,824 $ 32,282 $ 32,290 $ 31,004 $ 27,220

Net income $ 2,074 $ 4,455 $ 3,213 $ 2,387 $ 1,725

Net income per limited
partnership unit $ 3,035 $ 6,521 $ 4,703 $ 3,495 $ 2,525

Limited partnership
units outstanding 649 649 649 649 649

Total assets $ 51,540 $ 65,825 $ 71,425 $ 67,310 $ 64,900

Mortgage note payable $113,500 $110,386 $113,100 $ 51,788 $ 53,689

The above selected financial data should be read in conjunction with the
Partnership's financial statements and notes thereto appearing in "Item 8.
Financial Statements and Supplementary Data."

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

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

The Partnership's financial results depend upon a number of factors including
the ability to attract and maintain tenants at the investment property, interest
rates on mortgage loans, costs incurred to operate the investment property,
general economic conditions and weather. As part of the ongoing business plan of
the Partnership, the Managing General Partner monitors the rental market
environment of its investment property to assess the feasibility of increasing
rents, maintaining or increasing occupancy levels and protecting the Partnership
from increases in expenses. As part of this plan, the Managing General Partner
attempts to protect the Partnership from the burden of inflation-related
increases in expenses by increasing rents and maintaining a high overall
occupancy level. However, the Managing General Partner may use rental
concessions and rental rate reductions to offset softening market conditions,
accordingly, there is no guarantee that the Managing General Partner will be
able to sustain such a plan. Further, a number of factors that are outside the
control of the Partnership, such as the local economic climate and weather, can
adversely or positively affect the Partnership's financial results.

Results of Operations

2004 Compared with 2003

The Partnership's net income for the year ended December 31, 2004 was
approximately $2,074,000 compared to net income of approximately $4,455,000 for
the year ended December 31, 2003 (See "Item 8. Financial Statements and
Supplementary Data - Note C" for a reconciliation of these amounts to the
Partnership's federal taxable income.) Income before minority interest for the
year ended December 31, 2004 was approximately $4,811,000 compared to
approximately $5,440,000 for the year ended December 31, 2003. The decrease in
income before minority interest is primarily due to an increase in total
expenses partially offset by an increase in total revenues. The increase in
total revenues for the year ended December 31, 2004 is due to an increase in
rental and other income partially offset by a decrease in casualty gain. Rental
income increased due to an increase in the average rental rates at the
Partnership's property. Other income increased due to an increase in utility
reimbursements, legal costs charged to tenants and lease cancellation fees at
Springhill Lake Apartments.

During September 2003, Hurricane Isabel caused damages to some of the apartment
buildings at the property. During the year ended December 31, 2004, all work was
completed to repair the damage and the property recorded a casualty gain of
approximately $31,000. The gain was the result of the receipt of insurance
proceeds of approximately $38,000 offset by approximately $7,000 of
undepreciated damaged assets being written off.

During 2002, a fire occurred at Springhill Lake Apartments which resulted in
damage to eleven units at the property. During the year ended December 31, 2003,
all work was completed to repair the damage and the property recorded a casualty
gain of approximately $83,000. The gain was the result of the receipt of
insurance proceeds of approximately $104,000 offset by approximately $21,000 of
undepreciated damaged assets being written off.

Total expenses for the year ended December 31, 2004 increased due to increases
in depreciation, property tax, bad debt expenses and loss on early
extinguishment of debt offset by decreases in operating and general and
administrative expenses. Interest expense remained relatively constant between
the comparable periods. Depreciation expense increased due to property
improvements and replacements being placed into service during the past twelve
months which are now being depreciated. Property tax expense increased due to an
increase in the assessed value of the Partnership's investment property by the
local taxing authority. Bad debt expense increased due to a number of evictions
of residents. Loss on early extinguishment of debt increased due to the
Partnership refinancing the mortgage during the year ended December 31, 2004.
The decrease in operating expense is primarily due to a decrease in maintenance
expenses offset by an increase in advertising and property expenses. Maintenance
expenses decreased due to decreases in contract services as more work is now
being performed by on-site employees and the cost of repairs to the property.
Advertising expenses increased due to special promotions to attract new tenants
and maintain occupancy levels. Property expenses increased due to increases in
utility costs, salaries and related employee expenses. General and
administrative expenses decreased due to a decrease in accountable
reimbursements charged to the Partnership in accordance with the Partnership
Agreement.

Included in general and administrative expenses are reimbursements to the
Managing General Partner as allowed under the Partnership Agreement associated
with its management of the Partnership. Costs associated with the quarterly and
annual communications with investors and regulatory agencies and the annual
audit required by the Partnership Agreement are also included in general and
administrative expenses.

The limited partnership interest of Theodore N. Lerner in the operating
partnerships is reflected as a minority interest in the accompanying
consolidated financial statements. Minority interest in net earnings of the
operating partnerships recorded by the Partnership totaled approximately zero
for the years ended December 31, 2004 and 2003. During the years ended December
31, 2004 and 2003, the Partnership did not recognize any minority interest in
net earnings of the operating partnerships as previous distributions to the
minority partner during 2002 reduced the minority interest partner's balance to
zero. For the years ended December 31, 2004 and 2003, distributions to the
minority interest partner of approximately $2,737,000 and $985,000,
respectively, were made in excess of the minority partner's investment in the
operating partnerships. When the operating partnerships make distributions in
excess of the minority partner's investment balance, the Partnership, as the
majority partner, records a charge equal to the minority partner's excess
distribution over the investment balance. The charge is classified as
distributions to the minority partner in excess of investment on the
accompanying consolidated statements of operations. Cumulative distributions to
the minority partner in excess of investment totaled approximately $4,820,000
and $2,083,000 at December 31, 2004 and 2003, respectively. No income is
allocated to the minority partner until all previous losses recognized by the
majority partner are recovered. For the years ended December 31, 2004 and 2003,
approximately $994,000 and $1,070,000, respectively, in earnings were allocated
to the majority partner to recover previous losses recognized. Earnings will
continue to be allocated to the majority partner to recover previous losses
recognized until such time as the net amount of approximately $2,756,000 at
December 31, 2004 is recovered.

2003 Compared with 2002

The Partnership's net income for the year ended December 31, 2003 was
approximately $4,455,000 compared to net income of approximately $3,213,000 for
the year ended December 31, 2002 (See "Item 8. Financial Statements and
Supplementary Data - Note C" for a reconciliation of theses amounts to the
Partnership's federal taxable income.) Income before minority interest for the
year ended December 31, 2003 was approximately $5,440,000 compared to
approximately $5,377,000 for the year ended December 31, 2002. The increase in
income before minority interest was primarily due to a decrease in total
expenses partially offset by a decrease in total revenues. The decrease in total
revenues for the year ended December 31, 2003 was due to a larger casualty gain
recognized in 2002 compared to 2003 related to separate fires at the property in
April 2001 and March 2002, respectively, slightly offset by an increase in both
other and rental income. Other income increased due to increases in utility
reimbursements and legal fees partially offset by decreases in lease
cancellation fees and miscellaneous resident charges at the property. Rental
income increased slightly due to increased rental rates at Springhill Lake
Apartments.

During March 2002 a fire occurred at Springhill Lake Apartments which resulted
in damage to eleven units at the property. During the year ended December 31,
2003, all work was completed to repair the damage and the property recorded a
casualty gain of approximately $83,000. The gain was the result of the receipt
of insurance proceeds of approximately $104,000 offset by approximately $21,000
of undepreciated property improvements and replacements being written off.

Total expenses for year ended December 31, 2003 decreased due to decreases in
interest and general and administrative expenses partially offset by increases
in operating, property tax, bad debt and depreciation expenses. Interest expense
decreased due to the refinancing of the mortgage encumbering Springhill Lake
Apartments in November 2002. Though the mortgage principal balance increased
significantly, the variable interest rate on the new loan was significantly
lower in 2003 than the fixed interest rate applicable to the old loan during
2002. General and administrative expense decreased due to a decrease in
accountable reimbursements paid to an affiliate of the Managing General Partner
in accordance with the Partnership Agreement. The increase in operating expense
was primarily due to increases in property administrative costs and maintenance
expenses at the property. Property administrative expenses increased primarily
due to the cost of cleaning contracts and costs associated with collecting
tenant rents. Maintenance expenses increased primarily due to roof repairs, snow
removal expenses and contract work offset by decreases in interior and exterior
building improvements at the Partnership's investment property. Property tax
expense increased due to an increased tax rate by the local taxing authority.
Depreciation expense increased due to property improvements and replacements
placed into service during the past twelve months which are now being
depreciated. Bad debt expense increased as a result of larger balances owed by
tenants that were evicted during 2003 compared to the balances owed for 2002
evictions.

Included in general and administrative expenses are reimbursements to the
Managing General Partner as allowed under the Partnership Agreement associated
with its management of the Partnership. Costs associated with the quarterly and
annual communications with investors and regulatory agencies and the annual
audit required by the Partnership Agreement are also included in general and
administrative expenses.

