UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the year ended December 31, ~~2014~~2015

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: 0-16467*

THE RANCON REALTY FUND V, LIQUIDATING TRUST

A CALIFORNIA LIMITED PARTNERSHIP

(Exact name of registrant as specified in its charter)

California (State or other jurisdiction Of incorporation or organization)	33-0098488 (I.R.S. Employer Identification No.)
California . (State or other jurisdiction Of incorporation or organization)	33-0098488 . (I.R.S. Employer Identification No.)
400 South El Camino Real, Suite 1100 San Mateo, California (Address of principal executive offices)	94402-1708 (Zip Code)

~~Partnership~~ Registrant’s telephone number, including area code (650) 343-9300

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: None

~~Units~~Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of ~~Limited~~the ~~Partnership~~Securities ~~Interest~~Act of 1933, as amended.

~~(Title~~Yes of¨ No x ~~class)~~

Indicate by check mark if the registrant is anot ~~well-known~~required ~~seasoned~~to ~~issuer,~~file asreports ~~defined~~pursuant into ~~Rule~~Section ~~405~~13 or Section 15(d) of the Securities Act of ~~1933~~1934, as amended. * Yes ¨ No x¨

Indicate by check mark ifwhether the registrant (1) ishas ~~not~~filed all reports required to ~~file~~be ~~reports~~filed ~~pursuant~~by to Section 13 or ~~Section~~ 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), asand ~~amended~~(2) has been subject to such filing requirements for the past 90 days. * Yes ¨ No x¨

Indicate by check mark whether the registrant has ~~(1)~~submitted ~~has~~electronically ~~filed~~and ~~all~~posted ~~reports~~on its corporate Web site, if any, every Interactive Data File required to be ~~filed~~submitted and byposted ~~Section~~pursuant 13to orRule ~~15(d)~~405 of ~~the~~Regulation ~~Securities~~S-T ~~Exchange Act~~(§232.405 of ~~1934~~this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to ~~file~~submit ~~such reports),~~ and ~~(2)~~post ~~has been subject to~~ such ~~filing requirements for the past 90 days~~files). ~~Yes~~* x Yes ¨ No ¨

Indicate by check mark ~~whether~~if ~~the~~disclosure ~~registrant~~of delinquent ~~has~~filers ~~submitted~~pursuant ~~electronically~~to ~~and~~Item ~~posted~~405 onof ~~its~~Regulation ~~corporate~~S-K ~~Web~~is ~~site,~~not ifcontained ~~any~~herein, ~~every~~and ~~Interactive Data~~will ~~File~~not ~~required to~~ be ~~submitted~~contained, ~~and posted pursuant~~ to ~~Rule~~the ~~405~~best of ~~Regulation~~registrant’s knowledge, ~~S-T~~in ~~(§232.405~~definitive ofproxy ~~this~~or ~~chapter)~~information ~~during~~statements ~~the preceding~~incorporated 12by ~~months~~reference ~~(or~~in ~~for~~Part ~~such~~III ~~shorter~~of ~~period~~this ~~that~~Form ~~the~~10-K ~~registrant~~or ~~was~~any ~~required~~ amendment to ~~submit~~this ~~and~~Form ~~post such files)~~10-K. ~~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 a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer”, “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer ¨ Accelerated Filer ¨ Non-accelerated filer ¨ Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ¨ No x

No market for the ~~Limited~~Beneficial ~~Partnership~~Interests ~~units~~ exists and therefore a market value for such ~~units~~Beneficial Interest cannot be determined.

DOCUMENTS INCORPORATED BY REFERENCE: None

*The Rancon Realty Fund V Liquidating Trust is the transferee of the assets and liabilities of Rancon Realty Fund V, A California Limited Partnership, and files reports under the Commission file number for Rancon Realty Fund V, A California Limited Partnership. Rancon Realty Fund V, A California Limited Partnership filed a Form 15 on August 13, 2015, indicating its notice of termination of registration and filing requirements.

INDEX

THE RANCON REALTY FUND V, LIQUIDATING TRUST

A CALIFORNIA LIMITED PARTNERSHIP

		Page No.
	PART I

Item 1.	Business	3-4
Item 1A.	Risk Factors	4
Item 1B.	Unresolved Staff Comments	5
Item 2.	Properties	5
Item 3.	Legal Proceedings	5
Item 4.	Mine Safety Disclosures	5

	PART II

Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	5
Item 6.	Selected Financial Data	5
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	5-8
Item 7A.	Qualitative and Quantitative Disclosures about Market Risk	8
Item 8.	Financial Statements and Supplementary Data	8
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	8
Item 9A.	Controls and Procedures	8
Item 9B.	Other Information	8

	PART III

Item 10.	Directors, Executive Officers, and Corporate Governance	8
Item 11.	Executive Compensation	9
Item 12.	Security Ownership of Certain Beneficial Owners and Management and related Stockholder Matters	9
Item 13.	Certain Relationships, Related Transactions, and Director Independence	9
Item 14.	Principal Accountant Fees and Services	9

	PART IV

Item 15.	Exhibits and Financial Statement Schedules	9-15

	SIGNATURES	16

		Page No.
	PART I
Item 1.	Business	3
Item 1A.	Risk Factors	4
Item 1B.	Unresolved Staff Comments	4
Item 2.	Properties	5-6
Item 3.	Legal Proceedings	6
Item 4.	Mine Safety Disclosures	6
	PART II
Item 5.	Market for Partnership’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	7
Item 6.	Selected Financial Data	7
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	7-10
Item 7A.	Qualitative and Quantitative Disclosures about Market Risk	10
Item 8.	Financial Statements and Supplementary Data	10
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	10
Item 9A.	Controls and Procedures	11
Item 9B.	Other Information	11
	PART III
Item 10.	Directors, Executive Officers, and Corporate Governance	11
Item 11.	Executive Compensation	11
Item 12.	Security Ownership of Certain Beneficial Owners and Management and related Stockholder Matters	11
Item 13.	Certain Relationships, Related Transactions, and Director Independence	12
Item 14.	Principal Accountant Fees and Services	12
	PART IV
Item 15.	Exhibits and Financial Statement Schedules	13-14
	SIGNATURES	15

Part I

Item 1.

Business

Rancon Realty Fund V, a California Limited Partnership (“the Partnership”), was organized in accordance with the provisions of the California Revised Limited Partnership Act for the purpose of acquiring, developing, operating and disposing of real property. The Partnership was organized in 1985 and reached final funding in February 1989. The general partners of the Partnership ~~are~~were Daniel L. Stephenson and Rancon Financial Corporation (“RFC”), hereinafter collectively referred to as the “General Partner”. RFC is wholly-owned by Daniel L. Stephenson. The Partnership ~~has~~had no employees.

The Partnership’s initial acquisition of property in 1985 consisted of approximately 76.21 acres of partially developed and unimproved land located in San Bernardino, California. The property is part of a master-planned development of approximately 153 acres known as Tri-City Corporate Centre (“Tri-City”) and is zoned for mixed commercial, office, hotel, transportation-related, and light industrial uses. ~~Other~~Except for ~~than~~ two properties which ~~were sold~~are instill ~~2005~~owned ~~and one property which was sold in 2013 to third parties~~ by ~~the Partnership and~~ Rancon Realty Fund IV (“Fund IV”), a limited partnership sponsored by the General Partner of the Partnership, all of the parcels thereof ~~are~~have ~~separately owned~~been ~~either~~sold byto ~~the~~third ~~Partnership or Fund IV~~parties. ~~As of December 31, 2014, the Partnership has twelve properties consisting of eight office properties, and four retail buildings. The Partnership’s properties are more fully described in Item 2.~~

InThe Partnership commenced on May 8, 1985 ~~November~~and ~~2005~~had a term which was set to expire on December 31, 2015 in ~~connection~~accordance with athe ~~refinancing,~~provisions of the Partnership ~~formed~~Agreement. ~~Rancon~~On April ~~Realty~~21, ~~Fund~~2014, Vthe ~~Subsidiary~~Partnership ~~LLC~~sent ~~(“RRF~~a VConsent ~~SUB”), a~~Solicitation ~~Delaware~~Statement ~~limited~~to ~~liability~~its ~~company,~~Limited ~~which~~Partners isseeking ~~wholly~~their ~~owned~~consent byto the dissolution of the Partnership. ~~The~~prior ~~new~~to ~~entity~~December ~~was~~31, ~~formed~~2015, toin ~~satisfy~~accordance ~~certain~~with ~~lender requirements~~the ~~for~~terms aof ~~loan~~the ~~obtained~~Partnership inAgreement ~~the~~and ~~fourth~~as ~~quarter~~detailed ofby ~~2005.~~a ~~The~~Plan of ~~loan~~Liquidation isand ~~collateralized~~Dissolution adopted by ~~seven~~the ~~properties~~General Partner on April 10, 2014 (asthe ~~discussed~~“Plan ~~in Item~~of 2Liquidation”). ~~which~~The ~~have~~dissolution required ~~been~~the ~~contributed~~approval toof ~~RRF~~Limited VPartners ~~SUB~~holding by50% of the ~~Partnership~~outstanding units. ~~Since~~On ~~RRF~~May V8, ~~SUB~~2014, isthe ~~wholly~~dissolution ~~owned~~was approved by Limited Partners holding 50% of the ~~Partnership~~outstanding units, and the ~~financial statements~~Plan of ~~RRF~~Liquidation Vbecame ~~SUB~~effective. ~~have~~Consequently ~~been~~the ~~consolidated~~General ~~with~~Partner began ~~those~~an orderly sale of the Partnership’s assets and on March 20, 2015, the last property was sold.

InThe Plan of Liquidation authorized the ~~April~~General ~~2006~~Partners to transfer and assign the Partnership’s remaining assets to a liquidating trust to facilitate the Partnership’s dissolution. In furtherance of the Plan of Liquidation, on July 29, 2015, the Partnership ~~formed~~entered into a Liquidating Trust Agreement (the “Liquidating Trust Agreement”) with RFC, as trustee of the Liquidating Trust (the “Trustee”), in connection with the formation of The Rancon Realty Fund V ~~Subsidiary~~Liquidating ~~Two~~Trust ~~LLC~~ (the “~~RRF~~Liquidating VTrust” ~~SUB2~~or the “Trust”),. In aaccordance ~~Delaware~~with ~~limited~~the ~~liability company~~Liquidating ~~which~~Trust isAgreement, ~~wholly~~on ~~owned~~August by12, 2015, the Partnership. ~~The~~transferred ~~new~~all ~~entity~~of ~~was~~its ~~formed~~remaining assets to ~~satisfy~~the ~~certain~~Liquidating ~~lender~~Trust ~~requirements~~to ~~for~~be aadministered, ~~loan obtained~~disposed of or provided for in accordance with the ~~second~~terms ~~quarter~~and conditions of ~~2006~~the Liquidating Trust Agreement. ~~The~~Also ~~loan~~as isof ~~collateralized~~August by12, ~~four~~2015, ~~properties~~the (Partners, as ~~discussed~~beneficiaries of the Liquidating Trust (“Beneficiaries”), received beneficial interests in ~~Item~~the 2Liquidating Trust (the “Beneficial Interests”). ~~which~~The ~~have~~purpose ~~been~~of the Liquidating ~~contributed~~Trust is to ~~RRF~~provide Vfor ~~SUB2~~the orderly liquidation of the assets transferred to it by the Partnership, to pay the liabilities of the Partnership and the expenses of administering the Liquidating Trust, and to make liquidating distributions to the Beneficiaries in accordance with their Beneficial Interests. ~~Since~~The ~~RRF~~Liquidating VTrust ~~SUB2~~does isnot ~~wholly~~have ~~owned~~any employees, officers or directors. The existence of the Liquidating Trust will terminate upon a date determined by the ~~Partnership~~Trustee (the “Termination Date”) after the Trustee has distributed to all Beneficiaries, other than Beneficiaries who cannot be located (“Missing Beneficiaries”), all of the ~~financial~~Trust’s ~~statements~~assets in accordance with the terms of the Liquidating Trust Agreement, which is intended to take place within ~~RRF~~three Vyears ~~SUB2~~from ~~have~~the ~~been~~date ~~consolidated~~of ~~with~~the ~~those~~Liquidating Trust’s formation; provided that the Trustee has the discretion to delay such final distribution if in its good faith determination it should not be made at that time, so long as such date is no more than 21 years after the date of the ~~Partnership~~Liquidating Trust Agreement. The existence of the Liquidating Trust may, however, be extended beyond such three year term if the Trustee determines that the final distribution should not be made at that time. Notwithstanding such termination of the Liquidating Trust and the Trust Agreement on the Termination Date, the Liquidating Trust shall continue to exist for the purpose of winding up its affairs, collecting and discharging its remaining obligations, and disposing of its remaining assets, including disposing of any assets that are distributable to Missing Beneficiaries in accordance with applicable state laws regarding escheatment and abandoned property.

AsOn ofAugust ~~December 31~~13, ~~2014~~2015, ~~there~~the ~~were~~Partnership ~~83,898~~filed a Certificate of Cancellation with the California Secretary of State, cancelling the limited partnership, ~~units~~and filed a Form 15 with the Securities and Exchange Commission (the “~~Units~~Commission”), ~~outstanding~~terminating the registration of the limited partnership units in the Partnership. Accordingly, the Partnership has ceased filing reports under the Securities Exchange Act of 1934. However, the Trustee will cause annual reports provided to Beneficiaries to be filed with the Commission under cover of Form 10-K and periodic reports provided to Beneficiaries to be filed with the Commission under cover of Form 8-K.

~~The~~Overview ~~Partnership commenced on May 8, 1985 and had a term which was set to expire on December 31, 2015 in accordance with the provisions~~ of ~~the~~Sale ~~Partnership Agreement. On April 21, 2014, the Partnership sent a Consent Solicitation Statement to its Limited Partners seeking their consent to the dissolution~~ of the Partnership prior to December 31, 2015, in accordance with the terms of the Partnership Agreement and as detailed by a Plan of Liquidation and Dissolution adopted by the General Partner on April 10, 2014. The dissolution required the approval of Limited Partners holding 50% of the outstanding units. On May 8, 2014, the dissolution was approved by Limited Partners holding 50% of the outstanding units, and the Plan of Liquidation and Dissolution became effective. Consequently the General Partner began an orderly sale of the Partnership’s assets and on March 20, 2015, the last property was sold. With the sale of all of the properties, dissolution will continue but can be a complex process that may depend on a number of factors, most of which are beyond the Partnership’s control. There can be no assurance that the dissolution will be completed within a specific time frame.Property

~~Competition~~During ~~Within~~the first quarter of 2015, all of the ~~Market~~Partnership’s rental properties were sold. 690 E. Hospitality was sold on January 15, 2015 for $3,100,100, Outback was sold on January 23, 2015 for $2,024,100, Palm Retail 3 was sold on March 12, 2015 for $2,400,000 and the remainder of the portfolio was sold in one transaction on March 20, 2015 for $66,775,000.

~~The~~Note ~~Partnership~~payable ~~competes~~#1 inwas ~~the~~collateralized ~~leasing~~by 784 ofEast ~~its properties primarily with other available properties in the local real estate market. Other than Fund IV~~Hospitality, ~~management~~Carnegie ~~is not~~Business ~~aware~~Center of any specific competitors of the Partnership’s properties doing business on a significant scale in the local market. Management believes that characteristics influencing the competitiveness of a real estate project are the geographic location of the propertyII, ~~the~~Lakeside ~~professionalism of the property manager~~Tower, ~~the~~Outback ~~maintenance and appearance of the property and rental rates~~Steakhouse, in ~~addition~~690 toEast ~~external factors such as general economic circumstances~~Hospitality, ~~trends,~~Palm ~~and~~Court ~~the~~Retail ~~existence of new competing properties~~III inand ~~the~~One ~~vicinity.~~Carnegie ~~Additional~~Plaza ~~competitive factors with respect to commercial~~ and ~~industrial~~Note ~~properties~~payable ~~include~~#2 ~~the~~was ~~ease~~collateralized ofby ~~access to~~Brier ~~the~~Corporate ~~property~~Center, ~~the~~One ~~adequacy of related facilities~~Parkside, ~~such~~Two asParkside ~~parking,~~ and ~~the~~Two ~~ability to provide rent concessions and tenant improvements~~Carnegie ~~commensurate~~Plaza. ~~with~~As ~~local~~buildings ~~market~~were ~~conditions.~~sold ~~Although~~in ~~management~~2015, ~~believes~~ the ~~Partnership’s~~proceeds ~~properties~~were ~~are~~used ~~competitive with comparable properties as~~ to ~~those~~pay ~~factors~~down ~~within~~ the ~~Partnership’s~~notes ~~control,~~payable ~~over-building~~ and ~~other~~upon ~~external factors could adversely affect~~ the ~~ability~~closing of the ~~Partnership~~final ~~to attract and retain tenants. The marketability of the properties may also be~~sale ~~affected (either positively or negatively) by these factors as well as by changes in general or local economic conditions, including prevailing interest rates. Depending~~ on ~~market~~March ~~and economic conditions~~20, ~~the Partnership may be required to retain ownership of its properties for periods longer than anticipated~~2015, ~~or may need to sell earlier than anticipated or refinance a property at a time or under terms and conditions that are less advantageous than would be~~ the ~~case~~notes ifwere ~~unfavorable~~repaid ~~economic~~in ~~or market conditions did not exist~~full.

