As Filed With the Securities and Exchange Commission on November 24, 2003

                                                          Registration No. 333-

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM S-8

                        REGISTRATION STATEMENT UNDER THE
                             SECURITIES ACT OF 1933


                                   CHARTERMAC
             (Exact Name of Registrant as Specified in Its Charter)

                Delaware                        13-3949418
      (State or Other Jurisdiction           (I.R.S. Employer
    of Incorporation or Organization)     Identification Number)

                             625 Madison Avenue
                         New York, New York 10022
                              (212) 421-5333
(Address, Including Zip Code, and Telephone Number, Including Area Code,
               of Registrant's Principal Executive Offices)

                        CharterMac Restricted Share Plan
                      Non-Qualified Share Option Agreement
                            (Full Title of the Plans)


      Stuart J. Boesky                                With copies to:
    Chief Executive Officer                        Mark Schonberger, Esq.
     625 Madison Avenue                   Paul, Hastings, Janofsky & Walker LLP
 New York, New York 10022                          75 East 55th Street
      (212) 317-5700                             New York, New York 10022
(Name, Address, Including Zip Code,                   (212) 318-6000
and Telephone Number, Including
Area Code, of Agent For Service)

<TABLE>
<CAPTION>
                         CALCULATION OF REGISTRATION FEE
================================================================================================
                                         Proposed maximum   Proposed maximum
Title of securities     Amount to be      offering price        aggregate          Amount of
  to be registered       registered          per share       offering price    registration fee
------------------------------------------------------------------------------------------------
<S>                   <C>                    <C>                <C>              <C>
Common Shares of
Beneficial Interest   1,136,108 shares(1)    $19.50(3)          $22,154,106.00   $1,792.27

Common Shares of
Beneficial Interest   1,000,000 shares(2)    $17.78(4)          $17,780,000.00   $1,438.40

Total                 2,136,108 shares                                           $3,230.67
------------------------------------------------------------------------------------------------
</TABLE>

    (1) Represents 1,136,108 common shares of beneficial interest (the "Common
Shares") reserved for issuance pursuant to the CharterMac Restricted Share Plan
(the "Restricted Plan") plus such indeterminate amount of additional shares as
may become issuable pursuant to the anti-dilution provisions contained in the
Restricted Plan.
    (2) Represents 1,000,000 Common Shares issuable upon the exercise of options
granted to Stephen M. Ross by a Non-Qualified Share Option Agreement between the
Company and Stephen M. Ross (the "Ross Option Agreement") plus such
indeterminate amount of additional shares as may become issuable pursuant to the
anti-dilution provisions contained therein.
    (3) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(h) of the Securities Act, on the basis of
the average of the high and low prices of the Company's Common Shares as
reported by the American Stock Exchange on November 21, 2003.
    (4) Calculated in accordance with Rule 457(h) as this amount represents the
exercise price of the options granted pursuant to the Ross Option Agreement.

<PAGE>


                                  PART I

              INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS


                             Explanatory Note

     CharterMac  ("CharterMac" or the "Company") has prepared this  Registration
Statement in accordance  with the  requirements of Form S-8 under the Securities
Act to register:  (a) the issuance of common shares of beneficial  interest (the
"Common  Shares") upon the exercise of options being granted to Stephen M. Ross,
a principal of Related  Capital  Company,  a subsidiary of CharterMac  ("Related
Capital") and CharterMac's  non-executive  chairman pursuant to the terms of the
Ross Non-Qualified Share Option Agreement (the "Ross Option Agreement"); and (b)
the issuance of restricted Common Shares to certain employees of Related Capital
pursuant to the terms of  CharterMac's  Restricted  Share Plan (the  "Restricted
Plan").

     This Registration  Statement  contains two parts. The first part contains a
prospectus  prepared  in  accordance  with  Part I of S-8  (in  accordance  with
Instruction  C of the General  Instructions  to Form S-8),  including a re-offer
prospectus  that may be used for  re-offerings  and  re-sales  of Common  Shares
acquired  by  the  selling  shareholders  listed  on  page  39 of  the  re-offer
prospectus.  These selling  shareholders are affiliates of CharterMac as defined
in Rule 405 of the  Securities Act of 1933, as amended (the  "Securities  Act").
The second part  contains  information  required in the  Registration  Statement
pursuant to Part II of Form S-8.


     The documents relating to the Ross Option Agreement and the Restricted Plan
previously have been, or will be, sent or given to the  participants  thereunder
and are filed with the Commission as part of this Registration Statement.  These
documents  and the  documents  incorporated  by reference  in this  Registration
Statement  pursuant  to  Item 3 of Part II of this  Form  S-8,  taken  together,
constitute  a prospectus  that meets the  requirements  of Section  10(a) of the
Securities Act.



                                        i
<PAGE>




                               RE-OFFER PROSPECTUS

                           1,025,867 COMMON SHARES OF

                                   CHARTERMAC

     We are CharterMac ("CharterMac" or the "Company"), a statutory trust formed
under  the laws of the  State of  Delaware.  Our  common  shares  of  beneficial
interest (the "Common Shares") which are the subject of this re-offer prospectus
may be  offered  and  sold to the  public  by  Stephen  M.  Ross  and any  other
individuals who are deemed to be "affiliates"  under Rule 144 promulgated  under
the Act (the  "Selling  Securityholders")  who  shall be  issued  Common  Shares
pursuant to the terms of the Ross  Non-Qualified  Share  Option  Agreement  (the
"Ross Option Agreement") and CharterMac's Restricted Share Plan (the "Restricted
Plan"). We will issue the Common Shares to the Selling  Securityholders (i) upon
the exercise of options granted  pursuant to the Ross Option  Agreement and (ii)
pursuant to the terms of the Restricted Plan.


     The  Selling  Securityholders  may sell their  Common  Shares  directly  or
indirectly in one or more  transactions on any stock exchange or stock market on
which the  Common  Shares  may be listed at the time of the sale,  in  privately
negotiated  transactions,  or through a combination of such methods. These sales
may be at fixed prices (which may be changed),  at market  prices  prevailing at
the time of sale,  at prices  related  to such  prevailing  market  prices or at
negotiated prices.


     CharterMac's  Common Shares are listed on the American Stock Exchange under
the  symbol  CHC.  On  November  21,  2003,  the last  reported  sale  price for
CharterMac's Common Shares was $19.48 per share.


This re-offer  prospectus has been prepared for the purpose of  registering  the
Common  Shares  which are the  subject  of this  re-offer  prospectus  under the
Securities Act to allow for future sales by the Selling  Securityholders  to the
public. The Selling  Securityholders  may sell Common Shares through one or more
agents,  brokers or dealers or directly to  purchasers.  Such brokers or dealers
may receive  compensation in the form of  commissions,  discounts or concessions
from the Selling Securityholders and/or purchasers of the Common Shares, or both
(which  compensation  as to a  particular  broker or dealer  may be in excess of
customary   commissions).   In   connection   with  such   sales,   the  Selling
Securityholders  and any  participating  broker  or  dealer  may be deemed to be
"underwriters"  within the meaning of the  Securities  Act, and any  commissions
they receive and the  proceeds of any sale of Common  Shares may be deemed to be
underwriting discounts and commissions under the Securities Act. CharterMac will
not  receive  any  proceeds  from the sale of the Common  Shares by the  Selling
Securityholders.

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


        This investment involves a high degree of risk. Please see "Risk
Factors" beginning on page 3.

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


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

     This re-offer prospectus does not constitute an offer to sell securities in
any state to any person to whom it is unlawful to make such offer in such state.

          The date of this re-offer prospectus is November 25, 2003.


                                       ii
<PAGE>



You should rely only on the  information  contained or incorporated by reference
in this re-offer  prospectus.  CharterMac has not authorized any other person to
provide you with  information  different from or additional to that contained or
incorporated   by   reference   in  this   re-offer   prospectus.   The  Selling
Securityholders  are offering to sell Common Shares only in jurisdictions  where
offers and sales are permitted. You should assume that the information appearing
in this re-offer  prospectus and the documents  incorporated by reference herein
and  therein is  accurate  only as of its  respective  date or as of other dates
which are  specified in these  documents.  Our  business,  financial  condition,
results of operations and prospects may have changed since these dates.


                           ADDITIONAL INFORMATION


     We have filed with the United  States  Securities  and Exchange  Commission
(the "Commission") a registration statement on Form S-8 under the Securities Act
to register the Common Shares offered hereby.  This re-offer  prospectus is part
of the registration statement. This re-offer prospectus does not contain all the
information  contained  in the  registration  statement  because we have omitted
certain parts of the  registration  statement in  accordance  with the rules and
regulations of the Commission.  Statements contained in this re-offer prospectus
regarding the contents of any contract or any other document to which  reference
is made are not necessarily complete, and, in each instance where a copy of such
contract  or other  document  has been filed as an  exhibit to the  registration
statement,  reference is made to the copy so filed,  each statement is qualified
in all respects by such reference. For further information,  we refer you to the
registration  statement,  which  you may read and copy at the  public  reference
facilities  maintained by the Commission at Judiciary  Plaza,  450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549 and at the Commission's Regional Offices
at  Citicorp  Center,  500 W.  Madison  Street,  Suite 1400,  Chicago,  Illinois
60661-2511.  You may  obtain  copies at the  prescribed  rates  from the  Public
Reference Section of the Commission at its principal office in Washington,  D.C.
You may call the Commission at 1-800-SEC-0330 for further  information about the
public  reference  rooms.  The  Commission  maintains  a web site that  contains
reports,  proxy  and  information  statements  and other  information  regarding
CharterMac. You may access the Commission's web site at http://www.sec.gov.


     We are subject to the informational requirements of the Securities Exchange
Act of 1934, as amended.  As a result,  we are required to file  reports,  proxy
statements and other  information  with the  Commission.  These materials can be
copied and inspected at the locations  described above at prescribed  rates. Our
Common Shares are listed on the American Stock Exchange under the symbol "CHC."



               INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE


     The Commission  allows us to  "incorporate by reference" the information we
file with them, which means that we can disclose important information to you by
referring you to those documents.  The information  incorporated by reference is
considered to be part of this re-offer prospectus,  and information that we file
later  with  the  Commission  will  automatically   update  and  supersede  this
information.  We  incorporate  by reference the  documents  listed below and any
future filings we will make with the Commission  under Section 13(a),  13(c), 14
or 15(d) of the Securities Exchange Act of 1934:


     o    Our Annual Report on Form 10-K for the fiscal year ended  December 31,
          2002,  filed with the Commission on April 2, 2003 (Commission File No.
          001-13237);

     o    Our Quarterly  Report on Form 10-Q for the period ending September 30,
          2003,  filed with the Commission on November 14, 2003 (Commission File
          No. 001-13237);

     o    Our Quarterly Report on Form 10-Q for the period ending June 30, 2003,
          filed with the  Commission  on August 14,  2003  (Commission  File No.
          001-13237);



                                       iii
<PAGE>



     o    The  Company's  Quarterly  Report on Form 10-Q for the  period  ending
          March 31, 2003,  filed with the Commission on May 15, 2003 (Commission
          File No. 001-13237);

     o    Our Definitive Proxy Statement dated September 5, 2003 on Schedule 14A
          prepared in connection with our Annual Meeting of Shareholders held on
          November 17, 2003 (Commission File No. 001-13237);

     o    Our Current  Report on Form 8-K filed with the  Commission  on October
          31, 2003 (Commission File No. 001-13237); and

     o    Our Current  Report on Form 8-K filed with the Commission on September
          8, 2003 (Commission File No. 001-13237).

You may request a copy of these  filings  (not  including  the  exhibits to such
documents unless the exhibits are specifically  incorporated by reference in the
information  contained in this re-offer  prospectus),  at no cost, by writing or
telephoning us at the following address:

                                   CharterMac
                               625 Madison Avenue
                            New York, New York 10022
                               Attn: Brenda Abuaf
              Telephone requests may be directed to (212) 317-5700.


     This re-offer prospectus is part of a registration  statement we filed with
the  Commission.  You should  rely only on the  information  or  representations
provided in this re-offer  prospectus.  We have authorized no one to provide you
with different  information.  We are not making an offer of these  securities in
any state  where the offer is not  permitted.  You should  not  assume  that the
information  in this  re-offer  prospectus is accurate as of any date other than
the date on the front of the document.


     Statements  contained in this re-offer prospectus as to the contents of any
contract or document are not necessarily complete and in each instance reference
is made to the copy of that  contract  or  document  filed as an  exhibit to the
registration  statement or as an exhibit to another filing,  each such statement
being qualified in all respects by such reference and the exhibits and schedules
thereto.




                                       iv
<PAGE>


                          RE-OFFER PROSPECTUS SUMMARY


     This summary highlights  information  included elsewhere in or incorporated
by  reference  in  this  re-offer  prospectus.  It may  not  contain  all of the
information  that is  important to you.  You should read the  following  summary
together  with  the  more  detailed  information  included  or  incorporated  by
reference in this  re-offer  prospectus,  including  risk factors  regarding our
business and the Common Shares being offered hereby.

In this re-offer prospectus, we refer to:

     o    CharterMac   together  with  its  subsidiaries   (unless  the  context
          otherwise requires) as "we," "us," "our," or "our Company";

     o    Charter Mac Corporation,  our wholly-owned subsidiary,  as "CM Corp.";
          and

     o    Related Capital Company,  our  newly-acquired  subsidiary and internal
          manager, as "Related Capital".

Our Company

     Overview

     We are CharterMac,  a statutory trust formed under the laws of the State of
Delaware.  We are principally engaged in the acquisition and ownership (directly
and indirectly  through our  subsidiaries) of federally  tax-exempt  multifamily
housing revenue bonds issued by various state or local governments,  agencies or
authorities  and other  investments  designed  to produce  federally  tax-exempt
income. Most of our investments are held indirectly through our subsidiaries.

     CM Corp. and our newly-acquired subsidiary,  Related Capital, conducts most
of our taxable  business.  CM Corp. (i)  originates  and services  mortgages for
third parties and (ii)  guarantees  tax credit equity returns and mortgage loans
for a fee.  Related  Capital  conducts  fee-generating  activities  and provides
management services to us.

     CM Corp.  currently owns approximately 84% of the outstanding capital stock
of PW Funding  Inc.  (which we refer to as "PW  Funding"),  a national  mortgage
banking firm specializing in multifamily  housing.  CM Corp.  expects to acquire
the  remaining  outstanding  capital  stock of PW Funding  over the next 6 to 18
months.

     Our Common  Shares are listed for trading on the  American  Stock  Exchange
under the symbol  "CHC." We have also issued two  separate  series of  preferred
shares designated  Convertible  Community  Reinvestment Act Preferred Shares. We
collectively refer to both series of our Convertible Community  Reinvestment Act
Preferred Shares as our "CRA Shares"  throughout this re-offer  prospectus.  Our
CRA Shares are entitled to the same  economic  benefits as our Common Shares but
receive a  preference  with  respect to  certain  regulatory  benefits.  Our CRA
Shares,  which are not listed on any exchange,  are convertible  into our Common
Shares.

     Tax Status

     We and our subsidiaries (excluding CM Corp. and PW Funding) are each either
classified as a partnership or  disregarded  for federal income tax purposes and
thus are not subject to federal income taxation. As such, we pass through to our
shareholders,  in  the  form  of  distributions,   income  (including  federally
tax-exempt  income) derived from our  investments  without paying federal income
tax on that income.  Although the exact  percentage will vary from time to time,
we estimate that for the year ending  December 31, 2003, no less than 95% of our
distributions to our shareholders will be excludable from


<PAGE>



their gross income for federal income tax purposes.  For the calendar year ended
December 31, 2002, approximately 96% of our distributions consisted of federally
tax-exempt  income.  See "Risk  Factors--Risks  relating  to our Company and the
operation of our business--Our  classification as a publicly-traded  partnership
is not free  from  doubt  and  could be  challenged"  and  "Federal  Income  Tax
Considerations," below.

    Our Management


     We operate our day-to-day  activities and select our investments  utilizing
the  services  and  advice  provided  by  our  recently-acquired,   wholly-owned
subsidiary,  Related Capital, subject to the supervision and review of our board
of  trustees.  . See "- Our  Acquisition  of Related  Capital,"  below.  Related
Capital's  management  team has an average of 19 years of experience in the real
estate industry.

    Our Acquisition of Related Capital


     On November 17, 2003, we acquired  100% of the  ownership  interests in and
substantially  all of the  businesses  operated by Related  Capital  (other than
specific excluded interests).  The acquisition was structured so that the former
selling principals of Related Capital  contributed their ownership  interests in
Related Capital into CharterMac  Company,  LLC, a newly-formed  subsidiary of CM
Corp. which we refer to as "CCC", in exchange for  approximately  $282.8 million
of special common units in CCC. All of the selling  principals  were also issued
one special  preferred  voting share of our Company for each special common unit
they received.  The special  preferred voting shares have no economic  interest,
but entitle the holder thereof to one vote per special preferred voting share on
all matters  subject to a vote of the holders of our Common  Shares.  One of the
selling principals also received $50 million in cash.


     The  former  selling  principals  of  Related  Capital  included  its  four
executive managing partners (Stuart J. Boesky, Alan P. Hirmes, Marc D. Schnitzer
and Denise L. Kiley),  all of whom are members of our board of trustees,  and an
affiliate of The Related Companies,  L.P., a New York limited partnership with a
majority of its equity  controlled by Stephen M. Ross,  who is also the Chairman
of our board of trustees.


     As a result of the acquisition,  the beneficial ownership in our Company of
(i) Mr. Ross equals  approximately  15.0% and (ii) our  management and the other
selling principals (other than Mr. Ross) equals approximately 7.2%.

Securities That May Be Offered


     This re-offer prospectus relates to the offer and sale from time to time by
the persons listed under the "Selling  Securityholder"  section of this re-offer
prospectus  of up to  1,025,867  Common  Shares which may be issued (i) upon the
exercise  of options  granted  pursuant to the Ross  Option  Agreement  and (ii)
pursuant to the terms of the  Restricted  Plan.  We are  registering  the Common
Shares covered by this re-offer prospectus.


     We will not receive any cash proceeds from the sale of our Common Shares by
the Selling Securityholders.

Risk Factors


     Investing in our Common  Shares  involves  various  risks.  In  considering
whether to purchase our Common Shares, you should carefully consider the matters
discussed under "Risk Factors" beginning on page 3 of this re-offer prospectus.



                                       2
<PAGE>



                                RISK FACTORS


An  investment  in the Common Shares  offered  hereby  involves a high degree of
risk. You should  carefully  consider the following risk factors,  together with
all of the other  information  included or  incorporated  by  reference  in this
re-offer  prospectus  before you decide to purchase our Common Shares. If any of
the  following  risks  actually  occur,  our  business,  prospects,  results  of
operations and financial condition would likely suffer. In these  circumstances,
the market price of our Common  Shares and the value of our Common  Shares could
decline,  and you may lose all or part of the money  you paid to buy our  Common
Shares. This section includes or refers to certain forward-looking  information.
You should refer to the  explanation of the  qualifications  and  limitations on
such  forward-looking   information  discussed  on  page  39  of  this  re-offer
prospectus.



Risks related to investing in revenue bonds

Our income is subject to the risks of investments in affordable multifamily
rental residential properties.

We derive a large portion of our income by investing in revenue bonds secured by
affordable multifamily rental residential properties. Investing in such revenue
bonds subjects us to various types and degrees of risk that could adversely
affect the value of our assets and our ability to generate revenues, net income
and cash available for distributions to shareholders, including the following:

     -    the  property  securing a revenue  bond does not  generate  sufficient
          income to meet its  operating  expenses  and  payments  on its related
          revenue bond;

     -    local,  regional or national economic  conditions may limit the amount
          of rent that can be charged for rental  units at the  properties,  and
          may result in a reduction in rent  payments or the  timeliness of rent
          payments or a reduction in occupancy levels;

     -    occupancy  and  rent  levels  may  be  affected  by   construction  of
          additional  housing units and national,  regional and local  politics,
          including  current or future rent  stabilization and rent control laws
          and agreements;

     -    federal low income housing tax credits  ("LIHTCs") and city, state and
          federal housing subsidy or similar programs which apply to many of the
          properties  impose rent  limitations  and could  adversely  affect the
          ability to increase rents to generate the funds  necessary to maintain
          the properties in proper  condition,  which is particularly  important
          during  periods of rapid  inflation or declining  market value of such
          properties; and

     -    if a revenue bond  defaults,  the value of the property  securing such
          revenue bond (plus, for properties that have availed themselves of the
          federal  LIHTCs,  the  value  of such  credit)  may be less  than  the
          unamortized principal amount of such revenue bond.

We may suffer adverse consequences from changes in interest rates.

An  increase  in market  interest  rates may  reduce the  carrying  value of our
investments,  including  our  residual  interests in  tax-exempt  securitization
transactions,  decrease  the  amount  we  could  realize  on the  sale of  those
investments and adversely  affect the amount of funds available for distribution
to the common  shareholders.  Since a  significant  portion  of our  investments
represent  residual  interests in revenue bonds or other  securities  whose cash
flow is first used to pay senior  securities with short-term  floating  interest
rates,  any increase in  short-term  interest  rates will increase the amount of
interest  we are


                                       3
<PAGE>


required to pay on the senior  securities  and reduce the cash
flow from our residual  interests and could adversely affect the market value of
our shares by reducing  the amount of cash  available  for  distribution  to our
shareholders.

A decrease in market  interest rates may lead to the  refinancing of some of the
revenue bonds we own, through  redemption thereof by the issuing entities or the
borrowers. We may not be able to reinvest the proceeds of any such redemption in
a comparable  revenue bond at an attractive rate of return. In addition,  we may
not be able to purchase new revenue bonds at the same interest  rates as we have
in the past. This may affect our ability to generate  sufficient  income to make
distributions and other payments in respect of our shares.

We have no recourse  against state or local  governments or property owners upon
default of our revenue  bonds or upon the  bankruptcy  of an owner of properties
securing our revenue bonds.

Although state or local  governments or their agencies or authorities  issue the
revenue bonds we purchase,  the revenue bonds are not general obligations of any
state or local  government.  No government is liable to repay the revenue bonds,
nor is the taxing power of any  government  pledged for the payment of principal
or interest on the revenue bonds. An assignment by the issuing government agency
or  authority  of the mortgage  loan to the owner of the related  properties  in
favor of a bond trustee on behalf of us or one of our  subsidiaries,  or in some
cases, an assignment directly to the bondholder,  secures the applicable revenue
bond we own.  The loan is secured  by a  mortgage  on the  related  property  or
properties  and an  assignment  of  rents.  The  underlying  mortgage  loans are
nonrecourse to the property owner other than customary  recourse  carve-outs for
bad acts such as fraud;  that is,  the  owners of the  properties  securing  the
revenue  bonds that we own are liable for the payment of principal  and interest
under the loans only to the extent of cash flow  from,  and sale or  refinancing
proceeds  of,  such  properties.  Accordingly,  the  revenue  derived  from  the
operation of the  properties  securing the revenue bonds that we own and amounts
derived from the sale,  refinancing  or other  disposition of the properties are
the sole sources of funds for payment of  principal  and interest on the revenue
bonds.

Our revenue may also be  adversely  affected  by the  bankruptcy  of an owner of
properties  securing the revenue  bonds that we directly or  indirectly  own. An
owner  of  properties  under  bankruptcy  protection  may be  able  to  forcibly
restructure its debt service payments and stop making, temporarily or otherwise,
debt  service  payments  to us.  Our  rights in this  event  would be defined by
applicable law.

Some of the properties underlying our revenue bonds are owned by charities.

As of September 30, 2003,  nine of our revenue bonds with an aggregate  carrying
value of  approximately  $84.9  million  were  issued on  behalf  of  non-profit
organizations  described in Section 501(c)(3) of the Code and finance low income
multifamily properties or facilities for the elderly. Because an allocation of a
state's  volume  cap is not  needed for these  revenue  bonds,  they may be more
readily  available than revenue bonds which require an allocation of volume cap.
However,  because  charities  are not  profit-motivated,  they  may not  operate
properties  as  efficiently  as  for-profit  owners.  Many  charities are thinly
capitalized  and are  unable  to  invest  significant  amounts  of  equity  into
affordable  multifamily  properties  acquired  by them.  This may  increase  the
likelihood of default because the charity (i) may not have the capital  required
to operate and maintain  the property if the cash flow  expected to be generated
by rental  income is less than expected or (ii) may be more willing to abandon a
property experiencing financial difficulty because its investment is minimal. In
addition,  investing  in revenue  bonds owned by  charities  is subject to other
risks, including:

     -    changes in governmental sponsorship of subsidized programs;

     -    subsidization of indigent persons who use their facilities,  which may
          reduce the cash flow  available to pay debt  service on revenue  bonds
          secured by such facilities;


                                       4
<PAGE>


     -    the  possibility  that a  charity's  status as an exempt  organization
          could be revoked or the  possibility  that the  property  is sold to a
          person  which  is not an  exempt  organization  that is  described  in
          Section  501(c)(3)  of  the  Code,  for  example,  as  a  result  of a
          foreclosure  sale,  thereby  resulting  in the interest on the revenue
          bonds issued for the benefit of such charity  becoming  includable  in
          gross income for purposes of federal income  taxation from the date of
          issue of the respective revenue bond; and

     -    the  inability of the owner of the revenue bond to recover  sufficient
          value in the event of a default and subsequent foreclosure, because of
          the loss of the  benefit  of the  tax-exempt  financing  and,  in some
          cases,  real  estate tax  abatements,  unless the  project is promptly
          resold to another qualifying non-profit organization.

There may be negative effects of requirements  with respect to rent restrictions
and permissible income of occupants of properties securing our revenue bonds.

All of the properties securing our revenue bonds are subject to certain federal,
state and/or local  requirements with respect to the permissible income of their
tenants.  The LIHTC  program  and,  often,  state or local law  establish a rent
ceiling for some or all tenants.  In addition,  pursuant to the Code, all of the
properties  securing our revenue bonds are required to have at least 20% (and in
the case of low income  properties  owned by most  charities,  up to 75%) of the
units reserved for occupancy by low or moderate income persons or families.  The
Code  provides  that,  as a general  rule,  for revenue bonds issued on or after
January 1, 1986, the income  limitations for low or moderate income tenants will
be adjusted for family size. Since federal subsidies are not generally available
in connection with the mortgage loans, rents must be charged on such portions of
the units at a level to permit such units to be continuously  occupied by low or
moderate  income  persons  or  families.  As a  result,  such  rents  may not be
sufficient  to cover all  operating  costs  with  respect to such units and debt
service on the related  revenue bond. In such event,  the rents on the remaining
units may have to be higher  than they would  otherwise  be and may,  therefore,
exceed  competitive  rents,  which may adversely  affect the occupancy rate of a
property securing an investment and the developer's ability to service its debt.

We are  subject to  construction  completion  and  rehabilitation  risks.

As of September  30, 2003,  revenue  bonds with an aggregate  carrying  value of
approximately  $484.4  million were secured by  affordable  multifamily  housing
properties  which are still in various stages of construction  and revenue bonds
with an aggregate carrying value of approximately $148.1 million were secured by
affordable  multifamily  housing  properties  which are  undergoing  substantial
rehabilitation.  Construction and/or rehabilitation of such properties generally
takes  approximately  12 to 24 months.  The principal risk  associated with this
type of lending is the risk of noncompletion  of construction or  rehabilitation
which may arise as a result  of:  (i)  underestimated  initial  construction  or
rehabilitation  costs; (ii) cost overruns;  (iii) delays; (iv) failure to obtain
governmental  approvals;   and  (v)  adverse  weather  and  other  unpredictable
contingencies beyond the control of the developer.  If a mortgage loan is called
due to construction and/or rehabilitation not being completed as required in the
mortgage  loan  documents,  we may incur certain costs and be required to invest
additional capital in order to preserve our investment.

The properties  securing certain of our revenue bonds,  which are currently in a
lease-up stage, may experience  financial distress if they do not meet occupancy
and debt service coverage levels sufficient to stabilize such properties.

As of September 30, 2003,  revenue bonds in our portfolio  with a carrying value
of approximately $476.1 million are secured by mortgages on properties which are
currently in a lease-up stage. The lease-up of these  underlying  properties may
not be  completed  on schedule or at  anticipated  rent  levels,  resulting in a
greater risk that such revenue  bonds may go into default than bonds  secured by
mortgages on  properties  that are fully  leased-up.  Moreover,  there can be no
assurance that the underlying  property will achieve expected  occupancy or debt
service coverage levels.



                                       5
<PAGE>



Other  parties  may have the first right to income  from and  principal  of, and
control of foreclosure on, some of our investments.

As of the  date  of this  re-offer  prospectus,  a  substantial  portion  of our
investments  consist of revenue bonds that are  subordinated  or that  represent
interests in bonds,  notes or other  instruments  that may be junior in right of
payment to other bonds,  notes or  instruments.  There are risks in investing in
subordinated  revenue  bonds and other  junior  residual  interests  that  could
adversely affect our ability to make expected distributions to our shareholders,
including:

     -    the risk that  borrowers  may not be able to make payments on both the
          senior and the subordinated  revenue bonds or interests,  resulting in
          us, as a holder of the subordinated  revenue bond, receiving less than
          the full and timely payments of interest and principal;

     -    the risk that  short-term  interest  rates rise  significantly,  which
          would  increase  the  amounts  payable  to the  holders  of the senior
          interests created through our  securitizations  and reduce the amounts
          payable to us or our  subsidiaries  as holders of the junior  residual
          interests; and

     -    the possibility that the holders of the senior revenue bonds or senior
          interests created through our  securitizations may control the ability
          to enforce  remedies,  limiting our ability to take actions that might
          protect our interests.

Our  revenue bonds and mortgage loans may be considered usurious.

State  usury  laws  establish  restrictions,  in certain  circumstances,  on the
maximum rate of interest that may be charged by a lender and impose penalties on
parties making  usurious  loans,  including  monetary  penalties,  forfeiture of
interest and  unenforceability of the debt. Although we do not intend to acquire
revenue bonds secured by mortgage loans at usurious rates,  there is a risk that
our revenue  bonds and mortgage  loans could be found to be usurious as a result
of  uncertainties  in determining  the maximum legal rate of interest in certain
jurisdictions,  especially with respect to participating or otherwise contingent
interest.  Therefore, the amount of interest to be charged and our return on our
revenue bonds will be limited by state usury laws. In order to minimize the risk
of investing in a revenue bond at a usurious rate, our trust agreement  requires
us to obtain an opinion of local counsel to the effect that the interest rate of
a proposed  revenue bond is not  usurious  under  applicable  state law. We also
generally  obtain an opinion of local counsel to the effect that the interest on
the proposed mortgage loan is not usurious. To obtain such opinions, we may have
to agree to defer or reduce the amount of interest that can be paid in any year.
Some states may prohibit the compounding of interest,  in which case we may have
to agree to forego the  compounding  feature of our revenue bonds  originated in
those states.


Risks related to our taxable business

Our  subsidiaries'  fee-generating  activities  are  less  predictable  than our
tax-exempt  bond   investments  and  could  result  in  taxable  income  to  our
shareholders.

Our formation of CM Corp., acquisition of PW Funding and more recent acquisition
of  Related   Capital  further  changes  our  business  from  one  that  invests
substantially  all of our assets in tax-exempt bonds to one that, in addition to
tax-exempt  bond  investments,   conducts  significant   fee-generating  service
activities. These fee generating activities are significantly different from the
majority of our historical  investment business where revenue bonds are held and
income is generated primarily through receipt of interest payments.  Although we
expect that these service  businesses will generate  significant  growth for us,
they are inherently less  predictable than the ownership of tax-exempt bonds and
there can be no assurance that our subsidiaries'  fee-generating activities will
be profitable. In addition, the earnings and



                                       6
<PAGE>



cash generated by the Related Capital business fluctuate between quarters due to
the  variability in the timing of investing in tax credit  partnerships  and the
seasonality  inherent in the timing of tax credit  equity  investments,  both of
which are primary drivers of the earnings and cash generated by Related Capital.
These  fluctuations  could be perceived  negatively  and,  therefore,  adversely
affect the price at which our shares trade.