Minority interest in net earnings of the operating partnerships totaled
approximately zero and $1,066,000 for the years ended December 31, 2003 and
2002, respectively. During the year ended December 31, 2003, the Partnership did
not recognize any minority interest in net earnings of the operating
partnerships as previous distributions to the minority partner during 2002
reduced the minority interest partner's investment balance to zero. For the
years ended December 31, 2003 and 2002, distributions to the minority interest
partner of approximately $985,000 and $1,098,000, respectively, were made in
excess of the minority partner's investment in the operating partnerships. When
the operating partnerships make distributions in excess of the minority
partner's investment balance, the Partnership, as the majority partner, records
a charge equal to the minority partner's excess distribution over the investment
balance. The charge is classified as distributions to the minority partner in
excess of investment on the accompanying consolidated statements of operations.
Cumulative distributions to the minority partner in excess of investment totaled
approximately $2,083,000 and $1,098,000 at December 31, 2003 and 2002,
respectively. No income is allocated to the minority partner until all previous
losses recognized by the majority partner are recovered. For the years ended
December 31, 2003 and 2002, approximately $1,070,000 and zero, respectively, in
earnings were allocated to the majority partner to recover previous losses
recognized. Earnings will continue to be allocated to the majority partner to
recover previous losses recognized until such time as the net amount of
approximately $1,013,000 at December 31, 2003 is recovered.

Liquidity and Capital Reserves

At December 31, 2004, the Partnership had cash and cash equivalents of
approximately $1,502,000, compared to approximately $5,194,000 at December 31,
2003. Cash and cash equivalents decreased approximately $3,692,000 from December
31, 2003 due to approximately $18,772,000 of cash used in financing activities
partially offset by approximately $13,219,000 and $1,861,000 of cash provided by
operating and investing activities, respectively. Cash used in financing
activities consisted of repayment of the mortgage encumbering the Partnership's
investment property, distributions to partners, loan costs paid for the property
refinancing, payment of a prepayment penalty and principal payments made on the
mortgage encumbering the property partially offset by proceeds from the new
mortgage encumbering the property. Cash provided by investing activities
consisted of net withdrawals from restricted escrows and the receipt of
insurance proceeds partially offset by property improvements and replacements.
The Partnership invests its working capital in interest bearing accounts.

The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the property to adequately maintain the physical assets
and other operating needs of the Partnership and to comply with Federal, state
and local legal and regulatory requirements. The Managing General Partner
monitors developments in the area of legal and regulatory compliance. For
example, the Sarbanes-Oxley Act of 2002 mandates or suggests additional
compliance measures with regard to governance, disclosure, audit and other
areas. In light of these changes, the Partnership expects that it will incur
higher expenses related to compliance. The Partnership regularly evaluates the
capital improvement needs of the property for the upcoming year. During 2005 the
Partnership anticipates completing the repairs and improvements at the property
required to be made in connection with the July 2004 refinancing of the mortgage
encumbering the property. In connection with the refinancing, approximately
$675,000 was deposited in an escrow account to fund such repairs and
improvements. At December 31, 2004, the balance in the escrow account was
approximately $535,000. Additional improvements and routine capital expenditures
are anticipated during 2005. Such capital expenditures will depend on the
physical condition of the property as well as replacement reserves and
anticipated cash flow generated by the property. The additional capital
expenditures will be incurred only if cash is available from operations or from
Partnership reserves. To the extent that capital improvements are completed the
Partnership's distributable cash flow, if any, may be adversely affected at
least in the short term.

The Partnership's assets are thought to be sufficient for any near term needs
(exclusive of capital improvements) of the Partnership. On July 22, 2004, the
Partnership refinanced the existing mortgage encumbering Springhill Lake
Apartments which had been previously refinanced in 2002 (see discussion below).
The new mortgage of $113,500,000 replaced existing mortgage indebtedness of
approximately $109,007,000. The new mortgage bears interest at a variable rate
and has a balloon payment of $113,500,000 due on August 1, 2011. The interest
rate on the variable rate loan is the Freddie Mac discounted mortgage-backed
security index plus 63 basis points. The rate was 2.728% at December 31, 2004.
After repayment of the existing mortgage, payment of closing costs, and funding
of a $675,000 repair escrow account and operating reserves, the Partnership
received net proceeds of approximately $3,294,000. The Partnership also received
a refund of approximately $7,085,000 relating to the repair escrow required by
the previous lender. Total capitalized loan costs associated with this
refinancing were approximately $526,000 during the year ended December 31, 2004.
The Partnership recognized a loss on the early extinguishment of debt of
approximately $918,000 due to the write off of approximately $904,000 of
unamortized loan costs and a prepayment penalty of approximately $14,000 during
the year ended December 31, 2004.

On November 14, 2002, the Partnership refinanced its then existing mortgage
encumbering Springhill Lake Apartments. This loan was initially refinanced under
an interim credit facility ("Interim Credit Facility") which had a term of three
months. The Interim Credit Facility included properties in other partnerships
that are affiliated with the Partnership. However, the Interim Credit Facility
created separate loans for each property that are not cross-collateralized or
cross-defaulted with the other property loans. During the term of the Interim
Credit Facility, the property was required to make interest-only payments. The
first month's interest, which was paid at the date of the refinancing, was
calculated at LIBOR plus 70 basis points. Interest for the following month was
calculated at LIBOR plus 150 basis points.

During December 2002 the loan was sold to Fannie Mae under a permanent credit
facility ("Permanent Credit Facility"). The Credit Facility had a maturity of
five years, with one five-year extension option. This Permanent Credit Facility
also created separate loans for each property that were not cross-collateralized
or cross-defaulted with the other property loans. Each note under this Permanent
Credit Facility began as a variable rate loan with the option of converting to a
fixed rate loan after three years. The interest rate on the variable rate loans
was the Fannie Mae discounted mortgage-backed security index plus 85 basis
points. The rate was 1.92% at December 31, 2003 and reset monthly. Each loan
automatically renewed at the end of each month. In addition, monthly principal
payments were required based on a 30-year amortization schedule, using the
interest rate in effect during the first month that any property was on the
Permanent Credit Facility. The loans could be prepaid without penalty.

The 2002 refinancing of the existing Springhill Lake Apartments loan replaced
the first mortgage of approximately $50,300,000 with a new mortgage in the
amount of $113,100,000. Total capitalized loan costs were approximately
$2,058,000 during the year ended December 31, 2002. Additional loan costs of
approximately $53,000 were capitalized during the year ended December 31, 2003.
The Partnership recognized a loss on the early extinguishment of debt of
approximately $58,000 during the year ended December 31, 2002 due to the write
off of unamortized loan costs. In addition, approximately $7,783,000 was
initially deposited in an escrow account to be used to complete required repairs
at the property. At December 31, 2003, the escrow account balance was
approximately $7,070,000.

The Partnership distributed the following amounts during the years ended
December 31, 2004, 2003, and 2002 (in thousands, except per unit data):

Year Ended Per Limited Year Ended Per Limited Year Ended Per Limited
December 31, Partnership December 31, Partnership December 31, Partnership
2004 Unit 2003 Unit 2002 Unit

Refinance $ 7,744 (2) $11,932 $ 2,818 (1) $ 4,342 $45,840 (1) $70,632
Operations 10,865 15,904 3,932 5,755 5,966 8,733
Total $18,609 $27,836 $ 6,750 $10,097 $51,806 $79,365

(1) Proceeds from the November 2002 refinancing of the mortgage encumbering
Springhill Lake Apartments.
(2) Proceeds from the July 2004 refinancing of the mortgage encumbering
Springhill Lake Apartments.

Future cash distributions will depend on the levels of net cash generated from
operations, the timing of the debt maturity, property sale and/or refinancing.
The Partnership's cash available for distribution is reviewed on a monthly
basis. There can be no assurance that the Partnership will generate sufficient
funds from operations after required capital improvement expenditures to permit
additional distributions to its partners during 2005 or subsequent periods.

Other

AIMCO and its affiliates owned 522.65 limited partnership units (the "Units") in
the Partnership representing 80.53% of the outstanding Units at December 31,
2004. A number of these Units were acquired pursuant to tender offers made by
AIMCO or its affiliates. It is possible that AIMCO or its affiliates will
acquire additional Units in exchange for cash or a combination of cash and units
in AIMCO Properties, L.P., the operating partnership of AIMCO, either through
private purchases or tender offers. Pursuant to the Partnership Agreement,
unitholders holding a majority of the Units are entitled to take action with
respect to a variety of matters that include, but are not limited to, voting on
certain amendments to the Partnership Agreement and voting to remove the
Managing General Partner. As a result of its ownership of 80.53% of the
outstanding Units, AIMCO and its affiliates are in a position to control all
voting decisions with respect to the Partnership. Although the Managing General
Partner owes fiduciary duties to the limited partners of the Partnership, the
Managing General Partner also owes fiduciary duties to AIMCO as its sole
stockholder. As a result, the duties of the Managing General Partner, as
managing general partner, to the Partnership and its limited partners may come
into conflict with the duties of the Managing General Partner to AIMCO as its
sole stockholder.