Working Capital

The Partnership’s practice is to maintain cash reserves for normal repairs, replacements, working capital and other contingencies.

Distributions

The Liquidating Trust Agreement provides that liquidating distributions will be made to the beneficiaries as determined by the Trustee. On December 17, 2015, the Trust made its first liquidating distribution to Beneficiaries in the aggregate amount of $19,500,000. After giving effect to the initial liquidating distribution, as of December 17, 2015, the Liquidating Trust retained approximately $4,291,000 in assets, and had approximately $875,000 in estimated expenses, leaving approximately $3,416,000 available to be distributed to Beneficiaries. Although it is estimated that the Liquidating Trust will make a final distribution in approximately that amount, there can be no assurance of the amount that will be available for the final distribution from the Liquidating Trust after all of the liabilities of the Partnership and expenses of administering the Liquidating Trust have been paid.

Item 1A.

Risk Factors

~~Risks~~Risk ofassociated ~~the~~with ~~Current~~our ~~Economic Environment~~ liquidation.

~~Financial~~In ~~markets~~addition ~~have~~to ~~experienced~~other ~~unusual volatility~~information ~~and~~in ~~uncertainty~~this annual ~~over~~report ~~the~~on ~~past~~Form ~~few years. Liquidity has tightened in all financial markets~~10-K, ~~including~~ the ~~debt~~following ~~and~~risk ~~equity markets.~~factors ~~The~~should ~~Partnership’s~~be ~~ability~~carefully toreviewed ~~fund~~because ~~normal~~such ~~recurring~~factors ~~expenses~~may ~~and~~have ~~capital~~a ~~expenditures~~significant impact ason ~~well~~the asexecution ~~its~~of ~~ability~~the ~~to repay~~Plan orof ~~refinance~~Liquidation ~~debt~~and ~~maturities~~the ~~could~~timing beand ~~adversely~~amount ~~affected~~of byfuture anliquidating ~~inability~~distributions to ~~secure financing at reasonable terms, if at all~~Beneficiaries. As Ifa ~~economic~~result ~~conditions~~of ~~persist~~the orrisk ~~deteriorate,~~factors ~~the~~set ~~Partnership~~forth ~~may~~below ~~experience~~and ~~increases~~elsewhere in ~~past~~this ~~due~~Form ~~accounts~~10-K, ~~defaults,~~actual ~~lower occupancy~~results ~~and reduced effective rents. These conditions~~ could ~~negatively~~differ ~~affect~~materially ~~the~~from ~~Partnership’s future net income and~~those ~~cash~~projected ~~flows~~in ~~and~~any ~~could~~forward-looking ~~adversely affect its ability to fund distributions, debt service payments and tenant improvements~~statements.

~~Potential~~We ~~Liability~~cannot ~~Due~~assure toyou ~~Environmental~~of the exact ~~Matters~~amount or timing of any future distribution to Beneficiaries.

~~Under~~The ~~federal,~~liquidation ~~state~~ and ~~local~~dissolution ~~laws relating~~process tois ~~protection~~subject ofto ~~the~~numerous ~~environment~~uncertainties ~~(“Environmental~~and ~~Laws”)~~may aresult ~~current~~in orless ~~previous~~than ~~owner~~anticipated or ~~operator~~no ofremaining ~~real~~capital ~~estate~~available ~~may be liable~~ for ~~contamination~~future ~~resulting from the presence or discharge of petroleum products or other hazardous or toxic substances~~distribution ~~on the property. These owners may be required~~ to ~~investigate and clean-up the contamination on the property as well as the contamination which has migrated from the property~~Beneficiaries. ~~Environmental~~The ~~Laws~~precise ~~typically impose liability and clean-up responsibility without regard to whether the owner or operator knew of~~nature, oramount ~~was responsible for, the presence of the contamination. This liability may be joint~~ and ~~several~~timing ~~unless the harm is divisible and there is a reasonable basis for allocation~~ of ~~responsibility.~~any Infuture ~~addition,~~distribution ~~the owner or operator of a property may be subject~~ to ~~claims~~Beneficiaries bywill ~~third~~depend ~~parties based~~ on ~~personal injury, property damage~~ and~~/or~~ ~~other~~could ~~costs, including investigation and clean-up costs, resulting from environmental contamination. Environmental Laws may also impose restrictions on the manner in which a property may~~ be ~~used or transferred or in which businesses may be operated. These restrictions may require~~ ~~expenditures.~~delayed ~~Under the Environmental Laws~~by, ~~any~~among ~~person~~other ~~who arranges for the transportation~~things, ~~disposal~~currently orunknown ~~treatment~~creditor ofclaims ~~hazardous~~ or ~~toxic~~lawsuits ~~substances~~and ~~may~~unexpected ~~also be liable for the costs of investigation~~ or ~~clean-up~~greater ofthan ~~those~~expected ~~substances at the disposal or treatment facility, whether or not the facility is or ever was owned or operated by that person~~expenses.

~~Our~~Beneficial ~~tenants~~Interests ~~generally~~ are required by their leases to operate in compliance with all applicable Environmental Laws, and to indemnify us against any environmental liability arising from their activities on the properties. However, we could be subject to strict liability by virtue of our ownership interest in the properties. Also, tenants may not ~~satisfy their indemnification obligations under the leases~~transferable. ~~We are also subject to the risk that:~~

●There ~~any~~is ~~environmental~~no ~~assessments~~public ofmarket ~~our~~for ~~properties~~Beneficial Interests in the Trust. Beneficial Interests in the Trust may not ~~have~~be ~~revealed~~transferred ~~all~~in ~~potential~~any ~~environmental~~manner ~~liabilities~~whatsoever (including, without limitation, by sale, exchange, gift, pledge or creation of a security interest) except (a) a bequest or inheritance in the case of the death of an individual Beneficiary, or (b) by operation of law, provided, however, that in no event shall any such transfer by operation of law take place unless the Trustee has received reasonable assurance that the transfer is in compliance with federal and state securities laws.

●We ~~any~~will ~~prior~~continue ~~owner~~to orincur ~~prior~~liabilities and orexpenses ~~current~~that ~~operator~~will ofreduce ~~these~~the ~~properties~~amount ~~may~~available ~~have~~for ~~created~~distribution anout ~~environmental~~of ~~condition~~the ~~not~~liquidation ~~known~~ to ~~us, or~~Beneficiaries.

●Liabilities anand ~~environmental~~expenses ~~condition~~from ~~may~~operations, such ~~otherwise~~as ~~exist~~legal, asaccounting and investor services fees and other operating expenses, will continue to ~~any~~be ~~one~~incurred oras ~~more~~we complete the Plan of ~~these~~Liquidation. ~~properties~~These expenses and liabilities will reduce the amount of assets available for future distribution to Beneficiaries.

~~Any~~Our ~~one~~Beneficiaries ~~of these conditions~~ could ~~have an~~be ~~adverse effect on our results of operations and financial condition. Moreover, future environmental laws, ordinances or regulations~~liable ~~may~~to ~~have an adverse effect on our results of operations and financial condition. Also,~~ the ~~current~~extent ~~environmental condition~~ of ~~those~~ ~~properties~~liquidating ~~may~~distributions bereceived ~~affected~~from byus ~~tenants~~if ~~and~~contingent ~~occupants~~reserves ofare ~~the~~insufficient ~~properties,~~to bysatisfy ~~the~~our ~~condition of land or operations in the vicinity of the properties (such as the presence of underground storage tanks), or by third parties unrelated to us~~liabilities.

WeSimilar ~~are~~to ~~not~~the ~~aware~~liquidation of any ~~current liabilities~~fund, ~~related~~including tohad ~~environmental~~we ~~matters~~remained ~~that~~as ~~are~~a ~~material~~partnership, if we fail to ~~us.~~create ~~However~~an adequate contingency reserve for payment of our expenses and liabilities, or if the ~~foregoing~~contingency ~~risk~~reserve ~~factor~~and isthe ~~provided~~assets ~~because~~held ~~such~~by ~~risks~~us are less than the amount ultimately found payable in respect ~~inherent~~of expenses and liabilities, each of our Beneficiaries could be held liable for the payment to ~~real~~creditors ~~estate~~of ~~ownership~~such Beneficiary’s pro rata portion of the excess, limited to the amounts previously received by each Beneficiary in distributions from us.

~~Uninsured~~If ~~Losses~~a ~~May~~court ~~Adversely~~holds ~~Affect~~at ~~Operations~~any time that we have failed to make adequate provision for our expenses and liabilities or if the amount ultimately required to be paid in respect of such liabilities exceeds the amount available from contingency reserve and our assets, our creditors could seek an injunction to prevent us from making distributions under the Plan of Liquidation on the grounds that the amounts to be distributed are needed to provide for the payment of our expenses and liabilities. Any such action could delay or substantially diminish the cash distributions to be made to our beneficiaries under the Liquidating Trust Agreement.

~~We,~~ A ~~or in certain instances, tenants of~~Successor ~~our~~Trustee ~~properties,~~may ~~carry~~need ~~property and liability insurance policies with respect~~ to ~~the properties. This coverage has policy specifications and insured limits customarily carried for similar properties. However, certain types of losses (such as from earthquakes and floods) may~~ be ~~either~~appointed ~~uninsurable or not economically insurable. Further, certain properties are located in areas that are subject~~ to ~~earthquake~~complete activity and floods. Should a property sustain damage as a result of an earthquake or flood, we may incur losses due to insurance deductibles, co-payments on insured losses or uninsured losses. Additionally, we have elected to obtain insurance coverage for "certified acts of terrorism" as defined in the ~~Terrorism~~Plan ~~Risk Insurance Act~~ of ~~2002~~Liquidation, aswhich amended and reauthorized to date; however, our policies of insurance may not provide coverage for other acts of terrorism. Any losses from such other acts of terrorism might be uninsured. Should an uninsured loss occur, we could ~~lose~~delay ~~some~~the orfinal ~~all~~distribution ~~of our capital investment, cash flow~~ and ~~anticipated~~closing ~~profits related to one or more properties. This could have an adverse effect on our results~~ of ~~operations and~~the ~~financial condition~~Trust.

~~Potential~~The ~~Liability~~Trust ~~Under~~Agreement provides that in the event ~~Americans~~of the resignation of the Trustee, a successor trustee will be appointed. In such event, there may be a delay in the administration ~~With~~of ~~Disabilities~~the ~~Act~~Trust while the successor trustee is appointed and takes office, which may delay the final liquidating distribution, if any, and the closure of the Trust.

All of our properties are required to be in compliance with the Americans With Disabilities Act. The Americans With Disabilities Act generally requires that places of public accommodation be made accessible to people with disabilities to the extent readily achievable. Compliance with the Americans With Disabilities Act requirements could require removal of access barriers. Non-compliance could result in imposition of fines by the federal government, an award of damages to private litigants and/or a court order to remove access barriers. Pursuant to lease agreements with tenants in certain of the “single-tenant” properties, the tenants are obligated to comply with the Americans With Disabilities Act provisions. If our costs are greater than anticipated or tenants are unable to meet their obligations, our results of operations and financial condition could be adversely affected.4

Risks of Litigation

Certain claims and lawsuits have arisen against us in our normal course of business. We believe that such claims and lawsuits will not have a material adverse effect on our financial position, cash flow or results of operations.

Item 1B.

Unresolved Staff Comments

None.

Item 2.

Properties

InAs ~~1985, the Partnership acquired a total~~ of ~~76.21~~December ~~acres~~31, ~~of partially developed land in Tri-City for an aggregate purchase price of $14~~2015,~~118,000.~~ Inthe ~~1984~~Trust ~~and~~no ~~1985, a total~~longer ofowned ~~76.56~~any ~~acres within Tri-City were acquired by Fund IV~~properties.

Tri-City is located at the northeastern quadrant of the intersection of Interstate 10 (San Bernardino Freeway) and Waterman Avenue in the southernmost part of the City of San Bernardino, and is in the heart of the Inland Empire, the most densely populated area of San Bernardino and Riverside counties.

The Inland Empire consists of approximately 24.5 million square feet of office space and is generally broken down into two major markets, Inland Empire East and Inland Empire West. Tri-City is located within the Inland Empire East market. According to a fourth quarter 2014 market view report from an independent broker the overall vacancy rate was 17% within the Inland Empire market as of December 31, 2014.

As of December 31, 2014, the Partnership owned twelve rental properties and approximately 4.4 acres of unimproved land.

Properties

The Partnership’s improved properties, all of which are held for sale as of December 31, 2014, are as follows:

Property	Type	Square Footage
One Carnegie Plaza	Two two-story office buildings		107,276
Two Carnegie Plaza	Two-story office building		68,957
Carnegie Business Center II	Two two-story office buildings		50,867
Lakeside Tower	Six-story office building		118,090
One Parkside	Four-story office building		70,068
784 East Hospitality	Health club facility		25,000
Outback Steakhouse (Outback)	Restaurant		6,500
Palm Court Retail III	Retail		6,004
Two Parkside	Three-story office building		82,039
690 East Hospitality	Restaurant		7,118
Brier Corporate Center	Three-story office building		104,501
Three Parkside	Two-story office building		29,076
Total			675,496

The office buildings total approximately 630,000 square feet with occupancy of 63%, and the retail buildings total approximately 45,000 square feet with an occupancy rate of 100%, as of December 31, 2014.

On March 7, 2013, the Partnership sold the Three Carnegie property. The sale to an unrelated party for a gross sale price of $8,000,000 included $3,200,000 paid in consideration and the buyer’s issuance of a promissory note to the Partnership in the amount of $4,800,000 bearing interest at the rate of 5.5% per annum, with a 60-day maturity and an election to extend the maturity date for an additional sixty days. The note was repaid during the second quarter of 2013.

As of December 31, 2014, no tenant accounts for more than 10% of the rental income generated by the Partnership’s properties for the year.

Weighted average occupancy rates for the Partnership’s buildings for each of the five years ended December 31, 2014 were as follows:

	2014			2013			2012			2011			2010
One Carnegie Plaza		68	%		77	%		78	%		68	%		70	%
Two Carnegie Plaza		52	%		66	%		67	%		65	%		77	%
Carnegie Business Center II		39	%		36	%		36	%		36	%		92	%
Lakeside Tower		85	%		80	%		83	%		84	%		85	%
One Parkside		70	%		80	%		73	%		61	%		61	%
784 East Hospitality		100	%		100	%		100	%		100	%		100	%
Outback Steakhouse		100	%		100	%		100	%		100	%		100	%
Palm Court Retail III		100	%		100	%		100	%		100	%		100	%
Two Parkside		71	%		95	%		100	%		100	%		71	%
690 East Hospitality		67	%		42	%		100	%		100	%		100	%
Brier Corporate Center		45	%		45	%		45	%		84	%		84	%
Three Parkside		28	%		28	%		28	%		28	%		28	%
Weighted average occupancy		64	%		70	%		70	%		73	%		76	%

Management is actively marketing for lease the vacant space in all of the buildings.

The annual effective rents per square foot for each of the five years ended December 31, 2014 were as follows:

	2014		2013		2012		2011		2010
One Carnegie Plaza	$	20.89	$	18.32	$	21.60	$	21.27	$	21.02
Two Carnegie Plaza	$	18.43	$	8.27	$	19.11	$	20.81	$	18.81
Carnegie Business Center II	$	13.14	$	14.88	$	15.43	$	14.98	$	16.56
Lakeside Tower	$	21.16	$	14.83	$	18.82	$	22.64	$	20.50
One Parkside	$	17.34	$	15.89	$	21.77	$	15.44	$	14.98
784 East Hospitality	$	15.64	$	15.64	$	15.64	$	15.64	$	18.19
Outback Steakhouse	$	18.43	$	18.43	$	18.43	$	18.43	$	16.75
Palm Court Retail III	$	22.52	$	21.85	$	20.65	$	21.41	$	24.23
Two Parkside	$	24.87	$	17.50	$	21.89	$	20.47	$	20.55
690 East Hospitality	$	23.26	$	0.00	$	19.41	$	19.41	$	19.41
Brier Corporate Center	$	25.94	$	25.34	$	24.74	$	24.26	$	23.67
Three Parkside	$	26.41	$	30.83	$	29.93	$	29.06	$	28.22

Annual effective rent is calculated by dividing the aggregate of annualized December rental income by the respective total square feet occupied at the property as of December 31.