In  addition,   the  portion  of  our  distributions  that  represent  federally
tax-exempt  income could  decrease based on the proportion of our future taxable
business.  If the taxable dividend income distributed by CM Corp. to us grows as
a percentage of our consolidated net income, if we invest in a larger percentage
of taxable investments or if we engage in other taxable fee generating business,
the  percentage  of our  net  income  distributed  to our  shareholders  that is
federally tax-exempt to them is likely to decrease.

There are risks  associated  with  Delegated  Underwriter  and Servicer  ("DUS")
lending.

Through PW  Funding's  DUS  program,  we  originate  loans which are  thereafter
purchased by Fannie Mae. PW Funding  retains a first loss  position with respect
to loans  that it  originates  and  sells to  Fannie  Mae.  PW  Funding  assumes
responsibility for a portion of any loss that may result from borrower defaults,
based on the  Fannie  Mae loss  sharing  formulas,  Levels I, II, or III.  As of
September 30, 2003, all of PW Funding's  loans  consisted of Level I loans.  For
such loans, PW Funding is responsible  for the first 5% of the unpaid  principal
balance  and a portion  of any  additional  losses  to a  maximum  of 20% of the
original  principal  balance.  Level II and Level III loans  carry a higher loss
sharing percentage. Any remaining loss is sustained by Fannie Mae.

Under the terms of the Master Loss Sharing  Agreement  between Fannie Mae and PW
Funding,  PW Funding is  responsible  for funding 100% of mortgagor  delinquency
(principal and interest) and servicing (taxes,  insurance and foreclosure costs)
advances until the amounts advanced exceed 5% of the unpaid principal balance at
the date of  default.  Thereafter,  for Level I loans,  PW Funding  may  request
interim  loss  sharing  adjustments  which  allow PW Funding to fund 25% of such
advances  until final  settlement  under the Master Loss Sharing  Agreement.  No
interim sharing adjustments are available for Level II and Level III loans.

There are risks associated with credit enhancement.

Through CM Corp.,  we provide credit  enhancement to third parties for a fee. If
such third  parties  default  on their  obligations  on which CM Corp.  provided
credit  enhancement,  CM Corp. would be called upon to make the related payment,
which  could be in an amount that is far in excess of the fee  obtained  for its
credit  enhancement.  In addition,  we usually guarantee CM Corp.'s  obligations
under its credit enhancement transactions. As of September 30, 2003, our maximum
risk associated with these credit  enhancement  transactions  was  approximately
$141.5 million.

Elimination of, or changes to, governmental programs.

A  significant  portion of  Related  Capital's  revenues  are  derived  from the
syndication of partnership interests in properties eligible for LIHTCs. Although
LIHTCs are a permanent part of the Internal  Revenue Code, as in the case of all
legislated  programs,  Congress  can  repeal or modify it at any time.  If it is
repealed  or  adversely  modified,  Related  Capital  would no longer be able to
generate  transactional  revenues and increase or maintain the base of recurring
revenues associated with these properties, as is currently contemplated.

First  loss and  non-investment  grade  subordinated  interests  are  subject to
increased risk of loss.

We  have  invested   indirectly  in  subordinated   Commercial  Mortgage  Backed
Securities ("CMBS") through our ownership of a preferred  membership interest in
ARCap Investors L.L.C.  ("ARCap").  Subordinated CMBS of the type in which ARCap
invests typically  include "first loss" and  non-investment  grade


                                       7
<PAGE>



subordinated interests. A first loss security is the most subordinate class in a
structure  and  accordingly  is the  first to bear the loss  upon a  default  or
restructuring  or  liquidation  of the  underlying  collateral  and the  last to
receive  payment  of  interest  and  principal,  and is often  not  assigned  an
investment  rating.  Accordingly,  such classes are subject to a greater risk of
loss of principal and  non-payment of interest than more senior,  rated classes.
The  market  values of  subordinated  interests  in CMBS and other  subordinated
securities tend to be more sensitive to changes in economic conditions than more
senior,  rated  classes.  As a result of these and other  factors,  subordinated
interests  generally  are  not  actively  traded  and  are  relatively  illiquid
investments.  With respect to our  investment in ARCap,  our ability to transfer
our  membership  interest  in ARCap is  further  limited by the terms of ARCap's
operating agreement.

The inability to maintain Related  Capital's  current recurring fee arrangements
and to generate new  transaction  fees could have a negative impact on the price
of our shares.

Two of our major  revenue  sources will be the recurring  and  transaction  fees
payable  by  investment  programs  sponsored,  or to be  sponsored,  by  Related
Capital.  Recurring fees depend on the ongoing operation of investment  programs
sponsored by Related  Capital while  transaction  fees are generally  "up-front"
fees that are generated from the  sponsorship of new  investment  programs.  The
termination of one or more of these recurring fee arrangements, or the inability
to sponsor new programs which will generate new recurring and transaction  fees,
could adversely  affect our results of operations and reduce the market price of
our shares. There can be no assurance that existing fee arrangements will not be
terminated or that we will be able to realize  revenues  from these  existing or
any new fee arrangements.

The agreements  with companies and investment  programs  Related Capital manages
may not be renewed and may have finite terms.

Related  Capital  receives fees pursuant to an advisory  agreement with American
Mortgage Acceptance Company ("AMAC").  The AMAC advisory agreement is subject to
annual  renewal by AMAC,  which requires the approval of a majority of its board
of trustees.  In addition, a majority of the independent members of AMAC's board
may terminate this agreement  with Related  Capital with or without cause.  As a
result,  this agreement may not be renewed or may be terminated  with or without
cause.

Related Capital also receives fees from investment  programs Related Capital has
sponsored and may sponsor in the future that do not provide for annual elections
by investors of their management.  In connection with our acquisition of Related
Capital, we acquired  controlling  interests in the entities which control these
investment  programs which currently  generate  recurring fees.  However,  these
interests are subject to the  fiduciary  duty of the  controlling  entity to the
investors in those investment  programs which may affect our ability to continue
to collect fees from those investment programs.

Furthermore,   the  organizational  documents  of  substantially  all  of  these
investment  programs  allow for the  investors,  at their option,  to remove the
entity  controlled  by Related  Capital as general  partner or  managing  member
without cause.  Although the  investment  programs will generally be required to
pay fair market value if they exercise this right,  Related  Capital's  right to
receive  future  fees would  terminate  and there can be no  assurance  that the
payment will fully compensate us for this loss.

Finally,  many of these  investment  programs  typically  have finite periods in
which  they are  scheduled  to  exist,  after  which  they are  liquidated.  The
termination  of a  program  will  result in a  termination  of the fees we could
otherwise expect to receive from those programs.

Related  Capital's  business  is subject to  competition  and our  inability  to
compete  effectively in the future for financial  services business could reduce
the  revenues  we expect to  receive as a result of our  acquisition  of Related
Capital and negatively impact the price of our shares.


                                       8
<PAGE>

Financial  services in the  multifamily  affordable  housing  industry is highly
competitive.  Related  Capital  competes  with  entities  that  possess  greater
financial  resources for (a) providing  financing to multifamily  developers and
(b) selling tax credit and other syndication funds to investors. Related Capital
also competes against numerous private  financial  service  providers as well as
state and federal  agencies.  Dominant  competitors  include  Enterprise  Social
Investment Corp., Sun America and Municipal Mortgage and Equity LLC.

Pursuant  to  Section 42 of the Code,  a fixed  number of  housing  credits  are
allocated  annually  to each  state  based on  population.  In 2002,  there were
approximately  2.5 times as many  applications by developers for a national pool
of approximately  $5 billion in tax credits as there were tax credits  available
for  allocation.  Related Capital is dependent upon the developers of tax credit
properties  to apply for and  obtain  tax  credits.  Related  Capital,  in turn,
contracts  with the  local  developer  for the  right to offer  the tax  credits
through  investment  programs  it  sponsors.   These  local  developers  include
independent  third  parties as well as  affiliates  of TRCLP.  Our  inability to
continue to arrange for the acquisition of tax credit  opportunities  from local
developers  or the inability of  developers  with whom Related  Capital has done
business  in the past to  continue  to obtain  tax credit  allocations  from the
states, may adversely affect our ability to achieve the anticipated  benefits of
our acquisition of Related Capital.

Related Capital relies on  relationships  with key investors and customers which
may not continue, which would adversely affect our ability to generate revenue.

Related  Capital relies on  relationships  with key investors and customers.  If
these relationships do not continue,  or if we are unable to create and form new
relationships,  our ability to generate revenue will be adversely  affected.  In
2002, five key investors provided approximately 72% of the equity capital raised
by tax credit  syndication  programs  sponsored  by Related  Capital with two of
those key investors providing approximately 47% of the capital. In addition, ten
key developers provided approximately 55% of the tax credit properties for which
Related Capital provided equity financing for in 2002. There can be no assurance
that we will be able to  continue to do business  with these key  investors  and
customers or that new relationships will be achieved.

General risks related to our Company

We and our  subsidiaries  depend on the  services  of Related  Capital's  senior
management team.

We and our subsidiaries  depend upon the services of Related  Capital's four key
employees  (Messrs.  Boesky,  Hirmes  and  Schnitzer  and Ms.  Kiley)  and other
individuals who comprise Related Capital's senior management team. All decisions
with respect to the management and control of our Company and our  subsidiaries,
subject  to  the  supervision  of our  board  of  trustees  (or  the  applicable
subsidiaries  board of directors),  are currently made exclusively by these four
key employees and Related  Capital's  senior  management  team.  This  includes,
without  limitation,  the determination as to how we and our subsidiaries choose
our  investments.  The departure or the loss of the services of any of these key
employees or a large number of senior  management  personnel and other employees
could have a material  adverse effect on our ability to effectively  operate our
business and our future results of operations.

Because  we  hold  most  of  our  investments  through  our  subsidiaries,   our
shareholders  are  effectively  subordinated  to the  liabilities  and preferred
equity of our subsidiaries.

We hold most of our  investments  through  our  subsidiaries.  Since we own only
common equity of our subsidiaries,  we, and therefore holders of our shares, are
effectively  subordinated  to  the  liabilities  and  preferred  equity  of  our
subsidiaries,  which  at  September  30,  2003,  aggregated  approximately  $1.3
billion.  In  particular,  the  holders  of the  preferred  shares of one of our
subsidiaries,  the  CharterMac  Equity  Issuer  Trust,  are  entitled to receive
preferential  distributions  with respect to revenues  generated by  investments
held directly or indirectly  through it, which constitute a substantial  portion
of our  assets.  Similarly,


                                       9
<PAGE>


holders of senior interests created through our  securitization  programs have a
superior  claim to the  cash  flow  from the  revenue  bonds  deposited  in such
programs.  Accordingly, a portion of the earnings on our investments will not be
available for distribution on our Common Shares.

We are subject to ongoing  liabilities  and business  risks that are inherent to
Related Capital's business.

Assumed  Liabilities.  In connection with our acquisition of Related Capital, we
assumed and incurred liabilities and associated costs,  including the assumption
of liabilities under certain guarantees.  We also provided  replacement notes to
capitalize general partner entities of investment programs previously  sponsored
by Related Capital and controlled  directly by us and guaranteed the performance
by our  subsidiaries  of any  obligations  they have pursuant to the  agreements
entered  into in  connection  with our  acquisition  of  Related  Capital.  As a
guarantor, we could incur liability if events of default occur.

New  Liabilities  and Business  Risks.  In connection  with the  sponsorship  of
investment  programs and joint venture  activities related to the co-development
of tax credit  properties,  Related Capital acts as a fiduciary to the investors
in its syndication  programs and is often also required to provide guarantees of
performance.

Related Capital advances funds to acquire  interests in properties for inclusion
in offerings to investors and at any point in time, the amount of funds advanced
can be material.  The warehouse  line of credit  utilized by Related  Capital to
fund  these  advances  has a maximum  amount of $85.0  million.  Realization  of
Related  Capital's  investment  is subject to  continued  success in  attracting
investors to new funds or, if investors are not found,  the sale of the acquired
properties.

Finally,  our  subsidiaries  could be subject to  liabilities  to  investors  in
investment programs and third parties as a result of serving as general partner.
In  addition,  even when we are not  required to do so, we may advance  funds to
allow investment programs to meet their expenses.

Certain types of losses are uninsured.

There are certain types of losses (generally of a catastrophic  nature,  such as
toxic  mold,  earthquakes,   floods,   terrorism  and  wars)  which  are  either
uninsurable or not economically insurable.  Should a disaster of this type occur
to, or cause the destruction  of, one of the properties  securing a revenue bond
that we  directly  or  indirectly  own,  it is  possible  that we could lose our
invested capital, anticipated future revenue and anticipated profit.

Our investments are illiquid.

Our investments  lack a regular  trading  market.  There is no limitation in our
trust agreement or otherwise as to the percentage of our investments that may be
illiquid and we expect to continue to invest in assets, a substantial portion of
which will be illiquid securities.  If a situation arises where we would require
additional  cash, we could be forced to liquidate some or all of our investments
on unfavorable terms (if any sale is possible) that could  substantially  reduce
the  amount of  distributions  available  and  payments  made in  respect of our
shares.

Certain of the revenue bonds held by us and our subsidiaries have been pledged.

A significant  portion of our revenue bond portfolio has been pledged in support
of our securitizations,  credit enhancement  activities and warehouse borrowing.
The  carrying  value of the  pledged  bonds  varies  from  time to  time.  As of
September 30, 2003,  the carrying  value of the aggregate  amount of all pledged
bonds is approximately $1.6 billion.  Upon the occurrence of a default under one
or more of the programs in connection  with which our revenue bonds are pledged,
those bonds could be liquidated and the proceeds of such liquidation  applied to
cure such default.  Such liquidation and application  would reduce



                                       10
<PAGE>



the amount of interest available for distributions to our shareholders and would
also  potentially  trigger  other  defaults,  which  could  lead  to  additional
liquidations of the pledged revenue bonds.

Our board of trustees can change our business policies unilaterally.

Our  shareholders  have no control over changes in our  policies,  including our
business  policies  with  respect  to  acquisitions,  financing,  growth,  debt,
capitalization and distributions, which are determined by our board of trustees.
Our board of trustees  may amend or revise our business  plan and certain  other
policies without  shareholder vote. There is a risk that changes in our business
policies may not fully serve the interests of all of our shareholders.

We invest in real estate related  investments  and revenue bonds secured by real
estate, which involves risk of liability under the environmental laws.

Under various  federal,  state and local laws,  ordinances and  regulations,  an
owner  or  operator  of real  estate  is  liable  for the  costs of  removal  or
remediation of certain hazardous or toxic substances  released on, above,  under
or in such real estate.  These laws often  impose  liability  without  regard to
whether  the  owner  knew of,  or was  responsible  for,  the  presence  of such
hazardous or toxic  substances.  As a result,  the entities we sponsor which own
real estate,  and the owners of the real estate securing our investments,  could
be  required  to pay  removal or  remediation  costs.  These costs of removal or
remediation could be substantial and could negatively impact the availability of
property  cash flow for payments on our  investments.  Phase I reports have been
obtained  for all of the  properties  securing our  investments,  and in certain
instances,  because of  findings in the Phase I reports,  Phase II reports  have
also been obtained. The results of such reports were that no material violations
of applicable  regulations were found and such reports  concluded that there has
been no verifiable or apparent adverse environmental impact from past or present
land use which has not been or will not be  remediated.  Other than such Phase I
and Phase II reports, no further environmental analyses have been performed with
respect to the properties  securing our  investments.  Other than the results of
the reports described above, our awareness of environmental  problems associated
with the properties securing our investments is derived, for the most part, from
information obtained from owners of the properties which secure our investments,
due diligence inquiries when our investments were financed or visual inspections
of properties by independent  appraisers.  There may, however,  be environmental
problems  associated with a property  securing an investment not known to us and
our subsidiaries.

We are not registered under the Investment  Company Act and would not be able to
conduct  our  activities  as we  currently  conduct  them if we  were to  become
required to be registered.

Neither we nor our subsidiaries are registered under the Investment  Company Act
of 1940, as amended (the  "Investment  Company Act") and we would not be able to
conduct our  activities  as we  currently  conduct  them if we were  required to
register thereunder.

We at all times intend to conduct our activities, and those of our subsidiaries,
so as not to become  regulated as an  investment  company  under the  Investment
Company Act. Even if we are not an  "investment  company"  under the  Investment
Company Act, we could be subject to regulation under the Investment  Company Act
if a subsidiary of ours were to be deemed to be an "investment  company."  There
are a number of  possible  exemptions  from  registration  under the  Investment
Company  Act that we  believe  apply  to us and our  subsidiaries  and  which we
believe  make it  possible  for us not to be subject to  registration  under the
Investment Company Act.

For example,  the  Investment  Company Act exempts  entities that are "primarily
engaged in the business of purchasing or otherwise acquiring mortgages and other
liens on and  interests  in real  estate,"  which  we  refer  to as  "qualifying
interests." Under current interpretation of the staff of the Commission,  one of
the ways in which our subsidiaries can qualify for this exemption is to maintain
at least 55% of its assets  directly in qualifying  interests and the balance in
real estate-type interests.  Under this test, unless certain



                                       11
<PAGE>



mortgage securities represent all of the certificates issued with respect to an
underlying  pool of  mortgages,  such  mortgage  securities  may be  treated  as
securities  separate from the  underlying  mortgage  loans and, thus, may not be
considered qualifying interests for purposes of the 55% requirement.  We believe
our  subsidiaries  can  rely  on  this  exemption  or  another   exemption  from
registration.

The  requirement  that our  subsidiaries  maintain  55% of assets in  qualifying
interests  (or satisfy  another  exemption  from  registration)  may inhibit our
ability to acquire certain kinds of assets or to securitize additional interests
in the future.  If any of our  subsidiaries  fail to qualify for exemption  from
registration as an investment company,  we, in turn, may be required to register
as an investment  company under the Investment  Company Act. In such event,  our
ability to maintain our financing strategies would be substantially reduced, and
we would be unable to conduct our business as described  herein.  Such a failure
to  qualify  could  have a  material  adverse  effect  upon our  ability to make
distributions to our shareholders.

There are possible  adverse  effects  arising from shares  available  for future
sale.

Our board of trustees is permitted to offer  additional  Common  Shares or other
equity or debt  securities  of our  Company in exchange  for money,  property or
otherwise.  Our  ability to sell or  exchange  such  securities  will  depend on
conditions  then  prevailing in the relevant  capital markets and our results of
operations,  financial  condition,  investment portfolio and business prospects.
Subject to American Stock Exchange rules which require shareholder  approval for
certain  issuances  of  securities  and as  long  as the  issuance  is  made  in
accordance with our trust agreement,  the issuance of such additional securities
will not be subject  to the  approval  of our  shareholders  and may  negatively
prevailing  market prices of our Common Shares.  Our shareholders  will not have
any  preemptive  rights  in  connection  with  the  issuance  of any  additional
securities we or our  subsidiaries  may offer,  and any of our equity  offerings
will cause dilution of a shareholder's investment in us.

Our inability to raise capital could adversely affect our growth.

A major  aspect of our business  plan  includes the  acquisition  of  additional
revenue bonds,  which requires  capital.  In addition to funds generated through
operations  (including  securitizations),   we  raise  capital  by  periodically
offering securities issued by us or one or more of our subsidiaries. Our ability
to raise capital through securities offerings is subject to risks, including:

     -    conditions then prevailing in the relevant capital markets;

     -    our results of operations,  financial condition,  investment portfolio
          and business prospects;

     -    the timing and amount of  distributions  to the  holders of our shares
          which could negatively affect the price of a Common Share; and

     -    the  amount  of  securities  that  are  structurally   senior  to  the
          securities being sold.

Our classification as a publicly traded partnership not taxable as a corporation
is not free from doubt and could be challenged.

We and each of our  subsidiaries  (excluding  CM Corp.  and PW  Funding)  either
operate as partnerships or are disregarded for federal income tax purposes. This
allows us to pass through our income, including our federally tax-exempt income,
and  deductions  to our  shareholders.  The listing of our Common  Shares on the
American  Stock  Exchange  causes  us  to  be  treated  as  a  "publicly  traded
partnership" for federal income tax purposes. We, and Paul, Hastings, Janofsky &
Walker LLP, our counsel (who we also refer to as "Paul Hastings"),  believe that
we have been and are properly  treated as a partnership  for federal  income tax
purposes.  However,  the Internal  Revenue  Service  ("IRS") could challenge our
partnership  status  and we could fail to  qualify  as a  partnership  in future
years.  Qualification  as a  partnership  involves



                                       12
<PAGE>



the application of highly technical and complex Code provisions.  For example, a
publicly traded  partnership is generally taxable as a corporation unless 90% or
more of its gross  income  is  "qualifying"  income  (which  includes  interest,
dividends, real property rents, gains from the sale or other disposition of real
property, gain from the sale or other disposition of capital assets held for the
production  of  interest  or  dividends,  and  certain  other  items).  We  have
represented  that in all prior years of our  existence at least 90% of our gross
income was qualifying income and we intend to conduct our operations in a manner
such that at least 90% of our gross  income will  constitute  qualifying  income
this year and in the future.  Subject to the discussion below entitled  "Federal
Income Tax Considerations - General", in the opinion of Paul Hastings,  although
the issue is not free from  doubt,  we have been and are  properly  treated as a
partnership for federal income tax purposes.

In  determining  whether  interest is treated as  qualifying  income under these
rules,  interest income derived from a "financial business" and income and gains
derived by a "dealer" in  securities  are not treated as qualifying  income.  We
have  represented  that  we  are  acting  as an  investor  with  respect  to our
investments and that we have not engaged in, and will not engage in, a financial
business.  There is no clear guidance on what constitutes a financial  business.
We have taken the position that for purposes of determining  whether we are in a
financial business, our bond acquisition and financing activities as well as our
proposed  activities would not cause us to be engaged in a financial business or
to be  considered  a  "dealer"  in  securities.  The IRS could  assert  that our
activities  constitute a financial  business.  Even if we were  considered to be
engaged  in  a  financial  business,  we  believe  that  we  would  satisfy  the
requirement that 90% or more of our income constitutes qualifying income. If our
activities  constitute  (or  as a  result  of  increased  volume  constitute)  a
financial business or cause us to be treated as a dealer, there is a substantial
risk  that more than 10% of our gross  income  would not  constitute  qualifying
income.  We could also be treated as if we were engaged in a financial  business
if the  activities of Related  Capital were  attributed  to us.  Although we are
affiliated with Related Capital,  we seek to enter into arms length arrangements
with  Related  Capital.  CM Corp.  will be subject to income tax with respect to
amounts  earned by Related  Capital.  Accordingly,  we believe the activities of
Related Capital will not be attributed to us.

In addition,  in determining  whether interest is treated as qualifying  income,
interest  income  that is  determined  based  upon the  income or profits of any
person is not treated as qualifying income. A portion of the interest payable on
participating  interest  bonds owned by us and our  subsidiaries  is  determined
based upon the income or profits of the  properties  securing  our  investments.
Accordingly,  if we were to receive more than 10% of our interest  income in any
given year from such "contingent interest," the IRS could take the position that
we should be treated as publicly traded  partnerships,  taxable as associations.
We  carefully  monitor  the type of  interest  income we receive to avoid such a
circumstance.  However,  there can be no assurance that such monitoring would be
effective  in all  events  to avoid  the  receipt  of more  than 10%  contingent
interest in any given year, because  circumstances  outside of the control of us
and our subsidiaries could cause such a result.

If for any  reason  less than 90% of our  gross  income  constitutes  qualifying
income, items of income and deduction would not pass through to our shareholders
and our  shareholders  would be  treated  for  federal  income tax  purposes  as
stockholders in a corporation. We would be required to pay income tax at regular
corporate  rates  on any  portion  of our net  income  that  did not  constitute
tax-exempt income. In addition, a portion of our federally tax-exempt income may
be included in determining our alternative minimum tax liability.  Distributions
by us to our shareholders  would constitute  ordinary dividend income taxable to
such  holders to the extent of our earnings  and  profits,  which would  include
tax-exempt  income, as well as any taxable income we might have, and the payment
of these  distributions  would not be deductible by us. These consequences would
have a material adverse effect on us and our shareholders.

Our  treatment  of income from our residual  interests  as federally  tax-exempt
could be challenged.

We hold, indirectly,  residual interests in certain federally tax-exempt revenue
bonds through securitization  programs,  such as the Private Label Tender Option
Program  and  P-FLOATs(SM)/RITES(SM)



                                       13
<PAGE>



program,  which  entitle us to a share of the federally  tax-exempt  interest of
such revenue  bonds.  Special tax counsel  have each  rendered an opinion to the
effect that the issuer of the RITESSM and the issuer of the Private Label Tender
Option Program residual certificates, respectively, will each be classified as a
partnership  for federal  income tax purposes and the holders of the RITESSM and
the Private Label Tender Option Program residual certificates will be treated as
partners of each partnership. Consequently, as the holder of the RITESSM and the
Private Label Tender Option  Program  residual  certificates,  we believe we are
entitled to treat our share of the  federally  tax-exempt  income  allocated and
distributed  to us as tax-exempt  income.  However,  it is possible that the IRS
could disagree with those conclusions and an alternative  characterization could
adversely affect the treatment of any income we receive from the RITESSM and the
Private  Label  Tender  Option  Program  residual  certificates,  as well as the
pass-through of that income to our shareholders, as ordinary taxable income.

The value of our  shares  and our  ability to make  distributions  of  federally
tax-exempt income depends upon the application of tax laws.

The  following  discussion  relates  only to those  investments  which  generate
federally tax-exempt income.

Tax  treatment of our revenue  bonds.  We primarily  acquire and hold  federally
tax-exempt  investments  that we believe,  based upon the opinion of  nationally
recognized  counsel  delivered on the date the investment was originally  issued
(or on the date on which the investment was considered reissued),  will generate
interest  or  distributions  excludable  from the gross  income  of the  holders
thereof for federal  income tax purposes.  Certain of the revenue bonds acquired
directly or indirectly by us bear interest at rates which include  participating
or otherwise contingent  interest.  These revenue bonds are called participating
interest bonds. In the case of all participating interest bonds, the opinions of
counsel include an opinion to the effect that such  participating  interest bond
would be treated as debt for federal income tax purposes.

Tax-exemption  of our  revenue  bonds.  On the  date  of  original  issuance  or
reissuance of each revenue bond,  nationally  recognized bond counsel or special
tax counsel  rendered its opinion to the effect that, based on the law in effect
on the date of original  issuance or reissuance,  interest on such revenue bonds
is excludable  from gross income for federal  income tax  purposes,  except with
respect to any revenue  bond (other than a revenue  bond,  the proceeds of which
are loaned to a charitable  organization  described in Section  501(c)(3) of the
Code)  during  any  period  in which it is held by a  "substantial  user" of the
property  financed with the proceeds of such revenue bonds or a "related person"
of such a "substantial user." In the case of participating  interest bonds, such
opinion assumes,  in certain cases in reliance on another  unqualified  opinion,
that such  participating  interest bond  constitutes debt for federal income tax
purposes.  See  "--Treatment  of revenue  bonds as equity"  below.  Each opinion
speaks only as of the date it was delivered. In addition, in the case of revenue
bonds which,  subsequent  to their  original  issuance,  have been  reissued for
federal tax purposes,  nationally recognized bond counsel or special tax counsel
has delivered  opinions to the effect that interest on the reissued revenue bond
is  excludable  from gross income of the holder  thereof for federal  income tax
purposes from the date of reissuance  or, in some cases,  to the effect that the
reissuance did not adversely affect the excludability of interest on the revenue
bonds  from the gross  income of the  holders  thereof.  However,  an opinion of
counsel has no binding  effect and there is no  assurance  that the  conclusions
reached will not be contested by the IRS or, if contested,  will be sustained by
a court.

The reissuance of a revenue bond generally does not, in and of itself, cause the
interest on such revenue bond to be includable in the gross income of the holder
thereof for federal income tax purposes.  However,  if a revenue bond is treated
as reissued and the appropriate federal tax information return, a Form 8038, has
not  been  timely  filed or a late  filing  has not  been  accepted  by the IRS,
interest on such  revenue  bond could be  includable  in the gross income of the
holder  thereof for federal  income tax purposes  from and after the  reissuance
date.  In  addition,  if a  participating  interest  revenue  bond is treated as
reissued,  there can be no assurance that such revenue bond would continue to be
characterized   as  debt,  as  described   below,   insofar  as  the  facts  and
circumstances  underlying such  characterization may have



                                       14
<PAGE>



changed. Furthermore, pursuant to regulations generally effective as of June 30,
1993, if an issue of revenue  bonds is treated as reissued  within six months of
the transfer of the project financed by such issue of revenue bonds by the owner
of such project to an unrelated  party the interest on such revenue  bonds could
become  includable in gross income for purposes of federal income  taxation.  In
addition, if a participating  interest revenue bond is reissued after August 13,
1996,  the  reissued  revenue  bond  is  or  would  become  subject  to  certain
regulations concerning contingent payments, which could cause some or all of the
interest  payable  on  such  participating   interest  revenue  bond  to  become
includable  in gross  income  of the  holder  thereof  for  federal  income  tax
purposes,  unless such  participating  interest  revenue bond is modified at the
time of reissuance to comply with the contingent payment regulations.

The Code establishes  certain  requirements  which must be met subsequent to the
issuance and delivery of  tax-exempt  revenue bonds for interest on such revenue
bonds to remain  excludable  from gross income for federal  income tax purposes.
Among these  continuing  requirements are restrictions on the investment and use
of the revenue bond  proceeds  and, for revenue  bonds the proceeds of which are
loaned to a charitable  organization described in Section 501(c)(3) of the Code,
the  continued  exempt  status of such  borrower.  In addition,  the  continuing
requirements include tenant income restrictions, regulatory agreement compliance
and compliance  with rules  pertaining to arbitrage.  Each issuer of the revenue
bonds,  as well as each of the  underlying  borrowers,  has covenanted to comply
with certain  procedures and guidelines  designed to ensure  satisfaction of the
continuing  requirements  of the Code.  Failure to comply with these  continuing
requirements  of the Code may cause the interest on such bonds to be  includable
in gross  income for federal  income tax purposes  retroactively  to the date of
issuance, regardless of when such noncompliance occurs.

Greenberg  Traurig,  LLP (also  referred to as "Greenberg  Traurig") as our bond
counsel,  and Paul Hastings,  as our securities  counsel  (Greenberg Traurig and
Paul Hastings are collectively  referred to herein as our "Counsel"),  have not,
in  connection  with the sale of the Common  Shares  pursuant  to this  re-offer
prospectus,  passed upon and do not assume any  responsibility  for,  but rather
have  assumed the  continuing  correctness  of, the  opinions of bond counsel or
special tax counsel (including  opinions rendered by Greenberg Traurig) relating
to the exclusion  from gross income for federal  income tax purposes of interest
on the revenue bonds and have not  independently  verified whether any events or
circumstances  have  occurred  since the date such  opinions  were rendered that
would adversely  affect the conclusions  set forth therein.  However,  as of the
date of  this  re-offer  prospectus,  neither  we,  nor  our  subsidiaries,  our
affiliates  or our Counsel  have  knowledge  of any events that might  adversely
affect the  federally  tax-exempt  status of our revenue  bonds,  including  any
notice  that  the IRS  considers  interest  on any of our  revenue  bonds  to be
includable in gross income for federal income tax purposes.

Treatment  of  revenue  bonds as equity.  Payment  of a portion of the  interest
accruing on each participating  interest bond depends in part upon the cash flow
from, and proceeds upon sale of, the property  securing our investment  financed
by such revenue bond. An issue may arise as to whether the relationship  between
us and the respective  obligors is that of debtor and creditor or whether we are
engaged in a partnership or joint venture with the respective  obligors.  If the
IRS were to  determine  that  one or more of the  participating  interest  bonds
represented  or  contained  an  equity  investment  in the  respective  property
securing our investment because of this feature,  all or part of the interest on
such  participating  interest  bond could be viewed as a taxable  return on such
investment  and would not qualify as tax-exempt  interest for federal income tax
purposes.