Critical Accounting Policies and Estimates

A summary of the Partnership's significant accounting policies is included in
"Note A - Organization and Summary of Significant Accounting Policies" which is
included in the consolidated financial statements in "Item 8. Financial
Statements". The Managing General Partner believes that the consistent
application of these policies enables the Partnership to provide readers of the
financial statements with useful and reliable information about the
Partnership's operating results and financial condition. The preparation of
consolidated financial statements in conformity with accounting principles
generally accepted in the United States requires the Partnership to make
estimates and assumptions. These estimates and assumptions affect the reported
amounts of assets and liabilities at the date of the financial statements as
well as reported amounts of revenues and expenses during the reporting period.
Actual results could differ from these estimates. Judgments and assessments of
uncertainties are required in applying the Partnership's accounting policies in
many areas. The Partnership believes that of its significant accounting
policies, the following may involve a higher degree of judgment and complexity.

Impairment of Long-Lived Assets

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

Real property investments are subject to varying degrees of risk. Several
factors may adversely affect the economic performance and value of the
Partnership's investment property. These factors include, but are not limited
to, changes in the national, regional and local economic climate; local
conditions, such as an oversupply of multifamily properties; competition from
other available multifamily property owners and changes in market rental rates.
Any adverse changes in these factors could cause an impairment in the
Partnership's asset.

Revenue Recognition

The Partnership generally leases apartment units for twelve-month terms or less.
Commercial building lease terms are generally for terms of 3 to 10 years or
month to month. The Partnership will offer rental concessions during
particularly slow months or in response to heavy competition from other similar
complexes in the area. Rental income attributable to leases, net of any
concessions, is recognized on a straight-line basis over the term of the lease.
The Partnership evaluates all accounts receivable from residents and establishes
an allowance, after the application of security deposits, for accounts greater
than 30 days past due on current tenants and all receivables due from former
tenants.

Item 7a. Quantitative and Qualitative Disclosures About Market Risk

The Partnership is exposed to market risks from adverse changes in interest
rates. In this regard, changes in U.S. interest rates affect the interest earned
on the Partnership's cash and cash equivalents as well as interest paid on its
indebtedness. As a policy, the Partnership does not engage in speculative or
leveraged transactions, nor does it hold or issue financial instruments for
trading purposes. The Partnership is exposed to changes in interest rates
primarily as a result of its borrowing activities used to maintain liquidity and
fund business operations. The debt encumbering the property bears interest at a
variable rate. Based on interest rates at December 31, 2004, a 100 basis point
increase or decrease in market interest rates would affect net income by
approximately $1.1 million.

The Partnership's debt obligations at December 31, 2004 consist of a mortgage of
$113,500,000 which is due on August 1, 2011. The mortgage bears interest at a
variable rate and requires monthly payments of interest only. The interest rate
on the variable rate loan is the Freddie Mac discounted mortgage-backed security
index ("DMBS") plus 63 basis points. The rate was 2.728% at December 31, 2004
and resets monthly. Management believes that the fair value of the Partnership's
debt approximates its carrying value as of December 31, 2004.

Item 8. Financial Statements and Supplementary Data

SPRINGHILL LAKE INVESTORS LIMITED PARTNERSHIP

LIST OF FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets - December 31, 2004 and 2003

Consolidated Statements of Operations - Years ended December 31, 2004, 2003
and 2002

Consolidated Statements of Changes in Partners' (Deficiency) Capital - Years
ended December 31, 2004, 2003 and 2002

Consolidated Statements of Cash Flows - Years ended December 31, 2004, 2003 and
2002

Notes to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm

The Partners of
Springhill Lake Investors Limited Partnership

We have audited the accompanying consolidated balance sheets of Springhill Lake
Investors Limited Partnership as of December 31, 2004 and 2003, and the related
consolidated statements of operations, changes in partners' (deficiency)
capital, and cash flows for each of the three years in the period ended December
31, 2004. These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. We were not engaged to perform an
audit of the Partnership's internal control over financial reporting. Our audit
included consideration of internal control over financial reporting as a basis
for designing audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the
Partnership's internal control over financial reporting. Accordingly, we express
no such opinion. An audit also includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Springhill Lake
Investors Limited Partnership at December 31, 2004 and 2003, and the
consolidated results of its operations and its cash flows for each of the three
years in the period ended December 31, 2004, in conformity with accounting
principles generally accepted in the United States.

/s/ERNST & YOUNG LLP

Greenville, South Carolina
March 10, 2005

SPRINGHILL LAKE INVESTORS LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)

December 31,
2004 2003
Assets

Cash and cash equivalents $ 1,502 $ 5,194
Receivables and deposits 943 1,944
Restricted escrows 535 7,070
Other assets 2,584 3,046
Investment property (Notes B and E):
Land 5,833 5,833
Buildings and related personal property 127,632 122,808
133,465 128,641
Less accumulated depreciation (87,489) (80,070)
45,976 48,571
$ 51,540 $ 65,825
Liabilities and Partners' Deficit
Liabilities
Accounts payable $ 227 $ 830
Tenant security deposit liabilities 654 834
Other liabilities 575 656
Mortgage note payable (Note E) 113,500 110,386
114,956 112,706

Minority Interest (Note H) -- --

Partners' Deficit
General partners (3,210) (2,771)
Investor limited partners
(649 units issued and outstanding) (60,206) (44,110)
(63,416) (46,881)
$ 51,540 $ 65,825

See Accompanying Notes to Consolidated Financial Statements

SPRINGHILL LAKE INVESTORS LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per unit data)

Years Ended December 31,
2004 2003 2002
Revenues:

Rental income $31,073 $30,677 $30,462
Other income 1,720 1,522 1,362
Casualty gain (Note F) 31 83 466
Total revenues 32,824 32,282 32,290

Expenses:
Operating 13,821 13,990 12,347
General and administrative 575 598 639
Depreciation 7,435 7,377 7,106
Interest 2,715 2,714 4,714
Property taxes 2,173 1,883 1,850
Bad debt expense 376 280 199
Loss on early extinguishment of debt (Note E) 918 -- 58
Total expenses 28,013 26,842 26,913

Income before minority interest 4,811 5,440 5,377

Distributions to minority interest partner
in excess of investment (Note H) (2,737) (985) (1,098)

Minority interest in net earnings of
operating partnerships (Note H) -- -- (1,066)
Net income $ 2,074 $ 4,455 $ 3,213

Net income allocated to general partners (5%) $ 104 $ 223 $ 161
Net income allocated to investor limited
partners (95%) 1,970 4,232 3,052
Net income $ 2,074 $ 4,455 $ 3,213

Net income per limited partnership unit $ 3,035 $ 6,521 $ 4,703

Distributions per limited partnership unit $27,836 $10,097 $79,365

See Accompanying Notes to Consolidated Financial Statements

SPRINGHILL LAKE INVESTORS LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' (DEFICIENCY) CAPITAL
For The Years Ended December 31, 2004, 2003 and 2002
(in thousands, except unit data)

Total
Limited Investor Partners'
Partnership General Limited (Deficit)
Units Partners Partners Capital

Original capital contributions 649 $ -- $ 40,563 $ 40,563

Partners' (deficiency) capital
at December 31, 2001 649 $(2,660) $ 6,667 $ 4,007

Distributions to partners -- (298) (51,508) (51,806)

Net income for the year ended
December 31, 2002 -- 161 3,052 3,213

Partners' deficit
at December 31, 2002 649 (2,797) (41,789) (44,586)

Distributions to partners (197) (6,553) (6,750)

Net income for the year ended
December 31, 2003 -- 223 4,232 4,455

Partners' deficit at
December 31, 2003 649 (2,771) (44,110) (46,881)

Distributions to partners (543) (18,066) (18,609)

Net income for the year ended
December 31, 2004 -- 104 1,970 2,074

Partners' deficit at
December 31, 2004 649 $(3,210) $(60,206) $(63,416)

See Accompanying Notes to Consolidated Financial Statements

SPRINGHILL LAKE INVESTORS LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

Years Ended December 31,
2004 2003 2002
Cash flows from operating activities:

Net income $ 2,074 $ 4,455 $ 3,213
Adjustments to reconcile net income to net cash provided
by operating activities:
Distributions to minority interest partner in excess
of investment 2,737 985 1,098
Minority interest in net earnings of operating
Partnerships -- -- 1,066
Depreciation 7,435 7,377 7,106
Casualty gain (31) (83) (466)
Amortization of loan costs 297 437 150
Loss on early extinguishment of debt 918 -- 58
Bad debt expense 376 280 199
Change in accounts:
Receivables and deposits 625 (370) 65
Other assets (213) (6) (318)
Accounts payable (738) 280 (1,042)
Tenant security deposit liabilities (180) 60 (1)
Other liabilities (81) (281) (2)
Due to affiliate -- -- (99)
Net cash provided by operating activities 13,219 13,134 11,027
Cash flows from investing activities:
Insurance proceeds received 38 104 445
Property improvements and replacements (4,712) (2,901) (3,858)
Net withdrawals from (deposits to) restricted escrows 6,535 (44) (4,694)
Refund of construction service fees from affiliate -- -- 2,245
Net cash provided by (used in) investing activities 1,861 (2,841) (5,862)
Cash flows from financing activities:
Proceeds from advances from affiliate -- -- 156
Payments on advances from affiliate -- (156) (1,853)
Payments on mortgage note payable (1,379) (2,714) (1,488)
Distributions to partners (18,609) (6,750) (51,806)
Distributions to minority interest partner (2,737) (985) (7,634)
Repayment of mortgage notes payable (109,007) -- (50,300)
Proceeds from mortgage note payable 113,500 -- 113,100
Prepayment penalty (14) -- --
Loan costs paid (526) (53) (2,058)
Net cash used in financing activities (18,772) (10,658) (1,883)
Net (decrease) increase in cash and cash equivalents (3,692) (365) 3,282
Cash and cash equivalents at beginning of year 5,194 5,559 2,277
Cash and cash equivalents at end of year $ 1,502 $ 5,194 $ 5,559
Supplemental disclosure of cash flow information:
Cash paid for interest, including approximately $0, $0,
and $41, respectively, paid to an affiliate $ 2,505 $ 2,456 $ 4,586
Supplemental disclosure of non-cash information:
Property improvements and replacements in accounts
payable and other liabilities $ 135 $ -- $ 494