The Partnership’s properties are owned by the Partnership subject to the following first deeds of trust as of December 31, 2014:

Collateral

Outstanding balance

Mortgage

Fixed Interest rate

Monthly payment

Maturity date

Note payable #1

Principal &

Seven properties (listed below)

22,690

Note

5.46

Interest

1/1/2016

Note payable #2

Principal &

Four properties (listed below)

25,705

Note

5.61

Interest

5/1/2016

Land

As of December 31, 2014, the Partnership owned approximately 4.4 acres of land, a portion of which is undeveloped and the remainder is used as parking lots. As of December 31, 2014, the land is held for sale.

Item 3.

Legal Proceedings

Certain claims and lawsuits have arisen against ~~the~~us ~~Partnership~~ in ~~its~~the normal course of business. ~~The~~We ~~Partnership~~believe ~~believes~~ that such claims and lawsuits will not ~~in the future~~ have a material adverse effect on our ~~the Partnership’s~~ financial position, cash flow or results of operations.

Item 4.

Mine Safety Disclosures

Not ~~Applicable~~applicable.

Part II

Item 5. Market for ~~Partnership~~Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

There is no ~~established~~public ~~trading~~ market for Beneficial Interests in the ~~Units~~Trust. ~~issued~~Beneficial Interests in the Trust may not be transferred in any manner whatsoever (including, without limitation, by sale, exchange, gift, pledge or creation of a security interest) except (a) a bequest or inheritance in the ~~Partnership~~case of the death of an individual Beneficiary, or (b) by operation of law, provided, however, that in no event shall any such transfer by operation of law take place unless the Trustee has received reasonable assurance that the transfer is in compliance with federal and state securities laws.

~~Holders~~Beneficiaries

As of December 31, ~~2014~~2015, there were 7,156 holders of ~~Units~~Beneficial Interests in the Trust. The rights of Beneficiaries in the Trust are not represented by any form of certificate or other instrument. Rather, the Trustee, through its transfer agent, is maintaining a record of the name and address of each Beneficiary and such Beneficiary’s aggregate Beneficial Interest in the Trust.

Distributions

~~Distributions~~There ~~are~~were ~~paid~~no distributions from ~~either~~the ~~Cash~~Partnership ~~From~~during ~~Operations~~2014 or ~~Cash~~2015. ~~From~~On ~~Sales~~December or17, ~~Refinancing~~2015, ~~(as~~following ~~such~~the ~~terms~~dissolution ~~are~~of ~~defined~~the inPartnership, the ~~Partnership~~Trustee authorized, pursuant to the Trust Agreement), an initial liquidating distribution of a total of $19,500,000 to the Beneficiaries of the Trust, which amount was to be apportioned pro rata according to their Beneficial Interests in the Trust.

Cash From Operations includes all cash receipts from operations in the ordinary course of business (except for the sale, exchange or other disposition of real property in the ordinary course of business) after deducting payments for operating expenses. All distributions of Cash From Operations are paid in the ratio of 90% to the limited partners and 10% to the General Partner.

Cash From Sales or Refinancing is the net cash realized by the Partnership from the sale, disposition or refinancing of any property after redemption of applicable mortgage debt and all expenses related to the transaction, together with interest on any notes taken back by the Partnership upon the sale of a property. All distributions of Cash From Sales or Refinancing are generally allocated as follows: (i) first, 1% to the General Partner and 99% to the limited partners until the limited partners have received an amount equal to their capital contributions; (ii) second, 1% to the General Partner and 99% to the limited partners until the limited partners have received a 12% return on their unreturned capital contributions including prior distributions of Cash From Operations; plus their Limited Incremental Preferred Return for the twelve month period following the purchase date of each Unit and following admission as a limited partner; (iii) third, 99% to the General Partner and 1% to the limited partners until the General Partner has received an amount equal to 20% of all distributions of Cash From Sales or Refinancing previously made under clauses (ii) and (iii) above, reduced by the amount of prior distributions made to the General Partner under clauses (ii) and (iii); and (iv) fourth, the balance 20% to the General Partner and 80% to the limited partners. A more detailed statement of the distribution policies is set forth in the Partnership Agreement.

There were no distributions during 2014 or 2013.

Item 6.

Selected Financial Data

Not ~~Applicable~~applicable.

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of of our results of operations, liquidity and capital resources, and financial condition should be read in conjunction with the ~~selected~~ unaudited financial ~~data in Item 6 and the Consolidated Financial Statements~~statements, including the notes thereto, included in Item 15 of Part IV.

Background

The Partnership’s initial acquisition of property in 1985 consisted of approximately 76.21 acres of partially developed and unimproved land located in San Bernardino, California. The property is part of a master-planned development of approximately 153 acres known as Tri-City Corporate Centre ~~(“Tri-City”)~~ and is zoned for mixed commercial, office, hotel, transportation-related, and light industrial uses. ~~Substantially~~Except ~~all~~for oftwo ~~the~~properties ~~balance~~which ofare ~~Tri-City~~still is owned by ~~Rancon Realty~~ Fund IV ~~(“Fund IV”)~~, a limited partnership sponsored by the General Partner of the Partnership., Asall of ~~December 31, 2014,~~ the ~~Partnership has twelve properties which consisted of nine office buildings~~parcels ~~and~~thereof ~~four~~have ~~retail~~been ~~buildings,~~sold ~~all~~to ofthird ~~which are classified as held for sale~~parties.

The Partnership commenced on May 8, 1985 and had a term which was set to expire on December 31, 2015 in accordance with the provisions of the Partnership Agreement. On April 21, 2014, the Partnership sent a Consent Solicitation Statement to its Limited Partners seeking their consent to the dissolution of the Partnership prior to December 1531, 2015, in accordance with the terms of the Partnership Agreement and as detailed by a Plan of Liquidation ~~and Dissolution~~ adopted by the General Partner on April 10, 2014. The dissolution required the approval of Limited Partners holding 50% of the outstanding units. On May 8, 2014, the dissolution was approved by Limited Partners holding 50% of the outstanding units, and the Plan of Liquidation ~~and Dissolution~~ became effective. Consequently the General Partner began an orderly sale of the Partnership’s assets and on March 20, 2015, the last property was sold. With the sale of all of the properties, dissolution will continue but can be a complex process that may depend on a number of factors, most of which are beyond the Partnership’s control. There can be no assurance that the dissolution will be completed within a specific time frame.

~~Overview~~The Plan of Liquidation authorized the General Partners to transfer and assign the Partnership’s remaining assets to a liquidating trust to facilitate the Partnership’s dissolution. In furtherance of the Plan of Liquidation, on July 29, 2015, the Partnership entered into the “Liquidating Trust Agreement with RFC, as Trustee, in connection with the formation of the Liquidating Trust. In accordance with the Liquidating Trust Agreement, on August 12, 2015, the Partnership transferred all of its remaining assets to the Liquidating Trust to be administered, disposed of or provided for in accordance with the terms and conditions of the Liquidating Trust Agreement. Also as of August 12, 2015, the Partners, as the Beneficiaries of the Liquidating Trust, received Beneficial Interests in the Liquidating Trust. The purpose of the Liquidating Trust is to provide for the orderly liquidation of the assets transferred to it by the Partnership, to pay the liabilities of the Partnership and the expenses of administering the Liquidating Trust, and to make liquidating distributions to the Beneficiaries in accordance with their Beneficial Interests. The Liquidating Trust does not have any employees, officers or directors. The existence of the Liquidating Trust will terminate upon a date determined by the Trustee (the “Termination Date”) after the Trustee has distributed to all Beneficiaries, other than Beneficiaries who cannot be located (“Missing Beneficiaries”), all of the Trust’s assets in accordance with the terms of the Liquidating Trust Agreement, which is intended to take place within three years from the date of the Liquidating Trust’s formation; provided that the Trustee has the discretion to delay such final distribution if in its good faith determination it should not be made at that time, so long as such date is no more than 21 years after the date of the Liquidating Trust Agreement. The existence of the Liquidating Trust may, however, be extended beyond such three year term if the Trustee determines that the final distribution should not be made at that time. Notwithstanding such termination of the Liquidating Trust and the Trust Agreement on the Termination Date, the Liquidating Trust shall continue to exist for the purpose of winding up its affairs, collecting and discharging its remaining obligations, and disposing of its remaining assets, including disposing of any assets that are distributable to Missing Beneficiaries in accordance with applicable state laws regarding escheatment and abandoned property.

~~Leasing~~On ~~activities~~August 13, 2015, the Partnership filed a Certificate of Cancellation with the California Secretary of State, cancelling the limited partnership, and filed a Form 15 with the Commission, terminating the registration of the limited partnership units in the Partnership. Accordingly, the Partnership has ceased filing reports under the Securities Exchange Act of 1934. However, the Trustee will cause annual reports provided to Beneficiaries to be filed with the Commission under cover of Form 10-K and periodic reports provided to Beneficiaries to be filed with the Commission under cover of Form 8-K.

~~During~~Liquidation ~~2014,~~Basis ~~management~~of ~~executed~~Accounting ~~nine~~and ~~new~~Plan ~~leases totaling 50,412 square feet~~ of ~~space and renewed four leases totaling 16,960 square feet.~~Liquidation

~~Results~~The accompanying financial statements have been prepared on the liquidation basis of ~~Operations~~accounting. Under the liquidation basis of accounting, assets are stated at their estimated net realizable values and liabilities are stated at their estimated settlement amounts. The precise nature, amount and timing of any future distribution to our Beneficiaries will depend on and could be delayed by, among other things, claim settlements with creditors, new claims filed by third parties, whether our insurance policies will provide coverage for defense costs and any damages payable on any future litigation matters, and unexpected or greater than expected expenses. Claims, liabilities and future expenses for operations, although currently declining in the aggregate, will continue to be incurred until termination of the Trust. These costs will reduce the amount of net assets available for ultimate distribution to Beneficiaries.

Comparison of the year ended December 31, 2014 to the year ended December 31, 2013

Revenue

Rental revenue and other decreased by $1,191,000, or 12%, for the year ended December 31, 2014 compared to the year ended December 31, 2013. This decrease is primarily due to a decrease in occupancy and the March 2013 sale of Three Carnegie. Tenant reimbursements increased by $28,000, or 5%, due primarily to increased billings for operating expenses due to older base years and increased expenses at some properties, offset by lower billings for overtime HVAC.

No interest income was recognized for the year ended December 31, 2014, as compared to $51,000 in interest income for the year ended December 31, 2013. The 2013 interest income is a result of the note receivable from the buyer of Three Carnegie. The note was fully repaid during the second quarter of 2013.

Expenses

Property operating expenses were flat for the year ended December 31, 2014 compared to the year ended December 31, 2013. Property operating expenses for properties operated throughout both twelve month periods increased by approximately $100,000, or 2%, for the year ended December 31, 2014 compared to the year ended December 31, 2013 due to increased utility costs.

Depreciation and amortization decreased $1,260,000, or 34%, for the year ended December 31, 2014 compared to the year ended December 31, 2013 due to previously fully depreciated assets as well as no depreciation or amortization being recorded on assets held for sale.

General and administrative expenses increased $281,000, or 32%, for the year ended December 31, 2014 compared to the year ended December 31, 2013 due to expenses related to the pending dissolution of the Partnership.

Non-operating income / expenses

Interest expense decreased $63,000, or 2%, for the year ended December 31, 2014 compared to the year ended December 31, 2013 due to principle amortization.

Liquidity and Capital Resources

As of December 31, 2014, the Partnership had cash and cash equivalents of $7,125,000.

The Partnership’s liabilities at December 31, 2014, include two notes payable. The borrowings totaled approximately $48,395,000, collateralized by properties with an aggregate net carrying value of approximately $34,868,000.

The Partnership is contingently liable for subordinated real estate commissions payable to the General Partner in the amount of $102,000 as of December 31, 2014 for sales that occurred in previous years. The subordinated real estate commissions are payable only after the limited partners have received distributions equal to their original invested capital plus a cumulative, non-compounded return of 12 % per annum on their adjusted invested capital. Since the circumstances under which these commissions would be payable are considered remote, the liability has not been recognized in the accompanying consolidated financial statements; however, the amount will be recorded when and if it becomes probable.

Following the sale of the final properties on March 20, 2015, management will continue with dissolution of the Partnership and distribute any remaining net proceeds to the partners.

Contractual Obligations

At December 31, 2014, we had contractual obligations as follows (in thousands):

	Less than 1 year		1 to 3 years		Total
Collateralized mortgage loans	$	1,132	$	47,263	$	48,395
Interest on indebtedness		2,650		467		3,117
Total	$	3,782	$	47,730	$	51,512

The Partnership knows of no demands, commitments, events or uncertainties, which might affect its capital resources in any material respect. In addition, the Partnership is not subject to any covenants pursuant to its secured debt that would constrain its ability to obtain additional capital.

Cash flows

For the year ended December 31, 2014, cash used in operating activities was $805,000 as compared to cash provided by operating activities of $415,000 for the year ended December 31, 2013. This decrease was primarily due to a decrease in revenues combined with changes in certain assets and liabilities, notably deferred costs. For the year ended December 31, 2014, cash used in investing activities was $1,223,000, representing capital and tenant improvement costs, as compared to cash provided by investing activities of $6,603,000 for the year ended December 31, 2013, due to the proceeds of the sale from the Three Carnegie property in 2013, net of capital and tenant improvement costs. For the year ended December 31, 2014, cash used in financing activities was $1,170,000 which compares to $1,108,000 for the year ended December 31, 2013.

Operationally, our primary source of funds consists of cash provided by rental activities. In March 2013, the Partnership sold the Three Carnegie property. Net cash provided to the Partnership from this transaction was $7,620,000.

Critical Accounting Policies

~~Revenue~~Although ~~recognized~~our onfinancial astatements ~~straight~~and accompanying notes are prepared without audit, they continue to be prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and applicable sections of Regulation S-~~line~~X promulgated by the SEC. The preparation ~~basis~~of these financial statements requires us to use estimates and assumptions that affect reported amounts of assets and liabilities. These estimates are subject to known and unknown risks, uncertainties and other factors that could materially impact the amounts reported and disclosed in the financial statements. We believe the following to be among the most critical judgment areas in the application of our accounting policies.

~~The~~Liquidation ~~Partnership~~Basis ~~recognizes rental revenue on a straight-line basis over the term~~ of its leases. Actual amounts collected could be lower than the amounts recognized on a straight-line basis if specific tenants are unable to pay rent that the Partnership has previously recognized as revenue. For tenants with percentage rent, the Partnership recognizes revenue when the tenants’ specified sales targets have been met. The reimbursements from tenants for real estate taxes and other recoverable operating expenses are recognized as revenue on an estimated basis during the current year. The Partnership develops a revised estimate of the amount recoverable from tenants based on updated expenses for the year and amounts to be recovered and records adjustments to income in the current year financial statement accounts. Any final changes in estimate based on lease-by-lease reconciliations and tenant negotiations and collection are recorded in the period those negotiations are settled.Accounting

~~Carrying~~The ~~value~~liquidation basis of ~~rental~~accounting ~~properties~~was adopted by the Trust in executing the Plan of Liquidation for all periods subsequent to August 12, 2015, and ~~land~~will ~~held~~continue as the basis of accounting for ~~development~~the Trust.