To our knowledge,  neither the  characterization  of the participating  interest
bonds as debt,  nor the  characterization  of the  interest  thereon as interest
excludable  from gross  income for  federal  income tax  purposes of the holders
thereof,  has  been  challenged  by  the  IRS  in  any  judicial  or  regulatory
proceeding.  In certain  instances,  opinions  rendered by bond counsel provided
that the  characterization of the bonds as debt was not free from doubt and that
all or a portion of the interest on such bonds,  including "contingent interest"
and  "deferred  interest,"  may not be treated as interest for state and federal
law but that it is more likely than not that such interest is interest for state
and federal law purpose or otherwise  similarly limited.  We or our predecessors
received  opinions  of counsel  from  Willkie,  Farr &  Gallagher  LLP and


                                       15
<PAGE>



other  counsel  retained  by  us or  our  predecessor  respecting  each  of  our
participating  interest  bonds  to  the  effect  that,  based  upon  assumptions
described in such opinions,  which assumptions included the fair market value of
the  respective   properties  upon  completion  and  economic   projections  and
guarantees,  the participating interest bonds "would" be treated for federal tax
purposes as representing  debt. The implicit corollary of these opinions is that
the participating interest bonds do not constitute the following:  (i) an equity
interest  in the  underlying  borrower;  (ii) an  equity  interest  in a venture
between the  underlying  borrower and us; or (iii) an ownership  interest in the
properties   securing  our  investments.   Although  we  assume  the  continuing
correctness of these opinions, and will treat all interest received with respect
to these  bonds as  tax-exempt  income,  there  can be no  assurance  that  such
assumptions  are correct,  such treatment would not be challenged by the IRS, or
that intervening facts and circumstances  have changed the assumptions and basis
for providing such opinions.

Most of the opinions  described in the preceding  paragraph were not rendered by
Greenberg Traurig, which has not passed on or assumed any responsibility for the
opinions of other counsel on this issue, nor made any independent  determination
as to whether any events or circumstances  have occurred or intervened since the
original  issuance  of the "debt"  opinions  that would  adversely  affect  such
opinions.  In  addition,  the  opinions  discussed  above speak only as of their
respective  delivery  dates,  and our Counsel has not passed upon or assumed any
responsibility for reviewing any events that may have occurred subsequent to the
delivery of such opinions which could adversely affect the conclusions contained
therein.

"Substantial  User"  Limitation.  Interest on a revenue  bond owned by us or our
subsidiaries, other than a bond the proceeds of which are loaned to a charitable
organization  described in Section  501(c)(3) of the Code,  will not be excluded
from  gross  income  during  any  period in which we or our  subsidiaries  are a
"substantial user" of the properties  financed with the proceeds of such revenue
bond or a "related person" to a "substantial user." We have received advice from
our counsel  with  respect to our revenue  bonds to the effect that we are not a
"substantial user" of any properties financed with the proceeds of such bonds or
a  "related  person"  thereto.  A  "substantial  user"  generally  includes  any
underlying borrower and any person or entity who uses the financed properties on
other than a de minimis basis. We would be a "related  person" to a "substantial
user" for this  purpose if,  among other  things,  (i) the same person or entity
owned more than a 50% interest in both us and in the  properties  financed  with
the  proceeds  of a bond owned by us or one of our  subsidiaries,  or (ii) if we
owned a  partnership  or  similar  equity  interest  in the owner of a  property
financed with the proceeds of a bond. Additionally,  a determination that we are
a partner or a joint venturer with a mortgagor involving an equity interest,  as
described above under  "Treatment of revenue bonds as equity," could cause us to
be treated as a "substantial  user" of the properties  securing our investments.
In the event that the  entity  which owns a  property  securing  our  investment
financed  with the proceeds of a revenue bond owned by us were to acquire any of
our  shares,  the IRS,  if it became  aware of such  ownership,  could  take the
position  that the  substantial  user and related  person rules require that the
interest  income  on  such  revenue  bond  allocable  to all  of our  investors,
including  the  holders of the shares,  be included in gross  income for federal
income tax purposes. Greenberg Traurig has advised us that in its opinion such a
result is not supported by the Code and treasury regulations; however, there can
be no assurance that the IRS would not take such a position.

Related  Capital and its affiliates  owned a portion of our  outstanding  Common
Shares.  Such  ownership of the obligors of certain of our revenue bonds and our
Common  Shares  were  considered  when  we  received  advice  that  we are not a
"substantial  user"  of the  properties  financed  by such  revenue  bonds  or a
"related  party" to a  "substantial  user."  The  former  principals  of Related
Capital and its  affiliates  also own  special  common  units in CCC.  Greenberg
Traurig has reviewed  the revenue  bonds owned by us and our  subsidiaries,  the
ownership of the obligors of our revenue  bonds and the  ownership of our shares
and our  subsidiaries'  shares,  and concurs in the  conclusion  that we and our
subsidiaries  are not  "substantial  users" of the properties  financed with the
proceeds  of the  revenue  bonds or  related  parties  thereto.  There can be no
assurance,  however,  that the IRS would not challenge such conclusion.  If such
challenge were successful, the interest received on any bond respecting which we
or our  subsidiaries  were treated as a  "substantial  user" or a "related party
thereto" would be includable in gross income for federal income tax purposes.


                                       16
<PAGE>



In  addition,  Related  Capital  owns,  directly  and  indirectly,   partnership
interests in many partnerships  owning multifamily  properties financed with the
proceeds of revenue bonds in our revenue bond portfolio  which could cause us to
be treated as a "substantial  user" of these entities or a "related  party" to a
"substantial user". Prior to our acquisition of Related Capital, we modified the
structure of the ownership interests in such entities and our operation of CCC's
investment  programs so that we will not be treated as a  "substantial  user" of
any entities  financed  with the  proceeds of revenue  bonds in our revenue bond
portfolio or a "related  party"  thereto.  Under our new  structure,  designated
senior  executives will acquire and hold 51% of the equity  interests in certain
entities and we or our affiliates own a 49% interest and serve as the non-equity
manager or general  partner.  It is not expected  that such  entities  will have
significant  economic value.  Paul Hastings and Greenberg  Traurig have reviewed
the structure of our acquisition of Related  Capital,  the  modifications to the
ownership  interests in such  entities  and the  structure we use to operate the
real estate investment  programs of CCC and they have advised us that, with such
modifications,  we and our subsidiaries should not be "substantial users" of the
entities  financed with the proceeds of the revenue  bonds or "related  parties"
thereto.  There can be no assurance,  however,  that the IRS would not challenge
such a conclusion.  If such challenge were successful,  the interest received on
any revenue bond during the time period when we or our subsidiaries were treated
as a substantial  user or a "related party" thereto would be includable in gross
income for federal income tax purposes.

Structure of our  acquisition  of Related  Capital.  Our  acquisition of Related
Capital  was  structured  to prevent us from  realizing  active  income from the
Related Capital  business and  effectively  receive a tax deduction for payments
made to the former  principals of Related  Capital.  It is possible that the IRS
could  challenge  this  structure,  with material  adverse  consequences  to our
Company. First, the IRS could assert that CharterMac is the owner of the Related
Capital business, in which case we would realize an amount of active income from
the  Related  Capital  business  that  would  require  us  to  be  treated  as a
corporation instead of a publicly traded partnership for income tax purposes. If
the IRS  prevailed,  we would be required  to pay taxes on our  income,  thereby
reducing the amount available to us to make  distributions.  As a result,  it is
possible  that the value of our  shares  would  decline.  Second,  the IRS might
assert that the special  common  units in CCC held by the former  principals  of
Related Capital are actually shares of our Company.  If this position prevailed,
the  distributions  payable on the special  common units would not result in tax
deductions  for CM Corp. In such event,  CM Corp.  would be subject to increased
tax, which could reduce our net after-tax income and our distributions.

Taxable income.  We primarily invest in investments that produce only tax-exempt
income.  However, the IRS may seek to recharacterize a portion of our tax-exempt
income as taxable  income as  described  above.  If the IRS were  successful,  a
shareholder's  distributive  share  of  such  income  will  be  taxable  to  the
shareholder,  regardless of whether an amount of cash equal to such distributive
share is actually  distributed.  Any taxable  income will be allocated  pro rata
between our CRA Shares and our Common Shares. We may also have taxable income in
the form of  market  discount  or gain on the sale or other  disposition  of our
investments,  and we  expect  to own  investments  and  engage  in  certain  fee
generating activities that will generate taxable income. See "Federal Income Tax
Considerations - Certain income tax  considerations  relating to our Company and
our shareholders."

Impact of recent and future tax  legislation.  Recent and future tax legislation
could also adversely impact the value of our investments and the market price of
our shares. On May 28, 2003,  President Bush signed into law the Jobs and Growth
Tax Relief Act. This law amends the Code to reduce  federal income tax rates for
individuals  on  long-term  capital  gains and dividend  income and  accelerates
certain  previously  enacted income tax rate  reductions for individuals for tax
years  ending  on or  after  May 6,  2003.  This  tax  legislation  reduces  the
importance  of a primary  advantage of investing  in municipal  bonds--that  the
interest received on these bonds is federally tax-exempt,  while other income is
subject to federal  income tax at higher rates.  It is likely that these tax law
changes,  and any similar  future tax law  changes,  could


                                       17
<PAGE>



increase  the cost of  tax-exempt  financings,  as  interest  rates  offered  by
municipal  issuers  would rise to  compensate  investors for the loss of the tax
advantage.  This could  lead to a  decrease  in  tax-exempt  multifamily  rental
housing bond issuances, which would reduce our opportunities to purchase revenue
bonds.

If the interest received on the revenue bonds remains federally tax-exempt under
the Code, the  allocations  of such  federally tax exempt  interest by us to our
investors will also remain  excludable  from gross income for federal income tax
purposes.  However, the Jobs and Growth Tax Relief Act could cause the after-tax
returns available from other investments to increase,  and cause shares in other
companies to become more attractive relative to our shares.  These changes could
also reduce the value of our existing investments,  because federally tax-exempt
municipal  bond  income  would not  enjoy the same  relative  tax  advantage  as
provided under prior law.

No  assurance  can be given that our  shareholders  will be entitled to the same
limitation on personal  liability as  stockholders of private  corporations  for
profit.

We are governed by the laws of the State of Delaware.  Under our trust agreement
and  the  Delaware  Statutory  Trust  Act,  as  amended  ("Delaware  Act"),  our
shareholders  will be entitled  to the same  limitation  of  personal  liability
extended to stockholders of private  corporations for profit organized under the
General  Corporation Law of the State of Delaware.  In general,  stockholders of
Delaware  corporations are not personally  liable for the payment of corporation
debts and obligations,  and are liable only to the extent of their investment in
the  Delaware  corporation.  However,  a  shareholder  may be  obligated to make
certain payments provided for in our trust agreement and bylaws.  The properties
securing our  investments  are dispersed in numerous  states and the District of
Columbia.  In  jurisdictions  which  have  not  adopted  legislative  provisions
regarding statutory trusts similar to those of the Delaware Act, questions exist
as to whether such  jurisdictions  would recognize a statutory  trust,  absent a
state  statute,  and whether a court in such  jurisdiction  would  recognize the
Delaware Act as  controlling.  If not, a court in such  jurisdiction  could hold
that our  shareholders are not entitled to the limitation of liability set forth
in our trust  agreement  and the Delaware Act and, as a result,  are  personally
liable for our debts and obligations.

Our  anti-takeover  provisions may  discourage  third-party  proposals.

Certain provisions of our trust agreement and our management agreements may have
the effect of discouraging a third party from making an acquisition proposal for
our  Company.  This  could  inhibit a change in  control  of our  Company  under
circumstances  that could give our  shareholders  the  opportunity  to realize a
premium  over  then-prevailing   market  prices.  Such  provisions  include  the
following:

Additional  Classes and Series of Shares.  Our trust agreement permits our board
of trustees to issue additional classes or series of beneficial interests and to
establish the preferences and rights of any such securities.  Thus, our board of
trustees  could  authorize the issuance of beneficial  interests  with terms and
conditions  which  could have the  effect of  discouraging  a takeover  or other
transaction in which holders of some, or a majority, of our shares might receive
a premium for their shares over then-prevailing market price of such shares.

Staggered Board.  Our board of trustees has three classes of managing  trustees.
The terms of the first,  second and third classes will expire in 2004,  2005 and
2006,  respectively.  Managing  trustees  for each  class  will be chosen  for a
three-year  term upon the  expiration of the current  class' term.  The use of a
staggered  board makes it more  difficult for a third-party  to acquire  control
over us.

Terrorist  attacks and the United States'  response  thereto may have a negative
effect on our earnings.



                                       18
<PAGE>



The  terrorist  attacks  which  occurred  in New  York  City,  Pennsylvania  and
Washington, D.C. on September 11, 2001, the subsequent military actions taken by
the United States and its allies in response and the war with Iraq,  have caused
considerable uncertainty regarding the U.S. economy and a slowdown in the global
financial  markets.  While  the  long-term  effects  of these  events  and their
potential consequences are uncertain,  they could have a material adverse effect
on general economic conditions,  consumer confidence and market liquidity. There
can be no assurance  that these events or  comparable  events in the future will
not ultimately have an adverse effect on our earnings and results of operations.

The  interests of the former  principals  of Related  Capital may be in conflict
with the interests of our shareholders.

Because  the former  selling  principals  of Related  Capital  are our  managing
trustees,  there are  ongoing  conflicts  of  interests  if we are  required  to
determine whether or not to take actions to enforce our rights under the various
agreements  entered into in connection with our acquisition of Related  Capital.
While any material decisions  involving the former principals of Related Capital
are  subject  to the  vote  of a  majority  of our  independent  trustees,  such
decisions may create  conflicts  between us and these former  principals who are
our managing  trustees.  In  addition,  we have some  obligations  to the former
principals  of Related  Capital  which will require us to make choices on how we
operate our business which may affect those obligations.  (For example,  we have
agreed to guarantee the payment to the former  principals of Related  Capital of
all but $5 million of the  distributions  they would  otherwise  be  entitled to
receive  under the  operating  agreement of CCC. In addition,  we have agreed to
share cash flow from  investment  programs  so that we and  Related  Capital can
receive payment of deferred fees.)

In addition,  TRCLP and its  affiliates  currently  engage in  businesses  which
compete with  Related  Capital.  The  non-competition  covenants  contained in a
future  relations  agreement  entered  into  by  TRCLP  and  its  affiliates  in
connection  with our  acquisition  of  Related  Capital  prohibit  TRCLP and its
affiliates  from  competing  with any business  currently  engaged in by Related
Capital and our Company other than in specified areas,  including  providing (a)
credit  enhancement on debt products  secured by so-called  "80/20"  multifamily
housing properties and (b) mezzanine financing to multifamily housing properties
other than so-called "tax credit  properties." There can be no assurance that we
and TRCLP and its affiliates would not directly compete for similar products and
opportunities in these areas in the future.

The former  principals  of Related  Capital  have  significant  voting  power on
matters submitted to a vote of our shareholders.

In  connection  with our  acquisition  of  Related  Capital,  each of the former
principals of Related Capital were issued one special preferred voting share for
each special  common unit they  received.  The special  preferred  voting shares
entitle  each  holder  thereof to vote on all  matters  subject to a vote of the
holders of our Common Shares. The former principals of Related Capital,  who are
now employees of Related  Capital,  received  enough  special  preferred  voting
shares to collectively hold  approximately  8.3% of our voting power.  TRCLP and
Mr. Ross controls  approximately  17.1% of our voting power.  As such,  Mr. Ross
and, if they vote as a block,  the other former  principals  of Related  Capital
will have  significant  voting power on all matters  submitted  for  shareholder
action. These individuals could have significant  influence over any shareholder
vote as a result of the issuance of the special preferred voting shares.

We may not  realize  any cost  savings  as a result  of the  integration  of the
management services of Related Capital, which could adversely affect our results
of operations.

In  connection  with our  acquisition  of Related  Capital,  we  terminated  our
external management agreements.  Related Capital employed certain principals and
substantially  all of the employees that it employed prior to our acquisition of
Related Capital to perform  internally those functions  formerly provided by it.
There  can be no  assurance  that  costs or other  factors  associated  with the
integration  of Related  Capital and our Company will not  adversely  affect our
future combined results of operations or that the expected benefits will occur.



                                       19
<PAGE>



Sales in the public  market of our Common  Shares  issuable upon exchange of the
special  common  units  issued in  connection  with our  acquisition  of Related
Capital could adversely affect prevailing market prices of our shares.

Future sales of  substantial  amounts of our Common  Shares in the public market
could adversely  affect  prevailing  market prices of our shares.  Approximately
15,905,512  Common Shares are issuable upon exchange of the special common units
issued in connection with our acquisition of Related  Capital.  In addition,  we
also granted  approximately  $23.4 restricted  Common Shares to the employees of
Related Capital at the closing of our acquisition of Related Capital.  Following
the  effective  registration  of the Common  Shares  issuable  upon  exchange of
special  common  units and the  expiration  of any  lock-up  to which the Common
Shares and restricted  Common Shares are subject,  the sale in the public market
of these Common Shares and  restricted  Common Shares could,  and depending upon
the number of Common Shares and restricted Common Shares involved, likely would,
adversely affect prevailing market prices of our shares. TRCLP and Mr. Ross owns
special  common units and Common  Shares with an aggregate  value at the time of
issuance of approximately $193.7 million which, subject to some exceptions,  are
not subject to a lock-up.  Sales in the public  market  could  reduce the market
price of the shares and our ability to raise  additional  capital through equity
markets.



                                       20
<PAGE>



                                   OUR COMPANY

Overview

     We are a Delaware  statutory  trust which  commenced  operations in October
1997. We are principally  engaged in the acquisition and ownership (directly and
indirectly through our subsidiaries) of federally tax-exempt multifamily housing
revenue  bonds  issued  by  various  state or  local  governments,  agencies  or
authorities  and other  investments  designed  to produce  federally  tax-exempt
income.

     While we hold a small  portion  of our  revenue  bond and loan  investments
directly,  substantially all of our investments are held indirectly  through our
subsidiaries.  For a more  complete  description  of our  relationship  with our
subsidiaries,  see "--Entity Structure," below.  Accordingly,  our shareholders'
interests  in the  cash  flow  from  investments  held by our  subsidiaries  are
subordinate to the rights of the debt holders, preferred shareholders and senior
interest holders of our subsidiaries.

     CM Corp. and our newly-acquired subsidiary,  Related Capital, conducts most
of our taxable  business.  CM Corp. (i)  originates  and services  mortgages for
third parties and (ii)  guarantees  tax credit equity returns and mortgage loans
for a fee.  Related  Capital  conducts  fee-generating  activities  and provides
management services to us. PW Funding,  the national mortgage banking firm which
we own an 84% interest in, is a subsidiary of CM Corp.

     Our Common  Shares trade on the American  Stock  Exchange  under the symbol
"CHC."

Tax Status

     We and our subsidiaries (with the exception of CM Corp. and PW Funding) are
each either  treated as  partnerships  or  disregarded  for  federal  income tax
purposes. Therefore, we and our subsidiaries (with the exception of CM Corp. and
PW Funding)  pass  through to our  shareholders,  in the form of  distributions,
income  (including  federally  tax-exempt  income)  derived from our investments
without paying federal income tax on that income. We intend to operate so that a
substantial  portion of our ordinary  income will be excluded  from gross income
for federal income tax purposes. Other income, such as capital gains and taxable
interest income, as well as any dividend income from CM Corp., generally will be
subject to tax. We expect that for the year ending  December 31,  2003,  no less
than 95% of our  distributions to our shareholders will be excludable from their
gross  income for  federal  income tax  purposes.  For the  calendar  year ended
December 31, 2002, approximately 96% of our distributions consisted of federally
tax-exempt  income.  See "Risk  Factors--Risks  relating  to our Company and the
operation of our business--Our  classification as a publicly-traded  partnership
not taxable as a corporation is not free from doubt and could be challenged" and
"Federal Income Tax Considerations."

Our Management

     We operate our day-to-day  activities and select our investments  utilizing
the services and advice provided by our  recently-acquired  subsidiary,  Related
Capital,  subject to the supervision and review of our board of trustees. See "-
Our Acquisition of Related Capital," below.  Related  Capital's  management team
has an average of 19 years of experience in the real estate industry.

Our Acquisition of Related Capital

     On November 17, 2003, we acquired  100% of the  ownership  interests in and
substantially  all of the  businesses  operated by Related  Capital  (other than
specific  excluded   interests).   The  acquisition  enabled  us  to  become  an
internally-managed company.




                                       21
<PAGE>



     The  acquisition  was structured so that the former  selling  principals of
Related Capital  contributed  their ownership  interests in Related Capital into
CCC, one of our subsidiaries,  in exchange for  approximately  $282.8 million of
special  common  units in CCC.  All of the selling  principals  were also issued
special preferred voting shares of our Company for each special common unit they
received.  The special  preferred voting shares have no economic  interest,  but
entitle the holder thereof to one vote per special preferred voting share on all
matters  subject  to a vote of the  holders  of our  Common  Shares.  One of the
selling principals also received $50 million in cash.

     The  former  selling  principals  of  Related  Capital  included  its  four
executive managing partners (Messrs.  Boesky, Hirmes,  Schnitzer and Ms. Kiley),
all of whom are  members  of our  board of  trustees,  and an  affiliate  of The
Related Companies,  L.P., a New York limited  partnership with a majority of its
equity  controlled  by Mr.  Ross,  who is also  the  Chairman  of our  board  of
trustees.

     As a result of the acquisition,  the beneficial ownership in our Company of
(i) Mr. Ross equals  approximately  17.7% and (ii) our  management and the other
selling principals (other than Mr. Ross) equals approximately 8.7%.


Entity Structure

The following  diagram depicts our  organizational  structure as of November 24,
2003:


                          [graphic omitted]



Our Offices

Our principal executive offices are located at 625 Madison Avenue, New York, New
York 10022. Our phone number is (212) 317-5700.




                                       22
<PAGE>



                            Description of Our Shares




     The following description of our shares does not purport to be complete and
is qualified in its entirety by  reference to  applicable  Delaware  law, and to
provisions  of our trust  agreement  and bylaws,  each as amended and  restated,
copies  of which  are  exhibits  to the  registration  statement  of which  this
re-offer prospectus is a part.

Overview

     Subject to limitations  prescribed by Delaware law and our trust agreement,
our board of trustees is  authorized to issue  100,000,000  shares of beneficial
interest  (common,  preferred  and  otherwise),  to classify or  reclassify  any
unissued  beneficial  interests,  to  provide  for the  issuance  of  beneficial
interests in other classes or series of  securities,  to establish the number of
beneficial  interests  in each  class  or  series  and to fix  the  preferences,
conversion  and other rights,  voting  powers,  restrictions,  limitations as to
distributions, qualifications or terms.

     As of the date of this  re-offer  prospectus,  our issued  and  outstanding
shares of beneficial  interest consist of Common Shares,  CRA Shares and Special
Preferred  Voting  Shares.  Two of our  subsidiaries,  Charter Mac Equity Issuer
Trust and CCC, have also issued equity. See "Description of our Preferred Shares
and Special  Common  Units,"  below.  All of our Common Shares  outstanding  are
currently  listed for trading on the American  Stock  Exchange  under the symbol
"CHC."

     Subject to the American  Stock  Exchange  rules which  require  shareholder
approval for certain  issuances of securities,  we may issue  additional  shares
from time to time in one or more series, generally without shareholder approval,
with such preferences, conversion and other rights, voting powers, restrictions,
limitations  as to  distributions,  qualifications  and terms and  conditions of
redemption as are permitted by Delaware law and as  established  by our board of
trustees.

Description of our Common Shares


     General.  Our Common  Shares  have equal  dividend,  liquidation  and other
rights,  and have no preference,  appraisal or exchange  rights.  Holders of our
Common  Shares  have no  conversion,  sinking  fund  or  redemption  rights,  or
preemptive rights to subscribe for any of our securities.

     Distributions. Subject to any preferential rights of any outstanding shares
or  series  of  shares,   our  common   shareholders  are  entitled  to  receive
distributions,  when and as authorized by our board of trustees,  out of legally
available  funds.  We anticipate  that we will pay  distributions  on our Common
Shares quarterly, subject to declaration by our board of trustees.

     Voting Rights. Our common  shareholders have no right to participate in the
control of our  business.  However,  our common  shareholders  have been granted
certain voting rights which are set forth in our trust agreement. Holders of our
Common Shares,  as a class,  have the power to vote on all matters  presented to
our shareholders,  except as otherwise provided by Delaware law. Pursuant to our
trust  agreement,  our common  shareholders  are entitled to one vote per Common
Share on all matters  voted on by  shareholders  and,  except as provided in our
trust agreement in respect of any other class or series of beneficial interests,
the holders of such Common Shares exclusively  possess all voting power and have
been granted the right to vote upon:  (i) the election of our board of trustees,
(ii) our merger, consolidation or termination and dissolution, (iii) sale of all
or  substantially  all of our assets and (iv)  amendment of our trust  agreement
(except in certain limited circumstances),  provided that provisions relating to
the   limitation   of  liability  and   indemnification   may  only  be  amended
prospectively.



                                       23
<PAGE>



     Registrar and Transfer  Agent.  The  registrar  and transfer  agent for our
Common Shares is EquiServe  Trust  Company,  N.A.,  P.O. Box 8694,  Edison,  NJ,
08818.

     Registration Rights. We have entered into the following registration rights
agreements  in  connection  with (i) the  issuances  of CRA  Shares and (ii) the
issuances of securities in connection with our acquisition of Related Capital:

     (i)  Issuances  of CRA Shares.  In  connection  with our  issuances  of CRA
Shares,  we entered into  registration  rights  agreements  pursuant to which we
agreed to register the Common Shares  issuable to the holders of CRA Shares upon
conversion of their CRA Shares.  These  registration  statements have been filed
with the SEC. The Common Shares issuable upon exchange of the CRA Shares will be
listed on the American Stock Exchange under the symbol CHC.

     The registration  rights agreements provide that we will indemnify and hold
harmless the selling shareholders under those agreements against losses, claims,
damages,   or  liabilities  (or  actions  in  respect  thereof)  to  which  such
individuals  may become  subject under Federal and state  securities  laws which
arise out of (i) any untrue  statement or alleged untrue statement of a material
fact  contained in a  registration  statement  (or any  amendment or  supplement
thereto)  pursuant  to which  their  Common  Shares  were  registered  under the
Securities Act of 1933, as amended,  (ii) any untrue statement or alleged untrue
statement of a material fact  contained in any  prospectus  (or any amendment or
supplement  thereto),   or  (iii)  the  omission  or  alleged  omission  from  a
registration  statement or prospectus (or amendments thereto) of a material fact
necessary  in  order  to  make  the  statements  therein,  in the  light  of the
circumstances  under  which they were made,  not  misleading.  The  registration
rights  agreements  also provide that we will reimburse the selling  shareholder
(and the officers,  directors or controlling persons of the selling shareholder)
for any legal or any other expenses  reasonably  incurred by such individuals in
connection  with  investigating  or  defending  any such  loss,  claim,  damage,
liability or action.

     However,  the  indemnity  discussed  above  does not  apply to the  selling
shareholder if the loss, claim, damage or liability arises out of (i) any untrue
statement or omission made by us in a  registration  statement or prospectus (or
any amendment or supplement  thereto) in reliance upon, and in conformity  with,
written information furnished to us by the selling shareholder  specifically for
use in, or the preparation of, such registration statement or prospectus (or any
amendment or supplement thereto),  or (ii) such selling shareholder's failure to
deliver an amended or supplemental prospectus, after having been provided copies
of any such amended or supplemental  prospectus by us, if such loss,  liability,
claim, damage or expense would not have arisen had such delivery occurred.

     (ii) Issuance of securities in connection  with our  acquisition of Related
Capital.  In connection with our acquisition of Related Capital, we entered into
registration  rights  agreement  with the former  selling  principals of Related
Capital  pursuant  to which we  agreed  to file a shelf  registration  statement
registering  (i) the resale of our Common  Shares  issuable upon exchange of the
special common units and (ii) exercise of options  issued to Mr. Ross.  Pursuant
to the terms of the registration rights agreement,  we are obligated to file the
shelf  registration  statement within 60 days of the closing of the acquisition.
We  have  agreed  to use our  commercially  reasonable  efforts  to  cause  this
registration  statement to be declared  effective by the SEC as soon as possible
after its filing. We will bear the costs of registration, including, among other
things,  registration  and filing  fees,  printing  expenses,  attorneys'  fees,
accountants' fees and other reasonable expenses.

     The registration  rights agreement provides that we will indemnify and hold
harmless the selling  shareholders  (and each person who  controls  such selling
shareholder) and each officer,  director,  trustee, partner and employee of such
selling  shareholder under that agreement against losses,  claims,  damages,  or
liabilities  and expenses  incurred by such party  arising out of (i) any untrue
statement  or alleged  untrue  statement  of a material  fact  contained  in the
registration  statement  (or any amendment or  supplement  thereto)  pursuant to
which their Common Shares were  registered  under the Securities Act of 1933, as
amended,  (ii) any untrue  statement or alleged  untrue  statement of a material
fact contained in any



                                       24
<PAGE>



prospectus  (or any amendment or supplement  thereto),  or (iii) the omission or
alleged  omission from a  registration  statement or prospectus  (or  amendments
thereto) of a material fact necessary in order to make the  statements  therein,
in the light of the  circumstances  under which they were made, not  misleading.
The  registration  rights  agreements  also provide that we will  reimburse  the
selling  shareholder (and the officers,  directors or controlling persons of the
selling  shareholder) for any legal or any other expenses reasonably incurred by
such  individuals in connection with  investigating  or defending any such loss,
claim, damage, liability or action or (iv) any violation or alleged violation by
our  Company  of  federal  or  state  securities  laws in  connection  with  the
registration statement.

     However,  the  indemnity  discussed  above  does not  apply to the  selling
shareholder  if the loss,  claim,  damage or liability  arises out of any untrue
statement or omission made by us in the registration statement or prospectus (or
any amendment or supplement  thereto) in reliance upon, and in conformity  with,
written information furnished to us by the selling shareholder  specifically for
use in, or the preparation of, such registration statement or prospectus (or any
amendment or supplement thereto).

Description of our Subsidiaries' Preferred Shares and Special Common Units

     Community Reinvestment Act Preferred Shares

     We have  issued,  and may in the  future  issue,  two  separate  series  of
preferred shares  designated  Convertible  Community  Reinvestment Act Preferred
Shares.  We  collectively  refer to both  series  of our  Convertible  Community
Reinvestment  Act  Preferred  Shares as our "CRA  Shares."  Our CRA  Shares  are
entitled  to the same  economic  benefits  as our Common  Shares  but  receive a
preference  with  respect to certain  regulatory  benefits  which are  described
below.  With the exception of the  conversion  rate and notice  provisions,  the
terms of both series of CRA Shares are the same.

     Our CRA Shares are  intended to enable  banks and similar  institutions  to
obtain  positive   consideration  under  the  Community  Reinvestment  Act.  The
Community  Reinvestment  Act,  enacted  in 1977,  encourages  banks and  similar
institutions  insured by the Federal Deposit Insurance  Corporation to invest in
projects that promote  community  development,  particularly in low and moderate
income neighborhoods.  The Community Reinvestment Act does this by awarding such
banks and similar  institutions,  "credits"  based upon the amount of funds they
invest in "qualifying" projects.  Examples of qualifying projects include, among
others,  those investments that provide  affordable  housing for low or moderate
income  individuals,  or fund  activities  that  revitalize  or stabilize low or
moderate  income  areas.  We invest in revenue  bonds  that fund these  types of
investments. We believe that an investment in our Company through our CRA Shares
will  qualify  for  credits  under  the  Community  Reinvestment  Act.  Each CRA
shareholder  may be entitled to an  allocation  of these  credits based upon the
aggregate  amount of their  investment  in us, for  Community  Reinvestment  Act
purposes.