See Accompanying Notes to Consolidated Financial Statements

SPRINGHILL LAKE INVESTORS LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004

Note A - Organization and Summary of Significant Accounting Policies

Organization: Springhill Lake Investors Limited Partnership (the "Partnership"),
a Maryland limited partnership was formed on December 28, 1984, to acquire and
own a 90% general partnership interest in Springhill Lake Limited Partnerships I
through IX and Springhill Commercial Limited Partnership (the "Operating
Partnerships"). The Operating Partnerships own and operate the Springhill Lake
complex in Greenbelt, Maryland. The complex consists of 2,899 apartment and
townhouse units and a four-store shopping center. The Managing General Partner
of the Registrant is AIMCO/Springhill Lake Investors GP, LLC ("AIMCO LLC" or
"Managing General Partner") a wholly owned subsidiary of AIMCO Properties, L.P.,
an affiliate of Apartment Investment and Management Company ("AIMCO"), a
publicly traded real estate investment trust. The Partnership Agreement provides
that the Partnership is to terminate on December 31, 2035 unless terminated
prior to such date.

On December 11, 2003, AIMCO Properties, L.P., a Delaware limited partnership,
entered into a Redemption and Contribution Agreement (the "Redemption and
Contribution Agreement") with First Winthrop Corporation, a Delaware corporation
("FWC") and the sole shareholder of Three Winthrop Properties, Inc.
("Winthrop"), the former managing general partner of the Partnership, with
respect to the acquisition of its general partner interest in the Partnership
(the "MGP Interest") by an affiliate of AIMCO Properties, L.P., the operating
partnership of AIMCO.

As of the time of the execution of the Redemption and Contribution Agreement and
until such time as the transfer of the MGP Interest from Winthrop to AIMCO LLC
became effective, NHP Management Company ("NHP"), an affiliate of AIMCO
Properties, L.P., was vested with the authority to, subject to certain
limitations, cause Winthrop to take such actions as it deemed necessary and
advisable in connection with the activities of the Partnership. The transfer of
the MGP Interest from Winthrop to AIMCO LLC became effective on March 31, 2004.
As used herein, the term "Managing General Partner" shall mean Winthrop, with
respect to matters occurring prior to March 31, 2004 and AIMCO LLC for matters
occurring from and after March 31, 2004.

Principles of Consolidation: The accompanying consolidated financial statements
include the accounts of the Partnership and the Operating Partnerships. Theodore
N. Lerner's ownership in the Operating Partnerships has been reflected as a
minority interest in the accompanying consolidated financial statements. All
significant interpartnership accounts and transactions have been eliminated in
consolidation.

Use of Estimates: The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the amounts reported in
the financial statements and accompanying notes. Actual results could differ
from those estimates.

Allocation of Profits, Gains and Losses: The Partnership Agreement provides for
net income and net losses for both financial and tax reporting purposes to be
allocated 95% to the Limited Partners and 5% to the General Partner.

Gains from property sales are allocated in accordance with the Partnership
Agreement.

Accordingly, net income as shown in the statements of operations and changes in
partners' capital for 2004, 2003 and 2002 was allocated 95% to the Limited
Partners and 5% to the General Partner. Net income per limited partnership unit
for each year was computed as 95% of net income divided by 649 units outstanding
(the "Units").

Depreciation: Depreciation is provided by the straight-line method over the
estimated lives of the apartment property and related personal property. For
Federal income tax purposes, the accelerated cost recovery method is used for
real property over 19 years for additions after May 8, 1985, and before January
1, 1987. As a result of the Tax Reform Act of 1986, for additions after December
31, 1986, the modified accelerated cost recovery method is used for depreciation
of (1) real property over 27.5 years and (2) personal property additions over 5
years.

Cash and Cash Equivalents: Cash and cash equivalents include cash on hand and in
banks. At certain times, the amount of cash deposited at a bank may exceed the
limit on insured deposits. Cash balances included approximately $1,421,000 and
$5,125,000 at December 31, 2004 and 2003, respectively, that are maintained by
an affiliated management company on behalf of affiliated entities in cash
concentration accounts.

Investment Property: Investment property consists of one apartment complex with
a four-store shopping center and is stated at cost. Acquisition fees are
capitalized as a cost of real estate. The Partnership capitalizes all
expenditures in excess of $250 that clearly relate to the acquisition and
installation of real and personal property components. These expenditures
include costs incurred to replace existing property components, costs incurred
to add a material new feature to a property, and costs that increase the useful
life or service potential of a property component. These capitalized costs are
depreciated over the useful life of the asset. Expenditures for ordinary
repairs, maintenance and apartment turnover costs are expensed as incurred. In
accordance with SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets," the Partnership records impairment losses on long-lived
assets used in operations when events and circumstances indicate that the assets
might be impaired and the undiscounted cash flows estimated to be generated by
those assets are less than the carrying amounts of those assets. No adjustments
for impairment of value were recorded in the years ended December 31, 2004, 2003
or 2002.

Advertising: The Partnership expenses the costs of advertising as incurred.
Advertising costs of approximately $135,000, $87,000, and $73,000 for the years
ended December 31, 2004, 2003 and 2002, respectively, were charged to operating
expense as incurred.

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

Deferred Costs: Loan costs of approximately $985,000 and $2,111,000 are included
in other assets in the accompanying consolidated balance sheet as of December
31, 2004 and 2003, respectively. Accumulated amortization of approximately
$46,000 and $497,000 was also included in other assets as of December 31, 2004
and 2003, respectively. The loan costs at December 31, 2004 are amortized over
the term of the related loan agreement. Amortization expense is included in
interest expense in the accompanying consolidated statements of operations.
Amortization of loan costs is expected to be approximately $141,000 each year
for years 2005 through 2009.

Leasing commissions and other direct costs incurred in connection with
successful leasing efforts are deferred and amortized over the terms of the
related leases. Amortization of these costs is included in operating expenses.

Fair Value of Financial Instruments: SFAS No. 107, "Disclosures about Fair Value
of Financial Instruments", as amended by SFAS No. 119, "Disclosures about
Derivative Financial Instruments and Fair Value of Financial Instruments",
requires disclosure of fair value information about financial instruments,
whether or not recognized in the balance sheet, for which it is practicable to
estimate fair value. Fair value is defined in the SFAS as the amount at which
the instruments could be exchanged in a current transaction between willing
parties, other than in a forced or liquidation sale. The Partnership believes
that the carrying amount of its financial instruments (except for long term
debt) approximate their fair value due to the short term maturity of these
instruments. The Partnership estimates the fair value of its long term debt by
discounting future cash flows using a discount rate commensurate with that
currently believed to be available to the Partnership for similar term, fully
amortizing long term debt. The fair value of the Partnership's long term debt
approximates its carrying value at December 31, 2004.

Leases: The Partnership generally leases apartment units for twelve-month terms
or less. Commercial building lease terms are generally for terms of 3 to 10
years of month to month. The Partnership will offer rental concessions during
particularly slow months or in response to heavy competition from other similar
complexes in the area. Rental income attributable to leases, net of any
concessions, is recognized on a straight-line basis over the term of the lease.
The Partnership evaluates all accounts receivable from residents and establishes
an allowance, after the application of security deposits, for accounts greater
than 30 days past due on current tenants and all receivables due from former
tenants.

Tenant Security Deposits: The Partnership requires security deposits from
lessees for the duration of the lease and are included in receivables and
deposits in the accompanying consolidated balance sheets. Deposits are refunded
when the tenant vacates, provided the tenant has not damaged its space and is
current on its rental payments.

Income Taxes: No provision for income taxes is reflected in the accompanying
consolidated financial statements. Each partner is required to report on his
individual tax return his allocable share of income, gains, losses, deductions
and credits.