~~The~~Use Partnership’s rental properties, including the related land, are stated at depreciated cost unless events or circumstances indicate that such amount cannot be recovered based on undiscounted cash flows, excluding interest, in which case the carrying value of the property is reduced to its estimated fair value. The valuation of impaired real estate assets is determined using widely accepted valuation techniques including income capitalization approach or discounted cash flow analysis on the expected cash flows of each asset considering prevailing market capitalization rates, analysis of recent comparable sales transactions, actual sales negotiations, bona fide purchase offers received from third parties and/or consideration of the amount that would be required to replace the asset, as adjusted for obsolescence. In general, the Partnership considers multiple valuation techniques when measuring fair value of an investment. However, in certain circumstances, a single valuation technique may be appropriate.Estimates

~~Land~~The ~~held~~preparation ~~for~~of ~~development~~financial isstatements in ~~stated~~conformity ~~at cost~~with ~~unless~~GAAP ~~events~~requires ormanagement ~~circumstances~~to ~~indicate~~make estimates and assumptions that ~~cost~~affect ~~cannot~~the bereported ~~recovered,~~amounts inof ~~which~~assets ~~case~~and liabilities and disclosure of contingent assets and liabilities at the ~~carrying~~date ~~value~~of isthe ~~reduced~~financial tostatements. ~~estimated~~The liquidation basis of accounting ~~fair~~requires ~~value.~~us ~~Estimated~~to ~~fair~~make ~~value~~assumptions, isjudgments ~~computed~~and ~~using~~estimates ~~estimated~~that ~~sales~~can ~~price~~have a significant impact on our reported net assets in liquidation. We base our assumptions, ~~based~~judgments ~~upon~~and ~~market~~estimates ~~values~~on ~~for~~the ~~comparable~~most ~~properties~~recent information available and various other factors that we believe ~~considers~~to be reasonable under the ~~cost~~circumstances. toActual ~~complete~~results ~~and~~could differ materially from these estimates under different assumptions or conditions. Any increases in the amount of estimated ~~fair~~costs to be incurred during liquidation or decreases in the estimated realizable value of assets will reduce the ~~completed~~amount ~~project.~~of net assets available for ultimate distribution to the trust beneficiaries

The pre-development costs for a new project include survey fees and consulting fees. Interest, property taxes and insurance related to the new project are capitalized during periods when activities that are necessary to get the project ready for its intended use are in progress. The capitalization ends when the construction is substantially completed and the project is ready for its intended use.6

~~The~~On ~~actual~~a ~~value~~regular basis, we evaluate our assumptions, judgments and estimates and make changes accordingly. Under the liquidation basis of accounting, we accrue for the ~~Partnership’s~~estimated remaining ~~portfolio~~costs to be incurred during liquidation, including expenses of ~~properties~~the Trustee, legal expenses, accounting expenses, tax expenses, contractor services, and ~~land~~miscellaneous ~~held~~other ~~for~~expected ~~development~~future ~~could~~costs. As of December 31, 2015, such costs were estimated at approximately $800,000. Our estimates are based on assumptions regarding costs to be ~~different~~incurred ~~from~~in ~~their~~executing ~~carrying~~the ~~amounts~~Plan of Liquidation. If there are delays in executing the Plan of Liquidation, actual costs incurred during liquidation may increase, reducing net assets available in liquidation.

~~Fair~~Net ~~Value~~Assets ofin ~~Investments~~Liquidation and Changes in Net Assets in Liquidation

~~The~~On ~~guidance~~August ~~related~~12, to2015, accounting for fair value measurements defines fair value and establishes a framework for measuring fair value in order to meet disclosure requirements for fair value measurements. Fair value is defined as the ~~exchange~~remaining ~~price~~net ~~that would be received for an asset or paid to transfer~~assets aof ~~liability (an exit price) in~~ the ~~principal~~Partnership, orconsisting ~~most~~primarily ~~advantageous~~of ~~market~~$22,559,000 ~~for the asset or liability~~ in ancash, ~~orderly transaction between market participants on the measurement date. This guidance also establishes a fair value hierarchy~~ which ~~requires~~were antransferred ~~entity~~ to ~~maximize~~ the ~~use of observable inputs and minimize the use of unobservable inputs when measuring fair value~~Trust. ~~This hierarchy describes three levels of inputs that may be used to measure fair value.~~

9As of December 31, 2015, net assets in liquidation of the Trust totaled $3,371,000, as follows:

~~Financial assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows:~~Assets

~~Level~~As of December 31, 2015, the Trust retained approximately $4,311,000 in assets, comprised of $2,890,000 in cash and cash equivalents, the right to receive up to $1,260,000 in escrow proceeds in accordance with the terms of the Purchase and Sale Agreement and related documents, and $161,000 in receivables. The ~~Quoted~~Purchase ~~prices~~and Sale Agreement required the Partnership to deposit $1,260,000 in ~~active~~an ~~markets~~escrow account held by a title company for a period of nine months from the closing of the sale of the Property on March 20, 2015 as security for ~~identical~~any ~~assets~~claim ormade ~~liabilities.~~by ~~Level~~the 1buyer for ~~assets~~breach of any of the Partnership’s representations in the Purchase and ~~liabilities~~Sale ~~include~~Agreement. ~~debt~~All of these funds were returned to the Trust on January 8, 2016 and ~~equity~~are ~~securities~~available for one or more additional liquidating distributions in amounts and ~~derivative~~on ~~contracts~~dates to be determined. However, there can be no assurance that ~~are~~there ~~traded~~will inbe ansufficient ~~active~~funds ~~exchange~~available ~~market~~to make any such future liquidating distributions.

Level 2. Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments and derivative contracts whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data.Liabilities

~~Level~~As 3.of ~~Unobservable~~December ~~inputs~~31, ~~that~~2015, ~~are supported~~the byTrust ~~little~~retained approximately or$140,000 noin ~~market~~liabilities, ~~activity~~comprised ~~and that are significant to the fair value~~ of ~~the~~accounts ~~assets~~payable, oraccrued ~~liabilities.~~expenses, ~~Level~~taxes ~~3 assets~~ and ~~liabilities~~professional ~~include~~fees ~~financial~~and ~~instruments~~the ~~whose~~Trust has ~~value~~estimated isthat ~~determined~~it ~~using~~will ~~pricing~~incur ~~models,~~approximately ~~discounted cash flow methodologies~~$800, or000 ~~similar~~in ~~techniques,~~costs asrelated ~~well~~to ~~as instruments for which~~ the ~~determination~~liquidation, ofincluding ~~fair~~legal ~~value~~expenses, ~~requires significant management judgment~~accounting orexpenses, ~~estimation~~tax ~~using~~reporting ~~unobservable~~expenses, ~~inputs.~~contractor ~~This category generally includes long-term derivative contracts~~services, ~~real~~and ~~estate~~miscellaneous ~~and~~other ~~unconsolidated joint~~expected ~~ventures~~future costs.

~~Inflation~~Statement of Operations

~~Leases~~The atfinancial ~~the~~statements ~~office~~of ~~properties~~the ~~typically~~Trust are ~~provide~~prepared ~~for~~on ~~rent~~a ~~adjustment~~liquidation basis and ~~pass-through~~therefore ofdo ~~certain~~not ~~operating~~include ~~expenses~~a ~~during~~statement ~~the term~~ of ~~the~~operations; ~~lease. Substantially~~ all ~~of the~~references ~~leases~~to at the ~~office~~results ~~and retail properties provide for pass-through to tenants~~ of ~~certain~~operations have ~~operating~~been ~~costs,~~deleted ~~including~~and ~~real estate~~replaced ~~taxes,~~by ~~common~~references ~~area~~to ~~maintenance~~changes ~~expenses,~~in ~~and~~net ~~insurance~~assets. WeAn ~~anticipate~~unaudited ~~that~~statement ~~these~~of ~~provisions~~operations ~~may~~for ~~permit~~the usperiod ~~to increase rental~~representing ~~rates~~the orcurrent ~~other~~year ~~charges~~prior to ~~tenants~~the inexistence ~~response~~of tothe ~~rising~~Trust ~~prices~~has ~~and,~~been ~~therefore,~~provided ~~serve~~for toinformational ~~reduce our exposure to the adverse effects of inflation~~purposes.

~~Forward~~Changes ~~Looking~~in ~~Statements;~~Net ~~Factors That~~Assets ~~May~~(in ~~Affect~~thousands, except ~~Operating~~units ~~Results~~outstanding):

This Report on Form 10-K contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements regarding our expectations, hopes, intentions, beliefs and strategies regarding the future.

	December 31,
	2015
Net assets in liquidation	$	3,371,000
Number of beneficial units outstanding at each respective date		83,898
Net asset value per unit	$	40.18

~~All~~For ~~forward-looking statements included in this document are based on information available to us on~~ the ~~date~~period ~~hereof.~~August ~~Because these forward looking statements involve risk and uncertainty~~12, ~~there~~2015 ~~are important factors that could cause our actual results~~ to ~~differ materially from those stated or~~ ~~implied~~December in31, ~~the forward-looking statements.~~2015

~~Risks~~Net assets in liquidation decreased $19,500,000, during the period August 12, 2015 to December 31, 2015. The decrease in our net assets in liquidation is the result of ~~Litigation~~the Trustee having authorized, pursuant to the Trust Agreement, an initial liquidating distribution of a total of $19,500,000 to the Beneficiaries of the Trust, which amount was to be apportioned pro rata according to their Beneficial Interests.

~~Certain~~Liquidity ~~claims~~ and ~~lawsuits~~Capital ~~have~~Resources arisen against us in our normal course of business. We believe that such claims and lawsuits will not have a material adverse effect on our financial position, cash flow or results of operations. See Item 1A for further discussion.

We believe that our cash and cash equivalents balance of approximately $2,890,000 plus our January 8, 2016 collected additional escrow proceeds of $1,260,000 should provide sufficient liquidity to meet our cash needs during the next twelve months from December 31, 2015. While we anticipate that our existing cash and cash equivalents balance will be sufficient to fund our cash needs for expenses related to completion of the Plan of Liquidation for the next twelve months, we can provide no assurances that this will be the case.

At December 31, 2015, our cash and cash equivalents were held in bank deposit accounts. We expect to continue to hold our cash and cash equivalents primarily in bank deposit accounts while we execute the Plan of Liquidation.

Off Balance Sheet Arrangements

As of December 31, 2015, we did not have any off-balance sheet arrangements or other contractually narrow or limited purpose arrangements. As such, we are not exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in such relationships.

Obligations and Commitments

Our contractual obligations and commitments as of December 31, 2015 are reported in the statements of net assets in liquidation as estimated costs to be incurred during liquidation. Obligations and commitments of the Trust include the Trust Agreement and all banking arrangements.

Item 7A.

Qualitative and Quantitative Disclosures about Market Risk

~~Interest~~Not ~~Rates~~applicable.

The Partnership expects that changes in market interest rates will not have a material impact on the performance or fair value of its portfolio due to their fixed nature.

For debt obligations, the table below presents principal cash flows by expected maturity dates.

	Expected Maturity Date
	2015		2016
	(in thousands)
Collateralized fixed rate debt at 5.46%	$	489	$	22,201
Collateralized fixed rate debt at 5.61%		643		25,062

The Partnership does not own any derivative instruments.

Item 8.

Financial Statements and Supplementary Data

For information with respect to this item, see Financial Statements and Financial Statement Schedule as listed in Item 15.

Item 9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

~~None~~Not applicable.

Item 9A.

Controls and Procedures

~~The~~Disclosure ~~principal~~Controls ~~executive officer~~ and principal financial officer of the General Partner have evaluated the disclosure controls and procedures of the Partnership as of the end of the period covered by this annual report. As used herein, the term “disclosure controls and procedures” has the meaning given to the term by Rule 13a-15 under the Securities Exchange Act of 1934, as amended (“Exchange Act”), and includes the controls and other procedures of the Partnership that are designed to ensure that information required to be disclosed by the Partnership in the reports that it files with the SEC under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Based upon his evaluation, the principal executive officer and principal financial officer of the General Partner has concluded that the Partnership’s disclosure controls and procedures were effective such that the information required to be disclosed by the Partnership in this annual report is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms applicable to the preparation of this report and is accumulated and communicated to the General Partner’s management, including the General Partner’s principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.Procedures

The Chairman of the Trustee, who performs the equivalent functions of the principal executive officer and principal financial officer of the Trust, has evaluated the disclosure controls and procedures of the Trust (as successor to the Partnership) as of the end of the period covered by this annual report. As used herein, the term “disclosure controls and procedures” has the meaning given to the term by Rule 13a-15 under the Securities Exchange Act of 1934, as amended (“Exchange Act”), and includes the controls and other procedures of the Trust that are designed to ensure that information required to be disclosed by the Trust in the reports that it files with the SEC under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Based upon his evaluation, the Chairman of the Trustee has concluded that the Trustee’s disclosure controls and procedures were effective such that the information required to be disclosed by the Trust in this annual report is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms applicable to the preparation of this report and is accumulated and communicated to the Trustee’s management, including the Trustee’s Chairman, as appropriate to allow timely decisions regarding required disclosures.

The report called for by Item 308(a) of Regulation S-K is incorporated herein by reference to “Management’s Annual Report on Internal Control Over Financial Reporting” (“Management’s Report”), included in the financial statements included as an exhibit to this report.

There have not been any changes in the ~~Partnership~~Trust’s internal control over financial reporting identified in connection with Management’s Report that occurred ~~during~~ during the ~~Partnership’s~~ fourth fiscal quarter ended December 31, ~~2014~~2015 that has materially affected, or is reasonably likely to materially affect, the ~~Partnership~~ Trust’s internal control over financial reporting.

Item 9B.

Other Information

~~None~~Not applicable.

Part III

Item 10.

Directors, Executive Officers and Corporate Governance

~~Daniel~~The L.Trust ~~Stephenson~~has ~~and~~no ~~Rancon~~directors ~~Financial Corporation~~or ~~(“RFC”) are the general partners of the Partnership~~executive officers. ~~Mr.~~Rancon ~~Stephenson~~Financial isCorporation, ~~the~~as ~~Director~~Trustee, ~~President,~~manages ~~Chief Executive~~the ~~Officer~~business affairs and ~~Chief~~assets ~~Financial Officer~~ of ~~RFC~~the Trust.

Mr. Stephenson, age 71, founded RFC (formerly known as Rancon Corporation) in 1971 for the purpose of establishing a commercial, industrial and residential property syndication, development and brokerage concern. Mr. Stephenson has, from RFC’s inception, held the position of Director. In addition, Mr. Stephenson was President, Chief Executive Officer and Chief Financial Officer of RFC from 1971 to 1986, from August 1991 to September 1992, and from March 31, 1995 to present. Mr. Stephenson is Chairman of the Board of PacWest Group, Inc., a real estate firm which acquired a portfolio of assets from the Resolution Trust Corporation.

Section 16(a) Beneficial Ownership Reporting Compliance

Based on a review of the copies of beneficial ownership reports filed pursuant to Section 16(a) of the Exchange Act received by the Partnership, ~~the Partnership believes that,~~ during the fiscal year ended December 31, ~~2014~~2015, the Trust believes that, during such fiscal year all such ownership reports were filed on a timely basis.

Code of Ethics

The ~~Partnership~~Trust has not adopted a "“code of ethics"” as defined in rules adopted by the SEC. Because ~~neither~~ the ~~Partnership~~Trust ~~nor~~does ~~the~~not ~~General~~have ~~Partner has~~ any ~~employees~~ ~~other than Daniel L. Stephenson~~employees, the ~~Partnership~~Trust has determined that adopting a code of ethics would not appreciably improve the ~~Partnership'~~Trust’s ability to deter wrongdoing or promote the conduct set forth in such SEC rules.

Item 11.

Executive Compensation

~~The~~As ~~Partnership~~of ~~has~~December 31, 2015, we have no directors or executive officers. ~~For~~ ~~information~~The ~~relating~~Trustee tomanages ~~fees,~~the ~~compensation,~~business ~~reimbursement~~affairs and ~~distributions~~assets ~~paid~~of tothe ~~related~~Trust. ~~parties,~~The ~~reference~~Trustee isdoes ~~made~~not ~~to Item~~receive 13any ~~below~~compensation.

Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

~~The~~On ~~table~~August ~~below~~12, ~~sets~~2015, ~~forth~~the ~~beneficial~~Partnership transferred ~~holdings~~its remaining net assets to the Trust, and on August 13, 2015, the Partnership filed its Certificate of ~~Units~~Cancellation with the Secretary of State of the State of California, which became effective on that date. There is no public market for Beneficial Interests in the Trust. Beneficial Interests in the Trust may not be transferred in any manner whatsoever (including, without limitation, by sale, exchange, gift, pledge or creation of a security interest) except (ia) a bequest or inheritance in the ~~General~~case ~~Partners~~of ~~and~~the death of an individual Beneficiary, or (iib) ~~all~~by ~~those~~operation ~~known~~of bylaw, usprovided, tohowever, bethat ~~beneficial~~in ~~owners~~no ofevent ~~more~~shall ~~than~~any 5%such transfer by operation of law take place unless the ~~Units. The~~Trustee ~~Partnership~~has ~~does~~received ~~not~~reasonable ~~have~~assurance ~~any~~that ~~executive~~the ~~officers~~transfer is in compliance with federal and state securities laws.