     Our CRA Shares  rank (i) on parity (pro rata based on the number of shares)
with our  Common  Shares  and all other CRA  Shares  with  respect to payment of
distributions  and rights upon our  liquidation,  dissolution and winding up and
(ii)  pari  passu  with  all  other  CRA  Shares  with  respect  to  CRA  Credit
allocations. Our income and loss is also allocated pro rata (based on the number
of  shares)  among our common  shareholders  and our CRA  shareholders.  In this
regard,  in the event of (i) the payment of distributions  payable in our Common
Shares or securities  convertible  into our Common Shares,  (ii) the issuance to
all  holders  of our  Common  Shares of  certain  rights,  options  or  warrants
entitling  them to subscribe for or purchase  Common Shares at a price per share
less  than the  fair  market  value  per  Common  Share,  and  (iii)  all  other
distributions  to  the  holders  of  our  Common  Shares  or  evidences  of  our
indebtedness or our assets, our CRA shareholders will receive for each CRA Share
held, the same payment,  issuance or distribution  payable for each Common Share
held. For example, if we pay a distribution with respect to our Common Shares or
to securities  convertible into our Common Shares,  and common  shareholders are
entitled to receive two Common  Shares for each Common Share they hold,  the CRA
shareholders  will also receive two Common  Shares for each CRA Share they hold.
In connection with the foregoing payments,  issuances or distributions,  we will
take whatever actions we consider to be



                                       25
<PAGE>



advisable in order that both our common and CRA shareholders will be treated the
same for federal income tax purposes.

  Charter Mac Equity Issuer Trust--Preferred Shares

     Our  subsidiary  the  Equity  Trust,   has  issued   preferred   shares  to
institutional  investors with an aggregate  liquidation  amount of approximately
$273.5 million.  Attributes of each series of Cumulative Preferred Shares are as
follows:


<TABLE>
<CAPTION>


     Preferred Series          Total
                               Liquidation
                               Amount                          Annual
                               ($ in thousands)                Dividend Rate
--------------------------------------------------------------------------------
     <S>                       <C>                             <C>
     Series A                  90,000                          6.625%
     Series A-1                24,000                          7.100%
     Series A-2                31,000                          6.300%
     Series A-3                30,000                          6.800%
     Series B                  55,000                          7.600%
     Series B-1                18,500                          6.800%
     Series B-2                25,000                          7.200%
--------------------------------------------------------------------------------
</TABLE>


     We collectively refer to the Series A Cumulative  Preferred Shares,  Series
A-1 Cumulative  Preferred  Shares,  Series A-2 Cumulative  Preferred  Shares and
Series A-3 Cumulative Preferred Shares as the "Series A Shares." We collectively
refer to the  Series B  Subordinate  Cumulative  Preferred  Shares,  Series  B-1
Subordinate  Cumulative  Preferred Shares and Series B-2 Subordinate  Cumulative
Preferred  Shares as the  "Series B Shares." We also  collectively  refer to the
Series A Shares and the Series B Shares as the "Cumulative Preferred Shares."

     The Cumulative  Preferred  Shares are not convertible into common shares of
the Equity Trust or our Common Shares.  The Cumulative  Preferred Shares have an
annual preferred  dividend payable quarterly in arrears on January 31, April 30,
July 31 and October 31 of each year,  but only upon  declaration  thereof by the
Equity  Trust's  board of trustees and only to the extent of the Equity  Trust's
tax-exempt income (net of expenses) for the particular quarter. Since inception,
all quarterly distributions have been declared at the stated annualized dividend
rate for each respective series.

     The Series A Shares all have identical terms except as to the  distribution
commencement date, the annual preferred dividend rate, the remarketing date, the
mandatory repurchase date and the liquidation amount per share. The Equity Trust
may not redeem the Series A, A-1 and A-2  preferred  shares before June 30, 2009
and they are subject to mandatory  tender for  remarketing  and purchase on such
date and each  remarketing  date thereafter at a price equal to their respective
per share liquidation amounts plus an amount equal to all distributions  accrued
but unpaid on the Series A, A-1 and A-2 preferred  shares.  The Equity Trust may
not redeem the Series A-3 preferred  shares before October 31, 2014 and they are
subject to mandatory  tender for  remarketing and purchase on such date and each
remarketing date thereafter at a price equal to its per share liquidation amount
plus an amount equal to all  distributions  accrued but unpaid on the Series A-3
preferred  shares.  Holders  of the  Series A Shares  may elect to retain  their
shares upon remarketing,  with a distribution rate to be determined  immediately
prior to the  remarketing  date by the  remarketing  agent.  After  the  initial
remarketing  dates,  all or a portion of the shares may be redeemed,  subject to
certain  conditions.  Each  holder of the  Series A,  Series  A-1 and Series A-2
preferred shares,  and each holder of the Series A-3 preferred  shares,  will be
required to tender its shares to the Equity Trust for  mandatory  repurchase  on
June 30,  2049 and  October  31,  2052,  respectively,  unless the Equity  Trust
decides to remarket the shares on such dates.

     The Series A Shares  rank,  with  respect to payment of  distributions  and
amounts upon liquidation,  dissolution or winding-up of the Equity Trust, senior
to the Series B Shares and all classes or series of




                                       26
<PAGE>



common shares of the Equity Trust and, therefore, effectively rank senior to our
Common Shares, our CRA Shares and our preferred shares, if any.

     The Series B Shares all have identical terms, except as to the distribution
commencement  date, the annual preferred dividend rate, the remarketing date and
the mandatory  repurchase date. The Equity Trust may not redeem the Series B and
Series B-1  preferred  shares  before  November 30, 2010 and they are subject to
mandatory  tender for remarketing and purchase on such date and each remarketing
date thereafter at a price equal to their per share  liquidation  amount plus an
amount equal to all distributions  accrued but unpaid on the Series B and Series
B-1 preferred  shares.  The Equity Trust may not redeem the Series B-2 preferred
shares  before  October 31, 2014,  and they are subject to mandatory  tender for
remarketing and purchase on such date and each  remarketing date thereafter at a
price  equal to its per share  liquidation  amount  plus an amount  equal to all
distributions accrued but unpaid on the Series B-2 preferred shares.  Holders of
the Series B Shares may elect to retain  their shares upon  remarketing,  with a
distribution rate to be determined  immediately prior to the remarketing date by
the remarketing agent. After the initial  remarketing dates, all or a portion of
the shares may be redeemed,  subject to certain  conditions.  Each holder of the
Series B and  Series  B-1  preferred  shares  and each  holder of the Series B-2
preferred  shares will be required to tender its shares to the Equity  Trust for
mandatory  repurchase  on November 30, 2050 and October 31, 2052,  respectively,
unless the Equity Trust decides to remarket the shares on such dates.

     The Series B Shares  rank,  with  respect to payment of  distributions  and
amounts upon liquidation,  dissolution or winding up of the Equity Trust, senior
to all classes or series of common  shares of the Equity  Trust and,  therefore,
effectively  rank senior to our Common Shares,  our CRA Shares and our preferred
shares, if any, and junior to the Series A Shares.

     The Equity Trust is subject to, among others, the following  covenants with
respect to the Cumulative Preferred Shares:

     Tax-exempt  interest and  distributions.  The Equity Trust may only acquire
new  investments  that  it  reasonably   believes  will  generate  interest  and
distributions  excludable from gross income for federal income tax purposes. The
Equity  Trust will  dispose of any  investment  the  interest  on which  becomes
includable in gross income for federal income tax purposes,  for any reason,  as
soon as commercially practicable.

     Leverage.  The  Equity  Trust  will  not,  and will not  permit  any of its
subsidiaries to, directly or indirectly,  incur any obligation except if (i) the
Equity Trust is not in default under its trust agreement,  (ii) the Equity Trust
has  paid or  declared  and  set  aside  for  payment  all  accrued  and  unpaid
distributions on the Cumulative  Preferred Shares, and (iii) after giving effect
to the incurrence of the obligation, the leverage ratio on the portfolio is less
than 0.6 to 1.0.

     Failure to pay distributions.  If the Equity Trust has not paid in full six
consecutive  quarterly  distributions on the Cumulative  Preferred  Shares,  the
Equity  Trust is  required  to  reconstitute  its  board of  trustees  so that a
majority of the board of trustees  consists of trustees who are independent with
respect to the Equity Trust, us, or our subsidiaries.

     Allocation of Taxable Interest Income and Market Discount. The Equity Trust
will specially  allocate  taxable  interest  income and market  discount that is
taxable as ordinary income to us. Market  discount,  if any, may arise where the
Equity Trust acquires a bond other than upon its original issuance for less than
its stated  redemption price at maturity and the difference is greater than a de
minimis  amount  (generally  1/4 of 1% of a bond's  stated  redemption  price at
maturity multiplied by the number of complete years to maturity).

     Limitation on Issuance of Preferred Equity Interests.  The Equity Trust may
not issue  preferred  equity  interests  that are  senior to the Series A Shares
without the  consent of a majority  of the  holders of



                                       27
<PAGE>



the  Series A Shares.  The  Equity  Trust may not  issue  any  preferred  equity
interests  that are  equal in rank to the  Cumulative  Preferred  Shares  unless
certain  conditions are met,  including that the amount of such preferred equity
interests  is limited,  the Equity  Trust has paid or declared and set aside for
payment all accrued and unpaid  distributions on the Cumulative Preferred Shares
to holders, and there is no default or event of default under the Equity Trust's
trust agreement.

  Special Common Units

     In  connection  with  our  acquisition  of  Related  Capital,   the  former
principals  of Related  Capital were issued  membership  interests in CCC in the
form of "special common units."

     Features of the Special  Common Units.  The features of the special  common
units are as follows: (a) the special common units will be exchangeable, subject
to  anti-dilution  adjustments  and some  other  restrictions  set  forth in the
exchange  rights  agreement (see  "-Exchange  rights  agreement,"  below) at the
election  of the  holders of the  special  common  units,  for cash equal to the
average closing price of our Common Shares for the five consecutive trading days
immediately preceding the date we receive a notice of exchange;  provided,  that
we may  choose,  at our sole  discretion,  to  satisfy  this  exchange  right by
exchanging the special common units for Common Shares on a one-for-one basis, in
lieu of cash;  (b)  distributions  will be paid to the holders of special common
units at the same time as, and only if, distributions are paid to holders of our
Common Shares; and (c) distributions paid to the holders of special common units
will consist of taxable income.

     Distributions on the special common units.  Holders of special common units
will be entitled to  distributions  at the same time as, and only if,  dividends
are paid on our Common Shares.  However,  unlike dividends payable to holders of
our  Common  Shares,   which  consist  of   substantially   tax-exempt   income,
distributions  payable to holders of the special  common  units will  consist of
taxable  income.  In order to take into account the  difference in tax treatment
and  enable  holders  of the  special  common  units to  receive  an  equivalent
after-tax  return on  distributions  as holders of our Common Shares  receive on
their  dividends,  the amount of their initial  distribution  will equal our per
share dividend,  annualized as of the closing date of our acquisition of Related
Capital,  divided by 0.72.  Subsequent  distributions  to the holders of special
common units will be increased (or decreased) proportionately with increases (or
decreases) in dividends paid to holders of our Common Shares.

     To the extent that, in any year, CCC does not have  sufficient cash flow to
pay the entire  distribution  due on the special common units, we have agreed to
contribute  or to lend to CCC all but $5  million  of these  distributions.  The
remaining  shortfall,  if any, will earn interest at a market rate and will only
be payable at the time CCC has sufficient cash flow.

     Governance/voting  rights. Holders of the special common units may not take
part in the  operation,  management or control of CCC's business and do not have
any voting  rights.  This  notwithstanding,  the  consent  of a majority  of the
holders of the special  common  units will be required to approve the  following
"Capital  Transactions"  related to CCC: (a) the  dissolution  or liquidation of
CCC; (b) the sale,  assignment,  transfer or pledge of assets of CCC outside the
ordinary course of business;  (c) a merger or consolidation  with another entity
where CCC (1) is not the surviving  entity;  (2) issues  special common units in
connection with the merger or consolidation;  or (3) makes any change to the CCC
operating  agreement or certificate of formation;  (d) any  distribution  by CCC
(other than cash  distributions);  (e)  specified  transfers of assets and other
transactions  that would result in  recognition  of taxable income to the former
principals of Related  Capital;  or (f) the issuance of additional  interests in
CCC.

     Consent  will not be  required  with  respect to any action  referred to in
clause (b) or (e) above, if the action is with an  unaffiliated  third party and
at the time of the transaction, CCC distributes to the holders of special common
units  cash in an  amount  sufficient  to  offset  any tax  payable  on any gain
recognized by them as a result of these actions.



                                       28
<PAGE>


     If we  decide  to  sell  or  dispose  of  all or  substantially  all of our
Company's   assets  or  equity  interests  (an   "Extraordinary   Transaction"),
structured  in a way that  requires  a  Capital  Transaction  to  occur,  we may
consummate the Extraordinary  Transaction  without the consent of the holders of
the special common units provided that the Extraordinary  Transaction either (a)
entitles the holders of the special  common units to retain their special common
units,  (b) allows our  shareholders  to receive more than 50% of the  aggregate
value of the  consideration  to be paid to them in cash or (c) occurs  more than
five  years  after the  closing  of the  acquisition  transaction,  and  further
provided  that if the holders of the special  common  units are not  entitled to
retain their special  common  units,  those holders will be required to exchange
their special common units pursuant to the exchange rights agreement.

     Exchange  Rights.  Each holder of special common units has the right,  upon
expiration  of any lock-up  period,  to (a)  exchange  all or a portion of their
special  common  units for cash and (b) receive  cash in an amount  equal to any
accrued but unpaid  distributions with respect to the special common units being
exchanged  (not  including  accrued and unpaid  distributions  for the quarterly
period  in  which  the  exchange  occurs).  In lieu  of  cash,  we  may,  at our
discretion,  exchange  such  special  common  units (and any  accrued but unpaid
distributions)   for  Common   Shares  on  a  one-for-one   basis,   subject  to
anti-dilution adjustments.  The Common Shares will be issued at a price equal to
the average  closing market price of our Common Shares for the five  consecutive
trading  days  prior to the date upon which CCC and CM Corp.  receive  notice of
conversion. Exchanges may only be made in amounts equal to or greater than 1,000
special common units, unless a holder owns less than 1,000 special common units,
in which case that holder may exchange the entire amount held.

  Special Preferred Voting Shares

     In  connection  with our  acquisition  of Related  Capital,  each holder of
special  common units acquired one special  preferred  voting share (at $.01 per
share) for each special common unit they received.

     Voting rights.  The special  preferred voting shares entitle the holders of
the special common units to vote, on a one-for-one basis, on all matters subject
to a vote of the holders of our Common Shares. We have the right to require that
each  special  preferred  voting  share be  redeemed  (for $.01 per  share)  and
cancelled  simultaneously  upon the  exchange  of a special  common  unit by the
holder  thereof  into cash or our Common  Shares.  Other than the payment of the
$.01 per share upon  redemption  of the special  preferred  voting shares or the
liquidation of our Company, the special preferred voting shares are not entitled
to any distributions or other economic rights.

     Voting  Agreement.  The former principals of Related Capital entered into a
voting  agreement  which  governs the voting of all of their  special  preferred
voting  shares,  Common Shares  issuable  upon exchange of their special  common
units and any other Common  Shares  currently  owned or which may be acquired by
them in the future.  The voting agreement provides that the former principals of
Related  Capital  will (a) vote on any  matter  requiring  a vote of our  common
shareholders  not more than 90% of the voting power  represented  by the special
preferred  voting shares (and any Common Shares to be issued in exchange for the
special common units) for a period of two years; (b) vote their Common Shares or
special  preferred  voting  shares in favor of the  election of any  independent
trustee  approved  by our board of  trustees  or in the same  proportion  as the
unaffiliated  holders of our Common  Shares vote in such  election,  and (b) not
exercise any right as a shareholder  of our Company to nominate any  independent
trustee.  With the  exception of Mr. Ross,  whose  voting  agreement  remains in
effect as long as he owns any of our special  preferred  voting shares or Common
Shares,  the voting  agreement  will  terminate for each of the  remaining  four
former  principals  at the time he or she is no longer an  employee,  officer or
trustee of our Company.



                                       29
<PAGE>



Trust Agreement and Bylaw Provisions and Certain Provisions of Delaware Law

     Our Board of Trustees. Our business and affairs are managed by our board of
trustees.  Our board of  trustees  consists of not less than three nor more than
sixteen trustees, of which eight shall be independent,  which means they may not
be our officers or employees, related to our officers nor represent concentrated
or family holdings of our voting interests, and who, in the view of our board of
trustees,  are free from any relationship that would interfere with the exercise
of  independent  judgment with respect to matters  relating or pertaining to our
affairs.  As long as Thomas W. White is on the board of trustees,  a majority of
the board of trustees by at least one managing trustee must be independent. Upon
Thomas  W.  White's  ceasing  to serve as a  managing  trustee  for any  reason,
including by reason of his resignation or removal or otherwise, and at all times
thereafter,  a  majority  of the  board of  trustees  by at least  two  managing
trustees  must be  independent  trustees  (e.g.  if the total number of managing
trustees is nine, independent trustees must comprise at least six members of the
board of  trustees).  The total number of managing  trustees may be increased or
decreased  pursuant  to the  bylaws,  but shall  never be less than the  minimum
number, if any, required by the Delaware Act nor more than sixteen.

     Our board of trustees  currently has fifteen  managing  trustees,  eight of
whom are  independent  trustees.  Our  board  of  trustees  establishes  written
policies  on  investments   and  borrowings  and  monitors  our   administrative
procedures,  investment  operations  and  performance  as well as monitoring our
management  team to assure that such  policies are carried out. The  independent
trustees are  responsible  for reviewing our investment  policies not less often
than annually and with sufficient frequency to determine that the policies being
followed are in the best interests of our shareholders.

     We have annual  shareholder  meetings to re-elect a portion of our managing
trustees, who will generally serve staggered, three-year terms. Election of each
managing  trustee  requires the approval of a plurality of the votes cast by the
holders of Common Shares in person or by proxy at our annual meeting.  Our trust
agreement  provides that (i) with respect to an annual meeting of  shareholders,
nominations of persons for election to the board of trustees and the proposal of
business to be considered by  shareholders  may be made only (a) pursuant to our
Company's  notice  of the  meeting,  (b) by the board of  trustees,  or (c) by a
shareholder  who is entitled to vote at the  meeting and has  complied  with the
advance  notice  procedures  set  forth in our  trust  agreement,  and (ii) with
respect to special meetings of shareholders,  only the business specified in our
Company's notice of meeting may be brought before the meeting of shareholders.

     A vacancy in our board of trustees  created by the death,  resignation,  or
incapacity of a managing  trustee  (within the limits  referred to above) may be
filled  by the vote of a  majority  of the  remaining  managing  trustees  (with
respect to a vacancy  created by the death,  resignation,  or  incapacity  of an
independent  trustee,  the  remaining  independent  trustees  shall  nominate  a
replacement).  A vacancy in our board of trustees  created by an increase in the
number of managing trustees may be filled by a majority vote of the entire board
of trustees.  Any managing  trustee may resign at any time. Our trust  agreement
provides  that,  subject  to the right of the  holders of any class of shares to
elect  additional  managing  trustees,  managing  trustees may be removed by the
affirmative  vote of a majority of our Common  Shares then  outstanding  with or
without cause. Wilmington Trust Company, a Delaware banking corporation, is also
one of our trustees.  Wilmington  Trust Company has been appointed as registered
trustee  solely to satisfy  certain  requirements  of the  Delaware  Act and its
duties and  responsibilities  with respect to us and our  shareholders  are very
limited.

     So long as the holders of the special  common units own, in the  aggregate,
7.5% or more of our  outstanding  voting  securities  (a) there must be at least
fourteen  trustees  on  our  board  of  trustees,  consisting  of at  least  six
non-independent trustees and at least eight independent trustees and (b) holders
of a majority of the outstanding  special voting  preferred shares will have the
right,  in lieu of our board of trustees (or  nominating  committee  thereof) to
elect to our board of trustees  any  non-independent  trustees to fill a vacancy
and to  nominate  any  non-independent  trustees  for  election at any annual or
special



                                       30
<PAGE>



meeting of our shareholders.  This power of nomination will not affect the right
of the  holders of our Common  Shares to also  nominate  their  choices  for the
non-independent  trustee nominees.  After the date upon which the holders of the
special  preferred  voting shares own, in the  aggregate,  less than 7.5% of our
outstanding voting securities,  the nominating  committee will have the right to
nominate  non-independent  trustees to fill a vacancy  (which  vacancies will be
filled by the  affirmative  vote of a majority of our board of  trustees)  or to
stand for election at any annual or special meeting.


     Additional Classes and Series of Shares. Our trust agreement  authorizes us
to issue 100,000,000  shares and authorizes our board of trustees to classify or
reclassify  any unissued  beneficial  interests,  to provide for the issuance of
beneficial interests in other classes or series of securities,  to establish the
number  of  beneficial  interests  in  each  class  or  series  and to  fix  the
preferences,   conversion  and  other  rights,   voting  powers,   restrictions,
limitations  as to  distributions,  qualifications  or  terms or  conditions  of
redemption of such class or series.  We believe that the ability of our board of
trustees to issue one or more classes or series of beneficial interests provides
us with  increased  flexibility in structuring  possible  future  financings and
acquisitions,  and in meeting  other  needs which  might  arise.  Subject to the
American  Stock Exchange  rules which require  shareholder  approval for certain
issuances of securities, the additional classes or series, as well as the Common
Shares,   will  be  available  for  issuance   without  further  action  by  our
shareholders. See "Risk Factors--Risks relating to our Company and the operation
of our business--There are possible adverse effect arising from shares available
for future sale." Although our board of trustees has no intention at the present
time of doing so, it could issue a class or series that could,  depending on the
terms of such class or series, delay, defer or prevent a transaction or a change
in control of our Company that might  involve a premium price for holders of our
Common Shares or otherwise be in their best interest.

     Advance Notice of Managing Trustee Nominations and New Business. Our bylaws
provide  that (i) with  respect  to an annual  meeting  of common  shareholders,
nominations of persons for election to our board of trustees and the proposal of
business to be considered by common  shareholders  may be made only (a) pursuant
to our  notice  of  meeting,  (b) by our board of  trustees,  or (c) by a common
shareholder  who is entitled to vote at the  meeting and has  complied  with the
advance  notice  procedures  set  forth in our  trust  agreement,  and (ii) with
respect to special meetings of common shareholders,  only the business specified
in  our  notice  of  meeting  may  be  brought  before  the  meeting  of  common
shareholders,  and  nominations of persons for election to our board of trustees
may be made only (a) pursuant to our notice of the meeting,  (b) by our board of
trustees,  or (c)  provided  that our  board of  trustees  has  determined  that
managing trustees shall be elected at such meeting,  by a common shareholder who
is  entitled to vote at the meeting  and has  complied  with the advance  notice
provisions set forth in our bylaws.

     The advance notice provisions set forth in our bylaws could have the effect
of delaying, deferring or preventing a transaction or a change in control of our
Company  that might  involve a premium  price for  holders  of Common  Shares or
otherwise be in their best interest.

     Term and Dissolution.  We have perpetual existence, but may be dissolved at
an earlier  date (i) upon the  recommendation  of our board of trustees  and the
approval  of  shareholders  by  majority  vote  and  (ii) by order of a court of
competent  jurisdiction  to  judicially  dissolve our Company if it is no longer
reasonably  practicable  to continue  the business and affairs of our Company as
contemplated by our trust agreement.

     Upon  dissolution  of our Company,  our assets will be  liquidated  and the
proceeds of liquidation  will be applied first to the  satisfaction  (whether by
payment or  reasonable  provision  for payment  thereof) of  obligations  of our
Company to third parties  (including holders of senior interests created through
our securitization  programs and preferred shareholders of our subsidiaries) and
then to payment of  liquidation  expenses.  Any remaining  proceeds will then be
distributed to our shareholders.

     Change of Control;  Anti-Takeover Provisions.  Our trust agreement contains
provisions  that might have the effect of delaying,  deferring  or  preventing a
transaction  or a change of control of our



                                       31
<PAGE>



Company that might involve a premium price for our Common  Shares,  or otherwise
be in the best interest of our shareholders.  See "Risk Factors--Risks  relating
to our Company and the operation of our business--Our  anti-takeover  provisions
may discourage  third-party  proposals" for a discussion of these  anti-takeover
provisions.

     Voting  Rights  of our  Shareholders.  Our  shareholders  have no  right to
participate  in the control of our business.  However,  our common  shareholders
have  been  granted  certain  voting  rights  which  are set  forth in our trust
agreement. The common shareholders, as a class, have the right to vote upon:


     a.   the election of our board of trustees;

     b.   merger, consolidation or conversion and dissolution of our Company;

     c.   sale of all or substantially all of our assets; and

     d.   amendment  of  our  trust   agreement   (except  in  certain   limited
circumstances), provided that provisions relating to the limitation of liability
and indemnification may only be amended prospectively.

     Amendments to our Trust Agreement.  In general,  our trust agreement may be
amended by the  affirmative  vote or written  consent of the holders of not less
than a majority  of the Common  Shares  then  outstanding  and  entitled to vote
thereon.

     Meetings.  We will hold annual meetings of our common shareholders to elect
managing  trustees  whose terms have  expired.  Our board of trustees may at any
time  call a  meeting  of  common  shareholders  or call for a vote,  without  a
meeting,  of the common  shareholders  on matters on which they are  entitled to
vote,  and shall call for such  meeting or vote  following  receipt of a written
request therefor of common  shareholders  holding 10% or more of the outstanding
Common Shares.

     Borrowing Policies. Our trust agreement provides that we will be allowed to
incur  aggregate  financing  or leverage  (as defined in our Second  Amended and
Restated Trust Agreement) of up to 50% of our total market value  (calculated at
the time any additional financing or leverage is incurred).

     Indemnification  and  Limitation  of  Liability.  The Delaware Act provides
that, except to the extent otherwise  provided in the governing  instrument of a
statutory  trust,  a  trustee,  when  acting  in  such  capacity,  shall  not be
personally  liable to any person other than the statutory  trust or a beneficial
owner for any act,  omission or obligation of the statutory trust or any trustee
thereof.  In addition,  the Delaware  Act  provides  that,  except to the extent
otherwise provided in the governing instrument of a statutory trust, an officer,
employee,  manager or other person acting on behalf of the statutory trust, when
acting in such capacity, shall not be personally liable to any person other than
the statutory trust or the beneficial owner for any act,  omission or obligation
of the statutory trust or any trustee thereof.

     The Delaware Act provides that, subject to such standards and restrictions,
if any, as are set forth in the  governing  instrument of a statutory  trust,  a
statutory  trust shall have the power to indemnify and hold harmless any trustee
or  beneficial  owner or other  person  from and  against any and all claims and
demands whatsoever.

     Our trust  agreement  requires  us to  indemnify  our  present  and  former
trustees,  among  others (any such  person,  an  "indemnified  party"),  against
judgments,  penalties,  fines,  settlements  and  reasonable  expenses  actually
incurred by them in connection  with any  proceeding to which they may be made a
party by  reason  of their  service  in those or other  capacities  unless it is
established  that (a) the act or omission  of the  trustee  was  material to the
matter giving rise to the  proceeding and (i) was committed in bad faith or (ii)
was the result of active and deliberate  dishonesty,  (b) the indemnified  party
actually received an improper  personal benefit in money,  property or services,
or (c) in the  case  of any  criminal  proceeding,



                                       32
<PAGE>



the indemnified  party had reasonable  cause to believe that the act or omission
was unlawful.  In addition,  our trust  agreement  requires us, as conditions to
advancing expenses, to obtain (i) a written affirmation by the indemnified party
of his or its  good-faith  belief that he or it has met the  standard of conduct
necessary  for  indemnification  by our  Company  as  authorized  by  our  trust
agreement  and (ii) a written  statement by him or it or on his or its behalf to
repay the amount paid or reimbursed  by us if it shall  ultimately be determined
that the standard of conduct was not met. Our trust  agreement  also requires us
to  provide  indemnification  and  advance  of  expenses  to a present or former
indemnified party who served a predecessor of our Company in such capacity,  and
to any employee or agent of our Company or a predecessor of our Company.

     We  have  obtained  a  liability  insurance  policy  for our  trustees  and
officers, as well as the trustees and officers of our subsidiaries.

     Liability  of  Shareholders.  We are  governed  by the laws of the State of
Delaware.  Under our trust agreement and the Delaware Act, our shareholders will
be  entitled  to  the  same  limitation  of  personal   liability   extended  to
stockholders  of private  corporations  for profit  organized  under the General
Corporation Law of the State of Delaware.

     In general, stockholders of Delaware corporations are not personally liable
for the payment of a corporation's  debts and obligations.  They are liable only
to the extent of their  investment  in the  Delaware  corporation.  In addition,
under the Delaware  Act,  neither the  existence of certain  powers in our trust
agreement  that may be  exercised by our  shareholders  nor the exercise of such
powers will cause such  shareholders to be deemed to be a trustee of our Company
or to be held personally liable for our acts, omissions and obligations.

     The  principles of law governing the  limitation of liability of beneficial
owners of a  statutory  trust have not been  authoritatively  established  as to
statutory  trusts  organized under the laws of one jurisdiction but operating or
owning property, incurring obligations or having beneficiaries resident in other
jurisdictions. A number of states have adopted legislation containing provisions
comparable to the provisions of the Delaware Act.  Accordingly,  in such states,
the  limitation  of liability of our  shareholders  provided by the Delaware Act
should be respected.

     In  those   jurisdictions   which  have  not  adopted  similar  legislative
provisions,  questions exist as to whether such jurisdictions  would recognize a
statutory  trust,  absent  a  state  statute,   and  whether  a  court  in  such
jurisdictions  would recognize the Delaware Act as controlling.  If not, a court
in such  jurisdiction  could hold that the  shareholders are not entitled to the
limitation  of liability  set forth in our trust  agreement and the Delaware Act
and, as a result, are personally liable for our debts and obligations.



                                       33
<PAGE>



                        FEDERAL INCOME TAX CONSIDERATIONS

The following is a summary of certain of the federal  income tax  considerations
which may be material to a typical shareholder who is a United States person and
is based  upon the Code,  judicial  decisions,  final,  temporary  and  proposed
treasury  regulations and administrative  rulings and pronouncements of the IRS.
No attempt has been made to comment on all federal income tax matters  affecting
our Company or our  shareholders.  The discussion  does not purport to deal with
federal income or other tax consequences  applicable to an investment by certain
categories  of   shareholders,   including,   without   limitation,   tax-exempt
organizations,  dealers in securities, banks, insurance companies,  Subchapter S
corporations,  regulated investment companies, real estate investment trusts and
persons who are not citizens or residents of the United States, and is not to be
construed as tax advice.

No ruling on the  federal,  state or local tax  considerations  relevant  to the
issuance of the common and preferred shares,  the debt  characterization  of the
revenue bonds,  the  tax-exempt  character of interest on certain of the revenue
bonds or other bond-related investments,  the classification of our Company as a
partnership,  or any other issue relevant to this offering has been, or will be,
requested from the IRS or from any other tax authority.  Moreover,  no assurance
can be given that the  conclusions  reached by Paul Hastings will be accepted by
the IRS or, if challenged by the IRS, sustained in court.

This summary is based on current legal  authority and there is no assurance that
legislative or  administrative  changes or court  decisions will not occur which
could  significantly  modify  the  statements  and  opinions  expressed  herein,
possibly with retroactive effect.

YOU SHOULD CONSULT YOUR OWN TAX ADVISORS REGARDING THE FEDERAL, STATE, LOCAL AND
FOREIGN INCOME TAX  CONSEQUENCES TO YOU PRIOR TO PURCHASING OUR COMPANY'S COMMON
SHARES.

General

Entity  status of our  Company and our  subsidiaries.  Each holder of our Shares
will agree to treat our Shares as a partnership  interest for federal income tax
purposes.  Based upon  representations  from us, Paul  Hastings has rendered its
opinion  that,  although the issue is not free from doubt,  we have been and are
properly treated as a partnership,  and not as a publicly traded  partnership or
association  taxable  as  a  corporation,   for  federal  income  tax  purposes.
Accordingly,  our  shareholders,  subject to the discussion  regarding  publicly
traded  partnerships  below,  will be partners in such  partnership  for federal
income tax  purposes,  and the  allocations  of  tax-exempt  income by us to the
shareholders will be excludable from gross income for purposes of federal income
taxation.