Note B - Investment Property and Accumulated Depreciation

Initial Cost

Investment Property To Partnership

Buildings Cost
and Related Capitalized
Personal Subsequent to
Description Encumbrances Land Property Acquisition
(in thousands) (in thousands)

Springhill Lake $113,500 $ 5,833 $ 67,484 $ 60,148

Gross Amount At Which Carried
At December 31, 2004
(in thousands)

Buildings
And
Related
Personal Accumulated Date Depreciable
Description Land Property Total Depreciation Acquired Life-Years

Springhill Lake $5,833 $127,632 $133,465 $ 87,489 10/84 5-30

Reconciliation of "Investment Property and Accumulated Depreciation":

Years Ended December 31,
2004 2003 2002
(in thousands)
Investment Property

Balance at beginning of year $128,641 $126,302 $125,133
Property improvements 4,847 2,407 3,679
Disposition of property (23) (68) (265)
Refund of construction service fees
previously capitalized (1) -- -- (2,245)
Balance at end of year $133,465 $128,641 $126,302

Accumulated Depreciation
Balance at beginning of year $ 80,070 $ 72,740 $ 65,806
Depreciation of real estate 7,435 7,377 7,106
Disposition of property (16) (47) (172)
Balance at end of year $ 87,489 $ 80,070 $ 72,740

(1) See Note D - Related Party Transactions for further information.

The aggregate cost of the real estate for Federal income tax purposes at
December 31, 2004 and 2003, is approximately $132,415,000 and $127,734,000. The
accumulated depreciation taken for Federal income tax purposes at December 31,
2004 and 2003 is approximately $100,531,000 and $96,655,000.

Note C - Taxable Income

Taxable income or loss of the Partnership is reported in the income tax returns
of its partners. Accordingly, no provision for income taxes is made in the
financial statements of the Partnership. The following is a reconciliation of
reported income and Federal taxable income (in thousands, except per unit data):

2004 2003 2002

Net income as reported $ 2,074 $ 4,455 $ 3,213
Excess of accelerated depreciation for
income tax purposes 3,558 3,623 778
Deferred revenue - laundry income (65) (79) (79)
Other 978 117 542
Casualty (32) -- --
Federal taxable income $ 6,513 $ 8,116 $ 4,454

Federal taxable income per limited
partnership unit $ 9,535 $11,881 $ 6,519

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

2004 2003
Net liabilities as reported: $(63,416) $(46,881)
Land and buildings (1,050) (907)
Accumulated depreciation (13,042) (16,585)
Deferred sales commission -- 65
Other 4,664 3,558

Net liabilities - income tax method $(72,844) $(60,750)

Note D - Related Party Transactions

The Partnership has no employees and depends on the Managing General Partner and
its affiliates for the management and administration of all Partnership
activities. The Limited Partnership Agreement provides for (i) certain payments
to affiliates for services (ii) reimbursements of certain expenses incurred by
affiliates on behalf of the Partnership (iii) an annual asset management fee of
$100,000 and (iv) an annual administration fee of $10,000.

Affiliates of the Managing General Partner receive 3% of residential rent
collections and 5% of commercial income from the Partnership's property as
compensation for providing property management services. The Partnership paid to
such affiliates approximately $965,000, $953,000 and $936,000 for the years
ended December 31, 2004, 2003 and 2002, respectively, which is included in
operating expense.

Affiliates of the Managing General Partner charged the Partnership reimbursement
of accountable administrative expenses amounting to approximately $381,000,
$413,000 and $435,000 for the years ended December 31, 2004, 2003 and 2002,
respectively, which is included in general and administrative expenses. For the
year ended 2002, the first three quarters were based on estimated amounts and in
the fourth quarter the reimbursement was adjusted based on actual costs (see
"Note J"). During 2001, the Partnership was charged, by affiliates of the
Managing General Partner, approximately $2,245,000 for fees related to
construction management services for work performed during 1999, 2000 and 2001.
These fees had been capitalized and included in investment property. During the
second quarter of 2002, it was determined by the Managing General Partner that
these fees should not have been charged and the Partnership was refunded the
full amount. Accordingly, such previously capitalized fees were no longer
included in investment property at December 31, 2002.

In accordance with the Partnership Agreement, the Managing General Partner
earned approximately $100,000 in asset management fees and approximately $10,000
in administrative fees for the years ended December 31, 2004, 2003 and 2002,
which is included in general and administrative expense.

During the year ended December 31, 2002, an affiliate of the Managing General
Partner advanced the Partnership approximately $156,000. There were no advances
made for the years ended December 31, 2004 and 2003. Approximately $156,000 and
$1,853,000 was repaid during 2003 and 2002, respectively. At December 31, 2004
and 2003, there was no balance due for advances from affiliate. In accordance
with the Partnership Agreement, interest is charged at the prime rate plus 2%.
The Partnership recognized approximately $30,000 of interest expense related to
these advances during the year ended December 31, 2002. Interest expense for the
year ended December 31, 2003 amounted to less than $1,000.

The Partnership insures its property up to certain limits through coverage
provided by AIMCO which is generally self-insured for a portion of losses and
liabilities related to workers compensation, property casualty and vehicle
liability. The Partnership insures its property above the AIMCO limits through
insurance policies obtained by AIMCO from insurers unaffiliated with the
Managing General Partner. During the years ended December 31, 2004, 2003 and
2002, the Partnership was charged by AIMCO and its affiliates approximately
$288,000, $273,000 and $331,000, respectively, for insurance coverage and fees
associated with policy claims administration.

AIMCO and its affiliates owned 522.65 limited partnership units (the "Units") in
the Partnership representing 80.53% of the outstanding Units at December 31,
2004. A number of these Units were acquired pursuant to tender offers made by
AIMCO or its affiliates. It is possible that AIMCO or its affiliates will
acquire additional Units in exchange for cash or a combination of cash and units
in AIMCO Properties, L.P., the operating partnership of AIMCO, either through
private purchases or tender offers. Pursuant to the Partnership Agreement,
unitholders holding a majority of the Units are entitled to take action with
respect to a variety of matters that include, but are not limited to, voting on
certain amendments to the Partnership Agreement and voting to remove the
Managing General Partner. As a result of its ownership of 80.53% of the
outstanding Units, AIMCO and its affiliates are in a position to control all
voting decisions with respect to the Partnership. Although the Managing General
Partner owes fiduciary duties to the limited partners of the Partnership, the
Managing General Partner also owes fiduciary duties to AIMCO as its sole
stockholder. As a result, the duties of the Managing General Partner, as
managing general partner, to the Partnership and its limited partners may come
into conflict with the duties of the Managing General Partner to AIMCO as its
sole stockholder.

Note E - Mortgage Note Payable

The terms of the mortgage note payable are as follows:

Principal Principal
Balance Balance Principal
Due At Due At Balance
Property December 31, Interest Maturity Due At
2004 2003 Rate Date Maturity
(in thousands) (in thousands)
Springhill Lake

1st mortgage $113,500 $110,386 (1) 08/11 $113,500

(1) Adjustable rate based on Freddie Mac discounted mortgage-backed security
index plus 63 basis points. The rate at December 31, 2004 was 2.728% and
will reset monthly.

On July 22, 2004, the Partnership refinanced the mortgage encumbering Springhill
Lake Apartments. The new mortgage of $113,500,000 replaced existing mortgage
indebtedness of approximately $109,007,000. The new mortgage bears interest at a
variable rate and has a balloon payment of $113,500,000 due on August 1, 2011.
The interest rate on the variable rate loan is the Freddie Mac discounted
mortgage-backed security index plus 63 basis points. The rate was 2.728% at
December 31, 2004. After repayment of the existing mortgage, payment of closing
costs, and funding of a $675,000 repair escrow account and operating reserves,
the Partnership received net proceeds of approximately $3,294,000. The
Partnership also received a refund of approximately $7,085,000 relating to the
repair escrow required by the previous lender. Total capitalized loan costs
associated with this refinancing were approximately $526,000 during the year
ended December 31, 2004. The Partnership recognized a loss on the early
extinguishment of debt of approximately $918,000 due to the write off of
approximately $904,000 of unamortized loan costs and a prepayment penalty of
approximately $14,000 during the year ended December 31, 2004.

On November 14, 2002, the Partnership refinanced its then existing mortgage
encumbering Springhill Lake Apartments. This loan was initially refinanced under
an interim credit facility ("Interim Credit Facility") which had a term of three
months. The Interim Credit Facility included properties in other partnerships
that are affiliated with the Partnership. However, the Interim Credit Facility
created separate loans for each property that are not cross-collateralized or
cross-defaulted with the other property loans. During the term of the Facility,
the property was required to make interest-only payments. The first month's
interest, which was paid at the date of the refinancing, was calculated at LIBOR
plus 70 basis points. Interest for the following month was calculated at LIBOR
plus 150 basis points.

During December 2002 the loan was sold to Fannie Mae under a permanent credit
facility ("Permanent Credit Facility"). The Credit Facility had a maturity of
five years, with one five-year extension option. This Permanent Credit Facility
also created separate loans for each property that were not cross-collateralized
or cross-defaulted with the other property loans. Each note under this Permanent
Credit Facility began as a variable rate loan with the option of converting to a
fixed rate loan after three years. The interest rate on the variable rate loans
was the Fannie Mae discounted mortgage-backed security index plus 85 basis
points. The rate was 1.92% at December 31, 2003 and reset monthly. Each loan
automatically renewed at the end of each month. In addition, monthly principal
payments were required based on a 30 year amortization schedule, using the
interest rate in effect during the first month that any property was on the
Permanent Credit Facility. The loans could be prepaid without penalty.