~~Security~~Item ~~Ownership~~13. of Certain ~~Beneficial Owners~~Relationships and Related Transactions and Director Independence

Title of Class	Name of Beneficial Owner	Amount and Nature of Beneficial Ownership	Percent of Class
Units	Glenborough Property Partners, LLC 400 South El Camino Real, Suite 1100 San Mateo, CA 94402	11,565 Units		13.78	%
Units	Mackenzie Capital Management, LP 1640 School Street Moraga, CA 94566	8,605 Units (indirect ownership)*		10.25	%

The Trust has no officers or directors. The Trustee manages the Trust’s day-to-day business affairs and assets. Prior to the dissolution of the Partnership, the Trustee was a General Partner of the Partnership. The Trustee is a corporation wholly-owned by Daniel L. Stephenson.

11Pursuant to the Liquidating Trust Agreement, the Trustee, and its officers, directors and affiliates (together, the “Indemnified Persons”), shall be indemnified, and may reimburse itself out of the Trust property, against and from any and all loss, cost, liability, expense or damage which any such Indemnified Person may sustain in connection with the Trust, provided that the same were not the result of negligence or misconduct on the part of such Indemnified Person. The Trust shall advance to each Indemnified Person all expenses incurred by such Indemnified Person in connection with the investigation, defense, settlement, or appeal of any claim or proceeding attributable to a matter described in the immediately preceding sentence. Such Indemnified Person shall promptly repay such amounts advanced only if it is ultimately determined that such Indemnified Person was not entitled to be indemnified by the Trust pursuant to the Liquidating Trust Agreement.

Security Ownership of Management

Title of Class	Name of Beneficial Owner	Amount and Nature of Beneficial Ownership	Percent of Class
Units	Daniel L. Stephenson (IRA) 41391 Kalmia, Suite 200, Murrieta, CA 92562	3 Units (direct)	**
Units	Daniel L. Stephenson (IRA) 41391 Kalmia, Suite 200, Murrieta, CA 92562	100 Units (direct)***	**

* Based on a review of the Partnership’s records, 24 entities that appear to be controlled by MacKenzie Capital Management, LP or its affiliates are the record owners of 8,605 Units in the aggregate.

** Less than 1 percent

*** These Units are held by Streamside Investors, LP, of which Mr. Stephenson is the general partner.

Changes in Control

The limited partners have no right, power or authority to act for or bind the Partnership. However, the limited partners generally have the power to vote upon the following matters affecting the basic structure of the Partnership, passage of each of which requires the approval of limited partners holding a majority of the outstanding Units: (i) amendment of the Partnership Agreement; (ii) termination and dissolution of the Partnership; (iii) sale, exchange or pledge of all or substantially all of the assets of the Partnership; (iv) removal of the General Partner or any successor General Partner; (v) election of a new General Partner upon the removal, redemption, death, insanity, insolvency, bankruptcy or dissolution of the General Partner or any successor General Partner; (vi) modification of the terms of any agreement between the Partnership and the General Partner or an affiliate of the General Partner; and (vii) extension of the term of the Partnership.

Item 13. Certain Relationships and Related Transactions, and Director Independence

During the years ended December 31, 2014 and 2013 no distributions were made to the General Partner. In both 2014 and 2013, the Partnership paid fees, as described in more detail in Note 6 to the consolidated financial statements attached hereto as an exhibit, to Glenborough LLC, an affiliate of Glenborough Property Partners, LLC, which holds 13.78% of the Units. Other than the fees paid to Glenborough LLC in 2014 and 2013, the Partnership did not incur any expenses or costs reimbursable to any related person of the Partnership during the fiscal years ended December 31, 2014 and 2013.

Director Independence

The Partnership has no officers or directors. Information on Mr. Stephenson, one of the general partners of the Partnership and Director, President, Chief Executive Officer and Chief Financial Officer of the other general partner of the Partnership, is provided in the first paragraph of Item 10. Mr. Stephenson is not “independent” within the meaning of relevant SEC and stock exchange definitions of the term.

The Partnership has no “parents” within the meaning of the Exchange Act and the SEC’s rules. See also Item 12 herein, “Security Ownership of Certain Beneficial Owners.”

Item 14.

Principal Accountant Fees and Services

~~Audit~~Not ~~Fees~~applicable.

~~The~~PART ~~Partnership was billed $141,000 and $137,000 for audit services rendered by its registered public accounting firm for the years ended December 31, 2014 and 2013, respectively.~~IV

~~Audit-Related~~Item ~~Fees~~15. Exhibits, Financial Statement Schedules

~~The~~(a)(1) Financial ~~Partnership~~Statements ~~did not incur audit-related~~and ~~fees~~Financial ~~for~~Statement ~~services provided by its registered public accounting firm for the years ended December 31, 2014 and 2013~~Schedules.

Tax Fees

Management’s Annual Report on Internal Control over Financial Reporting	10
Unaudited Statement of Net Assets in Liquidation as of December 31, 2015	11
Unaudited Statement of Operations for the period January 1, 2015 to August 11, 2015	11
Unaudited Statement of Changes in Net Assets in Liquidation for the period August 12, 2015 to December 31, 2015	12
Notes to Unaudited Financial Statements	13-14

~~The~~(a)(2) ~~Partnership~~Financial ~~did~~Statement ~~not incur tax fees for services provided by its registered public accounting firm for the years ended December 31, 2014 and 2013.~~Schedules:

All ~~Other~~schedules ~~Fees~~have been omitted as the required information is inapplicable or the information is presented in the unaudited financial statements or related notes.

~~The~~(a)(3) ~~Partnership did not incur any other fees for services provided by its registered public accounting firm for the years ended December 31, 2014 and 2013.~~Exhibits:

12The exhibits listed on the Exhibit Index (following the signatures section of this report) are included, or incorporated by reference, in this annual report.

~~Part IV~~9

~~Item~~(b) ~~15.~~ Exhibits ~~and Financial Statement Schedules~~:

See item 15(a)(3) ~~The following documents are filed as part of the report:~~above.

(c) Financial Statement Schedules:

All schedules have been omitted as the required information is inapplicable or the information is presented in the unaudited financial statements or related notes.

Management’s Annual Report on Internal Control over Financial Reporting

The Trust, as such, has no officers or directors, but is managed by the Trustee. The Trustee’s Chairman is responsible for establishing and maintaining adequate internal control over financial reporting for the Trust. The Trust’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. The Trust’s internal control over financial reporting includes those policies and procedures that (1i) pertain ~~Financial~~to ~~Statements:~~the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Trust; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Trust are being made only in accordance with authorizations of the management and directors of the Trustee; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of assets of the Trust that could have a material effect on the financial statements of the Trust.

~~Report~~Because of ~~Independent~~its ~~Registered~~inherent limitations, ~~Public~~internal ~~Accounting~~control over financial reporting may not prevent or detect misstatements and even when determined to be effective, ~~Firm~~can only provide reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

~~Consolidated~~Management ~~Balance~~assessed the ~~Sheets~~effectiveness of the Trust’s internal control over financial reporting as of December 31, ~~2014~~2015. In making this assessment, ~~and~~management ~~2013~~used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (1992). Based on its assessment, management determined that the Trust maintained effective internal control over financial reporting as of December 31, 2015.

~~Consolidated~~The ~~Statements~~Rancon ofRealty ~~Discontinued~~Fund ~~Operations for~~V ~~the years ended December 31, 2014 and 2013~~Liquidating Trust

~~Consolidated~~Statement ~~Statements~~ of ~~Partners’~~Net ~~Equity for~~Assets ~~the~~in ~~years ended December 31, 2014 and 2013~~Liquidation

~~Consolidated~~As ~~Statements~~ of ~~Cash Flows for the years ended~~ December 31, ~~2014 and 2013~~2015

~~Notes to Consolidated Financial Statements~~(unaudited)

(2) Financial Statement Schedule:

Assets
Cash and cash equivalents	$	2,890,000
Receivables and other assets		1,421,000
		4,311,000

Liabilities
Accounts payable and accrued expenses		140,000
Costs to be incurred during liquidation		800,000
		940,000

Net assets in liquidation	$	3,371,000

~~Schedule~~The ~~III~~accompanying —notes ~~Real~~are ~~Estate~~an ~~and~~integral ~~Accumulated~~part ~~Depreciation as~~ of ~~December~~this ~~31,~~unaudited ~~2014~~financial ~~and Notes thereto~~statement.

~~All~~Rancon ~~other~~Realty ~~schedules~~Fund ~~are~~V, ~~omitted~~A ~~because~~California ~~they are~~Limited ~~not~~Partnership ~~applicable or the required information is shown in the financial statements or notes thereto~~

~~(3)~~Statement ~~Exhibits:~~of Discontinued Operations

~~(2.1)~~For ~~Plan of Liquidation of~~ the ~~Partnership,~~Period ~~dated~~January ~~April 10~~1, ~~2014~~2015 ~~(included as Appendix A~~ to ~~Schedule 14A dated April 21~~August 11, ~~2014, file number 0-16467, is incorporated herein by reference).~~2015

(unaudited)

Operating revenue	$	2,097,000
Operating expenses:
Property operating expenses		1,203,000
General and administrative		555,000
Total operating expenses		1,758,000

Interest expense		552,000

Income from discontinued operations		1,206,000
Loss on extinguishment of debt		(2,549,000	)
Gain on sale		26,665,000
Net income from discontinued operations	$	23,903,000

The accompanying notes are an integral part of this unaudited financial statement.

The Rancon Realty Fund V Liquidating Trust

Statement of Changes in Net Assets in Liquidation

For the Period August 12, 2015 to December 31, 2015

(unaudited)

Net assets in liquidation, beginning of period	$	—
Changes in net assets in liquidation:
Transfer from the Partnership		23,889,000
Costs to be incurred during liquidation		(1,018,000	)
Net change in net assets in liquidation		22,871,000

Amount of authorized distribution		19,500,000

Net increase in net assets in liquidation		3,371,000
Net assets in liquidation, end of period	$	3,371,000

The accompanying notes are an integral part of this unaudited financial statement.

The Rancon Realty Fund V Liquidating Trust

Notes to Unaudited Financial Statements

Note 1.

Description of Business

As used in this Annual Report on Form 10-K, unless the context otherwise requires, the terms “we,” “us,” “our,” and “the Trust” refer to The Rancon Realty Fund V Liquidating Trust. The use of “the Partnership” refers to Rancon Realty Fund IV, A California Limited Partnership, except where the context otherwise requires.

On July 29, 2015, Rancon Financial Corporation, as Trustee (the “Trustee”), formed the Trust by entering into the Liquidating Trust Agreement (the “Liquidating Trust Agreement”), for the creation and operation of The Rancon Realty Fund V Liquidating Trust (the “Liquidating Trust” or the “Trust”). In accordance with the Liquidating Trust Agreement, on August 12, 2015, the Partnership transferred all of its remaining assets to the Liquidating Trust to be administered, disposed of or provided for in accordance with the terms and conditions of the Liquidating Trust Agreement. Also as of August 12, 2015, the Partners, as beneficiaries of the Liquidating Trust (“Beneficiaries”), received beneficial interests in the Liquidating Trust (the “Beneficial Interests”). The purpose of the Trust is to provide for the orderly liquidation of the assets transferred to it by the Partnership, to pay the liabilities of the Partnership and the expenses of administering the Liquidating Trust, and to make liquidating distributions to the Beneficiaries in accordance with their Beneficial Interests. The Liquidating Trust does not have any employees, officers or directors. The existence of the Liquidating Trust will terminate upon a date determined by the Trustee (the “Termination Date”) after the Trustee has distributed to all Beneficiaries, other than Beneficiaries who cannot be located (“Missing Beneficiaries”), all of the Trust’s assets in accordance with the terms of the Liquidating Trust Agreement, which is intended to take place within three years from the date of the Liquidating Trust’s formation; provided that the Trustee has the discretion to delay such final distribution if in its good faith determination it should not be made at that time, so long as such date is no more than 21 years after the date of the Liquidating Trust Agreement. The existence of the Liquidating Trust may, however, be extended beyond such three year term if the Trustee determines that the final distribution should not be made at that time. Notwithstanding such termination of the Liquidating Trust and the Trust Agreement on the Termination Date, the Liquidating Trust shall continue to exist for the purpose of winding up its affairs, collecting and discharging its remaining obligations, and disposing of its remaining assets, including disposing of any assets that are distributable to Missing Beneficiaries in accordance with applicable state laws regarding escheatment and abandoned property.

On August 13, 2015, the Partnership filed a Certificate of Cancellation with the California Secretary of State, cancelling the limited partnership, and filed a Form 15 with the Securities and Exchange Commission (the “Commission”), terminating the registration of the limited partnership units in the Partnership. Accordingly, the Partnership has ceased filing reports under the Securities Exchange Act of 1934. However, the Trustee will cause annual reports provided to Beneficiaries to be filed with the Commission under cover of Form 10-K and periodic reports provided to Beneficiaries to be filed with the Commission under cover of Form 8-K.

Note 2.

Summary of Significant Accounting Policies

Basis of Accounting

The liquidation basis of accounting was adopted by the Partnership in executing the Plan of Liquidation for all periods subsequent to August 12, 2015, and will continue as the basis of accounting for the Trust. Under the liquidation basis of accounting, assets are stated at their estimated net realizable values and liabilities are stated at their estimated settlement amounts. Claims, liabilities and future expenses for operation of the Liquidating Trust will continue to be incurred until the Trust is terminated.

Use of Estimates

The preparation of financial statements in accordance with GAAP and under the liquidation basis of accounting requires us to make estimates and judgments that affect the reported amounts of assets (including net assets in liquidation), liabilities and expenses. We believe that our critical accounting policies are those that require significant judgments and estimates. These estimates are made and evaluated on an on-going basis using information that is currently available as well as various other assumptions believed to be reasonable under the circumstances. Actual results could vary from those estimates, perhaps in material adverse ways, and those estimates could be different under different assumptions or conditions.

Cash and Cash Equivalents

As of December 31, 2015, cash and cash equivalents total approximately $2,890,000, which consist of funds held in bank deposit accounts.

Recent Accounting Pronouncements

There are no previously issued or new accounting pronouncements or changes in accounting pronouncements that have had, or are expected to have a material impact on the Trust’s financial statements.

Concentration of Credit Risk - Financial Instruments

Financial instruments that subject the Trust to a concentration of credit risk consist of cash and cash equivalents balances maintained in financial institutions that are, in part, in excess of Federal Deposit Insurance Corporation (“FDIC”) limits. As of December 31, 2015, the Trust held cash and cash equivalents and restricted cash of approximately $2,640,000 in excess of the FDIC insurance limits.

Financial Instruments

Our net assets in liquidation as of December 31, 2015 include the following financial instruments: cash and cash equivalents, escrow proceeds deposit, receivables and accrued expenses. As our financial statements have been prepared under the liquidation basis of accounting, the carrying values of these instruments classified as assets and liabilities represent their estimated net realizable values and estimated settlement amounts, respectively.

Costs to be incurred during liquidation

Under the liquidation basis of accounting, we accrue for the estimated remaining costs to be incurred during liquidation, including legal expenses, accounting expenses, tax reporting expenses, contractor services, and miscellaneous other expected future costs. As of December 31, 2015, such costs were estimated at approximately $800,000. Our estimates are based on assumptions regarding costs to be incurred in executing the Trust Agreement, as described above in Note 1. The actual costs incurred during liquidation may increase, reducing net assets available in liquidation.

Income Taxes

We are treated as a grantor trust for federal income tax purposes and accordingly, will not be subject to federal or state income tax on any income earned or gain recognized by us. Our beneficiaries will be treated as the owner of a pro rata portion of each asset, including cash, received by and held by us and will be required to report on his or her federal, state or foreign tax return his or her pro rata share of taxable income, including gains and losses recognized by us. Accordingly, there is no provision for federal or state income taxes in the accompanying financial statements.

Note 3.