Our Common  Shares are publicly  traded.  In order for us not to be treated as a
publicly traded partnership  taxable as a corporation,  90% or more of our gross
income  each year must  consist of interest  and other types of passive  income.
Interest earned by our Company may only be included for purposes of this test if
(a) the interest  does not depend on the income or profits of any person and (b)
the  interest is not derived in the  conduct of a  financial  business.  We have
represented  that,  in the current  taxable year and future  taxable  years,  we
anticipate  that income  described in clause (a) will,  together  with any other
non-qualifying income, constitute less than 10% of its gross income. There is no
definitive guidance as to the level of activity that may, for purposes of clause
(b), cause us to be treated as if we were engaged in a financial business. There
is no assurance that the IRS will not  successfully  contend that our Company is
engaged in a financial  business or earns more than 10% of our gross income from
such a business and,  therefore,  is a publicly traded partnership  taxable as a
corporation.

If our Company in any taxable  year were  taxable as a  corporation  for federal
income tax purposes, our income and deductions would be reported only on our tax
return  rather than being  passed  through to our  shareholders  and we would be
required to pay income tax at corporate  rates on any portion of our income



                                       34
<PAGE>



that did not  constitute  tax-exempt  income.  In this regard,  a portion of our
tax-exempt  income may be included in determining  our  alternative  minimum tax
liability.  The  imposition  of any such tax  would  reduce  the  amount of cash
available to be distributed to our shareholders. In addition, distributions from
our  Company  to our  shareholders  would be  ordinary  dividend  income to such
shareholders to the extent of our earnings and profits,  which would include our
tax-exempt income as well as any other taxable income we might have. Payments of
such distributions would not be deductible by our Company.  Similarly, if any of
our  subsidiaries  (other  than CM  Corp.  and PW  Funding)  were  treated  as a
corporation  for federal income tax purposes,  rather than as a partnership or a
disregarded entity, adverse consequences could result.

Treatment as a Taxable  Mortgage Pool Taxable as a Corporation.  If, for federal
income tax purposes,  we were  classified as a taxable  mortgage pool within the
meaning of Section 7701(i) of the Code, we would be taxable as a corporation.  A
taxable mortgage pool is an entity (i)  substantially all of the assets of which
consist of debt obligations and more than 50% of such debt obligations  consists
of real  estate  mortgages,  (ii)  which is an  obligor of debt with two or more
maturities and (iii) under the terms of the debt obligations  under clause (ii),
payments bear a relationship  to payments on the debt  obligations  described in
clause (i).  The IRS has the  authority  to treat  certain  equity  interests in
issuers as debt for purposes of the taxable  mortgage  pool rules.  However,  we
will not be treated as a taxable  mortgage  pool  because of the  absence of any
relationship  between  the timing of payments  on the debt  obligations  we hold
(i.e.,  revenue bonds) and the timing of  distributions  on our equity interests
(i.e., common and preferred shares).

Taxation of CM Corp. and PW Funding. Unlike our other subsidiaries, CM Corp. and
PW Funding are taxable  corporations,  and will be required to pay income tax to
the extent they  realize  taxable  income.  It is possible  that the IRS may not
agree with our determinations as to which expenses are allocable to CM Corp. and
PW Funding and their ability to reduce their taxable income,  and which expenses
are  allocable  to us or our  other  subsidiaries.  If all or a  portion  of the
expenses that we allocate to CM Corp.  and PW Funding are  determined  not to be
deductible by CM Corp. or PW Funding,  they could be required to pay  additional
tax, as well as interest and penalties.  Additional tax, as well as interest and
penalties,  could also be payable by CM Corp.  if the IRS  determined  that fees
that we pay to Related  Capital (a  subsidiary  of CM Corp.)  were less than the
amounts  that would be payable if  Related  Capital  were not  related to us. In
addition,  any  dividends  paid by CM Corp.  to us will be treated  as  ordinary
income to us to the extent of CM Corp.'s earnings and profits, and any gain that
may be realized  if all or a portion of our  ownership  interest in CM Corp.  is
sold will result in taxable income.

Certain income tax considerations relating to our Company and our shareholders

Taxation of our Company and our  shareholders.  A partnership  is not subject to
federal income tax. Assuming we are classified as a partnership for tax purposes
and not a publicly traded partnership taxable as a corporation, our Company will
not be subject to federal  income tax and each  shareholder  will be required to
report on their income tax return their distributive share of our income,  gain,
loss,  deduction and items of tax preference and will be subject to tax on their
distributive  share of our taxable income,  regardless of whether any portion of
that income is, in fact,  distributed to such  shareholder in the  shareholder's
taxable  year  within  which  or  with  which  our  taxable  year  ends.   Thus,
shareholders  may be required to accrue income,  without the current  receipt of
cash, if our Company does not make cash  distributions  while generating taxable
income.  Consequently,  although  it is not  anticipated,  a  shareholder's  tax
liability  with  respect to its share of our taxable  income may exceed the cash
actually distributed in a given taxable year. We currently use the calendar year
as our taxable year.

We will file a federal tax return on Form 1065 and will provide  information  as
to each shareholder's  distributive share of our income,  gain, loss,  deduction
and items of tax preference on a Schedule K-1 supplied to such shareholder after
the close of our fiscal year.  In preparing  such  information,  we will utilize
various  accounting  and  reporting  conventions,  some of which  are  discussed
herein, to determine each  shareholder's  allocable share of income,  gain, loss
and  deduction.  There is no  assurance  that the use of such  conventions  will
produce a result that conforms to the  requirements  of the Code,  temporary and



                                       35
<PAGE>



proposed treasury regulations or IRS administrative  pronouncements and there is
no assurance that the IRS will not  successfully  contend that such  conventions
are impermissible.  Any such contentions could result in substantial expenses to
our Company and our shareholders as a result of contesting such contentions,  as
well as an increase in tax liability to  shareholders as a result of adjustments
to their  allocable share of our income,  gain,  loss and deduction.  See "--Tax
returns, audits, interest and penalties."

Tax-Exempt  Income. We expect that substantially all of our interest income will
constitute  tax-exempt income.  There are risks that certain amounts of interest
income  that our  Company  will  report as  tax-exempt  may not qualify for such
treatment. See "Risk Factors--Risks relating to our Company and the operation of
our business--The  value of our shares and our ability to make  distributions of
federally    tax-exempt   income   depends   upon   the   application   of   tax
laws--Tax-exemption  of our revenue bonds" and "--Taxable  income." In addition,
if the intended tax treatment of any of our subsidiaries other than CM Corp. and
PW Funding were successfully  challenged by the IRS, all or a part of the income
derived by such subsidiaries may be subject to tax.

Allocation  of income.  Generally,  built in gain or loss in our assets prior to
the   admission  of  our   shareholders   will  be  allocated  to  our  existing
shareholders. We are permitted to account for changes in the value of our assets
subsequent  to the date of the  admission  of a  shareholder  under one of three
methods.  A portion of the subsequent losses from appreciated assets (i.e., fair
market  value in excess of tax basis)  and  subsequent  gains  from  depreciated
assets (i.e.,  fair market value less than tax basis)  realized by a shareholder
may be deferred as a result of one method we may employ.

Capital gain upon sale of our assets.  We may, from time to time, sell,  dispose
of or otherwise be treated as disposing of, certain of our assets.  Such sale or
disposition may result in taxable capital gain.

Shareholder's  basis in Shares. Your adjusted basis in our Shares is relevant in
determining the gain or loss on the sale or other  disposition of our Shares and
the tax  consequences of a distribution  from our Company.  See  "--Treatment of
cash  distributions to our shareholders from our Company." In addition,  you are
entitled  to  deduct on your  income  tax  return,  subject  to the  limitations
discussed below, your distributive  share of our net loss, if any, to the extent
of your adjusted basis in your Shares.

Your  initial  basis in newly issued  Shares will be the purchase  price for the
Shares,  increased  by your share of items of our income  (including  tax-exempt
interest) and gain, and reduced,  but not below zero, by (a) your share of items
of Company loss and deduction (including any nondeductible expenses) and (b) any
cash distributions you have received from our Company.

Treatment of cash  distributions  to our  shareholders  from our  Company.  Cash
distributions   made  to  our  shareholders  will  generally  be  treated  as  a
non-taxable  return of capital and will not generally  increase or decrease your
share of taxable income or loss from our Company.  A return of capital generally
does not  result  in any  recognition  of gain or loss for  federal  income  tax
purposes but would reduce your adjusted basis in your Shares.  Distributions  of
cash in excess of your  adjusted  basis in your Common Shares will result in the
recognition of gain to the extent of such excess.

Limitations on deductibility of losses.  In the event you are allocated  losses,
you generally will be entitled to deduct your  distributive  share of any losses
of our Company to the extent of your tax basis of your Common  Shares at the end
of  the  year  in  which  such  losses  occur.  However,  shareholders  who  are
individuals,  trusts,  estates,  personal service  companies and certain closely
held C corporations may be subject to additional limitations on deducting losses
of our Company.

Limitation on the  deductibility  of interest  expense.  The Code  disallows any
deduction  for  interest  paid  by any  taxpayer  on  indebtedness  incurred  or
continued for the purpose of purchasing or carrying a tax-exempt  obligation.  A
purpose to carry  tax-exempt  obligations  will be inferred  whenever a taxpayer
owns tax-exempt  obligations and has outstanding  indebtedness  which is neither
directly connected with



                                       36
<PAGE>



personal  expenditures  nor incurred in connection  with the active conduct of a
trade or business. The IRS may take the position that a shareholder's  allocable
portion of any interest paid by our Company on our borrowings,  and any interest
paid by a shareholder  on  indebtedness  incurred to purchase our Common Shares,
should be viewed in whole or in part as incurred to enable such  shareholder  to
continue carrying such tax-exempt obligations and, therefore, that the deduction
of any such  interest by such  shareholder  should be  disallowed in whole or in
part.

In the  absence of direct  evidence  linking  debt with  purchasing  or carrying
tax-exempt  obligations  (for example,  the  tax-exempt  obligations  secure the
debt),  there is an exception to the interest  disallowance rule if the taxpayer
holds only an  insubstantial  amount of tax-exempt  obligations.  This exception
does not apply to banks,  certain other  financial  institutions,  or dealers in
tax-exempt  securities.  However, to the extent that an investor's debt would be
allocated  to  purchasing  or carrying  its Shares,  such Shares  should only be
treated as tax-exempt obligations for purposes of the interest disallowance rule
in  the  same  proportion  as the  assets  of our  Company  comprise  tax-exempt
obligations  (based on their  adjusted  tax  basis or  perhaps  capital  account
value).  We will  report to  shareholders  at the end of each  year the  average
percentage of our assets (based on adjusted tax basis and capital account value)
that were invested in  obligations we believe were  tax-exempt  each year. It is
uncertain whether an annual average or more frequent adjustments should be used.

Assuming interest on indebtedness is otherwise deductible,  the deductibility of
a non-corporate  taxpayer's  "investment interest" expense is further limited to
the amount of such taxpayer's "net investment income."

Alternative  minimum tax.  Except for  qualified  Section  501(c)(3)  bonds,  or
certain  revenue  bonds that are  grandfathered,  interest on the revenue  bonds
generally is an item of tax preference for purposes of the  alternative  minimum
tax. To the extent  interest on any of the revenue  bonds we own is such an item
of tax preference,  a portion of the income allocable to a shareholder also will
be a tax preference  item.  Substantially  all of our annual  interest income is
expected to  constitute  a tax  preference  item.  This  preference  item may be
reduced,  but not below zero, by interest  expense and other expenses that could
not be deducted  for regular tax purposes  because the expenses  were related to
tax-exempt  income generated by such preference bonds. To the extent interest on
any of the revenue bonds owned by our Company is not a tax preference  item, any
corporation  subject to the alternative  minimum tax must nevertheless take such
tax-exempt  interest into account in determining its adjusted  current  earnings
for purposes of computing its alternative minimum tax liability.

Other federal income tax  considerations.  The Code contains certain  provisions
that could  result in other tax  consequences  as a result of the  ownership  of
revenue bonds by our Company or the inclusion in certain computations including,
without limitation,  those related to the corporate  alternative minimum tax, of
interest that is excluded from gross income.

Ownership of tax-exempt  obligations by our Company may result in collateral tax
consequences to certain  taxpayers,  including,  without  limitation,  financial
institutions,   property  and  casualty  insurance  companies,  certain  foreign
corporations  doing business in the United States,  certain S corporations  with
excess  passive  income,  individual  recipients of social  security or railroad
retirement  benefits and  individuals  otherwise  eligible for the earned income
credit. Prospective purchasers of our Common Shares should consult their own tax
advisors as to the applicability of any such collateral consequences.

Company expenses.  We have incurred or will incur various expenses in connection
with our ongoing  administration  and operation.  Payment for services generally
are  deductible  if the  payments  are  ordinary  and  necessary  expenses,  are
reasonable in amount and are for services  performed  during the taxable year in
which paid or accrued.  We anticipate that a substantial portion of our ordinary
expenses will be allocable to tax-exempt interest income. The Code prohibits the
deduction  of any expense  otherwise  allowable  under Code Section 212 which is
allocable to tax-exempt  interest income. We allocate our expenses in proportion
to the  amount  of  tax-exempt  income  and  taxable  income  that  we  receive.




                                       37
<PAGE>



Shareholders  generally  will not be  permitted  to deduct  the  portion  of our
expenses  related to tax-exempt  income in calculating  their federal income tax
liability.  Borrowers pay certain fees they incur in connection  with  obtaining
financing  from us  directly to Related  Capital.  We treat these fees as earned
directly  by  Related  Capital  for  services  Related  Capital  renders  to the
borrowers. It is possible that the IRS could contend such fees should be treated
as additional taxable income to us and additional expense. If such position were
asserted  and  upheld,  it would  result in us  recognizing  additional  taxable
income,  but all or a  substantial  portion of the  additional  expense would be
disallowed. In addition,  depending on the amount of such income relative to our
other  income,  it  could  result  in us  being  treated  as a  publicly  traded
partnership taxable as a corporation.

The IRS may not agree with our  determinations  as to the  deductibility of fees
and  expenses  and might  require  that  certain  expenses  be  capitalized  and
amortized or  depreciate  d over a period of years.  If all or a portion of such
deductions  were to be  disallowed,  on the  basis  that  some of the  foregoing
expenses are  non-deductible  syndication fees or otherwise,  our taxable income
would be increased or our losses would be reduced.

An  individual  shareholder's  share of expenses of our Company  (not  including
interest  expenses) is a  miscellaneous  itemized  deduction which is deductible
only to the extent  it,  along with  other  miscellaneous  itemized  deductions,
exceeds 2% of such  individual  shareholder's  adjusted  gross income and is not
deductible for purposes of determining AMT.

Section  754  election.  We have not  elected  under  Section 754 of the Code to
adjust the basis of  partnership  property  on the  transfer  of Shares,  by the
difference  between the  transferee's  basis for his Shares and the transferee's
allocable  share of the basis of all property of our  Company,  but may do so in
the future. Any such election would not apply to the contribution of cash to our
Company in exchange for our Shares.

Backup  withholding.  Distributions to shareholders whose Common Shares are held
on their behalf by a "broker" may  constitute  "reportable  payments"  under the
federal income tax rules regarding  "backup  withholding."  Backup  withholding,
however,  would apply only if the  shareholder  (i) failed to furnish its Social
Security number or other taxpayer identification number of the person subject to
the backup  withholding  requirement  (e.g.,  the "broker") or (ii) furnished an
incorrect Social Security number or taxpayer  identification  number. If "backup
withholding" were applicable to a shareholder, we would be required to withhold,
at the applicable  rate, with respect to each  distribution to such  shareholder
and to pay such amount to the IRS on behalf of such shareholder.

Issuance of additional  Shares. We may issue new Shares to additional  investors
to finance  the  acquisition  of  additional  investments.  On any  issuance  of
additional  Shares,  we expect that we will  adjust the capital  accounts of the
existing  shareholders  to reflect a revaluation of our property (based on their
then fair market value, net of liabilities to which they are then subject).

Tax returns,  audits, interest and penalties. We will supply Schedule K-1 to IRS
Form 1065 to each  shareholder of record as of the last day of each month during
a taxable  year after the end of each  calendar  year.  We are not  obligated to
provide tax information to persons who are not shareholders of record.

Any shareholder who sells or transfers a Common Share will be required to notify
us of such  transaction  in writing  within 30 days of the  transaction  (or, if
earlier,  by  January  25 of the  calendar  year  after  the year in  which  the
transaction  occurs).  The notification is required to include (i) the names and
addresses of the transferor and the transferee, (ii) the taxpayer identification
number of the transferor  and, if known, of the transferee and (iii) the date of
the sale or exchange.  A shareholder  will not be required to notify our Company
of a sale or exchange of a Common Share if an information  return is required to
be filed by a broker with respect to such sale or exchange.  Any  transferor who
fails to notify  our  Company  of a sale or  exchange  may be  subject  to a $50
penalty for each such  failure.  We will treat any  transferor  shareholder  who
provides all of the  information  requested of the  transferor on the depositary
receipt as having satisfied this notification requirement.



                                       38
<PAGE>



In addition,  we must file a return notifying the IRS of any sale or exchange of
a Common  Share of which we have  notice and report the name and  address of the
transferee and the transferor who were parties to such  transaction,  along with
all other  information  required by applicable  temporary and proposed  treasury
regulations,  including  the  fair  market  value of the  selling  shareholder's
allocable share of unrealized receivables (including  depreciation recapture, if
any).  If we do not know the  identity  of the  beneficial  owner of the  Common
Share,  the record holder of such Common Share may be treated as the  transferor
or transferee, as the case may be.

State,  local and foreign  income taxes.  In addition to the federal  income tax
consequences  described  above,  shareholders  should consider  potential state,
local and  foreign  tax  consequences  of an  investment  in us and are urged to
consult their individual tax advisors in this regard.  The rules of some states,
localities and foreign  jurisdictions  for computing  and/or  reporting  taxable
income may differ from the federal rules. Interest income that is tax-exempt for
federal  purposes is generally  subject to state  taxes,  except in the state in
which the property securing our investment and the bond issuer are located.  All
the bonds and interest  income  thereon may be subject to taxation by localities
and foreign jurisdictions. An investment in our Common Shares could also require
our shareholders to file tax returns in various  jurisdictions,  although we are
not aware of any current filing obligations.

Under the tax laws of  certain  states,  we may be  subject  to state  income or
franchise tax or other taxes applicable to our Company.  Such taxes may decrease
the amount of  distributions  available to our  shareholders.  Shareholders  are
advised to consult with their tax advisors  concerning  the tax treatment of our
Company,  and the effects under the tax laws of the states  applicable to us and
our shareholders.

The summary tax consequences set forth above is for general information only and
does not address the  circumstances  of any particular  shareholder.  You should
consult  your  own tax  advisors  as to the  specific  tax  consequences  of the
purchase,   ownership  and  disposition  of  our  Common  Shares  including  the
application of state, local and foreign tax laws.


                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS


     This  re-offer  prospectus  and  the  information  incorporated  herein  by
reference  contain  certain  statements  and  other  written  material  and oral
statements  made from time to time by us do not relate strictly to historical or
current facts. As such, they are considered "forward-looking  statements" within
the  meaning of the  Private  Securities  Litigation  Reform Act of 1995.  These
forward-looking statements are not historical facts, but rather are based on our
current expectations,  estimates and projections about our industry, beliefs and
assumptions.   Words  such  as  "anticipates,"  "expects,"  "intends,"  "plans,"
"believes,"  "seeks,"  "estimates"  and  similar  expressions  are  intended  to
identify  forward-looking  statements.  These  statements  are not guarantees of
future  performance and are subject to risks,  uncertainties  and other factors,
some of which are beyond our control,  are  difficult to predict and could cause
actual results to differ  materially  from those  expressed or forecasted in the
forward-looking statements. These risks and uncertainties are described in "Risk
Factors" and elsewhere in this re-offer prospectus.  We caution you not to place
undue reliance on these forward-looking statements,  which reflect our view only
as of the respective  date of this re-offer  prospectus or other dates which are
specified herein.


                                 USE OF PROCEEDS


     CharterMac will not receive any proceeds from the sale of the Common Shares
which may be sold pursuant to this re-offer  prospectus  for the accounts of the
Selling  Securityholders.  All such proceeds, net of brokerage  commissions,  if
any,   will  be   received  by  the  Selling   Securityholders.   See   "Selling
Securityholders" and "Plan of Distribution."



                                       39
<PAGE>


                             SELLING SECURITYHOLDERS


     This re-offer  prospectus  covers offers and sales from time to time by the
Selling  Securityholders of up to 1,025,867 Common Shares issued or to be issued
to the Selling  Securityholders  (i) upon exercise of options granted to Stephen
Ross pursuant to the Ross Option Agreement and (ii) pursuant to the terms of the
Restricted   Plan.   Under  Rule  416  of  the   Securities   Act,  the  Selling
Securityholders  may also offer and sell  Common  Shares  issued to the  Selling
Securityholders  as a  result  of,  among  other  events,  stock  splits,  stock
dividends and similar events that affect the number of Common Shares held by the
Selling  Securityholders.  The Selling  Securityholders  are  affiliates  of the
Company pursuant to Rule 144 of the Securities Act.

     The following  table sets forth certain  information  as to the  beneficial
ownership of CharterMac's Common Shares as of November 21, 2003 for each Selling
Securityholder:

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------------
Name                   Relationship      Common Shares   Percentage  Common         Common Shares    Percentage
                       to the            Beneficially    of Common   Shares         Beneficially     of Common
                       Company           Owned Before    Shares      Offered        Owned After      Shares to
                                         Offering (1)    Owned                      Offering (1)     be Owned
                                                         Before                                      After
                                                         Offering                                    Offering
---------------------------------------------------------------------------------------------------------------
<S>                                      <C>             <C>         <C>            <C>              <C>
---------------------------------------------------------------------------------------------------------------
Stephen M. Ross        Chairman of
                       the Board of
                       Trustees of
                       CharterMac        11,257,661(2)   17.1%       1,000,000      10,257,661       15.6%
---------------------------------------------------------------------------------------------------------------
Stuart A. Rothstein    Chief Financial
                       Officer of
                       CharterMac        66,867(3)       *              25,867          41,000       *
---------------------------------------------------------------------------------------------------------------
</TABLE>

*less than 1%

(1)  The  number  of  shares   beneficially  owned  is  determined  under  rules
promulgated  by  the  Commission  and  includes  outstanding  Common  Shares  or
restricted  Common Shares and options for Common Shares that have vested or will
vest within 60 days.

(2) Includes 255,487 Common Shares, 10,000,000 special common units of CCC which
are  convertible  on a one-to-one  basis into Common  Shares;  2,174 options for
Common  Shares that are  exercisable  within 60 days of November 21,  2003;  and
1,000,000 options exercisable for Common Shares thereafter.

(3) Includes  1,000 Common  Shares;  25,867  restricted  Common  Shares;  13,333
options for Common Shares  exercisable  within 60 days of November 21, 2003; and
26,667 options exercisable for Common Shares thereafter.



                              PLAN OF DISTRIBUTION


Common  Shares  offered  hereby may be sold from time to time  directly by or on
behalf of the Selling  Securityholders  in one or more transactions on any stock
exchange or stock market on which the Common Shares may be listed at the time of
sale, in privately  negotiated  transactions,  or through a combination  of such
methods,  at market prices  prevailing at the time of sale, at prices related to
such  prevailing  market  prices,  at fixed prices  (which may be changed) or at
negotiated  prices.  The  Selling  Securityholders  may sell the  Common  Shares
through one or more agents,  brokers or dealers or directly


                                       40
<PAGE>



to purchasers.  Such brokers or dealers may receive  compensation in the form of
commissions,  discounts or concessions from the Selling  Securityholders  and/or
purchasers of the Common Shares or both (which  compensation  as to a particular
broker or dealer may be in excess of customary commissions).

In connection with such sales, the Selling Securityholders and any participating
broker or dealer may be deemed to be  "underwriters"  within the  meaning of the
Securities Act, and any commissions they receive and the proceeds of any sale of
Common Shares may be deemed to be underwriting  discounts and commissions  under
the Securities Act.

In order to comply with certain state securities laws, if applicable, the Common
Shares may be sold in certain  jurisdictions only through registered or licensed
brokers or dealers.  In certain states, the Common Shares may not be sold unless
the Common Shares have been registered or qualified for sale in such state or an
exemption from  regulation or  qualification  is available and is complied with.
Sales of Common  Shares  must  also be made by the  Selling  Securityholders  in
compliance with all other applicable state securities laws and regulations.

In addition to any Common Shares sold hereunder, Selling Securityholders may, at
the same time,  sell any Common  Shares of  beneficial  interest,  including the
Common Shares,  owned by them in compliance with all of the requirements of Rule
144, regardless of whether such shares are covered by this re-offer prospectus.

There can be no assurance that the Selling  Securityholders will sell any or all
of the  Common  Shares  offered  hereby.  In  addition,  there  may  be  certain
contractual  restrictions on the ability of the Selling  Securityholders to sell
any or all of their Common Shares.

The Company will pay all expenses of the  registration  of the Common Shares and
will not receive any proceeds  from the sale of any Common Shares by the Selling
Securityholders.

The Company has  notified the Selling  Securityholders  of the need to deliver a
copy of this  re-offer  prospectus  in  connection  with any sale of the  Common
Shares.


                                 LEGAL MATTERS


     Certain  legal  matters  have been  passed  upon for us by Paul,  Hastings,
Janofsky & Walker LLP, New York, New York. The validity of the restricted Common
Shares  have been  passed  upon for us by  Richards,  Layton and  Finger,  P.A.,
Wilmington, Delaware.


                                     EXPERTS


     The consolidated  financial  statements and the related financial statement
schedule  incorporated in this re-offer  prospectus by reference from our annual
report  on Form 10-K for the  fiscal  year  ended  December  31,  2002 have been
audited  by  Deloitte & Touche  LLP,  independent  auditors,  as stated in their
report which is incorporated herein by reference,  and have been so incorporated
in reliance  upon the report of such firm given upon their  authority as experts
in accounting and auditing.



                                       41
<PAGE>



                           1,025,867 COMMON SHARES OF

                                   CHARTERMAC


                               RE-OFFER PROSPECTUS


                                NOVEMBER 25, 2003





                                       42
<PAGE>



                                  PART II
              INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Documents by Reference

     The following documents and information previously filed by Registrant with
the  Commission  are  hereby  incorporated  by  reference  in this  Registration
Statement:

          (a) The Company's Annual Report on Form 10-K for the fiscal year ended
     December 31, 2002,  filed with the Commission on April 2, 2003  (Commission
     File No. 001-13237);

          (b) The Company's  Quarterly Report on Form 10-Q for the period ending
     September  30,  2003,  filed  with the  Commission  on  November  14,  2003
     (Commission File No. 001-13237)

          (c) The Company's  Quarterly Report on Form 10-Q for the period ending
     June 30, 2003,  filed with the  Commission  on August 14, 2003  (Commission
     File No. 001-13237);

          (d) The Company's  Quarterly Report on Form 10-Q for the period ending
     March 31, 2003,  filed with the Commission on May 15, 2003 (Commission File
     No. 001-13237);

          (e) The Company's  Definitive  Proxy Statement dated September 5, 2003
     on  Schedule  14A  prepared  in  connection  with  our  Annual  Meeting  of
     Shareholders held on November 17, 2003 (Commission File No. 001-13237);

          (f) The Company's Current Report on Form 8-K filed with the Commission
     on October 31, 2003 (Commission File No. 001-13237); and

          (g) The Company's Current Report on Form 8-K filed with the Commission
     on September 8, 2003 (Commission File No. 001-13237).

All  documents  subsequently  filed by the Company  pursuant to Sections  13(a),
13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment that  indicates  that all  securities  offered have been sold or which
deregisters  all  securities  then  remaining  unsold,  shall  be  deemed  to be
incorporated by reference in this Registration Statement and to be a part hereof
from the respective dates of the filing of those documents.

Any  statement  contained  herein  or  in a  document  incorporated,  or  deemed
incorporated,  by reference  herein or therein shall be deemed to be modified or
superseded  for  purposes  of the  Registration  Statement  to the extent that a
statement  contained  herein  or  therein  or in any  other  subsequently  filed
document which also is deemed to be incorporated by reference  herein or therein
modifies or supersedes such statement. Any such statement shall not be deemed to
constitute a part of this Registration  Statement or the Prospectus except as so
modified or replaced.

Item 4. Description of Securities

     Not Applicable.

Item 5. Interests of Named Experts and Counsel

     Not Applicable.

Item 6. Indemnification of Trustees and Officers


<PAGE>


     Section  3817(a)  of the  Delaware  Code  authorizes  a  business  trust to
indemnify  and hold harmless any trustee,  or  beneficial  owner or other person
from and against any and all claims and demands whatsoever.  Section 14.1 of our
Company's Amended and Restated Trust Agreement provides for the  indemnification
of directors and officers. Article XII of the Registrant's By-laws also provides
for indemnification of its officers.

     In addition to the above, our Company has purchased and maintains insurance
on  behalf of all of its  trustees  and  executive  officers  against  liability
asserted  against or  incurred  by them in their  official  capacities  with our
Company,  whether or not our Company is  required or has the power to  indemnify
them against the same liability.

Item 7. Exemption from Registration Claimed

     Not Applicable

Item 8. Exhibits.

<TABLE>
<CAPTION>

Exhibit No.   Description
-----------   -----------
<S>           <C>

3.1            Certificate of Business Trust of the Registrant*

3.2            Certificate of Amendment of Certificate of Business Trust of the
               Registrant, dated as of April 30, 1997*

3.3            Certificate of Amendment of the Restated Certificate of Trust of
               the Registrant, dated as of November 17, 2003**

3.4            Second Amended and Restated Trust Agreement of the Registrant,
               dated as of November 17, 2003**

3.5            Second Amended and Restated Bylaws of the Registrant, dated as of
               November 17, 2003**

4.1            Specimen Share Certificate**

4.2            Chartermac Restricted Share Plan**

4.3            Chartermac Ross Non-Qualified Share Option Agreement**

5.1            Opinion of Richards, Layton & Finger, P.A. regarding the legality
               of the securities being registered**

23.1           Consent of Deloitte & Touche LLP**

23.2           Consent of Richards, Layton & Finger, P.A.(included in Exhibit
               5.1)**

24.1           Power of Attorney (included on signature page hereto)**

99.1           Registration Rights Agreement, dated November 17, 2003**
</TABLE>

*       Previously Filed.

**      Filed Herewith.

                                       2
<PAGE>



Item 9.Undertakings

     The Company hereby undertakes:

     A. (1) To file, during any period in which it offers or sells securities, a
post-effective amendment to this Registration Statement to;

     (i) Include any prospectus  required by Section  10(a)(3) of the Securities
Act;

     (ii) Reflect in the prospectus any facts or events which,  individually  or
together,  represent a fundamental change in the information in the Registration
Statement.  Notwithstanding the foregoing, any increase or decrease in volume of
securities  offered (if the total dollar value of  securities  offered would not
exceed that which was  registered) and any deviation from the low or high end of
the estimated  maximum offering range may be reflected in the form of prospectus
filed with the  Commission  pursuant  to Rule 424(b) if, in the  aggregate,  the
changes in volume and price  represent  no more than a 20 percent  change in the
maximum  aggregate  offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement; and

     (iii)Include any additional or changed material  information on the plan of
distribution; provided, however, that the statements in paragraphs (A)(1)(i) and
(A)(1)(ii)  do  not  apply  if  the  information  required  in a  post-effective
amendment  is  incorporated  by reference  from  periodic  reports  filed by the
Company under the  Securities  Exchange Act of 1934,  as amended (the  "Exchange
Act").

     (2) That, for  determining  liability  under the Securities Act, treat each
such post-effective  amendment as a new registration statement of the securities
offered,  and the offering of the securities at that time to be the initial bona
fide offering.

     (3) To file a post-effective  amendment to remove from  registration any of
the securities that remain unsold at the end of the offering.

     (B) That  insofar as  indemnification  for  liabilities  arising  under the
Securities Act may be permitted to trustees, officers and controlling persons of
the Company pursuant to the foregoing provisions,  or otherwise, the Company has
been  advised  that in the opinion of the  Commission  such  indemnification  is
against  public  policy as expressed in the  Securities  Act and is,  therefore,
unenforceable.

