PROPERTY MANAGEMENT AGREEMENT

THIS AGREEMENT is made and entered into as of the 1st day of March, 1997, by and between Apple Residential Income Trust, Inc., a Virginia corporation (hereinafter referred to as "Owner"), and Apple Residential Management Group, Inc., a Virginia corporation (hereinafter referred to as "Manager").

WITNESSETH:

WHEREAS, Owner is the owner of Toscana Apartments (hereinafter referred to as the "Property"); and

WHEREAS, Owner and Manager desire to enter into this Agreement for the purposes herein contained.

NOW, THEREFORE, in consideration of the promises herein contained, and for other valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree as follows:

1. Designation of Manager as Manager for the Property. Owner hereby engages Manager as sole and exclusive manager to rent, manage and operate the Property, upon the conditions and for the term and compensation herein set forth. All or a portion of the services being performed by Manager may be contracted or subcontracted to another property management company, provided that such company agrees to be bound by the terms of this Agreement.

2. Term of Agreement: Renewal. This Agreement shall be valid for an initial term of two (2) years. In the event Owner sells its interest in the Property, this Agreement will terminate upon the date of such sale. Unless either party by written notice sent to the other party at least sixty (60) days before the end of any two-year term hereof elects not to renew this Agreement, this Agreement shall renew automatically for successive terms of two (2) years on the same terms as contained herein.

3. Acceptance of Engagement. Manager hereby accepts its engagement as the manager of the Property and agrees to perform all services necessary for the care, protection, maintenance and operation of the Property, including the following:

(a) The collection of all rents and other income from the Property, provided that nothing herein contained shall constitute a guarantee by Manager of the payment of rent by tenants;

(b) The purchase, at the expense of Owner, of all equipment, tools, appliances, materials, supplies and uniforms necessary for the maintenance or operation of the Property;

(c) The contracting on behalf of Owner for water, gas, electricity and other services necessary for the operation and maintenance of the Property;

(d) The advertising for the rental of space in the Property, the cost of which shall be paid or by Owner;

(e) The use of all reasonable efforts to keep the Property rented by procuring tenants for the Property and negotiating and executing on behalf of Owner all leases for space in the Property;

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