Commitments and Contingencies

Indemnifications

Pursuant to the Liquidating Trust Agreement, the Trustee, and its officers, directors and affiliates (together, the “Indemnified Persons”), shall be indemnified, and may reimburse itself out of the Trust property, against and from any and all loss, cost, liability, expense or damage which any such Indemnified Person may sustain in connection with the Trust, provided that the same were not the result of negligence or misconduct on the part of such Indemnified Person. The Trust shall advance to each Indemnified Person all expenses incurred by such Indemnified Person in connection with the investigation, defense, settlement, or appeal of any claim or proceeding attributable to a matter described in the immediately preceding sentence. Such Indemnified Person shall promptly repay such amounts advanced only if it is ultimately determined that such Indemnified Person was not entitled to be indemnified by the Trust pursuant to the Liquidating Trust Agreement.

Note 4.

Related Party Transactions

Glenborough LLC earned fees from the Trustee as prescribed by the Property Management and Services Agreement (the “Agreement”). The Agreement was in effect until the earlier of December 31, 2015 or the completion of the sale of all real property assets of the Trustee. The terms and conditions of the Agreement were to perform services for the following fees:

	For the year ended
	December 31,		December 31,
	2015		2014

(i) property management fees of 2.5% of gross rental revenue which were included in property operating expenses in the accompanying unaudited statements of operations	$	67,000	$	232,000
(ii) construction services fees which were capitalized and included in rental properties on the accompanying consolidated balance sheets		27,000		50,000
(iii) an asset and Partnership management fee which was included in general and administrative expenses in the accompanying consolidated statements of operations		500,000		250,000
(iv) leasing services fees which were included in deferred costs on the accompanying consolidated balance sheets		174,000		134,000
(v) a sales fee of 1% for all properties which was included in gains on sale of assets in the accompanying consolidated statements of operations		737,500		-
(vi) data processing fees which were included in property operating expenses in the accompanying consolidated statements of operations		43,000		119,000
(vii) engineering fees which were included in property operating expenses in the accompanying consolidated statements of operations		-		20,000

On October 1, 2010, Glenborough Holdings, LLC (Glenborough Holdings) transferred all of its interest in the Partnership to Glenborough Investors, LLC, which currently holds those units in its subsidiary, Glenborough Property Partners, LLC (“Glenborough Property Partners”). As part of the same transaction, Glenborough Holdings transferred its ownership of Glenborough LLC to Glenborough Investors, LLC, which currently holds the ownership interests in that entity in its subsidiary, Glenborough Service, LP, the parent of Glenborough Property Partners. As of December 31, 2015, Glenborough Property Partners, an affiliate of Glenborough LLC, held 11,565 or 13.78% of the beneficial interests.

SIGNATURES

Pursuant to the requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, the Trust has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	THE RANCON REALTY FUND V LIQUIDATING TRUST

	By:	Rancon Financial Corporation a California corporation Trustee

Date: March 24, 2016	By:	/s/ Daniel L. Stephenson Daniel L. Stephenson, Chairman

EXHIBIT INDEX

Exhibit No.

Exhibit Title

(2.1)

Plan of Liquidation and Dissolution of the Partnership, dated April 10, 2014 (included as Appendix A to Schedule 14A dated April 21, 2014, file number 0-16467, is incorporated herein by reference).

(2.2)

Liquidating Trust Agreement of the Trust, dated July 29, 2015 (included as Exhibit 99.1 to the Form 8-K dated August 13, 2015, file number 0-16467, is incorporated herein by reference).

(3.1)

Amended and Restated Agreement of Limited Partnership of the Partnership (included as Exhibit B to the Prospectus dated March 3, 1988, filed pursuant to Rule 424(b), File Number 2-97837, is incorporated herein by reference).

(3.2)

Third Amendment to the Amended and Restated Agreement of Limited Partnership of the Partnership, dated April 1, 1989 (filed as Exhibit 3.2 to the Partnership’s annual report on Form 10-K for the fiscal year ended November 30, 1991, file number 0-16467, is incorporated herein by reference).

(3.3)

Fourth Amendment to the Amended and Restated Agreement of Limited Partnership of the Partnership, dated March 11, 1992 (filed as Exhibit 3.3 to the Partnership’s annual report on Form 10-K for the fiscal year ended November 30, 1991, file number 0-16467, is incorporated herein by reference).

(3.4) Sixth Amendment to the Amended and Restated Agreement of ~~the~~ Limited Partnership of the Partnership dated March 27, 2014 (included as exhibit 3.1 to the Form 8K8-K dated March 27, 2014, file number 0-16467, is incorporated herein by reference).

(3.5)

Limited Partnership Agreement of RRF V Tri-City Limited Partnership, A Delaware limited partnership of which Rancon Realty Fund V, A California Limited Partnership is the limited partner (filed as Exhibit 3.4 to the Partnership’s annual report on Form 10-K for the year ended December 31, 1996, file number 0-16467, is incorporated herein by reference).

(10.1)

First Amendment to the Second Amended Management, administration and consulting agreement for services rendered by Glenborough Corporation dated August 31, 1998 (filed as Exhibit 10.1 to the Partnership’s annual report on Form 10-K for the year ended December 31, 1998, file number 0-16467, is incorporated herein by reference).

(10.2) ~~Promissory~~Agreement ~~note~~for inAcquisition ~~the amount~~ of $9Management Interests,~~600,000~~ dated ~~May~~December 920, ~~1996~~1994 ~~secured by Deeds of Trust on three of the Partnership Properties~~ (filed as Exhibit 10.3 to the Partnership’s ~~annual~~quarterly report on Form 10-KQ for the ~~year~~period ended ~~December~~September 3130, ~~1996~~2003, file number 0-16467, is incorporated herein by reference).

(10.3) ~~Agreement~~Property ~~for~~Management ~~Acquisition~~and ofServices ~~Management~~Agreement ~~Interests,~~ dated ~~December~~July 2030, ~~1994~~2004 (filed as Exhibit 10.34 to the Partnership’s quarterly report on Form 10-Q for the period ended September 30, ~~2003~~2004, ~~file number 0-16467,~~ is incorporated herein by reference).

(10.4) First Amendment to Property Management and Services Agreement dated ~~July~~March 30, ~~2004~~2005 (filed as Exhibit 10.47 to the Partnership’s ~~quarterly~~current report on Form 108-QK ~~for~~filed with the ~~period~~SEC ~~ended~~on ~~September~~February 3027, ~~2004~~2009, is incorporated herein by reference).

(10.5) ~~First~~Second Amendment to Property Management and Services Agreement dated ~~March~~December 301, 2005 (filed as Exhibit 10.7 to the Partnership’s current report on Form 8-K filed with the SEC on February 27, 2009, is incorporated herein by reference).

(10.6) ~~Second~~Third Amendment to Property Management and Services Agreement dated ~~December~~May 1, ~~2005~~2006 (filed as Exhibit 10.7 to the Partnership’s current report on Form 8-K filed with the SEC on February 27, 2009, is incorporated herein by reference).

(10.7) ~~Third~~Fourth Amendment to Property Management and Services Agreement dated ~~May~~March 1, ~~2006~~2009 (filed as Exhibit 10.7 to the Partnership’s current report on Form 8-K filed with the SEC on February 27, 2009, is incorporated herein by reference).

(10.8) Fourth Amendment to Property Management and Services Agreement dated March 1, 2009 (filed as Exhibit 10.7 to the Partnership’s current report on Form 8-K filed with the SEC on February 27, 2009, is incorporated herein by reference).

(10.9) Promissory note in the amount of $26,800,000 dated November 15, 2005 secured by Deeds of Trust on seven of the Partnership’s Properties (filed as Exhibit 10.5 to the Partnership’s report on Form 10-K for the year ended December 31, 2005, is incorporated herein by reference).

(10.10) Promissory note in the amount of $30,000,000 dated April 13, 2006 secured by Deeds of Trust on four of the Partnership’s Properties (filed as Exhibit 10.6 to the Partnership’s report on Form 10-Q for the quarter ended June 30, 2006, is incorporated herein by reference).

(31) Section 302 Certification of Daniel L. Stephenson, Chief Executive Officer and Chief Financial Officer of the General Partner of the Partnership.

(32) Section 906 Certification of Daniel L. Stephenson, Chief Executive Officer and Chief Financial Officer of the General Partner of the Partnership.*

101.INS XBRL Instance Document.

101.SCH XBRL Taxonomy Extension Schema Document.

101.CAL XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB XBRL Taxonomy Extension Labels Linkbase Document.

101.PRE XBRL Taxonomy Extension Presentation Linkbase Document.

* This certification, required by Section 906 of the Sarbanes-Oxley Act of 2002, other than as required by Section 906, is not to be deemed “filed” with the SEC or subject to the rules and regulations promulgated by the SEC under the Securities Exchange Act of 1934, as amended, or to the liabilities of Section 18 of said Act.

SIGNATURES

Pursuant to the requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, the Partnership has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	RANCON REALTY FUND V, a California Limited Partnership
	By:	Rancon Financial Corporation
		a California corporation
		its General Partner
Date: March 24, 2015	By:	/s/ Daniel L. Stephenson
		Daniel L. Stephenson, President
Date: March 24, 2015	By:	/s/ Daniel L. Stephenson
		Daniel L. Stephenson,
		General Partner

INDEX TO FINANCIAL STATEMENTS

AND SCHEDULE

	Page No.
Management’s Annual Report on Internal Control over Financial Reporting	17
Report of Independent Registered Public Accounting Firm	18
Consolidated Balance Sheets as of December 31, 2014 and 2013	19
Consolidated Statements of Discontinued Operations for the years ended December 31, 2014 and 2013	20
Consolidated Statements of Partners’ Equity for the years ended December 31, 2014 and 2013	21
Consolidated Statements of Cash Flows for the years ended December 31, 2014 and 2013	22
Notes to Consolidated Financial Statements	23-33
Schedule III - Real Estate and Accumulated Depreciation as of December 31, 2014 and Notes thereto	34-35

All other schedules are omitted because they are not applicable or the required information is shown in the consolidated financial statements or notes thereto.

Management’s Annual Report on Internal Control over Financial Reporting

The Partnership, as such, has no officers or directors, but is managed by the General Partner. The General Partner’s principal officer is responsible for establishing and maintaining adequate internal control over financial reporting for the Partnership. The Partnership’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. The Partnership’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Partnership; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Partnership are being made only in accordance with authorizations of the management and directors of the General Partner; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of assets of the Partnership that could have a material effect on the financial statements of the Partnership.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements and even when determined to be effective, can only provide reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of the Partnership’s internal control over financial reporting as of December 31, 2014. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (1992). Based on its assessment, management determined that the Partnership maintained effective internal control over financial reporting as of December 31, 2014.

March 24, 2015

~~Report~~(31) Section 302 Certification of ~~Independent Registered~~the ~~Public~~Trustee ~~Accounting~~of ~~Firm~~the Trust.

To(32) ~~The~~Section ~~General~~906 ~~Partner~~Certification of the Trustee of the Trust.*

~~Rancon~~* ~~Realty~~This ~~Fund~~certification, Vrequired by Section 906 of the Sarbanes-Oxley Act of 2002, aother ~~California~~than ~~Limited~~as ~~Partnership:~~required by Section 906, is not to be deemed “filed” with the SEC or subject to the rules and regulations promulgated by the SEC under the Securities Exchange Act of 1934, as amended, or to the liabilities of Section 18 of said Act.

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Rancon Realty Fund V, a California Limited Partnership, and its subsidiaries (the “Partnership”) at December 31, 2014 and 2013 and the results of their operations and their cash flows for each of the years then ended in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedule 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 of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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.

Emphasis of Matter

As discussed in Note 1 to the consolidated financial statements, in accordance with the terms of the Partnership Agreement the Partnership has entered into a process of dissolution. Our opinion is not modified with respect to this matter.

/s/ PricewaterhouseCoopers LLP

San Francisco, CA

March 24, 2015

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Consolidated Balance Sheets

December 31, 2014 and 2013

(in thousands, except units outstanding)

	2014			2013
Assets
Investments in real estate:
Rental properties	$	-		$	65,417
Accumulated depreciation		-			(29,608	)
Rental properties, net		-			35,809
Land held for development		-			1,487
Total investments in real estate		-			37,296
Cash and cash equivalents		7,125			10,323
Note and accounts receivable, net		-			101
Deferred costs, net of accumulated amortization of $719 and $1,800 December 31, 2014 and 2013, respectively		88			1,667
Prepaid expenses and other assets		162			2,618
Assets held for sale		40,621			-
Total assets	$	47,996		$	52,005
Liabilities and Partners’ Equity (Deficit)
Liabilities:
Notes payable	$	48,395		$	49,565
Accounts payable and other liabilities		194			591
Tenant and building improvements payable		-			-
Prepaid rent		-			165
Liabilities related to assets held for sale		651			-
Total liabilities		49,240			50,321
Commitments and contingent liabilities (Note 7)
Partners’ Equity (Deficit):
General Partner		(2,434	)		(2,434	)
Limited partners, 83,898 limited partnership units outstanding as of December 31, 2014 and 2013		1,190			4,118
Total partners’ equity		(1,244	)		1,684
Total liabilities and partners’ equity	$	47,996		$	52,005

The accompanying notes are an integral part of these consolidated financial statements

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Consolidated Statements of Discontinued Operations

For the years ended December 31, 2014 and 2013

(in thousands, except per unit amounts and units outstanding)

	2014			2013
Revenue
Rental revenue and other	$	8,754		$	9,945
Tenant reimbursements		572			544
Total revenue		9,326			10,489
Expenses
Property operating expenses		5,808			5,808
Depreciation and amortization		2,491			3,751
General and administrative		1,158			877
Total expenses		9,457			10,436
Loss		(131	)		53
Interest and other income		-			51
Interest expense (including amortization of loan fees)		(2,797	)		(2,860	)
Loss from discontinued operations		(2,928	)		(2,756	)
Loss on sale of property		-			(20	)
Net Loss	$	(2,928	)	$	(2,776	)
Basic and diluted net loss per limited partnership unit	$	(34.90	)	$	(33.09	)
Weighted average number of limited partnership units outstanding		83,898			83,898

The accompanying notes are an integral part of these consolidated financial statements

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Consolidated Statements of Partners’ Equity

For the years ended December 31, 2014 and 2013

(in thousands)

	General			Limited
	Partner			Partners			Total
Balance (deficit) at December 31, 2012		(2,434	)		6,894			4,460
Net loss		-			(2,776	)		(2,776	)
Balance (deficit) at December 31, 2013		(2,434	)		4,118			1,684
Net loss		-			(2,928	)		(2,928	)
Balance (deficit) at December 31, 2014	$	(2,434	)	$	1,190		$	(1,244	)

The accompanying notes are an integral part of these consolidated financial statements

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Consolidated Statements of Cash Flows

For the years ended December 31, 2014 and 2013

(in thousands)

	2014			2013
Cash flows from operating activities:
Net loss	$	(2,928	)	$	(2,776	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Gain (loss) on sale of property		-			20
Depreciation and amortization		2,491			3,751
Amortization of loan fees, included in interest expense		81			81
Changes in certain assets and liabilities:
Note and accounts receivable		(56	)		90
Deferred costs		(406	)		(299	)
Prepaid expenses and other assets		(75	)		(260	)
Accounts payable and other liabilities		90			(190	)
Prepaid rent		(1	)		(2	)
Net cash (used in) provided by operating activities		(804	)		415
Cash flows from investing activities:
Additions to real estate investments		(1,224	)		(1,017	)
Proceeds from sale of land and rental properties		-			7,620
Net cash (used in) provided by investing activities		(1,224	)		6,603
Cash flows from financing activities:
Note payable principal payments		(1,170	)		(1,108	)
Net cash used in financing activities		(1,170	)		(1,108	)
Net (decrease) increase in cash and cash equivalents		(3,198	)		5,910
Cash and cash equivalents at beginning of year		10,323			4,413
Cash and cash equivalents at end of year	$	7,125		$	10,323
Supplemental disclosure of cash flow information:
Cash paid for interest	$	2,716		$	2,779
Supplemental disclosure of non-cash operating activities:
Write-off of fully depreciated rental property assets	$	1,391		$	2,333
Write-off of fully amortized deferred costs	$	349		$	941

The accompanying notes are an integral part of these consolidated financial statements

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Note 1. ORGANIZATION

Rancon Realty Fund V, a California Limited Partnership, (“the Partnership”), was organized in accordance with the provisions of the California Revised Limited Partnership Act for the purpose of acquiring, developing, operating and disposing of real property. The Partnership was organized in 1985 and reached final funding in February 1989. The general partners of the Partnership are Daniel L. Stephenson and Rancon Financial Corporation (“RFC”), hereinafter collectively referred to as the “General Partner”. RFC is wholly-owned by Daniel L. Stephenson. The Partnership has no employees.