     In the event  that a claim for  indemnification  against  such  liabilities
(other  than the  payment  by the  Company  of  expenses  incurred  or paid by a
director, officer or controlling person of the Company in the successful defense
of any action,  suit or  proceeding)  is asserted  by such  trustee,  officer or
controlling  person in connection  with the  securities  being  registered,  the
Company  will,  unless in the opinion of its counsel the matter has been settled
by  controlling  precedent,  submit to a court of appropriate  jurisdiction  the
question  whether  such  indemnification  by  it is  against  public  policy  as
expressed in the Securities  Act and will be governed by the final  adjudication
of such issue.



                                       3
<PAGE>



                                   SIGNATURES

Pursuant to the  requirements  of the  Securities  Act of 1933,  the  registrant
certifies  that it has  reasonable  grounds to believe  that it meets all of the
requirements  for  filing  on Form S-8 and has  duly  caused  this  registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the City of New  York,  State of New  York,  on this 24th day of
November, 2003.

                                     CHARTERMAC
                                     A Delaware statutory trust(registrant)



                                     By: /s/ Stuart J. Boesky
                                         --------------------
                                         Stuart J. Boesky
                                         Chief Executive Officer

                                POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Stuart
J.  Boesky and  Stuart A.  Rothstein,  and each or either of them,  his true and
lawful  attorney-in-fact  with full power of substitution and resubstitution and
revocation,  for each of him and in his name,  place,  and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
and additions to this registration  statement,  and to file or cause to be filed
the  same,  with  all  exhibits  thereto,  and  other  documents  in  connection
therewith,  with the Securities and Exchange  Commission,  and hereby grant unto
such  attorneys-in-fact  and agents,  and each of them, the full power to do and
perform each and every act and thing  requisite  and necessary to be done in and
about the foregoing,  as fully to all intents and purposes, as each of him might
or  could  do  in  person,   hereby  ratifying  and  confirming  all  that  said
attorneys-in-fact  and agents, or any of them, or their respective  substitutes,
may lawfully do or cause to be done by virtue hereof.

Pursuant to the  requirements of the Securities Act of 1933,  this  registration
statement has been signed by the following  persons in the capacities and on the
dates indicated.


<TABLE>
<CAPTION>


Signature                        Title                         Date
<S>                              <C>                           <C>

/s/ Stuart J. Boesky             Managing Trustee and          November 24, 2003
------------------------------   Chief Executive Officer
        Stuart J. Boesky

/s/ Stephen M. Ross              Managing Trustee and          November 24, 2003
---------------------------      Chairman of the Board
        Stephen M. Ross

/s/ Marc D. Schnitzer            Managing Trustee and          November 24, 2003
---------------------------      President
        Marc D. Schnitzer

/s/ Alan P. Hirmes               Managing Trustee and          November 24, 2003
---------------------------      Chief Operating Officer
        Alan P. Hirmes

/s/ Denise L. Kiley              Managing Trustee and          November 24, 2003
---------------------------      Chief Credit Officer
        Denise L. Kiley
</TABLE>



                                       4
<PAGE>


<TABLE>
<CAPTION>


Signature                        Title                         Date
<S>                              <C>                           <C>

/s/ Peter T. Allen               Managing Trustee              November 24, 2003
---------------------------
        Peter T. Allen

/s/ Charles L. Edson             Managing Trustee              November 24, 2003
---------------------------
        Charles L. Edson

/s/ Arthur P. Fisch              Managing Trustee              November 24, 2003
---------------------------
        Arthur P. Fisch

/s/ Thomas W. White              Managing Trustee              November 24, 2003
---------------------------
        Thomas W. White

/s/ Jeff T. Blau                 Managing Trustee              November 24, 2003
---------------------------
        Jeff T. Blau

/s/ Robert A. Meister            Managing Trustee              November 24, 2003
---------------------------
        Robert A. Meister

/s/ Jerome Y. Halperin           Managing Trustee              November 24, 2003
---------------------------
        Jerome Y. Halperin

/s/ Janice Cook Roberts          Managing Trustee              November 24, 2003
---------------------------
        Janice Cook Roberts

/s/ Nathan Gantcher              Managing Trustee              November 24, 2003
---------------------------
        Nathan Gantcher

/s/ Robert L. Loverd             Managing Trustee              November 24, 2003
---------------------------
        Robert L. Loverd
</TABLE>



                                       5
<PAGE>



                                INDEX TO EXHIBITS
                                   CHARTERMAC

<TABLE>
<CAPTION>


Exhibit No.    Description
-----------    -----------
<S>            <C>
3.1            Certificate of Business Trust of the Registrant*

3.2            Certificate of Amendment of Certificate of Business Trust of the
               Registrant, dated as of April 30, 1997*

3.3            Certificate of Amendment of the Restated Certificate of Trust of
               the Registrant, dated as of November 17, 2003**

3.4            Second Amended and Restated Trust Agreement of the Registrant,
               dated as of November 17, 2003**

3.5            Second Amended and Restated Bylaws of the Registrant, dated as of
               November 17, 2003**

4.1            Specimen Share Certificate**

4.2            Chartermac Restricted Share Plan**

4.3            Chartermac Ross Non-Qualified Share Option Agreement**

5.1            Opinion of Richards, Layton & Finger, P.A. regarding the legality
               of the securities being registered**

23.1           Consent of Deloitte & Touche LLP**

23.2           Consent of Richards, Layton & Finger, P.A.(included in Exhibit
               5.1)**

24.1           Power of Attorney (included on signature page hereto)**

99.1           Registration Rights Agreement, dated November 17, 2003**
</TABLE>

*       Previously Filed.

**      Filed Herewith.
[{"type": "S-8", "sequence": "1", "filename": "s8.txt", "secsgml_size_bytes": 207884}]
{"company-data": {"conformed-name": "CHARTER MUNICIPAL MORTGAGE ACCEPTANCE CO", "cik": "0001043325", "assigned-sic": "6500", "irs-number": "133916825", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-110722", "film-number": "031021485"}, "business-address": {"street1": "625 MADISON AVENUE", "city": "NEW YORK", "state": "NY", "zip": "10022", "phone": "2124215333"}, "mail-address": {"street1": "625 MADISON AVENUE", "city": "NEW YORK", "state": "NY", "zip": "10022"}}
As Filed With the Securities and Exchange Commission on November 24, 2003

                                                          Registration No. 333-

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM S-8

                        REGISTRATION STATEMENT UNDER THE
                             SECURITIES ACT OF 1933

                                   CHARTERMAC
             (Exact Name of Registrant as Specified in Its Charter)

                Delaware                        13-3949418
      (State or Other Jurisdiction           (I.R.S. Employer
    of Incorporation or Organization)     Identification Number)

                             625 Madison Avenue
                         New York, New York 10022
                              (212) 421-5333
(Address, Including Zip Code, and Telephone Number, Including Area Code,
               of Registrant's Principal Executive Offices)

                        CharterMac Restricted Share Plan
                      Non-Qualified Share Option Agreement
                            (Full Title of the Plans)

      Stuart J. Boesky                                With copies to:
    Chief Executive Officer                        Mark Schonberger, Esq.
     625 Madison Avenue                   Paul, Hastings, Janofsky & Walker LLP
 New York, New York 10022                          75 East 55th Street
      (212) 317-5700                             New York, New York 10022
(Name, Address, Including Zip Code,                   (212) 318-6000
and Telephone Number, Including
Area Code, of Agent For Service)
CALCULATION OF REGISTRATION FEE
================================================================================================
                                         Proposed maximum   Proposed maximum
Title of securities     Amount to be      offering price        aggregate          Amount of
  to be registered       registered          per share       offering price    registration fee
------------------------------------------------------------------------------------------------
Common Shares of
Beneficial Interest   1,136,108 shares(1)    $19.50(3)          $22,154,106.00   $1,792.27

Common Shares of
Beneficial Interest   1,000,000 shares(2)    $17.78(4)          $17,780,000.00   $1,438.40

Total                 2,136,108 shares                                           $3,230.67
------------------------------------------------------------------------------------------------
(1) Represents 1,136,108 common shares of beneficial interest (the "Common
Shares") reserved for issuance pursuant to the CharterMac Restricted Share Plan
(the "Restricted Plan") plus such indeterminate amount of additional shares as
may become issuable pursuant to the anti-dilution provisions contained in the
Restricted Plan.
    (2) Represents 1,000,000 Common Shares issuable upon the exercise of options
granted to Stephen M. Ross by a Non-Qualified Share Option Agreement between the
Company and Stephen M. Ross (the "Ross Option Agreement") plus such
indeterminate amount of additional shares as may become issuable pursuant to the
anti-dilution provisions contained therein.
    (3) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(h) of the Securities Act, on the basis of
the average of the high and low prices of the Company's Common Shares as
reported by the American Stock Exchange on November 21, 2003.
    (4) Calculated in accordance with Rule 457(h) as this amount represents the
exercise price of the options granted pursuant to the Ross Option Agreement.
PART I

              INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

                             Explanatory Note

     CharterMac  ("CharterMac" or the "Company") has prepared this  Registration
Statement in accordance  with the  requirements of Form S-8 under the Securities
Act to register:  (a) the issuance of common shares of beneficial  interest (the
"Common  Shares") upon the exercise of options being granted to Stephen M. Ross,
a principal of Related  Capital  Company,  a subsidiary of CharterMac  ("Related
Capital") and CharterMac's  non-executive  chairman pursuant to the terms of the
Ross Non-Qualified Share Option Agreement (the "Ross Option Agreement"); and (b)
the issuance of restricted Common Shares to certain employees of Related Capital
pursuant to the terms of  CharterMac's  Restricted  Share Plan (the  "Restricted
Plan").

     This Registration  Statement  contains two parts. The first part contains a
prospectus  prepared  in  accordance  with  Part I of S-8  (in  accordance  with
Instruction  C of the General  Instructions  to Form S-8),  including a re-offer
prospectus  that may be used for  re-offerings  and  re-sales  of Common  Shares
acquired  by  the  selling  shareholders  listed  on  page  39 of  the  re-offer
prospectus.  These selling  shareholders are affiliates of CharterMac as defined
in Rule 405 of the  Securities Act of 1933, as amended (the  "Securities  Act").
The second part  contains  information  required in the  Registration  Statement
pursuant to Part II of Form S-8.

     The documents relating to the Ross Option Agreement and the Restricted Plan
previously have been, or will be, sent or given to the  participants  thereunder
and are filed with the Commission as part of this Registration Statement.  These
documents  and the  documents  incorporated  by reference  in this  Registration
Statement  pursuant  to  Item 3 of Part II of this  Form  S-8,  taken  together,
constitute  a prospectus  that meets the  requirements  of Section  10(a) of the
Securities Act.

                                        i
RE-OFFER PROSPECTUS

                           1,025,867 COMMON SHARES OF

                                   CHARTERMAC

     We are CharterMac ("CharterMac" or the "Company"), a statutory trust formed
under  the laws of the  State of  Delaware.  Our  common  shares  of  beneficial
interest (the "Common Shares") which are the subject of this re-offer prospectus
may be  offered  and  sold to the  public  by  Stephen  M.  Ross  and any  other
individuals who are deemed to be "affiliates"  under Rule 144 promulgated  under
the Act (the  "Selling  Securityholders")  who  shall be  issued  Common  Shares
pursuant to the terms of the Ross  Non-Qualified  Share  Option  Agreement  (the
"Ross Option Agreement") and CharterMac's Restricted Share Plan (the "Restricted
Plan"). We will issue the Common Shares to the Selling  Securityholders (i) upon
the exercise of options granted  pursuant to the Ross Option  Agreement and (ii)
pursuant to the terms of the Restricted Plan.

     The  Selling  Securityholders  may sell their  Common  Shares  directly  or
indirectly in one or more  transactions on any stock exchange or stock market on
which the  Common  Shares  may be listed at the time of the sale,  in  privately
negotiated  transactions,  or through a combination of such methods. These sales
may be at fixed prices (which may be changed),  at market  prices  prevailing at
the time of sale,  at prices  related  to such  prevailing  market  prices or at
negotiated prices.

     CharterMac's  Common Shares are listed on the American Stock Exchange under
the  symbol  CHC.  On  November  21,  2003,  the last  reported  sale  price for
CharterMac's Common Shares was $19.48 per share.

This re-offer  prospectus has been prepared for the purpose of  registering  the
Common  Shares  which are the  subject  of this  re-offer  prospectus  under the
Securities Act to allow for future sales by the Selling  Securityholders  to the
public. The Selling  Securityholders  may sell Common Shares through one or more
agents,  brokers or dealers or directly to  purchasers.  Such brokers or dealers
may receive  compensation in the form of  commissions,  discounts or concessions
from the Selling Securityholders and/or purchasers of the Common Shares, or both
(which  compensation  as to a  particular  broker or dealer  may be in excess of
customary   commissions).   In   connection   with  such   sales,   the  Selling
Securityholders  and any  participating  broker  or  dealer  may be deemed to be
"underwriters"  within the meaning of the  Securities  Act, and any  commissions
they receive and the  proceeds of any sale of Common  Shares may be deemed to be
underwriting discounts and commissions under the Securities Act. CharterMac will
not  receive  any  proceeds  from the sale of the Common  Shares by the  Selling
Securityholders.

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

        This investment involves a high degree of risk. Please see "Risk
Factors" beginning on page 3.

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

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

     This re-offer prospectus does not constitute an offer to sell securities in
any state to any person to whom it is unlawful to make such offer in such state.

          The date of this re-offer prospectus is November 25, 2003.

                                       ii
You should rely only on the  information  contained or incorporated by reference
in this re-offer  prospectus.  CharterMac has not authorized any other person to
provide you with  information  different from or additional to that contained or
incorporated   by   reference   in  this   re-offer   prospectus.   The  Selling
Securityholders  are offering to sell Common Shares only in jurisdictions  where
offers and sales are permitted. You should assume that the information appearing
in this re-offer  prospectus and the documents  incorporated by reference herein
and  therein is  accurate  only as of its  respective  date or as of other dates
which are  specified in these  documents.  Our  business,  financial  condition,
results of operations and prospects may have changed since these dates.

                           ADDITIONAL INFORMATION

     We have filed with the United  States  Securities  and Exchange  Commission
(the "Commission") a registration statement on Form S-8 under the Securities Act
to register the Common Shares offered hereby.  This re-offer  prospectus is part
of the registration statement. This re-offer prospectus does not contain all the
information  contained  in the  registration  statement  because we have omitted
certain parts of the  registration  statement in  accordance  with the rules and
regulations of the Commission.  Statements contained in this re-offer prospectus
regarding the contents of any contract or any other document to which  reference
is made are not necessarily complete, and, in each instance where a copy of such
contract  or other  document  has been filed as an  exhibit to the  registration
statement,  reference is made to the copy so filed,  each statement is qualified
in all respects by such reference. For further information,  we refer you to the
registration  statement,  which  you may read and copy at the  public  reference
facilities  maintained by the Commission at Judiciary  Plaza,  450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549 and at the Commission's Regional Offices
at  Citicorp  Center,  500 W.  Madison  Street,  Suite 1400,  Chicago,  Illinois
60661-2511.  You may  obtain  copies at the  prescribed  rates  from the  Public
Reference Section of the Commission at its principal office in Washington,  D.C.
You may call the Commission at 1-800-SEC-0330 for further  information about the
public  reference  rooms.  The  Commission  maintains  a web site that  contains
reports,  proxy  and  information  statements  and other  information  regarding
CharterMac. You may access the Commission's web site at http://www.sec.gov.

     We are subject to the informational requirements of the Securities Exchange
Act of 1934, as amended.  As a result,  we are required to file  reports,  proxy
statements and other  information  with the  Commission.  These materials can be
copied and inspected at the locations  described above at prescribed  rates. Our
Common Shares are listed on the American Stock Exchange under the symbol "CHC."

               INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

     The Commission  allows us to  "incorporate by reference" the information we
file with them, which means that we can disclose important information to you by
referring you to those documents.  The information  incorporated by reference is
considered to be part of this re-offer prospectus,  and information that we file
later  with  the  Commission  will  automatically   update  and  supersede  this
information.  We  incorporate  by reference the  documents  listed below and any
future filings we will make with the Commission  under Section 13(a),  13(c), 14
or 15(d) of the Securities Exchange Act of 1934:

     o    Our Annual Report on Form 10-K for the fiscal year ended  December 31,
          2002,  filed with the Commission on April 2, 2003 (Commission File No.
          001-13237);

     o    Our Quarterly  Report on Form 10-Q for the period ending September 30,
          2003,  filed with the Commission on November 14, 2003 (Commission File
          No. 001-13237);

     o    Our Quarterly Report on Form 10-Q for the period ending June 30, 2003,
          filed with the  Commission  on August 14,  2003  (Commission  File No.
          001-13237);

                                       iii
o    The  Company's  Quarterly  Report on Form 10-Q for the  period  ending
          March 31, 2003,  filed with the Commission on May 15, 2003 (Commission
          File No. 001-13237);

     o    Our Definitive Proxy Statement dated September 5, 2003 on Schedule 14A
          prepared in connection with our Annual Meeting of Shareholders held on
          November 17, 2003 (Commission File No. 001-13237);

     o    Our Current  Report on Form 8-K filed with the  Commission  on October
          31, 2003 (Commission File No. 001-13237); and

     o    Our Current  Report on Form 8-K filed with the Commission on September
          8, 2003 (Commission File No. 001-13237).

You may request a copy of these  filings  (not  including  the  exhibits to such
documents unless the exhibits are specifically  incorporated by reference in the
information  contained in this re-offer  prospectus),  at no cost, by writing or
telephoning us at the following address:

                                   CharterMac
                               625 Madison Avenue
                            New York, New York 10022
                               Attn: Brenda Abuaf
              Telephone requests may be directed to (212) 317-5700.

     This re-offer prospectus is part of a registration  statement we filed with
the  Commission.  You should  rely only on the  information  or  representations
provided in this re-offer  prospectus.  We have authorized no one to provide you
with different  information.  We are not making an offer of these  securities in
any state  where the offer is not  permitted.  You should  not  assume  that the
information  in this  re-offer  prospectus is accurate as of any date other than
the date on the front of the document.

     Statements  contained in this re-offer prospectus as to the contents of any
contract or document are not necessarily complete and in each instance reference
is made to the copy of that  contract  or  document  filed as an  exhibit to the
registration  statement or as an exhibit to another filing,  each such statement
being qualified in all respects by such reference and the exhibits and schedules
thereto.

                                       iv
RE-OFFER PROSPECTUS SUMMARY

     This summary highlights  information  included elsewhere in or incorporated
by  reference  in  this  re-offer  prospectus.  It may  not  contain  all of the
information  that is  important to you.  You should read the  following  summary
together  with  the  more  detailed  information  included  or  incorporated  by
reference in this  re-offer  prospectus,  including  risk factors  regarding our
business and the Common Shares being offered hereby.

In this re-offer prospectus, we refer to:

     o    CharterMac   together  with  its  subsidiaries   (unless  the  context
          otherwise requires) as "we," "us," "our," or "our Company";

     o    Charter Mac Corporation,  our wholly-owned subsidiary,  as "CM Corp.";
          and

     o    Related Capital Company,  our  newly-acquired  subsidiary and internal
          manager, as "Related Capital".

Our Company

     Overview

     We are CharterMac,  a statutory trust formed under the laws of the State of
Delaware.  We are principally engaged in the acquisition and ownership (directly
and indirectly  through our  subsidiaries) of federally  tax-exempt  multifamily
housing revenue bonds issued by various state or local governments,  agencies or
authorities  and other  investments  designed  to produce  federally  tax-exempt
income. Most of our investments are held indirectly through our subsidiaries.

     CM Corp. and our newly-acquired subsidiary,  Related Capital, conducts most
of our taxable  business.  CM Corp. (i)  originates  and services  mortgages for
third parties and (ii)  guarantees  tax credit equity returns and mortgage loans
for a fee.  Related  Capital  conducts  fee-generating  activities  and provides
management services to us.

     CM Corp.  currently owns approximately 84% of the outstanding capital stock
of PW Funding  Inc.  (which we refer to as "PW  Funding"),  a national  mortgage
banking firm specializing in multifamily  housing.  CM Corp.  expects to acquire
the  remaining  outstanding  capital  stock of PW Funding  over the next 6 to 18
months.

     Our Common  Shares are listed for trading on the  American  Stock  Exchange
under the symbol  "CHC." We have also issued two  separate  series of  preferred
shares designated  Convertible  Community  Reinvestment Act Preferred Shares. We
collectively refer to both series of our Convertible Community  Reinvestment Act
Preferred Shares as our "CRA Shares"  throughout this re-offer  prospectus.  Our
CRA Shares are entitled to the same  economic  benefits as our Common Shares but
receive a  preference  with  respect to  certain  regulatory  benefits.  Our CRA
Shares,  which are not listed on any exchange,  are convertible  into our Common
Shares.

     Tax Status

     We and our subsidiaries (excluding CM Corp. and PW Funding) are each either
classified as a partnership or  disregarded  for federal income tax purposes and
thus are not subject to federal income taxation. As such, we pass through to our
shareholders,  in  the  form  of  distributions,   income  (including  federally
tax-exempt  income) derived from our  investments  without paying federal income
tax on that income.  Although the exact  percentage will vary from time to time,
we estimate that for the year ending  December 31, 2003, no less than 95% of our
distributions to our shareholders will be excludable from
their gross income for federal income tax purposes.  For the calendar year ended
December 31, 2002, approximately 96% of our distributions consisted of federally
tax-exempt  income.  See "Risk  Factors--Risks  relating  to our Company and the
operation of our business--Our  classification as a publicly-traded  partnership
is not free  from  doubt  and  could be  challenged"  and  "Federal  Income  Tax
Considerations," below.

    Our Management

     We operate our day-to-day  activities and select our investments  utilizing
the  services  and  advice  provided  by  our  recently-acquired,   wholly-owned
subsidiary,  Related Capital, subject to the supervision and review of our board
of  trustees.  . See "- Our  Acquisition  of Related  Capital,"  below.  Related
Capital's  management  team has an average of 19 years of experience in the real
estate industry.

    Our Acquisition of Related Capital

     On November 17, 2003, we acquired  100% of the  ownership  interests in and
substantially  all of the  businesses  operated by Related  Capital  (other than
specific excluded interests).  The acquisition was structured so that the former
selling principals of Related Capital  contributed their ownership  interests in
Related Capital into CharterMac  Company,  LLC, a newly-formed  subsidiary of CM
Corp. which we refer to as "CCC", in exchange for  approximately  $282.8 million
of special common units in CCC. All of the selling  principals  were also issued
one special  preferred  voting share of our Company for each special common unit
they received.  The special  preferred voting shares have no economic  interest,
but entitle the holder thereof to one vote per special preferred voting share on
all matters  subject to a vote of the holders of our Common  Shares.  One of the
selling principals also received $50 million in cash.

     The  former  selling  principals  of  Related  Capital  included  its  four
executive managing partners (Stuart J. Boesky, Alan P. Hirmes, Marc D. Schnitzer
and Denise L. Kiley),  all of whom are members of our board of trustees,  and an
affiliate of The Related Companies,  L.P., a New York limited partnership with a
majority of its equity  controlled by Stephen M. Ross,  who is also the Chairman
of our board of trustees.

     As a result of the acquisition,  the beneficial ownership in our Company of
(i) Mr. Ross equals  approximately  15.0% and (ii) our  management and the other
selling principals (other than Mr. Ross) equals approximately 7.2%.

Securities That May Be Offered

     This re-offer prospectus relates to the offer and sale from time to time by
the persons listed under the "Selling  Securityholder"  section of this re-offer
prospectus  of up to  1,025,867  Common  Shares which may be issued (i) upon the
exercise  of options  granted  pursuant to the Ross  Option  Agreement  and (ii)
pursuant to the terms of the  Restricted  Plan.  We are  registering  the Common
Shares covered by this re-offer prospectus.

     We will not receive any cash proceeds from the sale of our Common Shares by
the Selling Securityholders.

Risk Factors

     Investing in our Common  Shares  involves  various  risks.  In  considering
whether to purchase our Common Shares, you should carefully consider the matters
discussed under "Risk Factors" beginning on page 3 of this re-offer prospectus.

                                       2
RISK FACTORS

An  investment  in the Common Shares  offered  hereby  involves a high degree of
risk. You should  carefully  consider the following risk factors,  together with
all of the other  information  included or  incorporated  by  reference  in this
re-offer  prospectus  before you decide to purchase our Common Shares. If any of
the  following  risks  actually  occur,  our  business,  prospects,  results  of
operations and financial condition would likely suffer. In these  circumstances,
the market price of our Common  Shares and the value of our Common  Shares could
decline,  and you may lose all or part of the money  you paid to buy our  Common
Shares. This section includes or refers to certain forward-looking  information.
You should refer to the  explanation of the  qualifications  and  limitations on
such  forward-looking   information  discussed  on  page  39  of  this  re-offer
prospectus.

Risks related to investing in revenue bonds

Our income is subject to the risks of investments in affordable multifamily
rental residential properties.

We derive a large portion of our income by investing in revenue bonds secured by
affordable multifamily rental residential properties. Investing in such revenue
bonds subjects us to various types and degrees of risk that could adversely
affect the value of our assets and our ability to generate revenues, net income
and cash available for distributions to shareholders, including the following:

     -    the  property  securing a revenue  bond does not  generate  sufficient
          income to meet its  operating  expenses  and  payments  on its related
          revenue bond;

     -    local,  regional or national economic  conditions may limit the amount
          of rent that can be charged for rental  units at the  properties,  and
          may result in a reduction in rent  payments or the  timeliness of rent
          payments or a reduction in occupancy levels;

     -    occupancy  and  rent  levels  may  be  affected  by   construction  of
          additional  housing units and national,  regional and local  politics,
          including  current or future rent  stabilization and rent control laws
          and agreements;

     -    federal low income housing tax credits  ("LIHTCs") and city, state and
          federal housing subsidy or similar programs which apply to many of the
          properties  impose rent  limitations  and could  adversely  affect the
          ability to increase rents to generate the funds  necessary to maintain
          the properties in proper  condition,  which is particularly  important
          during  periods of rapid  inflation or declining  market value of such
          properties; and

     -    if a revenue bond  defaults,  the value of the property  securing such
          revenue bond (plus, for properties that have availed themselves of the
          federal  LIHTCs,  the  value  of such  credit)  may be less  than  the
          unamortized principal amount of such revenue bond.

We may suffer adverse consequences from changes in interest rates.

An  increase  in market  interest  rates may  reduce the  carrying  value of our
investments,  including  our  residual  interests in  tax-exempt  securitization
transactions,  decrease  the  amount  we  could  realize  on the  sale of  those
investments and adversely  affect the amount of funds available for distribution
to the common  shareholders.  Since a  significant  portion  of our  investments
represent  residual  interests in revenue bonds or other  securities  whose cash
flow is first used to pay senior  securities with short-term  floating  interest
rates,  any increase in  short-term  interest  rates will increase the amount of
interest  we are

                                       3
required to pay on the senior  securities  and reduce the cash
flow from our residual  interests and could adversely affect the market value of
our shares by reducing  the amount of cash  available  for  distribution  to our
shareholders.

A decrease in market  interest rates may lead to the  refinancing of some of the
revenue bonds we own, through  redemption thereof by the issuing entities or the
borrowers. We may not be able to reinvest the proceeds of any such redemption in
a comparable  revenue bond at an attractive rate of return. In addition,  we may
not be able to purchase new revenue bonds at the same interest  rates as we have
in the past. This may affect our ability to generate  sufficient  income to make
distributions and other payments in respect of our shares.

We have no recourse  against state or local  governments or property owners upon
default of our revenue  bonds or upon the  bankruptcy  of an owner of properties
securing our revenue bonds.

Although state or local  governments or their agencies or authorities  issue the
revenue bonds we purchase,  the revenue bonds are not general obligations of any
state or local  government.  No government is liable to repay the revenue bonds,
nor is the taxing power of any  government  pledged for the payment of principal
or interest on the revenue bonds. An assignment by the issuing government agency
or  authority  of the mortgage  loan to the owner of the related  properties  in
favor of a bond trustee on behalf of us or one of our  subsidiaries,  or in some
cases, an assignment directly to the bondholder,  secures the applicable revenue
bond we own.  The loan is secured  by a  mortgage  on the  related  property  or
properties  and an  assignment  of  rents.  The  underlying  mortgage  loans are
nonrecourse to the property owner other than customary  recourse  carve-outs for
bad acts such as fraud;  that is,  the  owners of the  properties  securing  the
revenue  bonds that we own are liable for the payment of principal  and interest
under the loans only to the extent of cash flow  from,  and sale or  refinancing
proceeds  of,  such  properties.  Accordingly,  the  revenue  derived  from  the
operation of the  properties  securing the revenue bonds that we own and amounts
derived from the sale,  refinancing  or other  disposition of the properties are
the sole sources of funds for payment of  principal  and interest on the revenue
bonds.

Our revenue may also be  adversely  affected  by the  bankruptcy  of an owner of
properties  securing the revenue  bonds that we directly or  indirectly  own. An
owner  of  properties  under  bankruptcy  protection  may be  able  to  forcibly
restructure its debt service payments and stop making, temporarily or otherwise,
debt  service  payments  to us.  Our  rights in this  event  would be defined by
applicable law.

Some of the properties underlying our revenue bonds are owned by charities.

As of September 30, 2003,  nine of our revenue bonds with an aggregate  carrying
value of  approximately  $84.9  million  were  issued on  behalf  of  non-profit
organizations  described in Section 501(c)(3) of the Code and finance low income
multifamily properties or facilities for the elderly. Because an allocation of a
state's  volume  cap is not  needed for these  revenue  bonds,  they may be more
readily  available than revenue bonds which require an allocation of volume cap.
However,  because  charities  are not  profit-motivated,  they  may not  operate
properties  as  efficiently  as  for-profit  owners.  Many  charities are thinly
capitalized  and are  unable  to  invest  significant  amounts  of  equity  into
affordable  multifamily  properties  acquired  by them.  This may  increase  the
likelihood of default because the charity (i) may not have the capital  required
to operate and maintain  the property if the cash flow  expected to be generated
by rental  income is less than expected or (ii) may be more willing to abandon a
property experiencing financial difficulty because its investment is minimal. In
addition,  investing  in revenue  bonds owned by  charities  is subject to other
risks, including:

     -    changes in governmental sponsorship of subsidized programs;

     -    subsidization of indigent persons who use their facilities,  which may
          reduce the cash flow  available to pay debt  service on revenue  bonds
          secured by such facilities;

                                       4
-    the  possibility  that a  charity's  status as an exempt  organization
          could be revoked or the  possibility  that the  property  is sold to a
          person  which  is not an  exempt  organization  that is  described  in
          Section  501(c)(3)  of  the  Code,  for  example,  as  a  result  of a
          foreclosure  sale,  thereby  resulting  in the interest on the revenue
          bonds issued for the benefit of such charity  becoming  includable  in
          gross income for purposes of federal income  taxation from the date of
          issue of the respective revenue bond; and

     -    the  inability of the owner of the revenue bond to recover  sufficient
          value in the event of a default and subsequent foreclosure, because of
          the loss of the  benefit  of the  tax-exempt  financing  and,  in some
          cases,  real  estate tax  abatements,  unless the  project is promptly
          resold to another qualifying non-profit organization.

There may be negative effects of requirements  with respect to rent restrictions
and permissible income of occupants of properties securing our revenue bonds.

All of the properties securing our revenue bonds are subject to certain federal,
state and/or local  requirements with respect to the permissible income of their
tenants.  The LIHTC  program  and,  often,  state or local law  establish a rent
ceiling for some or all tenants.  In addition,  pursuant to the Code, all of the
properties  securing our revenue bonds are required to have at least 20% (and in
the case of low income  properties  owned by most  charities,  up to 75%) of the
units reserved for occupancy by low or moderate income persons or families.  The
Code  provides  that,  as a general  rule,  for revenue bonds issued on or after
January 1, 1986, the income  limitations for low or moderate income tenants will
be adjusted for family size. Since federal subsidies are not generally available
in connection with the mortgage loans, rents must be charged on such portions of
the units at a level to permit such units to be continuously  occupied by low or
moderate  income  persons  or  families.  As a  result,  such  rents  may not be
sufficient  to cover all  operating  costs  with  respect to such units and debt
service on the related  revenue bond. In such event,  the rents on the remaining
units may have to be higher  than they would  otherwise  be and may,  therefore,
exceed  competitive  rents,  which may adversely  affect the occupancy rate of a
property securing an investment and the developer's ability to service its debt.