The 2002 refinancing of the existing Springhill Lake Apartments loan replaced
the first mortgage of approximately $50,300,000 with a new mortgage in the
amount of $113,100,000. Total capitalized loan costs were approximately
$2,058,000 during the year ended December 31, 2002. Additional loan costs of
approximately $53,000 were capitalized during the year ended December 31, 2003.
The Partnership recognized a loss on the early extinguishment of debt of
approximately $58,000 during the year ended December 31, 2002 due to the write
off of unamortized loan costs. In addition, approximately $7,783,000 was
initially deposited in an escrow account to be used to complete required repairs
at the property. At December 31, 2003, the escrow account balance was
approximately $7,070,000.

The mortgage note payable is non-recourse and is secured by pledge of the
Partnership's interest in the Operating Partnerships, and joint and several
guarantees by the Operating Partnerships which, in turn, are secured by an
indemnity first mortgage on the Operating Partnerships and a pledge of the stock
of Springfield Facilities, Inc., an affiliate. Further, the property may not be
sold subject to existing indebtedness.

Note F - Casualty Gains

During September 2003, Hurricane Isabel caused damaged to some of the apartment
buildings at the property. During the year ended December 31, 2004, all work was
completed to repair the damage and the property recorded a casualty gain of
approximately $31,000. The gain was the result of the receipt of insurance
proceeds of approximately $38,000 offset by approximately $7,000 undepreciated
damaged assets being written off.

During March 2002, a fire occurred at Springhill Lake Apartments which resulted
in damage to eleven units at the property. During the year ended December 31,
2003, all work was completed to repair the damage and the property recorded a
casualty gain of approximately $83,000. The gain was the result of the receipt
of insurance proceeds of approximately $104,000 offset by approximately $21,000
of undepreciated damaged assets being written off.

During April 2001 a fire occurred at Springhill Lake Apartments which resulted
in damage to two buildings at the property. The property initially received
$145,000 of insurance proceeds during August 2001 and received the remaining
balance of $445,000 in June 2002. All work has been completed with the total
costs to restore the buildings totaling approximately $595,000. A casualty gain
was recognized during the year ended December 31, 2002 of approximately $466,000
as a result of the receipt of $590,000 in total insurance proceeds less the
write-off of approximately $124,000 in undepreciated assets.

Note G - Operating Leases

One of the Operating Partnerships leases retail space to tenants in the shopping
center under operating leases which expire in various years through August 31,
2011. The leases call for base monthly rentals plus additional charges for pass
throughs and percentage rent. Minimum future rental payments to be received
subsequent to December 31, 2004 are as follows (in thousands):

2005 $ 158
2006 163
2007 149
2008 129
2009 111
Thereafter 155
$ 865

Note H - Minority Interest

The limited partnership interest of Theodore N. Lerner in the operating
partnerships is reflected as a minority interest in the accompanying
consolidated financial statements. Minority interest in net earnings of the
operating partnerships recorded by the Partnership totaled approximately zero
for the years ended December 31, 2004 and 2003. During the years ended December
31, 2004 and 2003, the Partnership did not recognize any minority interest in
net earnings of the operating partnerships as previous distributions to the
minority partner during 2002 reduced the minority interest partner's balance to
zero. For the years ended December 31, 2004 and 2003, distributions to the
minority interest partner of approximately $2,737,000 and $985,000,
respectively, were made in excess of the minority partner's investment in the
operating partnerships. When the operating partnerships make distributions in
excess of the minority partner's investment balance, the Partnership, as the
majority partner, records a charge equal to the minority partner's excess
distribution over the investment balance. The charge is classified as
distributions to the minority partner in excess of investment on the
accompanying consolidated statements of operations. Cumulative distributions to
the minority partner in excess of investment totaled approximately $4,820,000
and $2,083,000 at December 31, 2004 and 2003, respectively. No income is
allocated to the minority partner until all previous losses recognized by the
majority partner are recovered. For the years ended December 31, 2004 and 2003,
approximately $994,000 and $1,070,000, respectively, in earnings were allocated
to the majority partner to recover previous losses recognized. Earnings will
continue to be allocated to the majority partner to recover previous losses
recognized until such time as the net amount of approximately $2,756,000 at
December 31, 2004 is recovered.

Note I - Selected Quarterly Financial Data (Unaudited)

The following is a summary of the unaudited quarterly results of operations for
the Partnership (in thousands, except per unit data):

1st 2nd 3rd 4th
2004 Quarter Quarter Quarter Quarter Total

Total revenues $ 8,003 $ 8,116 $ 8,337 $ 8,368 $32,824
Total expenses 6,581 6,487 10,999 6,683 30,750
Net income (loss) $ 1,422 $ 1,629 $(2,662) $ 1,685 $ 2,074
Net income (loss) per limited
partnership unit $ 2,082 $ 2,385 $(3,897) $ 2,465 $ 3,035

1st 2nd 3rd 4th
2003 Quarter Quarter Quarter Quarter Total

Total revenues $ 7,902 $ 8,048 $ 8,165 $ 8,167 $32,282
Total expenses 7,656 6,626 6,789 6,756 27,827
Net income $ 246 $ 1,422 $ 1,376 $ 1,411 $ 4,455
Net income per limited
partnership unit $ 361 $ 2,082 $ 2,014 $ 2,064 $ 6,521

Note J - Fourth-Quarter Adjustment

The Partnership's policy is to record management reimbursements to the Managing
General Partner as allowed under the Partnership Agreement on a quarterly basis,
using estimated financial information furnished by an affiliate of the Managing
General Partner. For the first three quarters of 2002 these reimbursements of
accountable administrative expenses were based on estimated amounts. During the
fourth quarter of 2002 the Partnership recorded an adjustment to management
reimbursements to the Managing General Partner of approximately ($99,000) due to
a difference in the estimated costs and the actual costs incurred. The actual
management reimbursements to the Managing General Partner for the year ended
December 31, 2002 was approximately $435,000 as compared to the estimated
management reimbursements to the Managing General Partner for the nine months
ended September 30, 2002 of approximately $401,000. The adjustment to management
reimbursements was included in general and administrative expenses.

Note K - Contingencies

As previously disclosed, AIMCO Properties L.P. and NHP Management Company, both
affiliates of the Managing General Partner, are defendants in an action in the
United States District Court, District of Columbia. The plaintiffs have styled
their complaint as a collective action under the Fair Labor Standards Act
("FLSA") and seek to certify state subclasses in California, Maryland, and the
District of Columbia. Specifically, the plaintiffs contend that AIMCO Properties
L.P. failed to compensate maintenance workers for time that they were required
to be "on-call". Additionally, plaintiffs allege AIMCO Properties L.P. failed to
comply with the FLSA in compensating maintenance workers for time that they
worked in responding to a call while "on-call". The defendants have filed an
answer to the amended complaint denying the substantive allegations. Discovery
relating to the certification of the collective action has concluded and
briefing on the matter is currently underway. Although the outcome of any
litigation is uncertain, AIMCO Properties, L.P. does not believe that the
ultimate outcome will have a material adverse effect on its financial condition
or results of operations. Similarly, the Managing General Partner does not
believe that the ultimate outcome will have a material adverse effect on the
Partnership's consolidated financial condition or results of operations.

The Partnership is unaware of any other pending or outstanding litigation
matters involving it or its investment property that are not of a routine nature
arising in the ordinary course of business.

Environmental

Various Federal, state and local laws subject property owners or operators to
liability for management, and the costs of removal or remediation, of certain
hazardous substances present on a property. Such laws often impose liability
without regard to whether the owner or operator knew of, or was responsible for,
the release or presence of the hazardous substances. The presence of, or the
failure to manage or remedy properly, hazardous substances may adversely affect
occupancy at affected apartment communities and the ability to sell or finance
affected properties. In addition to the costs associated with investigation and
remediation actions brought by government agencies, the presence of hazardous
substances on a property could result in claims by private plaintiffs for
personal injury, disease, disability or other infirmities. Various laws also
impose liability for the cost of removal, remediation or disposal of hazardous
substances through a licensed disposal or treatment facility. Anyone who
arranges for the disposal or treatment of hazardous substances is potentially
liable under such laws. These laws often impose liability whether or not the
person arranging for the disposal ever owned or operated the disposal facility.
In connection with the ownership and operation of its property, the Partnership
could potentially be liable for environmental liabilities or costs associated
with its property.

Mold

The Partnership is aware of lawsuits against owners and managers of multifamily
properties asserting claims of personal injury and property damage caused by the
presence of mold, some of which have resulted in substantial monetary judgments
or settlements. The Partnership has only limited insurance coverage for property
damage loss claims arising from the presence of mold and for personal injury
claims related to mold exposure. Affiliates of the Managing General Partner have
implemented a national policy and procedures to prevent or eliminate mold from
its properties and the Managing General Partner believes that these measures
will eliminate, or at least minimize, the effects that mold could have on
residents. To date, the Partnership has not incurred any material costs or
liabilities relating to claims of mold exposure or to abate mold conditions.
Because the law regarding mold is unsettled and subject to change the Managing
General Partner can make no assurance that liabilities resulting from the
presence of or exposure to mold will not have a material adverse effect on the
Partnership's consolidated financial condition or results of operations.