The Partnership’s initial acquisition of property in 1985 consisted of approximately 76.21 acres (unaudited) of partially developed and unimproved land located in San Bernardino, California. The property is part of a master-planned development of approximately 153 acres (unaudited) known as Tri-City Corporate Centre (“Tri-City”) and is zoned for mixed commercial, office, hotel, transportation-related, and light industrial uses. Substantially all of the balance of Tri-City is owned by Rancon Realty Fund IV (“Fund IV”), a limited partnership sponsored by the General Partner of the Partnership. As of December 31, 2013, the Partnership has twelve properties consisting of eight office properties, a 25,000 square foot health club, two restaurants and a retail space.

In November 2005, in connection with a refinancing, the Partnership formed Rancon Realty Fund V Subsidiary LLC (“RRF V SUB”), a Delaware limited liability company which is wholly owned by the Partnership. The new entity was formed to satisfy certain lender requirements for a note obtained in the fourth quarter of 2005. The note is collateralized by seven properties (see Note 6) which have been contributed to RRF V SUB by the Partnership. Since RRF V SUB is wholly owned by the Partnership, the financial statements of RRF V SUB have been consolidated with those of the Partnership.

In April 2006, the Partnership formed Rancon Realty Fund V Subsidiary Two LLC (“RRF V SUB2”), a Delaware limited liability company which is wholly owned by the Partnership. The new entity was formed to satisfy certain lender requirements for a note obtained in the second quarter of 2006. The note is collateralized by four properties (see Note 6) which have been contributed to RRF V SUB2 by the Partnership. Since RRF V SUB2 is wholly owned by the Partnership, the financial statements of RRF V SUB2 have been consolidated with those of the Partnership.

As of December 31, 2014, there were 83,898 limited partnership interest (“Units”) outstanding.

The Partnership commenced on May 8, 1985 and had a term which was set to expire on December 31, 2015 in accordance with the provisions of the Partnership Agreement. On April 21, 2014, the Partnership sent a Consent Solicitation Statement to its Limited Partners seeking their consent to the dissolution of the Partnership prior to December 31, 2015, in accordance with the terms of the Partnership Agreement and as detailed by a Plan of Liquidation and Dissolution adopted by the General Partner on April 10, 2014. The dissolution required the approval of Limited Partners holding 50% of the outstanding units. On May 8, 2014, the dissolution was approved by Limited Partners holding 50% of the outstanding units, and the Plan of Liquidation and Dissolution became effective. Consequently the General Partner began an orderly sale of the Partnership’s assets and on March 20, 2015, the last property was sold. With the sale of all of the properties, dissolution will continue but can be a complex process that may depend on a number of factors, most of which are beyond the Partnership’s control. There can be no assurance that the dissolution will be completed within a specific time frame.

Any references to the number of buildings, square footage, customers and occupancy stated in the financial statement footnotes are unaudited.

Allocation of Net Income and Net Loss

Allocation of net income and net loss is made pursuant to the terms of the Partnership Agreement. Generally, net income and net losses from operations are allocated 90% to the limited partners and 10% to the General Partner; however, if the limited partners or the General Partner would have, as a result of an allocation of cumulative net losses, a deficit balance in their capital accounts, then net losses shall not be allocated to the limited partners or the General Partner, as the case may be, so as to create a capital account deficit, but such losses shall be allocated to the limited partners or General Partner with positive capital account balances until the positive capital account balances of such other partners are reduced to zero. However, if deficits are the result of cumulative distributions in excess of earnings, losses will continue to be allocated to the General Partner. Capital accounts shall be determined after taking into account all other allocations and distributions for the fiscal year.

Net income other than net income from operations shall be allocated as follows: (i) first, to the partners who have a deficit balance in their capital account, provided that, in no event shall the General Partner be allocated more than 5% of the net income other than net income from operations until the earlier of sale or disposition of substantially all of the assets or the distribution of cash (other than cash from operations) equal to the Unitholder’s original invested capital; (ii) second, to the limited partners in proportion to and to the extent of the amounts required to increase their capital accounts to an amount equal to the sum of the adjusted invested capital of their units plus an additional cumulative non-compounded 12% return per annum (plus additional amounts depending on the date Units were purchased); (iii) third, to the partners in the minimum amount required to first equalize their capital accounts in proportion to the number of units owned, and then, to bring the sum of the balances of the capital accounts of the limited partners and the General Partner into the ratio of 4 to 1; and (iv) the balance, if any, 80% to the limited partners and 20% to the General Partner. In no event shall the General Partner be allocated less than 1% of the net income other than net income from operations for any period.

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Net losses other than net losses from operations are allocated 99% to the limited partners and 1% to the General Partner. Such net losses will be allocated among limited partners as necessary to equalize their capital accounts in proportion to their Units, and thereafter will be allocated in proportion to their Units.

The terms of the Partnership Agreement call for the General Partner to restore any deficits that may exist in its capital account after allocation of gains and losses from the sale of the final property owned by the Partnership, but prior to any liquidating distributions being made to the partners.

Distribution of Cash

The Partnership shall make annual or more frequent distributions of substantially all cash available to be distributed to partners as determined by the General Partner, subject to the following: (i) distributions may be restricted or suspended for limited periods when the General Partner determines in their absolute discretion that it is in the best interests of the Partnership; and (ii) all distributions are subject to the payment of partnership expenses and maintenance of reasonable reserves for debt service, alterations and improvements, maintenance, replacement of furniture and fixtures, working capital and contingent liabilities.

All excess cash from operations shall be distributed 90% to the limited partners and 10% to the General Partner.

All cash from sales or refinancing and any other cash determined by the General Partner to be available for distribution other than cash from operations shall be distributed in the following order of priority: (i) first, 1% to the General Partner and 99% to the limited partners in proportion to the outstanding positive amounts of Adjusted Invested Capital (as defined in the Partnership Agreement) for each of their Units until Adjusted Invested Capital (as defined in the Partnership Agreement) for each Unit is reduced to zero; (ii) second, 1% to the General Partner and 99% to the limited partners until each of the limited partners has received an amount which, including cash from operations previously distributed to the limited partners equals a 12% annual cumulative non-compounded return on the Adjusted Invested Capital (as defined in the Partnership Agreement) of their Units plus such limited partners’ Limited Incremental Preferential Return (as defined in the Partnership Agreement), if any, with respect to each such Unit, on the Adjusted Investment Capital (as defined in the Partnership Agreement) of such Units for the twelve month period following the date upon which such Unit was purchased from the Partnership and following the admission of such limited partner (iii) third, 99% to the General Partner and 1% to the limited partners, until the General Partner has received an amount equal to 20% of all distributions of cash from sales or refinancing: (iv) the balance, 80% to the limited partners, pro rata in proportion to the number of Units held by each, and 20% to the General Partner.

Note 2. Significant Accounting Policies

Basis of Accounting and Consolidation

The accompanying consolidated financial statements present the consolidated financial position of the Partnership and its wholly-owned subsidiaries as of December 31, 2014 and 2013, and the consolidated statements of operations, of partners’ equity and of cash flows of the Partnership and its wholly-owned subsidiaries for the years ended December 31, 2014 and 2013. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported results of operations during the reporting period. Actual results could differ from those estimates.

Rental Properties

Rental properties, including the related land, are stated at depreciated cost unless events or circumstances indicate that such amounts cannot be recovered based on undiscounted cash flows, excluding interest, in which case the carrying value of the property is reduced to its estimated fair value. Estimated fair value is computed using estimated sales price, as determined by prevailing market values for comparable properties and/or the use of capitalization rates applied to annualized net operating income based upon the age, construction and use of the building. Due to uncertainties inherent in the valuation process and in the economy, it is reasonably possible that the actual results of operating and disposing of the Partnership’s properties could be materially different than current expectations. Rental properties are reviewed for impairment whenever there is a triggering event and at least annually. The Partnership recorded no impairment charges related to rental properties for the years ended December 31, 2014 and 2013, respectively.

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Depreciation is provided using the straight-line method over the useful lives of the respective assets. The useful lives are as follows:

Building and improvements	5 to 40 years
Tenant improvements	Lesser of the initial term of the related lease, or the estimated useful life of the improvement
Furniture and equipment	5 to 7 years

Construction In Progress and Land Held for Development

Construction in progress and land held for development are stated at cost, unless events or circumstances indicate that cost cannot be recovered, in which case the carrying value is reduced to estimated fair value. Estimated fair value is computed using estimated sales price, based upon market values for comparable properties and considers the cost to complete and the estimated fair value of the completed project. Construction in progress and land held for development are reviewed for impairment whenever there is a triggering event and at least annually. At December 31, 2014, there was no impairment of the Partnership’s land held for development.

Real Estate Impairment Charges

The Partnership conducted a comprehensive review of all real estate assets in accordance with guidance related to accounting for the impairment or disposal of long lived assets, which indicates that asset values should be analyzed whenever events or changes in circumstances indicate that the carrying value of a property may not be fully recoverable. The process entails the analysis of each asset for instances where the book value exceeded the estimated fair value.

In order to comply with disclosure requirements as outlined in the guidance, the designation of the level of inputs used in the fair value models must be determined. Inputs used in establishing fair value for real estate assets generally fall within level three, which are characterized as requiring significant judgment as little or no current market activity may be available for validation. The main indicator used to establish the classification of the inputs was current market conditions that, in many instances, resulted in the use of significant estimates in establishing fair value measurements.

The estimated fair value of the rental properties was based on the Partnership’s current market information which was used to determine capitalization and rental growth rates. When market information was not readily available, the inputs were based on management’s understanding of market conditions and the experience of the management team, although actual results could differ significantly from management’s estimates. Additional impairments may be necessary in the future in the event that market conditions deteriorate and impact the drivers used to estimate fair value.

Sale of Real Estate

The Partnership periodically classified real estate as held for sale. An asset is classified as held for sale after the approval of Management and after an active program to sell the asset has commenced. Upon the classification of real estate as held for sale, the carrying value of the asset is reduced to the lower of its net book value or its estimated fair value, less costs to sell the asset. Subsequent to the classification of assets as held for sale, no further depreciation expense is recorded. Real estate assets held for sale are stated separately on the accompanying consolidated balance sheets. Upon a decision to no longer market an asset for sale, the asset is classified as an operating asset at the lower of fair value or the depreciated balance had the asset never been classified as held for sale and depreciation expense is reinstated. As of December 31, 2014, the Partnership had eight office properties and four retail properties classified as held for sale on the consolidated balance sheet.

Fair Value of Investments

The Partnership has adopted policies related to the accounting for fair value measurements. The guidance related to accounting for fair value measurements defines fair value and establishes a framework for measuring fair value in order to meet disclosure requirements for fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. This guidance also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. This hierarchy describes three levels of inputs that may be used to measure fair value.

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Financial assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows:

Level 1. Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market.

Level 3. Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation using unobservable inputs. This category generally includes long-term derivative contracts, real estate and unconsolidated joint ventures.

Cash and Cash Equivalents

The Partnership considers short-term investments with an original maturity of three months or less at the time of investment to be cash and cash equivalents.

Deferred Costs

Deferred loan fees are capitalized and amortized on a straight-line basis, which approximates the effective interest method, over the life of the related loan. Deferred lease commissions are capitalized and amortized on a straight-line basis over the initial fixed term of the related lease agreements.

Revenues

The Partnership recognizes rental revenue on a straight-line basis over the term of the leases. Actual amounts collected could be lower than the amounts recognized on a straight-line basis if specific tenants are unable to pay rent that the Partnership has previously recognized as revenue. For tenants with percentage rent, the Partnership recognizes revenue when the tenants’ specified sales targets have been met. The reimbursements from tenants for real estate taxes and other recoverable operating expenses are recognized as revenue on an estimated basis during the current year. The Partnership develops a revised estimate of the amount recoverable from tenants based on updated expenses for the year and amounts to be recovered and records adjustments to income in the current year financial statement accounts. Any final changes in estimate based on lease-by-lease reconciliations and tenant negotiations and collection are recorded in the period those negotiations are settled.

Net Loss Per Limited Partnership Unit

Net loss per Unit is calculated using the weighted average number of Units outstanding during the period and the limited partners’ allocable share of the net loss.

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Net loss per Unit is as follows (in thousands, except for weighted average shares and per share amounts):

	2014					2013
	General Partner		Limited Partners			General Partner		Limited Partners
Loss Allocation:
Net loss	$	-	$	(2,928	)	$	-	$	(2,776	)
Weighted average number of limited partnership units outstanding during each year				83,898					83,898
Basic and diluted net loss per limited partnership unit			$	(34.90	)			$	(33.09	)

As discussed in Note 1, because distributions of available cash have exceeded cumulative earnings and the General Partner has a deficit, the General Partner would restore that deficit in liquidation.

Income Taxes

Income taxes on Partnership income are the responsibility of the individual Partners. Accordingly, no provision for income taxes is included in the accompanying consolidated financial statements. The Partnership determines whether a tax position of the Partnership is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The tax benefit to be recognized is measured as the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement which could result in the Partnership recording a tax liability that would reduce partners’ capital. Based on its analysis, the Partnership has determined that it has not incurred any liability for unrecognized tax benefits as of December 31, 2013. However, the Partnership’s conclusions may be subject to review and adjustment at a later date based on factors including, but not limited to, ongoing analysis of changes to tax laws, regulations and interpretations thereof. As of December 31, 2014, the tax years that remain subject to examination by the major tax jurisdictions under the statute of limitations are 2011, 2012, and 2013.

The Partnership files US Federal tax returns and state tax returns in California, Georgia, Indiana, Maine, Missouri, New Jersey, New York, Oregon, Pennsylvania and West Virginia.

Concentration risk

As of December 31, 2014 and 2013, no tenant accounted for more than 10% of the rental income generated by the Partnership properties for the year.

Recent accounting pronouncements

On April 10, 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” (“ASU No. 2014-08”). ASU No. 2014-08 clarifies that discontinued operations presentation applies only to disposals representing a strategic shift that has (or will have) a major effect on an entity’s operations and financial results (e.g. a disposal of a major geographical area, a major line of business, a major equity method investment of other major parts of an entity). ASU No. 2014-08 is effective prospectively for the reporting periods beginning after December 15, 2014. Early adoption is permitted, and the Partnership is currently assessing the impact, if any, that the adoption of this standard will have and will adopt the standard on January 1, 2015.

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers”, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new guidance is effective for the Partnership the first quarter of 2017, with no early adoption permitted. The Partnership is currently evaluating the effect that ASU 2014-09 will have on the consolidated financial statements and related disclosures.

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Note 3. ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

In response to the Limited Partners May 8, 2014 approval of the dissolution of the Partnership, the General Partner began an orderly liquidation of the Partnership’s assets and all properties were sold as of March 20, 2015. In accordance with the guidance, the related assets and liabilities of the Partnership’s properties have been classified as held for sale on the accompanying balance sheet as follows:

Reconciliation of Total Assets and Liabilities

of the Properties Held for Sale

That are Presented Separately in the Consolidated Balance Sheet

(in thousands)

	December 31
	2014
Carrying amounts of major classes of assets included as part of assets held for sale:
Investments in real estate: Rental properties net	$	36,355
Accounts receivable, net		157
Deferred costs, net of accumulated amortization of		1,578
Prepaid expenses and other assets		2,531
Total assets classified as held for sale	$	40,621
Carrying amounts of major classes of liabilities included as part of assets held for sale:
Accounts payable and other liabilities	$	487
Prepaid rent		164
Total liabilities	$	651

Investments in real estate held for sale consist of the following (in thousands):

	December 31,
	2014
Land	$	7,893
Land improvements		1,536
Buildings		46,970
Building and tenant improvements		10,338
		66,737
Less: accumulated depreciation		(30,382	)
Total rental properties, net	$	36,355

As of December 31, 2014, the Partnership’s rental properties included eight office properties and four retail properties (see detailed listing of properties in Item 2. Properties).

The Partnership conducts a comprehensive review of all real estate assets in accordance with the guidance related to accounting for the impairment or disposal of long lived assets, which indicates that asset values should be analyzed whenever events or changes in circumstances indicate that the carrying value of a property may not be fully recoverable. The process entails the analysis of each asset for instances where book value exceeded the estimated fair value. There were no impairment provisions recorded in the years ended December 31, 2014 and 2013.