We are  subject to  construction  completion  and  rehabilitation  risks.

As of September  30, 2003,  revenue  bonds with an aggregate  carrying  value of
approximately  $484.4  million were secured by  affordable  multifamily  housing
properties  which are still in various stages of construction  and revenue bonds
with an aggregate carrying value of approximately $148.1 million were secured by
affordable  multifamily  housing  properties  which are  undergoing  substantial
rehabilitation.  Construction and/or rehabilitation of such properties generally
takes  approximately  12 to 24 months.  The principal risk  associated with this
type of lending is the risk of noncompletion  of construction or  rehabilitation
which may arise as a result  of:  (i)  underestimated  initial  construction  or
rehabilitation  costs; (ii) cost overruns;  (iii) delays; (iv) failure to obtain
governmental  approvals;   and  (v)  adverse  weather  and  other  unpredictable
contingencies beyond the control of the developer.  If a mortgage loan is called
due to construction and/or rehabilitation not being completed as required in the
mortgage  loan  documents,  we may incur certain costs and be required to invest
additional capital in order to preserve our investment.

The properties  securing certain of our revenue bonds,  which are currently in a
lease-up stage, may experience  financial distress if they do not meet occupancy
and debt service coverage levels sufficient to stabilize such properties.

As of September 30, 2003,  revenue bonds in our portfolio  with a carrying value
of approximately $476.1 million are secured by mortgages on properties which are
currently in a lease-up stage. The lease-up of these  underlying  properties may
not be  completed  on schedule or at  anticipated  rent  levels,  resulting in a
greater risk that such revenue  bonds may go into default than bonds  secured by
mortgages on  properties  that are fully  leased-up.  Moreover,  there can be no
assurance that the underlying  property will achieve expected  occupancy or debt
service coverage levels.

                                       5
Other  parties  may have the first right to income  from and  principal  of, and
control of foreclosure on, some of our investments.

As of the  date  of this  re-offer  prospectus,  a  substantial  portion  of our
investments  consist of revenue bonds that are  subordinated  or that  represent
interests in bonds,  notes or other  instruments  that may be junior in right of
payment to other bonds,  notes or  instruments.  There are risks in investing in
subordinated  revenue  bonds and other  junior  residual  interests  that  could
adversely affect our ability to make expected distributions to our shareholders,
including:

     -    the risk that  borrowers  may not be able to make payments on both the
          senior and the subordinated  revenue bonds or interests,  resulting in
          us, as a holder of the subordinated  revenue bond, receiving less than
          the full and timely payments of interest and principal;

     -    the risk that  short-term  interest  rates rise  significantly,  which
          would  increase  the  amounts  payable  to the  holders  of the senior
          interests created through our  securitizations  and reduce the amounts
          payable to us or our  subsidiaries  as holders of the junior  residual
          interests; and

     -    the possibility that the holders of the senior revenue bonds or senior
          interests created through our  securitizations may control the ability
          to enforce  remedies,  limiting our ability to take actions that might
          protect our interests.

Our  revenue bonds and mortgage loans may be considered usurious.

State  usury  laws  establish  restrictions,  in certain  circumstances,  on the
maximum rate of interest that may be charged by a lender and impose penalties on
parties making  usurious  loans,  including  monetary  penalties,  forfeiture of
interest and  unenforceability of the debt. Although we do not intend to acquire
revenue bonds secured by mortgage loans at usurious rates,  there is a risk that
our revenue  bonds and mortgage  loans could be found to be usurious as a result
of  uncertainties  in determining  the maximum legal rate of interest in certain
jurisdictions,  especially with respect to participating or otherwise contingent
interest.  Therefore, the amount of interest to be charged and our return on our
revenue bonds will be limited by state usury laws. In order to minimize the risk
of investing in a revenue bond at a usurious rate, our trust agreement  requires
us to obtain an opinion of local counsel to the effect that the interest rate of
a proposed  revenue bond is not  usurious  under  applicable  state law. We also
generally  obtain an opinion of local counsel to the effect that the interest on
the proposed mortgage loan is not usurious. To obtain such opinions, we may have
to agree to defer or reduce the amount of interest that can be paid in any year.
Some states may prohibit the compounding of interest,  in which case we may have
to agree to forego the  compounding  feature of our revenue bonds  originated in
those states.

Risks related to our taxable business

Our  subsidiaries'  fee-generating  activities  are  less  predictable  than our
tax-exempt  bond   investments  and  could  result  in  taxable  income  to  our
shareholders.

Our formation of CM Corp., acquisition of PW Funding and more recent acquisition
of  Related   Capital  further  changes  our  business  from  one  that  invests
substantially  all of our assets in tax-exempt bonds to one that, in addition to
tax-exempt  bond  investments,   conducts  significant   fee-generating  service
activities. These fee generating activities are significantly different from the
majority of our historical  investment business where revenue bonds are held and
income is generated primarily through receipt of interest payments.  Although we
expect that these service  businesses will generate  significant  growth for us,
they are inherently less  predictable than the ownership of tax-exempt bonds and
there can be no assurance that our subsidiaries'  fee-generating activities will
be profitable. In addition, the earnings and

                                       6
cash generated by the Related Capital business fluctuate between quarters due to
the  variability in the timing of investing in tax credit  partnerships  and the
seasonality  inherent in the timing of tax credit  equity  investments,  both of
which are primary drivers of the earnings and cash generated by Related Capital.
These  fluctuations  could be perceived  negatively  and,  therefore,  adversely
affect the price at which our shares trade.

In  addition,   the  portion  of  our  distributions  that  represent  federally
tax-exempt  income could  decrease based on the proportion of our future taxable
business.  If the taxable dividend income distributed by CM Corp. to us grows as
a percentage of our consolidated net income, if we invest in a larger percentage
of taxable investments or if we engage in other taxable fee generating business,
the  percentage  of our  net  income  distributed  to our  shareholders  that is
federally tax-exempt to them is likely to decrease.

There are risks  associated  with  Delegated  Underwriter  and Servicer  ("DUS")
lending.

Through PW  Funding's  DUS  program,  we  originate  loans which are  thereafter
purchased by Fannie Mae. PW Funding  retains a first loss  position with respect
to loans  that it  originates  and  sells to  Fannie  Mae.  PW  Funding  assumes
responsibility for a portion of any loss that may result from borrower defaults,
based on the  Fannie  Mae loss  sharing  formulas,  Levels I, II, or III.  As of
September 30, 2003, all of PW Funding's  loans  consisted of Level I loans.  For
such loans, PW Funding is responsible  for the first 5% of the unpaid  principal
balance  and a portion  of any  additional  losses  to a  maximum  of 20% of the
original  principal  balance.  Level II and Level III loans  carry a higher loss
sharing percentage. Any remaining loss is sustained by Fannie Mae.

Under the terms of the Master Loss Sharing  Agreement  between Fannie Mae and PW
Funding,  PW Funding is  responsible  for funding 100% of mortgagor  delinquency
(principal and interest) and servicing (taxes,  insurance and foreclosure costs)
advances until the amounts advanced exceed 5% of the unpaid principal balance at
the date of  default.  Thereafter,  for Level I loans,  PW Funding  may  request
interim  loss  sharing  adjustments  which  allow PW Funding to fund 25% of such
advances  until final  settlement  under the Master Loss Sharing  Agreement.  No
interim sharing adjustments are available for Level II and Level III loans.

There are risks associated with credit enhancement.

Through CM Corp.,  we provide credit  enhancement to third parties for a fee. If
such third  parties  default  on their  obligations  on which CM Corp.  provided
credit  enhancement,  CM Corp. would be called upon to make the related payment,
which  could be in an amount that is far in excess of the fee  obtained  for its
credit  enhancement.  In addition,  we usually guarantee CM Corp.'s  obligations
under its credit enhancement transactions. As of September 30, 2003, our maximum
risk associated with these credit  enhancement  transactions  was  approximately
$141.5 million.

Elimination of, or changes to, governmental programs.

A  significant  portion of  Related  Capital's  revenues  are  derived  from the
syndication of partnership interests in properties eligible for LIHTCs. Although
LIHTCs are a permanent part of the Internal  Revenue Code, as in the case of all
legislated  programs,  Congress  can  repeal or modify it at any time.  If it is
repealed  or  adversely  modified,  Related  Capital  would no longer be able to
generate  transactional  revenues and increase or maintain the base of recurring
revenues associated with these properties, as is currently contemplated.

First  loss and  non-investment  grade  subordinated  interests  are  subject to
increased risk of loss.

We  have  invested   indirectly  in  subordinated   Commercial  Mortgage  Backed
Securities ("CMBS") through our ownership of a preferred  membership interest in
ARCap Investors L.L.C.  ("ARCap").  Subordinated CMBS of the type in which ARCap
invests typically  include "first loss" and  non-investment  grade

                                       7
subordinated interests. A first loss security is the most subordinate class in a
structure  and  accordingly  is the  first to bear the loss  upon a  default  or
restructuring  or  liquidation  of the  underlying  collateral  and the  last to
receive  payment  of  interest  and  principal,  and is often  not  assigned  an
investment  rating.  Accordingly,  such classes are subject to a greater risk of
loss of principal and  non-payment of interest than more senior,  rated classes.
The  market  values of  subordinated  interests  in CMBS and other  subordinated
securities tend to be more sensitive to changes in economic conditions than more
senior,  rated  classes.  As a result of these and other  factors,  subordinated
interests  generally  are  not  actively  traded  and  are  relatively  illiquid
investments.  With respect to our  investment in ARCap,  our ability to transfer
our  membership  interest  in ARCap is  further  limited by the terms of ARCap's
operating agreement.

The inability to maintain Related  Capital's  current recurring fee arrangements
and to generate new  transaction  fees could have a negative impact on the price
of our shares.

Two of our major  revenue  sources will be the recurring  and  transaction  fees
payable  by  investment  programs  sponsored,  or to be  sponsored,  by  Related
Capital.  Recurring fees depend on the ongoing operation of investment  programs
sponsored by Related  Capital while  transaction  fees are generally  "up-front"
fees that are generated from the  sponsorship of new  investment  programs.  The
termination of one or more of these recurring fee arrangements, or the inability
to sponsor new programs which will generate new recurring and transaction  fees,
could adversely  affect our results of operations and reduce the market price of
our shares. There can be no assurance that existing fee arrangements will not be
terminated or that we will be able to realize  revenues  from these  existing or
any new fee arrangements.

The agreements  with companies and investment  programs  Related Capital manages
may not be renewed and may have finite terms.

Related  Capital  receives fees pursuant to an advisory  agreement with American
Mortgage Acceptance Company ("AMAC").  The AMAC advisory agreement is subject to
annual  renewal by AMAC,  which requires the approval of a majority of its board
of trustees.  In addition, a majority of the independent members of AMAC's board
may terminate this agreement  with Related  Capital with or without cause.  As a
result,  this agreement may not be renewed or may be terminated  with or without
cause.

Related Capital also receives fees from investment  programs Related Capital has
sponsored and may sponsor in the future that do not provide for annual elections
by investors of their management.  In connection with our acquisition of Related
Capital, we acquired  controlling  interests in the entities which control these
investment  programs which currently  generate  recurring fees.  However,  these
interests are subject to the  fiduciary  duty of the  controlling  entity to the
investors in those investment  programs which may affect our ability to continue
to collect fees from those investment programs.

Furthermore,   the  organizational  documents  of  substantially  all  of  these
investment  programs  allow for the  investors,  at their option,  to remove the
entity  controlled  by Related  Capital as general  partner or  managing  member
without cause.  Although the  investment  programs will generally be required to
pay fair market value if they exercise this right,  Related  Capital's  right to
receive  future  fees would  terminate  and there can be no  assurance  that the
payment will fully compensate us for this loss.

Finally,  many of these  investment  programs  typically  have finite periods in
which  they are  scheduled  to  exist,  after  which  they are  liquidated.  The
termination  of a  program  will  result in a  termination  of the fees we could
otherwise expect to receive from those programs.

Related  Capital's  business  is subject to  competition  and our  inability  to
compete  effectively in the future for financial  services business could reduce
the  revenues  we expect to  receive as a result of our  acquisition  of Related
Capital and negatively impact the price of our shares.

                                       8
Financial  services in the  multifamily  affordable  housing  industry is highly
competitive.  Related  Capital  competes  with  entities  that  possess  greater
financial  resources for (a) providing  financing to multifamily  developers and
(b) selling tax credit and other syndication funds to investors. Related Capital
also competes against numerous private  financial  service  providers as well as
state and federal  agencies.  Dominant  competitors  include  Enterprise  Social
Investment Corp., Sun America and Municipal Mortgage and Equity LLC.

Pursuant  to  Section 42 of the Code,  a fixed  number of  housing  credits  are
allocated  annually  to each  state  based on  population.  In 2002,  there were
approximately  2.5 times as many  applications by developers for a national pool
of approximately  $5 billion in tax credits as there were tax credits  available
for  allocation.  Related Capital is dependent upon the developers of tax credit
properties  to apply for and  obtain  tax  credits.  Related  Capital,  in turn,
contracts  with the  local  developer  for the  right to offer  the tax  credits
through  investment  programs  it  sponsors.   These  local  developers  include
independent  third  parties as well as  affiliates  of TRCLP.  Our  inability to
continue to arrange for the acquisition of tax credit  opportunities  from local
developers  or the inability of  developers  with whom Related  Capital has done
business  in the past to  continue  to obtain  tax credit  allocations  from the
states, may adversely affect our ability to achieve the anticipated  benefits of
our acquisition of Related Capital.

Related Capital relies on  relationships  with key investors and customers which
may not continue, which would adversely affect our ability to generate revenue.

Related  Capital relies on  relationships  with key investors and customers.  If
these relationships do not continue,  or if we are unable to create and form new
relationships,  our ability to generate revenue will be adversely  affected.  In
2002, five key investors provided approximately 72% of the equity capital raised
by tax credit  syndication  programs  sponsored  by Related  Capital with two of
those key investors providing approximately 47% of the capital. In addition, ten
key developers provided approximately 55% of the tax credit properties for which
Related Capital provided equity financing for in 2002. There can be no assurance
that we will be able to  continue to do business  with these key  investors  and
customers or that new relationships will be achieved.

General risks related to our Company

We and our  subsidiaries  depend on the  services  of Related  Capital's  senior
management team.

We and our subsidiaries  depend upon the services of Related  Capital's four key
employees  (Messrs.  Boesky,  Hirmes  and  Schnitzer  and Ms.  Kiley)  and other
individuals who comprise Related Capital's senior management team. All decisions
with respect to the management and control of our Company and our  subsidiaries,
subject  to  the  supervision  of our  board  of  trustees  (or  the  applicable
subsidiaries  board of directors),  are currently made exclusively by these four
key employees and Related  Capital's  senior  management  team.  This  includes,
without  limitation,  the determination as to how we and our subsidiaries choose
our  investments.  The departure or the loss of the services of any of these key
employees or a large number of senior  management  personnel and other employees
could have a material  adverse effect on our ability to effectively  operate our
business and our future results of operations.

Because  we  hold  most  of  our  investments  through  our  subsidiaries,   our
shareholders  are  effectively  subordinated  to the  liabilities  and preferred
equity of our subsidiaries.

We hold most of our  investments  through  our  subsidiaries.  Since we own only
common equity of our subsidiaries,  we, and therefore holders of our shares, are
effectively  subordinated  to  the  liabilities  and  preferred  equity  of  our
subsidiaries,  which  at  September  30,  2003,  aggregated  approximately  $1.3
billion.  In  particular,  the  holders  of the  preferred  shares of one of our
subsidiaries,  the  CharterMac  Equity  Issuer  Trust,  are  entitled to receive
preferential  distributions  with respect to revenues  generated by  investments
held directly or indirectly  through it, which constitute a substantial  portion
of our  assets.  Similarly,

                                       9
holders of senior interests created through our  securitization  programs have a
superior  claim to the  cash  flow  from the  revenue  bonds  deposited  in such
programs.  Accordingly, a portion of the earnings on our investments will not be
available for distribution on our Common Shares.

We are subject to ongoing  liabilities  and business  risks that are inherent to
Related Capital's business.

Assumed  Liabilities.  In connection with our acquisition of Related Capital, we
assumed and incurred liabilities and associated costs,  including the assumption
of liabilities under certain guarantees.  We also provided  replacement notes to
capitalize general partner entities of investment programs previously  sponsored
by Related Capital and controlled  directly by us and guaranteed the performance
by our  subsidiaries  of any  obligations  they have pursuant to the  agreements
entered  into in  connection  with our  acquisition  of  Related  Capital.  As a
guarantor, we could incur liability if events of default occur.

New  Liabilities  and Business  Risks.  In connection  with the  sponsorship  of
investment  programs and joint venture  activities related to the co-development
of tax credit  properties,  Related Capital acts as a fiduciary to the investors
in its syndication  programs and is often also required to provide guarantees of
performance.

Related Capital advances funds to acquire  interests in properties for inclusion
in offerings to investors and at any point in time, the amount of funds advanced
can be material.  The warehouse  line of credit  utilized by Related  Capital to
fund  these  advances  has a maximum  amount of $85.0  million.  Realization  of
Related  Capital's  investment  is subject to  continued  success in  attracting
investors to new funds or, if investors are not found,  the sale of the acquired
properties.

Finally,  our  subsidiaries  could be subject to  liabilities  to  investors  in
investment programs and third parties as a result of serving as general partner.
In  addition,  even when we are not  required to do so, we may advance  funds to
allow investment programs to meet their expenses.

Certain types of losses are uninsured.

There are certain types of losses (generally of a catastrophic  nature,  such as
toxic  mold,  earthquakes,   floods,   terrorism  and  wars)  which  are  either
uninsurable or not economically insurable.  Should a disaster of this type occur
to, or cause the destruction  of, one of the properties  securing a revenue bond
that we  directly  or  indirectly  own,  it is  possible  that we could lose our
invested capital, anticipated future revenue and anticipated profit.

Our investments are illiquid.

Our investments  lack a regular  trading  market.  There is no limitation in our
trust agreement or otherwise as to the percentage of our investments that may be
illiquid and we expect to continue to invest in assets, a substantial portion of
which will be illiquid securities.  If a situation arises where we would require
additional  cash, we could be forced to liquidate some or all of our investments
on unfavorable terms (if any sale is possible) that could  substantially  reduce
the  amount of  distributions  available  and  payments  made in  respect of our
shares.

Certain of the revenue bonds held by us and our subsidiaries have been pledged.

A significant  portion of our revenue bond portfolio has been pledged in support
of our securitizations,  credit enhancement  activities and warehouse borrowing.
The  carrying  value of the  pledged  bonds  varies  from  time to  time.  As of
September 30, 2003,  the carrying  value of the aggregate  amount of all pledged
bonds is approximately $1.6 billion.  Upon the occurrence of a default under one
or more of the programs in connection  with which our revenue bonds are pledged,
those bonds could be liquidated and the proceeds of such liquidation  applied to
cure such default.  Such liquidation and application  would reduce

                                       10
the amount of interest available for distributions to our shareholders and would
also  potentially  trigger  other  defaults,  which  could  lead  to  additional
liquidations of the pledged revenue bonds.

Our board of trustees can change our business policies unilaterally.

Our  shareholders  have no control over changes in our  policies,  including our
business  policies  with  respect  to  acquisitions,  financing,  growth,  debt,
capitalization and distributions, which are determined by our board of trustees.
Our board of trustees  may amend or revise our business  plan and certain  other
policies without  shareholder vote. There is a risk that changes in our business
policies may not fully serve the interests of all of our shareholders.

We invest in real estate related  investments  and revenue bonds secured by real
estate, which involves risk of liability under the environmental laws.

Under various  federal,  state and local laws,  ordinances and  regulations,  an
owner  or  operator  of real  estate  is  liable  for the  costs of  removal  or
remediation of certain hazardous or toxic substances  released on, above,  under
or in such real estate.  These laws often  impose  liability  without  regard to
whether  the  owner  knew of,  or was  responsible  for,  the  presence  of such
hazardous or toxic  substances.  As a result,  the entities we sponsor which own
real estate,  and the owners of the real estate securing our investments,  could
be  required  to pay  removal or  remediation  costs.  These costs of removal or
remediation could be substantial and could negatively impact the availability of
property  cash flow for payments on our  investments.  Phase I reports have been
obtained  for all of the  properties  securing our  investments,  and in certain
instances,  because of  findings in the Phase I reports,  Phase II reports  have
also been obtained. The results of such reports were that no material violations
of applicable  regulations were found and such reports  concluded that there has
been no verifiable or apparent adverse environmental impact from past or present
land use which has not been or will not be  remediated.  Other than such Phase I
and Phase II reports, no further environmental analyses have been performed with
respect to the properties  securing our  investments.  Other than the results of
the reports described above, our awareness of environmental  problems associated
with the properties securing our investments is derived, for the most part, from
information obtained from owners of the properties which secure our investments,
due diligence inquiries when our investments were financed or visual inspections
of properties by independent  appraisers.  There may, however,  be environmental
problems  associated with a property  securing an investment not known to us and
our subsidiaries.

We are not registered under the Investment  Company Act and would not be able to
conduct  our  activities  as we  currently  conduct  them if we  were to  become
required to be registered.

Neither we nor our subsidiaries are registered under the Investment  Company Act
of 1940, as amended (the  "Investment  Company Act") and we would not be able to
conduct our  activities  as we  currently  conduct  them if we were  required to
register thereunder.

We at all times intend to conduct our activities, and those of our subsidiaries,
so as not to become  regulated as an  investment  company  under the  Investment
Company Act. Even if we are not an  "investment  company"  under the  Investment
Company Act, we could be subject to regulation under the Investment  Company Act
if a subsidiary of ours were to be deemed to be an "investment  company."  There
are a number of  possible  exemptions  from  registration  under the  Investment
Company  Act that we  believe  apply  to us and our  subsidiaries  and  which we
believe  make it  possible  for us not to be subject to  registration  under the
Investment Company Act.

For example,  the  Investment  Company Act exempts  entities that are "primarily
engaged in the business of purchasing or otherwise acquiring mortgages and other
liens on and  interests  in real  estate,"  which  we  refer  to as  "qualifying
interests." Under current interpretation of the staff of the Commission,  one of
the ways in which our subsidiaries can qualify for this exemption is to maintain
at least 55% of its assets  directly in qualifying  interests and the balance in
real estate-type interests.  Under this test, unless certain

                                       11
mortgage securities represent all of the certificates issued with respect to an
underlying  pool of  mortgages,  such  mortgage  securities  may be  treated  as
securities  separate from the  underlying  mortgage  loans and, thus, may not be
considered qualifying interests for purposes of the 55% requirement.  We believe
our  subsidiaries  can  rely  on  this  exemption  or  another   exemption  from
registration.

The  requirement  that our  subsidiaries  maintain  55% of assets in  qualifying
interests  (or satisfy  another  exemption  from  registration)  may inhibit our
ability to acquire certain kinds of assets or to securitize additional interests
in the future.  If any of our  subsidiaries  fail to qualify for exemption  from
registration as an investment company,  we, in turn, may be required to register
as an investment  company under the Investment  Company Act. In such event,  our
ability to maintain our financing strategies would be substantially reduced, and
we would be unable to conduct our business as described  herein.  Such a failure
to  qualify  could  have a  material  adverse  effect  upon our  ability to make
distributions to our shareholders.

There are possible  adverse  effects  arising from shares  available  for future
sale.

Our board of trustees is permitted to offer  additional  Common  Shares or other
equity or debt  securities  of our  Company in exchange  for money,  property or
otherwise.  Our  ability to sell or  exchange  such  securities  will  depend on
conditions  then  prevailing in the relevant  capital markets and our results of
operations,  financial  condition,  investment portfolio and business prospects.
Subject to American Stock Exchange rules which require shareholder  approval for
certain  issuances  of  securities  and as  long  as the  issuance  is  made  in
accordance with our trust agreement,  the issuance of such additional securities
will not be subject  to the  approval  of our  shareholders  and may  negatively
prevailing  market prices of our Common Shares.  Our shareholders  will not have
any  preemptive  rights  in  connection  with  the  issuance  of any  additional
securities we or our  subsidiaries  may offer,  and any of our equity  offerings
will cause dilution of a shareholder's investment in us.

Our inability to raise capital could adversely affect our growth.

A major  aspect of our business  plan  includes the  acquisition  of  additional
revenue bonds,  which requires  capital.  In addition to funds generated through
operations  (including  securitizations),   we  raise  capital  by  periodically
offering securities issued by us or one or more of our subsidiaries. Our ability
to raise capital through securities offerings is subject to risks, including:

     -    conditions then prevailing in the relevant capital markets;

     -    our results of operations,  financial condition,  investment portfolio
          and business prospects;

     -    the timing and amount of  distributions  to the  holders of our shares
          which could negatively affect the price of a Common Share; and

     -    the  amount  of  securities  that  are  structurally   senior  to  the
          securities being sold.

Our classification as a publicly traded partnership not taxable as a corporation
is not free from doubt and could be challenged.

We and each of our  subsidiaries  (excluding  CM Corp.  and PW  Funding)  either
operate as partnerships or are disregarded for federal income tax purposes. This
allows us to pass through our income, including our federally tax-exempt income,
and  deductions  to our  shareholders.  The listing of our Common  Shares on the
American  Stock  Exchange  causes  us  to  be  treated  as  a  "publicly  traded
partnership" for federal income tax purposes. We, and Paul, Hastings, Janofsky &
Walker LLP, our counsel (who we also refer to as "Paul Hastings"),  believe that
we have been and are properly  treated as a partnership  for federal  income tax
purposes.  However,  the Internal  Revenue  Service  ("IRS") could challenge our
partnership  status  and we could fail to  qualify  as a  partnership  in future
years.  Qualification  as a  partnership  involves

                                       12
the application of highly technical and complex Code provisions.  For example, a
publicly traded  partnership is generally taxable as a corporation unless 90% or
more of its gross  income  is  "qualifying"  income  (which  includes  interest,
dividends, real property rents, gains from the sale or other disposition of real
property, gain from the sale or other disposition of capital assets held for the
production  of  interest  or  dividends,  and  certain  other  items).  We  have
represented  that in all prior years of our  existence at least 90% of our gross
income was qualifying income and we intend to conduct our operations in a manner
such that at least 90% of our gross  income will  constitute  qualifying  income
this year and in the future.  Subject to the discussion below entitled  "Federal
Income Tax Considerations - General", in the opinion of Paul Hastings,  although
the issue is not free from  doubt,  we have been and are  properly  treated as a
partnership for federal income tax purposes.

In  determining  whether  interest is treated as  qualifying  income under these
rules,  interest income derived from a "financial business" and income and gains
derived by a "dealer" in  securities  are not treated as qualifying  income.  We
have  represented  that  we  are  acting  as an  investor  with  respect  to our
investments and that we have not engaged in, and will not engage in, a financial
business.  There is no clear guidance on what constitutes a financial  business.
We have taken the position that for purposes of determining  whether we are in a
financial business, our bond acquisition and financing activities as well as our
proposed  activities would not cause us to be engaged in a financial business or
to be  considered  a  "dealer"  in  securities.  The IRS could  assert  that our
activities  constitute a financial  business.  Even if we were  considered to be
engaged  in  a  financial  business,  we  believe  that  we  would  satisfy  the
requirement that 90% or more of our income constitutes qualifying income. If our
activities  constitute  (or  as a  result  of  increased  volume  constitute)  a
financial business or cause us to be treated as a dealer, there is a substantial
risk  that more than 10% of our gross  income  would not  constitute  qualifying
income.  We could also be treated as if we were engaged in a financial  business
if the  activities of Related  Capital were  attributed  to us.  Although we are
affiliated with Related Capital,  we seek to enter into arms length arrangements
with  Related  Capital.  CM Corp.  will be subject to income tax with respect to
amounts  earned by Related  Capital.  Accordingly,  we believe the activities of
Related Capital will not be attributed to us.

In addition,  in determining  whether interest is treated as qualifying  income,
interest  income  that is  determined  based  upon the  income or profits of any
person is not treated as qualifying income. A portion of the interest payable on
participating  interest  bonds owned by us and our  subsidiaries  is  determined
based upon the income or profits of the  properties  securing  our  investments.
Accordingly,  if we were to receive more than 10% of our interest  income in any
given year from such "contingent interest," the IRS could take the position that
we should be treated as publicly traded  partnerships,  taxable as associations.
We  carefully  monitor  the type of  interest  income we receive to avoid such a
circumstance.  However,  there can be no assurance that such monitoring would be
effective  in all  events  to avoid  the  receipt  of more  than 10%  contingent
interest in any given year, because  circumstances  outside of the control of us
and our subsidiaries could cause such a result.

If for any  reason  less than 90% of our  gross  income  constitutes  qualifying
income, items of income and deduction would not pass through to our shareholders
and our  shareholders  would be  treated  for  federal  income tax  purposes  as
stockholders in a corporation. We would be required to pay income tax at regular
corporate  rates  on any  portion  of our net  income  that  did not  constitute
tax-exempt income. In addition, a portion of our federally tax-exempt income may
be included in determining our alternative minimum tax liability.  Distributions
by us to our shareholders  would constitute  ordinary dividend income taxable to
such  holders to the extent of our earnings  and  profits,  which would  include
tax-exempt  income, as well as any taxable income we might have, and the payment
of these  distributions  would not be deductible by us. These consequences would
have a material adverse effect on us and our shareholders.

Our  treatment  of income from our residual  interests  as federally  tax-exempt
could be challenged.

We hold, indirectly,  residual interests in certain federally tax-exempt revenue
bonds through securitization  programs,  such as the Private Label Tender Option
Program  and  P-FLOATs(SM)/RITES(SM)

                                       13
program,  which  entitle us to a share of the federally  tax-exempt  interest of
such revenue  bonds.  Special tax counsel  have each  rendered an opinion to the
effect that the issuer of the RITESSM and the issuer of the Private Label Tender
Option Program residual certificates, respectively, will each be classified as a
partnership  for federal  income tax purposes and the holders of the RITESSM and
the Private Label Tender Option Program residual certificates will be treated as
partners of each partnership. Consequently, as the holder of the RITESSM and the
Private Label Tender Option  Program  residual  certificates,  we believe we are
entitled to treat our share of the  federally  tax-exempt  income  allocated and
distributed  to us as tax-exempt  income.  However,  it is possible that the IRS
could disagree with those conclusions and an alternative  characterization could
adversely affect the treatment of any income we receive from the RITESSM and the
Private  Label  Tender  Option  Program  residual  certificates,  as well as the
pass-through of that income to our shareholders, as ordinary taxable income.

The value of our  shares  and our  ability to make  distributions  of  federally
tax-exempt income depends upon the application of tax laws.

The  following  discussion  relates  only to those  investments  which  generate
federally tax-exempt income.

Tax  treatment of our revenue  bonds.  We primarily  acquire and hold  federally
tax-exempt  investments  that we believe,  based upon the opinion of  nationally
recognized  counsel  delivered on the date the investment was originally  issued
(or on the date on which the investment was considered reissued),  will generate
interest  or  distributions  excludable  from the gross  income  of the  holders
thereof for federal  income tax purposes.  Certain of the revenue bonds acquired
directly or indirectly by us bear interest at rates which include  participating
or otherwise contingent  interest.  These revenue bonds are called participating
interest bonds. In the case of all participating interest bonds, the opinions of
counsel include an opinion to the effect that such  participating  interest bond
would be treated as debt for federal income tax purposes.