As previously disclosed, the Central Regional Office of the United States
Securities and Exchange Commission (the "SEC") is conducting a formal
investigation relating to certain matters. Although the staff of the SEC is not
limited in the areas that it may investigate, AIMCO believes the areas of
investigation include AIMCO's miscalculated monthly net rental income figures in
third quarter 2003, forecasted guidance, accounts payable, rent concessions,
vendor rebates, capitalization of payroll and certain other costs, and tax
credit transactions. AIMCO is cooperating fully. AIMCO is not able to predict
when the matter will be resolved. AIMCO does not believe that the ultimate
outcome will have a material adverse effect on its consolidated financial
condition or results of operations. Similarly, the Managing General Partner does
not believe that the ultimate outcome will have a material adverse effect on the
Partnership's consolidated financial condition or results of operations.

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

None.

Item 9a. Controls and Procedures

(a) Disclosure Controls and Procedures. The Partnership's management, with the
participation of the principal executive officer and principal financial officer
of the Managing General Partner, who are the equivalent of the Partnership's
principal executive officer and principal financial officer, respectively, has
evaluated the effectiveness of the Partnership's disclosure controls and
procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end
of the period covered by this report. Based on such evaluation, the principal
executive officer and principal financial officer of the Managing General
Partner, who are the equivalent of the Partnership's principal executive officer
and principal financial officer, respectively, have concluded that, as of the
end of such period, the Partnership's disclosure controls and procedures are
effective.

(b) Internal Control Over Financial Reporting. There have not been any changes
in the Partnership's internal control over financial reporting (as such term is
defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the
fourth quarter of 2004 that have materially affected, or are reasonably likely
to materially affect, the Partnership's internal control over financial
reporting.

Item 9b. Other Information

None.

PART III

Item 10. Directors and Executive Officers of the Registrant

The Registrant has no directors or officers. AIMCO/Springhill Lake Investors GP,
LLC is the Managing General Partner and manages and controls substantially all
of the Registrant's affairs and has general responsibility and ultimate
authority in all matters affecting its business. On December 11, 2003, AIMCO
Properties, L.P., a Delaware limited partnership, entered into a Redemption and
Contribution Agreement (the "Redemption and Contribution Agreement") with First
Winthrop Corporation, a Delaware corporation ("FWC") and the sole shareholder of
Three Winthrop Properties, Inc. ("Winthrop"), the former managing general
partner of the Partnership, with respect to the acquisition of its general
partner interest in the Partnership (the "MGP Interest") by an affiliate of
AIMCO Properties, L.P., the operating partnership of AIMCO.

As of the time of the execution of the Redemption and Contribution Agreement and
until such time as the transfer of the MGP Interest from Winthrop to AIMCO LLC
became effective, NHP Management Company ("NHP"), an affiliate of AIMCO
Properties, L.P., was vested with the authority to, subject to certain
limitations, cause Winthrop to take such actions as it deemed necessary and
advisable in connection with the activities of the Partnership. The transfer of
the MGP Interest from Winthrop to AIMCO LLC became effective on March 31, 2004.
As used herein, the term "Managing General Partner" shall mean Winthrop, with
respect to matters occurring prior to March 31, 2004 and AIMCO LLC for matters
occurring from and after March 31, 2004. There are no family relationships
between or among any directors or officers.

Name Age Position
Harry G. Alcock 42 Director and Executive Vice President
Martha L. Long 45 Director and Senior Vice President
Miles Cortez 61 Executive Vice President, General Counsel
and Secretary
Patti K. Fielding 41 Executive Vice President
Paul J. McAuliffe 48 Executive Vice President and Chief Financial
Officer
Thomas M. Herzog 42 Senior Vice President and Chief Accounting
Officer
Stephen B. Waters 43 Vice President

Harry G. Alcock was appointed as a Director of the Managing General Partner in
October 2004 and was appointed Executive Vice President of the Managing General
Partner in February 2004 and has been Executive Vice President and Chief
Investment Officer of AIMCO since October 1999. Prior to October 1999 Mr. Alcock
served as a Vice President of AIMCO from July 1996 to October 1997, when he was
promoted to Senior Vice President Acquisitions where he served until October
1999. Mr. Alcock has had responsibility for acquisition and financing activities
of AIMCO since July 1994.

Martha L. Long has been a Director and Senior Vice President of the Managing
General Partner since February 2004. Ms. Long has been with AIMCO since October
1998 and has served in various capacities. From 1998 to 2001, Ms. Long served as
Senior Vice President and Controller of AIMCO and the Managing General Partner.
During 2002 and 2003, Ms. Long served as Senior Vice President of Continuous
Improvement for AIMCO.

Miles Cortez was appointed Executive Vice President, General Counsel and
Secretary of the Managing General Partner in February 2004 and of AIMCO in
August 2001. Prior to joining AIMCO, Mr. Cortez was the senior partner of Cortez
Macaulay Bernhardt & Schuetze LLC, a Denver law firm, from December 1997 through
September 2001.

Patti K. Fielding was appointed Executive Vice President - Securities and Debt
of the Managing General Partner in February 2004 and of AIMCO in February 2003.
Ms. Fielding was appointed Treasurer of AIMCO in January 2005. Ms. Fielding is
responsible for debt financing and the treasury department. Ms. Fielding
previously served as Senior Vice President - Securities and Debt of AIMCO from
January 2000 to February 2003. Ms. Fielding joined AIMCO in February 1997 as a
Vice President.

Thomas M. Herzog was appointed Senior Vice President and Chief Accounting
Officer of the Managing General Partner in February 2004 and of AIMCO in January
2004. Prior to joining AIMCO in January 2004, Mr. Herzog was at GE Real Estate,
serving as Chief Accounting Officer & Global Controller from April 2002 to
January 2004 and as Chief Technical Advisor from March 2000 to April 2002. Prior
to joining GE Real Estate, Mr. Herzog was at Deloitte & Touche LLP from 1990
until 2000.

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

Stephen B. Waters was appointed Vice President of the Managing General
Partner in April 2004. Mr. Waters previously served as a Director of Real
Estate Accounting since joining AIMCO in September 1999. Mr. Waters has
responsibilities for real estate and partnership accounting with AIMCO.

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

The board of directors of the Managing General Partner does not have a separate
audit committee. As such, the board of directors of the Managing General Partner
fulfills the functions of an audit committee. The board of directors has
determined that Martha L. Long meets the requirement of an "audit committee
financial expert".

The director and officers of the Managing General Partner with authority over
the Partnership are all employees of subsidiaries of AIMCO. AIMCO has adopted a
code of ethics that applies to such director and officers that is posted on
AIMCO's website (www.AIMCO.com). AIMCO's website is not incorporated by
reference to this filing.

Item 11. Executive Compensation

The Registrant is not required to and did not pay any compensation to the
officers or directors of the Managing General Partner. The Managing General
Partner does not presently pay any compensation to any of its officers and
directors (See "Item 13, Certain Relationships and Related Transactions").

Item 12. Security Ownership of Certain Beneficial Owners and Management

(a) Security Ownership of Certain Beneficial Owners

Except as noted below, no person or entity was known by the Registrant to be the
beneficial owner or more than 5% of the Limited Partnership Units of the
Registrant as of December 31, 2004.

Number
Entity of Units Percentage

AIMCO IPLP, L.P.
(an affiliate of AIMCO) 241.15 37.16%

AIMCO Properties, L.P.
(an affiliate of AIMCO) 281.50 43.37%

AIMCO IPLP, L.P. is ultimately owned by AIMCO. Its business address is 55
Beattie Place, Greenville, South Carolina 29601.

AIMCO Properties, L.P. is indirectly ultimately controlled by AIMCO. Its
business address is 4582 S. Ulster St. Parkway, Suite 1100, Denver, Colorado
80237.

No director or officer of the Managing General Partner owns any Units.

Item 13. Certain Relationships and Related Transactions

The Partnership has no employees and depends on the Managing General Partner and
its affiliates for the management and administration of all Partnership
activities. The Limited Partnership Agreement provides for (i) certain payments
to affiliates for services (ii) reimbursements of certain expenses incurred by
affiliates on behalf of the Partnership (iii) an annual asset management fee of
$100,000 and (iv) an annual administration fee of $10,000.

Affiliates of the Managing General Partner receive 3% of residential rent
collections and 5% of commercial income from the Partnership's property as
compensation for providing property management services. The Partnership paid to
such affiliates approximately $965,000, $953,000 and $936,000 for the years
ended December 31, 2004, 2003 and 2002, respectively, which is included in
operating expense.

Affiliates of the Managing General Partner charged the Partnership reimbursement
of accountable administrative expenses amounting to approximately $381,000,
$413,000 and $435,000 for the years ended December 31, 2004, 2003 and 2002,
respectively, which is included in general and administrative expenses. For the
year ended 2002, the first three quarters were based on estimated amounts and in
the fourth quarter the reimbursement was adjusted based on actual costs (see
Item 8. Financial Statements Note J). During 2001, the Partnership was charged,
by affiliates of the Managing General Partner, approximately $2,245,000 for fees
related to construction management services for work performed during 1999, 2000
and 2001. These fees had been capitalized and included in investment property.
During the second quarter of 2002, it was determined by the Managing General
Partner that these fees should not have been charged and the Partnership was
refunded the full amount. Accordingly, such previously capitalized fees were no
longer included in investment property at December 31, 2002.