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Note 4. DISPOSITION OF RENTAL PROPERTY

During the first quarter of 2013, the Partnership received an unsolicited offer to sell the Three Carnegie property. The sale was concluded on March 7, 2013 to an unrelated third party for a gross sales price of $8,000,000. The buyer paid the Partnership $3,200,000 in consideration at the time of the sale and the balance was paid by the buyer’s issuance of a promissory note to the Partnership in the amount of $4,800,000 bearing interest at the rate of 5.5% per annum with a 60 day maturity and an election to extend the maturity date for an additional sixty days. The note was repaid during the second quarter of 2013.

Note 5. NOTES PAYABLE

Notes payable as of December 31, 2014 and 2013, were as follows (in thousands):

	2014		2013
Note payable #1 collateralized by first deeds of trust on seven properties. The note has a fixed interest rate of 5.46%, a maturity date of January 1, 2016 with a 30-year amortization requiring monthly principal and interest payments of $151.	$	22,690	$	23,252
Note payable #2 collateralized by first deeds of trust on four properties. The note has a fixed interest rate of 5.61%, a maturity date of May 1, 2016 with a 30-year amortization requiring monthly principal and interest payments of $173.		25,705		26,313
Total notes payable	$	48,395	$	49,565

Note payable #1 is collateralized by 784 East Hospitality, Carnegie Business Center II, Lakeside Tower, Outback Steakhouse, 690 East Hospitality, Palm Court Retail III and One Carnegie Plaza and Note payable #2 is collateralized by Brier Corporate Center, One Parkside, Two Parkside and Two Carnegie Plaza. Both loan documents provide that if a debt service coverage ratio of 1.2 to 1 (as calculated by the lender), is not maintained, the lender has the right to notify the Partnership that a triggering event has occurred. If a triggering event has occurred, the lender would have certain rights to retain revenues generated by the property in excess of property operating expenses, taxes, insurance, capital improvement costs and debt service as additional cash collateral, rather than returning such amounts to the Partnership. As of December 31, 2014, the Partnership has not been notified by the lender that a triggering event has occurred. As buildings were sold in 2015, the proceeds were applied to the notes payable and upon closing of the sale of the office buildings on March 20, 2015, the notes were completely repaid.

The annual maturities of the Partnership’s notes payable as of December 31, 2014, are as follows (in thousands):

2015		1,132
2016		47,263
Total	$	48,395

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Note 6. RELATED PARTY TRANSACTIONS

Glenborough LLC earns fees from the Partnership as prescribed by the Property Management and Services Agreement (the “Agreement”). The Agreement is in effect until the earlier of December 31, 2015 or the completion of the sale of all real property assets of the Partnership. The terms and conditions of the Agreement are to perform services for the following fees:

		2014		2013
(i)	property management fees of 2.5% of gross rental revenue which were included in property operating expenses in the accompanying consolidated statements of operations	$	232,000	$	255,000
(ii)	construction services fees which were capitalized and included in rental properties on the accompanying consolidated balance sheets	$	50,000		50,000
(iii)	an asset and Partnership management fee which was included in general and administrative expenses in the accompanying consolidated statements of operations	$	250,000		250,000
(iv)	leasing services fees which were included in deferred costs on the accompanying consolidated balance sheets	$	134,000		128,000
(v)	a sales fee of 1% for all properties, which was included in net gain on sale of property	$	-		80,000
(vi)	data processing fees which were included in property operating expenses in the accompanying consolidated statements of operations	$	119,000		113,000
(vii)	engineering fees which were included in property operating expenses in the accompanying consolidated statements of operations	$	20,000		34,000

On October 1, 2010, Glenborough Holdings, LLC (Glenborough Holdings) transferred all of its interest in the Partnership to Glenborough Investors, LLC, which currently holds those units in its subsidiary, Glenborough Property Partners, LLC (“Glenborough Property Partners”). As part of the same transaction, Glenborough Holdings transferred its ownership of Glenborough LLC to Glenborough Investors, LLC, which currently holds the ownership interests in that entity in its subsidiary, Glenborough Service, LP, the parent of Glenborough Property Partners. As of December 31, 2014, Glenborough Property Partners, an affiliate of Glenborough LLC, held 11,565 or 13.78% of the Units.

Note 7. COMMITMENTS AND CONTINGENT LIABILITIES

Environmental Matters

The Partnership follows a policy of monitoring its properties for the presence of hazardous or toxic substances. The Partnership is not aware of any environmental liability with respect to the properties that would have a material adverse effect on the Partnership’s business, assets or results of operations. There can be no assurance that such a material environmental liability does not exist. The existence of any such material environmental liability could have an adverse effect on the Partnership’s consolidated results of operations and cash flows.

General Uninsured Losses

The Partnership carries property and liability insurance with respect to the properties. This coverage has policy specification and insured limits customarily carried for similar properties. However, certain types of losses (such as from earthquakes and floods) may be either uninsurable or not economically insurable. Should the properties sustain damage as a result of an earthquake or flood, the Partnership may incur losses due to insurance deductibles, co-payments on insured losses or uninsured losses. Additionally, the Partnership has elected to obtain insurance coverage for “certified acts of terrorism” as defined in the Terrorism Risk Insurance Act of 2002, as amended and reauthorized to date; however, our policies of insurance may not provide coverage for other acts of terrorism. Any losses from such other acts of terrorism might be uninsured. Should an uninsured loss occur, the Partnership could lose some or all of its capital investment, cash flow and anticipated profits related to the properties.

RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2014 and 2013

Other Matters

The Partnership is contingently liable for subordinated real estate commissions payable to the General Partner in the amount of $102,000 at December 31, 2014, for sales that occurred in previous years. The subordinated real estate commissions are payable only after the limited Partners have received distributions equal to their original invested capital plus a cumulative non-compounded return of 12% per annum on their adjusted invested capital. Since the circumstances under which these commissions would be payable are considered remote, the liability has not been recognized in the accompanying consolidated financial statements; however, the amount will be recorded when and if it becomes probable.

Note 8. LEASES

The Partnership’s rental properties are leased under non-cancelable operating leases that expire at various dates through August 2023. In addition to monthly base rents, several of the leases provide for additional contingent rents based upon a percentage of sales levels attained by the tenants. Future minimum rents under non-cancelable operating leases as of December 31, 2014 are as follows (in thousands):

2015	$	8,291
2016		6,188
2017		4,967
2018		3,463
2019		1,976
Thereafter		4,159
Total	$	29,044

Note 9. SUBSEQUENT EVENTS

Subsequent to December 31, 2014, the Partnership finalized the sale of four Retail buildings and all of the office properties. 690 E. Hospitality was sold on January 15, 2015 for $3,100,000, Outback was sold on January 23, 2015 for $2,024,000, Palm Retail 3 was sold on March 12, 2015 for $2,400,000. The remaining retail and all office properties were sold in one transaction on March 20, 2015 for $66,775,000. Net proceeds were used first to pay down the respective note payable and prepayment penalties. Any remaining proceeds will be distributed to the partners after deducting reserves for projected remaining dissolution costs of the partnership.

SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION

December 31, 2014

(In Thousands)

COLUMN A	COLUMN B		COLUMN C					COLUMN D					COLUMN E									COLUMN F		COLUMN G	COLUMN H	COLUMN I
			Initial Cost to					Cost Capitalized					Gross Amount Carried at
			Partnership					Subsequent to Acquisition					December 31, 2014
						Buildings										Buildings								Date		Life
						and					Carrying					and			(a)			Accumulated		Construction	Date	Depreciated
Description	Encumbrances		Land			Improvements		Improvements			Cost		Land			Improvements			Total			Depreciation		Began	Acquired	Over
Rental Properties:
Commercial Office -
One Carnegie Plaza		(b)	$	1,583		$	-	$	8,094		$	-	$	1,571		$	8,106		$	9,677		$	4,440	Aug-86	6/3/85	3-40 yrs.
Less: Provision for impairment of real estate				-			-		(1,657	)		-		(256	)		(1,401	)		(1,657	)		-
Two Carnegie Plaza		(c)		873			-		4,492			-		864			4,501			5,365			2,709	Jan-88	6/3/85	3-40 yrs.
Carnegie Business Center II		(b)		544			-		2,618			-		544			2,618			3,162			1,498	Oct-86	6/3/85	3-40 yrs.
Less: Provision for impairment of real estate				-			-		(299	)		-		(41	)		(258	)		(299	)		-
Lakeside Tower		(b)		834			-		10,017			-		824			10,027			10,851			5,791	Mar-88	6/3/85	3-40 yrs.
One Parkside		(c)		529			-		5,936			-		523			5,942			6,465			2,846	Feb-92	6/3/85	5-40 yrs.
Less: Provision for impairment of real estate				-			-		(700	)		-		(65	)		(635	)		(700	)		-
Two Parkside		(c)		330			-		7,661			-		1,315			6,676			7,991			3,338	Jan-96	6/3/85	5-40 yrs.
Less: Provision for impairment of real estate				(36	)		-		-			-		(36	)		-			(36	)		-
Brier Corporate Center		(c)		651			-		15,011			-		651			15,011			15,662			6,398	Jan-05	6/3/85	5-40 yrs.
Less: Provision for impairment of real estate				-			-		(436	)		-		-			(436	)		(436	)		-
Three Parkside				-			-		5,950			-		-			5,950			5,950			1,338	May-07	6/3/85	5-40 yrs.
Less: Provision for impairment of real estate				-			-		(2,300	)				-			(2,300	)		(2,300	)		-
Commercial Office -
784 East Hospitality		(b)		786			-		1,998			-		780			2,004			2,784			983	Jan-95	6/3/85	5-40 yrs.
Outback Steakhouse		(b)		-			-		837			-		157			680			837			299	Jan-96
Palm Court Retail #3		(b)		249			-		747			-		242			754			996			346	Jan-96	6/3/85	15-40 yrs.
Less: Provision for impairment of real estate				-			-		(131	)		-		-			(131	)		(131	)		-
690 East Hospitality		(b)		341			-		728			-		869			200			1,069			396	Nov-03	6/3/85	15-40 yrs.
		48,395		6,684			-		58,566			-		7,942			57,308			65,250			30,382
Land held for development:
0.3 acres		-		166			-		285			-		451			-			451			-	N/A	6/3/85	N/A
4.1 acres		-		1,500			-		356			-		1,856			-			1,856			-	Feb-07	6/3/85	N/A
Less: Provision for impairment of real estate		-		-			-		(820	)		-		(820	)		-			(820	)		-
		-		1,666			-		(179	)		-		1,487			-			1,487			-
TOTAL	$	48,395	$	8,350		$	-	$	58,387		$	-	$	9,429		$	57,308		$	66,737		$	30,382

(a) The aggregate cost of land and buildings for federal income tax purposes is $113,714.

(b) One Carnegie, Carnegie Business Center II, Lakeside Tower, 784 East Hospitality, Outback Steakhouse, Palm Court Retail III and 690 East Hospitality are collateral for debt in the aggregate amount of $22,690.

(c) Brier Corporate Center, One Parkside, Two Parkside and Two Carnegie Plaza collateral for debt in the aggregate amount of $25,705.

continued

SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION

(in thousands)

Reconciliation of gross amount at which real estate was carried for the years ended December 31, 2014 and 2013:

	2014			2013
Investments in real estate:
Balance at beginning of year	$	66,904		$	78,237
Additions during year		1,224			1,017
Write-off of fully depreciated rental property		(1,391	)		(2,333	)
Sales of real estate		-			(10,017	)
Balance at end of year	$	66,737		$	66,904
Accumulated Depreciation:
Balance at beginning of year	$	29,608		$	31,673
Additions charged to expense		2,165			3,229
Write-off of fully depreciated rental property		(1,391	)		(2,333	)
Sales of real estate		-			(2,961	)
Balance at end of year	$	30,382		$	29,608

See accompanying independent registered public accounting firm’s report.

EXHIBIT INDEX

Exhibit No.		Exhibit Title
(2.1)		Plan of Liquidation of the Partnership, dated April 10, 2014 (included as Appendix A to Schedule 14A dated April 21, 2014, file number 0-16467, is incorporated herein by reference).
(3.1)		Amended and Restated Agreement of Limited Partnership of the Partnership (included as Exhibit B to the Prospectus dated March 3, 1988, filed pursuant to Rule 424(b), File Number 2-97837, is incorporated herein by reference).
(3.2)		Third Amendment to the Amended and Restated Agreement of Limited Partnership of the Partnership, dated April 1, 1989 (filed as Exhibit 3.2 to the Partnership’s annual report on Form 10-K for the fiscal year ended November 30, 1991, file number 0-16467, is incorporated herein by reference).
(3.3)		Fourth Amendment to the Amended and Restated Agreement of Limited Partnership of the Partnership, dated March 11, 1992 (filed as Exhibit 3.3 to the Partnership’s annual report on Form 10-K for the fiscal year ended November 30, 1991, file number 0-16467, is incorporated herein by reference).
(3.4)		Sixth Amendment to the Amended and Restated Agreement of Limited Partnership of the Partnership dated March 27, 2014 (included as exhibit 3.1 to the Form 8-k dated March 27, 2014, file number 0-16467, is incorporated herein by reference).
(3.5)		Limited Partnership Agreement of RRF V Tri-City Limited Partnership, A Delaware limited partnership of which Rancon Realty Fund V, A California Limited Partnership is the limited partner (filed as Exhibit 3.4 to the Partnership’s annual report on Form 10-K for the year ended December 31, 1996, file number 0-16467, is incorporated herein by reference).
(10.1)		First Amendment to the Second Amended Management, administration and consulting agreement for services rendered by Glenborough Corporation dated August 31, 1998 (filed as Exhibit 10.1 to the Partnership’s annual report on Form 10-K for the year ended December 31, 1998, file number 0-16467, is incorporated herein by reference).
(10.2)		Promissory note in the amount of $9,600,000 dated May 9, 1996 secured by Deeds of Trust on three of the Partnership Properties (filed as Exhibit 10.3 to the Partnership’s annual report on Form 10-K for the year ended December 31, 1996, file number 0-16467, is incorporated herein by reference).
(10.3)		Agreement for Acquisition of Management Interests, dated December 20, 1994 (filed as Exhibit 10.3 to the Partnership’s quarterly report on Form 10-Q for the period ended September 30, 2003, file number 0-16467, is incorporated herein by reference).
(10.4)		Property Management and Services Agreement dated July 30, 2004 (filed as Exhibit 10.4 to the Partnership’s quarterly report on Form 10-Q for the period ended September 30, 2004, is incorporated herein by reference).
(10.5)		First Amendment to Property Management and Services Agreement dated March 30, 2005 (filed as Exhibit 10.7 to the Partnership’s current report on Form 8-K filed with the SEC on February 27, 2009, is incorporated herein by reference).
(10.6)		Second Amendment to Property Management and Services Agreement dated December 1, 2005 (filed as Exhibit 10.7 to the Partnership’s current report on Form 8-K filed with the SEC on February 27, 2009, is incorporated herein by reference).
(10.7)		Third Amendment to Property Management and Services Agreement dated May 1, 2006 (filed as Exhibit 10.7 to the Partnership’s current report on Form 8-K filed with the SEC on February 27, 2009, is incorporated herein by reference).
(10.8)		Fourth Amendment to Property Management and Services Agreement dated March 1, 2009 (filed as Exhibit 10.7 to the Partnership’s current report on Form 8-K filed with the SEC on February 27, 2009, is incorporated herein by reference).
(10.9)		Promissory note in the amount of $26,800,000 dated November 15, 2005 secured by Deeds of Trust on seven of the Partnership’s Properties (filed as Exhibit 10.5 to the Partnership’s report on Form 10-K for the year ended December 31, 2005, is incorporated herein by reference).

(10.10)		Promissory note in the amount of $30,000,000 dated April 13, 2006 secured by Deeds of Trust on four of the Partnership’s Properties (filed as Exhibit 10.6 to the Partnership’s report on Form 10-Q for the quarter ended June 30, 2006, is incorporated herein by reference).
(31)		Section 302 Certification of Daniel L. Stephenson, Chief Executive Officer and Chief Financial Officer of the General Partner of the Partnership.
(32)		Section 906 Certification of Daniel L. Stephenson, Chief Executive Officer and Chief Financial Officer of the General Partner of the Partnership.*

101.INS		XBRL Instance Document.
101.SCH		XBRL Taxonomy Extension Schema Document.
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB		XBRL Taxonomy Extension Labels Linkbase Document.
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.
		* This certification, required by Section 906 of the Sarbanes-Oxley Act of 2002, other than as required by Section 906, is not to be deemed “filed” with the SEC or subject to the rules and regulations promulgated by the SEC under the Securities Exchange Act of 1934, as amended, or to the liabilities of Section 18 of said Act.

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