In accordance with the Partnership Agreement, the Managing General Partner
earned approximately $100,000 in asset management fees and approximately $10,000
in administrative fees for the years ended December 31, 2004, 2003 and 2002,
which is included in general and administrative expense.

During the year ended December 31, 2002, an affiliate of the Managing General
Partner advanced the Partnership approximately $156,000. There were no advances
made for the years ended December 31, 2004 and 2003. Approximately $156,000 and
$1,853,000 was repaid during 2003 and 2002, respectively. At December 31, 2004
and 2003, there was no balance due for advances from affiliate. In accordance
with the Partnership Agreement, interest is charged at the prime rate plus 2%.
The Partnership recognized approximately $30,000 of interest expense related to
these advances during the year ended December 31, 2002. Interest expense for the
year ended December 31, 2003 amounted to less than $1,000.

The Partnership insures its property up to certain limits through coverage
provided by AIMCO which is generally self-insured for a portion of losses and
liabilities related to workers compensation, property casualty and vehicle
liability. The Partnership insures its property above the AIMCO limits through
insurance policies obtained by AIMCO from insurers unaffiliated with the
Managing General Partner. During the years ended December 31, 2004, 2003 and
2002, the Partnership was charged by AIMCO and its affiliates approximately
$288,000, $273,000 and $331,000, respectively, for insurance coverage and fees
associated with policy claims administration.

AIMCO and its affiliates owned 522.65 limited partnership units (the "Units") in
the Partnership representing 80.53% of the outstanding Units at December 31,
2004. A number of these Units were acquired pursuant to tender offers made by
AIMCO or its affiliates. It is possible that AIMCO or its affiliates will
acquire additional Units in exchange for cash or a combination of cash and units
in AIMCO Properties, L.P., the operating partnership of AIMCO, either through
private purchases or tender offers. Pursuant to the Partnership Agreement,
unitholders holding a majority of the Units are entitled to take action with
respect to a variety of matters that include, but are not limited to, voting on
certain amendments to the Partnership Agreement and voting to remove the
Managing General Partner. As a result of its ownership of 80.53% of the
outstanding Units, AIMCO and its affiliates are in a position to control all
voting decisions with respect to the Partnership. Although the Managing General
Partner owes fiduciary duties to the limited partners of the Partnership, the
Managing General Partner also owes fiduciary duties to AIMCO as its sole
stockholder. As a result, the duties of the Managing General Partner, as
managing general partner, to the Partnership and its limited partners may come
into conflict with the duties of the Managing General Partner to AIMCO as its
sole stockholder.

Item 14. Principal Accounting Fees and Services

The Managing General Partner has reappointed Ernst & Young LLP as independent
auditors to audit the financial statements of the Partnership for 2005. The
aggregate fees billed for services rendered by Ernst & Young LLP for 2004 and
2003 are described below.

Audit Fees. Fees for audit services totaled approximately $24,000 and $32,000
for 2004 and 2003, respectively. Fees for audit services also include fees for
the reviews of the Partnership's Quarterly Reports on Form 10-Q.

Tax Fees. Fees for tax services totaled approximately $49,000 and $29,000 for
2004 and 2003, respectively.

Item 15. Exhibits

See Exhibit Index.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

SPRINGHILL LAKE INVESTORS LIMITED
PARTNERSHIP

By: AIMCO/Springhill Lake Investors GP,LLC
Managing General Partner

By: /s/Martha L. Long
Martha L. Long
Senior Vice President

/s/Stephen B. Waters
By: Stephen B. Waters
Vice President

Date: March 25, 2005

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

/s/Martha L. Long Director and Senior Date: March 25, 2005
Martha L. Long Vice President

/s/Stephen B. Waters Vice President Date: March 25, 2005
Stephen B. Waters

/s/Harry G. Alcock Director and Executive Date: March 25, 2005
Harry G. Alcock Vice President

Index to Exhibits

Exhibit No. Document

3.4 Amended and Restated Limited Partnership Agreement and
Certificate of Amendment of Springhill Lake Investors
Limited Partnership(1)

3.4 (a) Amendment to Amended and Restated Limited Partnership
Agreement of Springhill Lake Investors Limited Partnership
dated August 23, 1995 (3)

10 (a) Amended and Restated Limited Partnership Agreement and
Certificate of Amendment of First Springhill Lake Limited
Partnership (Partnership Agreements of Second - Ninth
Springhill Lake Limited Partnerships are substantially
identical)(1)

(j) Consolidated, Amended and Restated Multifamily Note dated
November 1, 2002 between Springhill Lake Investors Limited
Partnership and GMAC Commercial Mortgage Corporation (2)

(k) Guaranty dated November 1, 2002 by AIMCO Properties, L.P., for
the benefit of GMAC Commercial Mortgage Corporation (2)

(l) Consolidated, Amended and Restated Payment Guaranty dated
November 1, 2002 by the Operating Partnerships (2)

(m) Completion/Repair and Security Agreement dated November 1,
2002 between the Operating Partnerships and GMAC
Commercial Mortgage Corporation (2)

(n) Replacement Reserve and Security Agreement dated November
1, 2002 between the Operating Partnerships and GMAC
Commercial Mortgage Corporation (2)

(o) Promissory Note dated November 1, 2002 between Springhill
Lake Investors Limited Partnership and the Operating
Partnerships (2)

(p) Maryland Amended and Restated Multifamily Note dated July 22,
2004 between Springhill Lake Investors Limited Partnership and
GMAC Commercial Mortgage Corporation (4)

(q) Amended and Restated Limited Guaranty dated July 22, 2004 by
AIMCO Properties, L.P., for the benefit of GMAC Commercial
Mortgage Corporation (4)

(r) Amended and Restated Payment Guaranty dated July 22, 2004 by
the Operating Partnerships (4)

(s) Repair Escrow Agreement dated July 22, 2004 between the
Springhill Lake Investors Limited Partnership and the
Operating Partnerships and GMAC Commercial Mortgage
Corporation (4)

(t) Replacement Reserve Agreement dated July 22, 2004 between the
Springhill Lake Investors Limited Partnership and the
Operating Partnerships and GMAC Commercial Mortgage
Corporation (4)

(u) Maryland Amended and Restated Promissory Note dated July 22,
2004 between Springhill Lake Investors Limited Partnership and
the Operating Partnerships (4)

31.1 Certification of equivalent of Chief Executive Officer
pursuant to Securities Exchange Act Rules
13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.

31.2 Certification of equivalent of Chief Financial Officer
pursuant to Securities Exchange Act Rules
13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.

32.1 Certification Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.

- ------------------------------------------------------------------------------
(1) Incorporated herein by reference to the Registrant's
Registration Statement on Form 10 dated April 30, 1986, as
thereafter amended.

(2) Incorporated herein by reference to the Registrant's
Current Report on Form 8-K dated November 14, 2002, as
filed November 29, 2002.

(3) Incorporated herein by reference to the Registrant's
Current Report on Form 8-K dated August 23, 1995, as filed
September 5, 1995.

(4) Incorporated herein by reference to the Registrant's Current
Report on Form 8-K dated July 22, 2004, as filed August 4,
2004.

Exhibit 31.1

CERTIFICATION

I, Martha L. Long, certify that:

1. I have reviewed this annual report on Form 10-K of Springhill Lake
Investors Limited Partnership;

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

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

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

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

(b) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about
the effectiveness of the disclosure controls and procedures, as of
the end of the period covered by this report based on such
evaluation; and

(c) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth
fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting; and

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

(a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to
record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal control over financial reporting.

Date: March 25, 2005

/s/Martha L. Long
Martha L. Long
Senior Vice President of AIMCO/Springhill
Lake Investors GP, LLC, equivalent of the
chief executive officer of the Partnership

Exhibit 31.2

CERTIFICATION

I, Stephen B. Waters, certify that:

1. I have reviewed this annual report on Form 10-K of Springhill Lake
Investors Limited Partnership;

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

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

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

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

(b) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about
the effectiveness of the disclosure controls and procedures, as of
the end of the period covered by this report based on such
evaluation; and

(c) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth
fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting; and

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

(a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to
record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal control over financial reporting.

Date: March 25, 2005

/s/Stephen B. Waters
Stephen B. Waters
Vice President of AIMCO/Springhill
Lake Investors GP, LLC equivalent
of the chief financial officer of
the Partnership

Exhibit 32.1

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

In connection with the Annual Report on Form 10-K of Springhill Lake Investors
Limited Partnership (the "Partnership"), for the year ended December 31, 2004 as
filed with the Securities and Exchange Commission on the date hereof (the
"Report"), Martha L. Long, as the equivalent of the Chief Executive Officer of
the Partnership, and Stephen B. Waters, as the equivalent of the Chief Financial
Officer of the Partnership, each hereby certifies, pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
that, to the best of his knowledge:

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

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

/s/Martha L. Long
Name: Martha L. Long
Date: March 25, 2005

/s/Stephen B. Waters
Name: Stephen B. Waters
Date: March 25, 2005

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