Tax-exemption  of our  revenue  bonds.  On the  date  of  original  issuance  or
reissuance of each revenue bond,  nationally  recognized bond counsel or special
tax counsel  rendered its opinion to the effect that, based on the law in effect
on the date of original  issuance or reissuance,  interest on such revenue bonds
is excludable  from gross income for federal  income tax  purposes,  except with
respect to any revenue  bond (other than a revenue  bond,  the proceeds of which
are loaned to a charitable  organization  described in Section  501(c)(3) of the
Code)  during  any  period  in which it is held by a  "substantial  user" of the
property  financed with the proceeds of such revenue bonds or a "related person"
of such a "substantial user." In the case of participating  interest bonds, such
opinion assumes,  in certain cases in reliance on another  unqualified  opinion,
that such  participating  interest bond  constitutes debt for federal income tax
purposes.  See  "--Treatment  of revenue  bonds as equity"  below.  Each opinion
speaks only as of the date it was delivered. In addition, in the case of revenue
bonds which,  subsequent  to their  original  issuance,  have been  reissued for
federal tax purposes,  nationally recognized bond counsel or special tax counsel
has delivered  opinions to the effect that interest on the reissued revenue bond
is  excludable  from gross income of the holder  thereof for federal  income tax
purposes from the date of reissuance  or, in some cases,  to the effect that the
reissuance did not adversely affect the excludability of interest on the revenue
bonds  from the gross  income of the  holders  thereof.  However,  an opinion of
counsel has no binding  effect and there is no  assurance  that the  conclusions
reached will not be contested by the IRS or, if contested,  will be sustained by
a court.

The reissuance of a revenue bond generally does not, in and of itself, cause the
interest on such revenue bond to be includable in the gross income of the holder
thereof for federal income tax purposes.  However,  if a revenue bond is treated
as reissued and the appropriate federal tax information return, a Form 8038, has
not  been  timely  filed or a late  filing  has not  been  accepted  by the IRS,
interest on such  revenue  bond could be  includable  in the gross income of the
holder  thereof for federal  income tax purposes  from and after the  reissuance
date.  In  addition,  if a  participating  interest  revenue  bond is treated as
reissued,  there can be no assurance that such revenue bond would continue to be
characterized   as  debt,  as  described   below,   insofar  as  the  facts  and
circumstances  underlying such  characterization may have

                                       14
changed. Furthermore, pursuant to regulations generally effective as of June 30,
1993, if an issue of revenue  bonds is treated as reissued  within six months of
the transfer of the project financed by such issue of revenue bonds by the owner
of such project to an unrelated  party the interest on such revenue  bonds could
become  includable in gross income for purposes of federal income  taxation.  In
addition, if a participating  interest revenue bond is reissued after August 13,
1996,  the  reissued  revenue  bond  is  or  would  become  subject  to  certain
regulations concerning contingent payments, which could cause some or all of the
interest  payable  on  such  participating   interest  revenue  bond  to  become
includable  in gross  income  of the  holder  thereof  for  federal  income  tax
purposes,  unless such  participating  interest  revenue bond is modified at the
time of reissuance to comply with the contingent payment regulations.

The Code establishes  certain  requirements  which must be met subsequent to the
issuance and delivery of  tax-exempt  revenue bonds for interest on such revenue
bonds to remain  excludable  from gross income for federal  income tax purposes.
Among these  continuing  requirements are restrictions on the investment and use
of the revenue bond  proceeds  and, for revenue  bonds the proceeds of which are
loaned to a charitable  organization described in Section 501(c)(3) of the Code,
the  continued  exempt  status of such  borrower.  In addition,  the  continuing
requirements include tenant income restrictions, regulatory agreement compliance
and compliance  with rules  pertaining to arbitrage.  Each issuer of the revenue
bonds,  as well as each of the  underlying  borrowers,  has covenanted to comply
with certain  procedures and guidelines  designed to ensure  satisfaction of the
continuing  requirements  of the Code.  Failure to comply with these  continuing
requirements  of the Code may cause the interest on such bonds to be  includable
in gross  income for federal  income tax purposes  retroactively  to the date of
issuance, regardless of when such noncompliance occurs.

Greenberg  Traurig,  LLP (also  referred to as "Greenberg  Traurig") as our bond
counsel,  and Paul Hastings,  as our securities  counsel  (Greenberg Traurig and
Paul Hastings are collectively  referred to herein as our "Counsel"),  have not,
in  connection  with the sale of the Common  Shares  pursuant  to this  re-offer
prospectus,  passed upon and do not assume any  responsibility  for,  but rather
have  assumed the  continuing  correctness  of, the  opinions of bond counsel or
special tax counsel (including  opinions rendered by Greenberg Traurig) relating
to the exclusion  from gross income for federal  income tax purposes of interest
on the revenue bonds and have not  independently  verified whether any events or
circumstances  have  occurred  since the date such  opinions  were rendered that
would adversely  affect the conclusions  set forth therein.  However,  as of the
date of  this  re-offer  prospectus,  neither  we,  nor  our  subsidiaries,  our
affiliates  or our Counsel  have  knowledge  of any events that might  adversely
affect the  federally  tax-exempt  status of our revenue  bonds,  including  any
notice  that  the IRS  considers  interest  on any of our  revenue  bonds  to be
includable in gross income for federal income tax purposes.

Treatment  of  revenue  bonds as equity.  Payment  of a portion of the  interest
accruing on each participating  interest bond depends in part upon the cash flow
from, and proceeds upon sale of, the property  securing our investment  financed
by such revenue bond. An issue may arise as to whether the relationship  between
us and the respective  obligors is that of debtor and creditor or whether we are
engaged in a partnership or joint venture with the respective  obligors.  If the
IRS were to  determine  that  one or more of the  participating  interest  bonds
represented  or  contained  an  equity  investment  in the  respective  property
securing our investment because of this feature,  all or part of the interest on
such  participating  interest  bond could be viewed as a taxable  return on such
investment  and would not qualify as tax-exempt  interest for federal income tax
purposes.

To our knowledge,  neither the  characterization  of the participating  interest
bonds as debt,  nor the  characterization  of the  interest  thereon as interest
excludable  from gross  income for  federal  income tax  purposes of the holders
thereof,  has  been  challenged  by  the  IRS  in  any  judicial  or  regulatory
proceeding.  In certain  instances,  opinions  rendered by bond counsel provided
that the  characterization of the bonds as debt was not free from doubt and that
all or a portion of the interest on such bonds,  including "contingent interest"
and  "deferred  interest,"  may not be treated as interest for state and federal
law but that it is more likely than not that such interest is interest for state
and federal law purpose or otherwise  similarly limited.  We or our predecessors
received  opinions  of counsel  from  Willkie,  Farr &  Gallagher  LLP and

                                       15
other  counsel  retained  by  us or  our  predecessor  respecting  each  of  our
participating  interest  bonds  to  the  effect  that,  based  upon  assumptions
described in such opinions,  which assumptions included the fair market value of
the  respective   properties  upon  completion  and  economic   projections  and
guarantees,  the participating interest bonds "would" be treated for federal tax
purposes as representing  debt. The implicit corollary of these opinions is that
the participating interest bonds do not constitute the following:  (i) an equity
interest  in the  underlying  borrower;  (ii) an  equity  interest  in a venture
between the  underlying  borrower and us; or (iii) an ownership  interest in the
properties   securing  our  investments.   Although  we  assume  the  continuing
correctness of these opinions, and will treat all interest received with respect
to these  bonds as  tax-exempt  income,  there  can be no  assurance  that  such
assumptions  are correct,  such treatment would not be challenged by the IRS, or
that intervening facts and circumstances  have changed the assumptions and basis
for providing such opinions.

Most of the opinions  described in the preceding  paragraph were not rendered by
Greenberg Traurig, which has not passed on or assumed any responsibility for the
opinions of other counsel on this issue, nor made any independent  determination
as to whether any events or circumstances  have occurred or intervened since the
original  issuance  of the "debt"  opinions  that would  adversely  affect  such
opinions.  In  addition,  the  opinions  discussed  above speak only as of their
respective  delivery  dates,  and our Counsel has not passed upon or assumed any
responsibility for reviewing any events that may have occurred subsequent to the
delivery of such opinions which could adversely affect the conclusions contained
therein.

"Substantial  User"  Limitation.  Interest on a revenue  bond owned by us or our
subsidiaries, other than a bond the proceeds of which are loaned to a charitable
organization  described in Section  501(c)(3) of the Code,  will not be excluded
from  gross  income  during  any  period in which we or our  subsidiaries  are a
"substantial user" of the properties  financed with the proceeds of such revenue
bond or a "related person" to a "substantial user." We have received advice from
our counsel  with  respect to our revenue  bonds to the effect that we are not a
"substantial user" of any properties financed with the proceeds of such bonds or
a  "related  person"  thereto.  A  "substantial  user"  generally  includes  any
underlying borrower and any person or entity who uses the financed properties on
other than a de minimis basis. We would be a "related  person" to a "substantial
user" for this  purpose if,  among other  things,  (i) the same person or entity
owned more than a 50% interest in both us and in the  properties  financed  with
the  proceeds  of a bond owned by us or one of our  subsidiaries,  or (ii) if we
owned a  partnership  or  similar  equity  interest  in the owner of a  property
financed with the proceeds of a bond. Additionally,  a determination that we are
a partner or a joint venturer with a mortgagor involving an equity interest,  as
described above under  "Treatment of revenue bonds as equity," could cause us to
be treated as a "substantial  user" of the properties  securing our investments.
In the event that the  entity  which owns a  property  securing  our  investment
financed  with the proceeds of a revenue bond owned by us were to acquire any of
our  shares,  the IRS,  if it became  aware of such  ownership,  could  take the
position  that the  substantial  user and related  person rules require that the
interest  income  on  such  revenue  bond  allocable  to all  of our  investors,
including  the  holders of the shares,  be included in gross  income for federal
income tax purposes. Greenberg Traurig has advised us that in its opinion such a
result is not supported by the Code and treasury regulations; however, there can
be no assurance that the IRS would not take such a position.

Related  Capital and its affiliates  owned a portion of our  outstanding  Common
Shares.  Such  ownership of the obligors of certain of our revenue bonds and our
Common  Shares  were  considered  when  we  received  advice  that  we are not a
"substantial  user"  of the  properties  financed  by such  revenue  bonds  or a
"related  party" to a  "substantial  user."  The  former  principals  of Related
Capital and its  affiliates  also own  special  common  units in CCC.  Greenberg
Traurig has reviewed  the revenue  bonds owned by us and our  subsidiaries,  the
ownership of the obligors of our revenue  bonds and the  ownership of our shares
and our  subsidiaries'  shares,  and concurs in the  conclusion  that we and our
subsidiaries  are not  "substantial  users" of the properties  financed with the
proceeds  of the  revenue  bonds or  related  parties  thereto.  There can be no
assurance,  however,  that the IRS would not challenge such conclusion.  If such
challenge were successful, the interest received on any bond respecting which we
or our  subsidiaries  were treated as a  "substantial  user" or a "related party
thereto" would be includable in gross income for federal income tax purposes.

                                       16
In  addition,  Related  Capital  owns,  directly  and  indirectly,   partnership
interests in many partnerships  owning multifamily  properties financed with the
proceeds of revenue bonds in our revenue bond portfolio  which could cause us to
be treated as a "substantial  user" of these entities or a "related  party" to a
"substantial user". Prior to our acquisition of Related Capital, we modified the
structure of the ownership interests in such entities and our operation of CCC's
investment  programs so that we will not be treated as a  "substantial  user" of
any entities  financed  with the  proceeds of revenue  bonds in our revenue bond
portfolio or a "related  party"  thereto.  Under our new  structure,  designated
senior  executives will acquire and hold 51% of the equity  interests in certain
entities and we or our affiliates own a 49% interest and serve as the non-equity
manager or general  partner.  It is not expected  that such  entities  will have
significant  economic value.  Paul Hastings and Greenberg  Traurig have reviewed
the structure of our acquisition of Related  Capital,  the  modifications to the
ownership  interests in such  entities  and the  structure we use to operate the
real estate investment  programs of CCC and they have advised us that, with such
modifications,  we and our subsidiaries should not be "substantial users" of the
entities  financed with the proceeds of the revenue  bonds or "related  parties"
thereto.  There can be no assurance,  however,  that the IRS would not challenge
such a conclusion.  If such challenge were successful,  the interest received on
any revenue bond during the time period when we or our subsidiaries were treated
as a substantial  user or a "related party" thereto would be includable in gross
income for federal income tax purposes.

Structure of our  acquisition  of Related  Capital.  Our  acquisition of Related
Capital  was  structured  to prevent us from  realizing  active  income from the
Related Capital  business and  effectively  receive a tax deduction for payments
made to the former  principals of Related  Capital.  It is possible that the IRS
could  challenge  this  structure,  with material  adverse  consequences  to our
Company. First, the IRS could assert that CharterMac is the owner of the Related
Capital business, in which case we would realize an amount of active income from
the  Related  Capital  business  that  would  require  us  to  be  treated  as a
corporation instead of a publicly traded partnership for income tax purposes. If
the IRS  prevailed,  we would be required  to pay taxes on our  income,  thereby
reducing the amount available to us to make  distributions.  As a result,  it is
possible  that the value of our  shares  would  decline.  Second,  the IRS might
assert that the special  common  units in CCC held by the former  principals  of
Related Capital are actually shares of our Company.  If this position prevailed,
the  distributions  payable on the special  common units would not result in tax
deductions  for CM Corp. In such event,  CM Corp.  would be subject to increased
tax, which could reduce our net after-tax income and our distributions.

Taxable income.  We primarily invest in investments that produce only tax-exempt
income.  However, the IRS may seek to recharacterize a portion of our tax-exempt
income as taxable  income as  described  above.  If the IRS were  successful,  a
shareholder's  distributive  share  of  such  income  will  be  taxable  to  the
shareholder,  regardless of whether an amount of cash equal to such distributive
share is actually  distributed.  Any taxable  income will be allocated  pro rata
between our CRA Shares and our Common Shares. We may also have taxable income in
the form of  market  discount  or gain on the sale or other  disposition  of our
investments,  and we  expect  to own  investments  and  engage  in  certain  fee
generating activities that will generate taxable income. See "Federal Income Tax
Considerations - Certain income tax  considerations  relating to our Company and
our shareholders."

Impact of recent and future tax  legislation.  Recent and future tax legislation
could also adversely impact the value of our investments and the market price of
our shares. On May 28, 2003,  President Bush signed into law the Jobs and Growth
Tax Relief Act. This law amends the Code to reduce  federal income tax rates for
individuals  on  long-term  capital  gains and dividend  income and  accelerates
certain  previously  enacted income tax rate  reductions for individuals for tax
years  ending  on or  after  May 6,  2003.  This  tax  legislation  reduces  the
importance  of a primary  advantage of investing  in municipal  bonds--that  the
interest received on these bonds is federally tax-exempt,  while other income is
subject to federal  income tax at higher rates.  It is likely that these tax law
changes,  and any similar  future tax law  changes,  could

                                       17
increase  the cost of  tax-exempt  financings,  as  interest  rates  offered  by
municipal  issuers  would rise to  compensate  investors for the loss of the tax
advantage.  This could  lead to a  decrease  in  tax-exempt  multifamily  rental
housing bond issuances, which would reduce our opportunities to purchase revenue
bonds.

If the interest received on the revenue bonds remains federally tax-exempt under
the Code, the  allocations  of such  federally tax exempt  interest by us to our
investors will also remain  excludable  from gross income for federal income tax
purposes.  However, the Jobs and Growth Tax Relief Act could cause the after-tax
returns available from other investments to increase,  and cause shares in other
companies to become more attractive relative to our shares.  These changes could
also reduce the value of our existing investments,  because federally tax-exempt
municipal  bond  income  would not  enjoy the same  relative  tax  advantage  as
provided under prior law.

No  assurance  can be given that our  shareholders  will be entitled to the same
limitation on personal  liability as  stockholders of private  corporations  for
profit.

We are governed by the laws of the State of Delaware.  Under our trust agreement
and  the  Delaware  Statutory  Trust  Act,  as  amended  ("Delaware  Act"),  our
shareholders  will be entitled  to the same  limitation  of  personal  liability
extended to stockholders of private  corporations for profit organized under the
General  Corporation Law of the State of Delaware.  In general,  stockholders of
Delaware  corporations are not personally  liable for the payment of corporation
debts and obligations,  and are liable only to the extent of their investment in
the  Delaware  corporation.  However,  a  shareholder  may be  obligated to make
certain payments provided for in our trust agreement and bylaws.  The properties
securing our  investments  are dispersed in numerous  states and the District of
Columbia.  In  jurisdictions  which  have  not  adopted  legislative  provisions
regarding statutory trusts similar to those of the Delaware Act, questions exist
as to whether such  jurisdictions  would recognize a statutory  trust,  absent a
state  statute,  and whether a court in such  jurisdiction  would  recognize the
Delaware Act as  controlling.  If not, a court in such  jurisdiction  could hold
that our  shareholders are not entitled to the limitation of liability set forth
in our trust  agreement  and the Delaware Act and, as a result,  are  personally
liable for our debts and obligations.

Our  anti-takeover  provisions may  discourage  third-party  proposals.

Certain provisions of our trust agreement and our management agreements may have
the effect of discouraging a third party from making an acquisition proposal for
our  Company.  This  could  inhibit a change in  control  of our  Company  under
circumstances  that could give our  shareholders  the  opportunity  to realize a
premium  over  then-prevailing   market  prices.  Such  provisions  include  the
following:

Additional  Classes and Series of Shares.  Our trust agreement permits our board
of trustees to issue additional classes or series of beneficial interests and to
establish the preferences and rights of any such securities.  Thus, our board of
trustees  could  authorize the issuance of beneficial  interests  with terms and
conditions  which  could have the  effect of  discouraging  a takeover  or other
transaction in which holders of some, or a majority, of our shares might receive
a premium for their shares over then-prevailing market price of such shares.

Staggered Board.  Our board of trustees has three classes of managing  trustees.
The terms of the first,  second and third classes will expire in 2004,  2005 and
2006,  respectively.  Managing  trustees  for each  class  will be chosen  for a
three-year  term upon the  expiration of the current  class' term.  The use of a
staggered  board makes it more  difficult for a third-party  to acquire  control
over us.

Terrorist  attacks and the United States'  response  thereto may have a negative
effect on our earnings.

                                       18
The  terrorist  attacks  which  occurred  in New  York  City,  Pennsylvania  and
Washington, D.C. on September 11, 2001, the subsequent military actions taken by
the United States and its allies in response and the war with Iraq,  have caused
considerable uncertainty regarding the U.S. economy and a slowdown in the global
financial  markets.  While  the  long-term  effects  of these  events  and their
potential consequences are uncertain,  they could have a material adverse effect
on general economic conditions,  consumer confidence and market liquidity. There
can be no assurance  that these events or  comparable  events in the future will
not ultimately have an adverse effect on our earnings and results of operations.

The  interests of the former  principals  of Related  Capital may be in conflict
with the interests of our shareholders.

Because  the former  selling  principals  of Related  Capital  are our  managing
trustees,  there are  ongoing  conflicts  of  interests  if we are  required  to
determine whether or not to take actions to enforce our rights under the various
agreements  entered into in connection with our acquisition of Related  Capital.
While any material decisions  involving the former principals of Related Capital
are  subject  to the  vote  of a  majority  of our  independent  trustees,  such
decisions may create  conflicts  between us and these former  principals who are
our managing  trustees.  In  addition,  we have some  obligations  to the former
principals  of Related  Capital  which will require us to make choices on how we
operate our business which may affect those obligations.  (For example,  we have
agreed to guarantee the payment to the former  principals of Related  Capital of
all but $5 million of the  distributions  they would  otherwise  be  entitled to
receive  under the  operating  agreement of CCC. In addition,  we have agreed to
share cash flow from  investment  programs  so that we and  Related  Capital can
receive payment of deferred fees.)

In addition,  TRCLP and its  affiliates  currently  engage in  businesses  which
compete with  Related  Capital.  The  non-competition  covenants  contained in a
future  relations  agreement  entered  into  by  TRCLP  and  its  affiliates  in
connection  with our  acquisition  of  Related  Capital  prohibit  TRCLP and its
affiliates  from  competing  with any business  currently  engaged in by Related
Capital and our Company other than in specified areas,  including  providing (a)
credit  enhancement on debt products  secured by so-called  "80/20"  multifamily
housing properties and (b) mezzanine financing to multifamily housing properties
other than so-called "tax credit  properties." There can be no assurance that we
and TRCLP and its affiliates would not directly compete for similar products and
opportunities in these areas in the future.

The former  principals  of Related  Capital  have  significant  voting  power on
matters submitted to a vote of our shareholders.

In  connection  with our  acquisition  of  Related  Capital,  each of the former
principals of Related Capital were issued one special preferred voting share for
each special  common unit they  received.  The special  preferred  voting shares
entitle  each  holder  thereof to vote on all  matters  subject to a vote of the
holders of our Common Shares. The former principals of Related Capital,  who are
now employees of Related  Capital,  received  enough  special  preferred  voting
shares to collectively hold  approximately  8.3% of our voting power.  TRCLP and
Mr. Ross controls  approximately  17.1% of our voting power.  As such,  Mr. Ross
and, if they vote as a block,  the other former  principals  of Related  Capital
will have  significant  voting power on all matters  submitted  for  shareholder
action. These individuals could have significant  influence over any shareholder
vote as a result of the issuance of the special preferred voting shares.

We may not  realize  any cost  savings  as a result  of the  integration  of the
management services of Related Capital, which could adversely affect our results
of operations.

In  connection  with our  acquisition  of Related  Capital,  we  terminated  our
external management agreements.  Related Capital employed certain principals and
substantially  all of the employees that it employed prior to our acquisition of
Related Capital to perform  internally those functions  formerly provided by it.
There  can be no  assurance  that  costs or other  factors  associated  with the
integration  of Related  Capital and our Company will not  adversely  affect our
future combined results of operations or that the expected benefits will occur.

                                       19
Sales in the public  market of our Common  Shares  issuable upon exchange of the
special  common  units  issued in  connection  with our  acquisition  of Related
Capital could adversely affect prevailing market prices of our shares.

Future sales of  substantial  amounts of our Common  Shares in the public market
could adversely  affect  prevailing  market prices of our shares.  Approximately
15,905,512  Common Shares are issuable upon exchange of the special common units
issued in connection with our acquisition of Related  Capital.  In addition,  we
also granted  approximately  $23.4 restricted  Common Shares to the employees of
Related Capital at the closing of our acquisition of Related Capital.  Following
the  effective  registration  of the Common  Shares  issuable  upon  exchange of
special  common  units and the  expiration  of any  lock-up  to which the Common
Shares and restricted  Common Shares are subject,  the sale in the public market
of these Common Shares and  restricted  Common Shares could,  and depending upon
the number of Common Shares and restricted Common Shares involved, likely would,
adversely affect prevailing market prices of our shares. TRCLP and Mr. Ross owns
special  common units and Common  Shares with an aggregate  value at the time of
issuance of approximately $193.7 million which, subject to some exceptions,  are
not subject to a lock-up.  Sales in the public  market  could  reduce the market
price of the shares and our ability to raise  additional  capital through equity
markets.

                                       20
OUR COMPANY

Overview

     We are a Delaware  statutory  trust which  commenced  operations in October
1997. We are principally  engaged in the acquisition and ownership (directly and
indirectly through our subsidiaries) of federally tax-exempt multifamily housing
revenue  bonds  issued  by  various  state or  local  governments,  agencies  or
authorities  and other  investments  designed  to produce  federally  tax-exempt
income.

     While we hold a small  portion  of our  revenue  bond and loan  investments
directly,  substantially all of our investments are held indirectly  through our
subsidiaries.  For a more  complete  description  of our  relationship  with our
subsidiaries,  see "--Entity Structure," below.  Accordingly,  our shareholders'
interests  in the  cash  flow  from  investments  held by our  subsidiaries  are
subordinate to the rights of the debt holders, preferred shareholders and senior
interest holders of our subsidiaries.

     CM Corp. and our newly-acquired subsidiary,  Related Capital, conducts most
of our taxable  business.  CM Corp. (i)  originates  and services  mortgages for
third parties and (ii)  guarantees  tax credit equity returns and mortgage loans
for a fee.  Related  Capital  conducts  fee-generating  activities  and provides
management services to us. PW Funding,  the national mortgage banking firm which
we own an 84% interest in, is a subsidiary of CM Corp.

     Our Common  Shares trade on the American  Stock  Exchange  under the symbol
"CHC."

Tax Status

     We and our subsidiaries (with the exception of CM Corp. and PW Funding) are
each either  treated as  partnerships  or  disregarded  for  federal  income tax
purposes. Therefore, we and our subsidiaries (with the exception of CM Corp. and
PW Funding)  pass  through to our  shareholders,  in the form of  distributions,
income  (including  federally  tax-exempt  income)  derived from our investments
without paying federal income tax on that income. We intend to operate so that a
substantial  portion of our ordinary  income will be excluded  from gross income
for federal income tax purposes. Other income, such as capital gains and taxable
interest income, as well as any dividend income from CM Corp., generally will be
subject to tax. We expect that for the year ending  December 31,  2003,  no less
than 95% of our  distributions to our shareholders will be excludable from their
gross  income for  federal  income tax  purposes.  For the  calendar  year ended
December 31, 2002, approximately 96% of our distributions consisted of federally
tax-exempt  income.  See "Risk  Factors--Risks  relating  to our Company and the
operation of our business--Our  classification as a publicly-traded  partnership
not taxable as a corporation is not free from doubt and could be challenged" and
"Federal Income Tax Considerations."

Our Management

     We operate our day-to-day  activities and select our investments  utilizing
the services and advice provided by our  recently-acquired  subsidiary,  Related
Capital,  subject to the supervision and review of our board of trustees. See "-
Our Acquisition of Related Capital," below.  Related  Capital's  management team
has an average of 19 years of experience in the real estate industry.

Our Acquisition of Related Capital

     On November 17, 2003, we acquired  100% of the  ownership  interests in and
substantially  all of the  businesses  operated by Related  Capital  (other than
specific  excluded   interests).   The  acquisition  enabled  us  to  become  an
internally-managed company.

                                       21
The  acquisition  was structured so that the former  selling  principals of
Related Capital  contributed  their ownership  interests in Related Capital into
CCC, one of our subsidiaries,  in exchange for  approximately  $282.8 million of
special  common  units in CCC.  All of the selling  principals  were also issued
special preferred voting shares of our Company for each special common unit they
received.  The special  preferred voting shares have no economic  interest,  but
entitle the holder thereof to one vote per special preferred voting share on all
matters  subject  to a vote of the  holders  of our  Common  Shares.  One of the
selling principals also received $50 million in cash.

     The  former  selling  principals  of  Related  Capital  included  its  four
executive managing partners (Messrs.  Boesky, Hirmes,  Schnitzer and Ms. Kiley),
all of whom are  members  of our  board of  trustees,  and an  affiliate  of The
Related Companies,  L.P., a New York limited  partnership with a majority of its
equity  controlled  by Mr.  Ross,  who is also  the  Chairman  of our  board  of
trustees.

     As a result of the acquisition,  the beneficial ownership in our Company of
(i) Mr. Ross equals  approximately  17.7% and (ii) our  management and the other
selling principals (other than Mr. Ross) equals approximately 8.7%.

Entity Structure

The following  diagram depicts our  organizational  structure as of November 24,
2003:

                          [graphic omitted]

Our Offices

Our principal executive offices are located at 625 Madison Avenue, New York, New
York 10022. Our phone number is (212) 317-5700.

                                       22
Description of Our Shares

     The following description of our shares does not purport to be complete and
is qualified in its entirety by  reference to  applicable  Delaware  law, and to
provisions  of our trust  agreement  and bylaws,  each as amended and  restated,
copies  of which  are  exhibits  to the  registration  statement  of which  this
re-offer prospectus is a part.

Overview

     Subject to limitations  prescribed by Delaware law and our trust agreement,
our board of trustees is  authorized to issue  100,000,000  shares of beneficial
interest  (common,  preferred  and  otherwise),  to classify or  reclassify  any
unissued  beneficial  interests,  to  provide  for the  issuance  of  beneficial
interests in other classes or series of  securities,  to establish the number of
beneficial  interests  in each  class  or  series  and to fix  the  preferences,
conversion  and other rights,  voting  powers,  restrictions,  limitations as to
distributions, qualifications or terms.

     As of the date of this  re-offer  prospectus,  our issued  and  outstanding
shares of beneficial  interest consist of Common Shares,  CRA Shares and Special
Preferred  Voting  Shares.  Two of our  subsidiaries,  Charter Mac Equity Issuer
Trust and CCC, have also issued equity. See "Description of our Preferred Shares
and Special  Common  Units,"  below.  All of our Common Shares  outstanding  are
currently  listed for trading on the American  Stock  Exchange  under the symbol
"CHC."

     Subject to the American  Stock  Exchange  rules which  require  shareholder
approval for certain  issuances of securities,  we may issue  additional  shares
from time to time in one or more series, generally without shareholder approval,
with such preferences, conversion and other rights, voting powers, restrictions,
limitations  as to  distributions,  qualifications  and terms and  conditions of
redemption as are permitted by Delaware law and as  established  by our board of
trustees.

Description of our Common Shares

     General.  Our Common  Shares  have equal  dividend,  liquidation  and other
rights,  and have no preference,  appraisal or exchange  rights.  Holders of our
Common  Shares  have no  conversion,  sinking  fund  or  redemption  rights,  or
preemptive rights to subscribe for any of our securities.

     Distributions. Subject to any preferential rights of any outstanding shares
or  series  of  shares,   our  common   shareholders  are  entitled  to  receive
distributions,  when and as authorized by our board of trustees,  out of legally
available  funds.  We anticipate  that we will pay  distributions  on our Common
Shares quarterly, subject to declaration by our board of trustees.

     Voting Rights. Our common  shareholders have no right to participate in the
control of our  business.  However,  our common  shareholders  have been granted
certain voting rights which are set forth in our trust agreement. Holders of our
Common Shares,  as a class,  have the power to vote on all matters  presented to
our shareholders,  except as otherwise provided by Delaware law. Pursuant to our
trust  agreement,  our common  shareholders  are entitled to one vote per Common
Share on all matters  voted on by  shareholders  and,  except as provided in our
trust agreement in respect of any other class or series of beneficial interests,
the holders of such Common Shares exclusively  possess all voting power and have
been granted the right to vote upon:  (i) the election of our board of trustees,
(ii) our merger, consolidation or termination and dissolution, (iii) sale of all
or  substantially  all of our assets and (iv)  amendment of our trust  agreement
(except in certain limited circumstances),  provided that provisions relating to
the   limitation   of  liability  and   indemnification   may  only  be  amended
prospectively.

                                       23
Registrar and Transfer  Agent.  The  registrar  and transfer  agent for our
Common Shares is EquiServe  Trust  Company,  N.A.,  P.O. Box 8694,  Edison,  NJ,
08818.

     Registration Rights. We have entered into the following registration rights
agreements  in  connection  with (i) the  issuances  of CRA  Shares and (ii) the
issuances of securities in connection with our acquisition of Related Capital:

     (i)  Issuances  of CRA Shares.  In  connection  with our  issuances  of CRA
Shares,  we entered into  registration  rights  agreements  pursuant to which we
agreed to register the Common Shares  issuable to the holders of CRA Shares upon
conversion of their CRA Shares.  These  registration  statements have been filed
with the SEC. The Common Shares issuable upon exchange of the CRA Shares will be
listed on the American Stock Exchange under the symbol CHC.

     The registration  rights agreements provide that we will indemnify and hold
harmless the selling shareholders under those agreements against losses, claims,
damages,   or  liabilities  (or  actions  in  respect  thereof)  to  which  such
individuals  may become  subject under Federal and state  securities  laws which
arise out of (i) any untrue  statement or alleged untrue statement of a material
fact  contained in a  registration  statement  (or any  amendment or  supplement
thereto)  pursuant  to which  their  Common  Shares  were  registered  under the
Securities Act of 1933, as amended,  (ii) any untrue statement or alleged untrue
statement of a material fact  contained in any  prospectus  (or any amendment or
supplement  thereto),   or  (iii)  the  omission  or  alleged  omission  from  a
registration  statement or prospectus (or amendments thereto) of a material fact
necessary  in  order  to  make  the  statements  therein,  in the  light  of the
circumstances  under  which they were made,  not  misleading.  The  registration
rights  agreements  also provide that we will reimburse the selling  shareholder
(and the officers,  directors or controlling persons of the selling shareholder)
for any legal or any other expenses  reasonably  incurred by such individuals in
connection  with  investigating  or  defending  any such  loss,  claim,  damage,
liability or action.

     However,  the  indemnity  discussed  above  does not  apply to the  selling
shareholder if the loss, claim, damage or liability arises out of (i) any untrue
statement or omission made by us in a  registration  statement or prospectus (or
any amendment or supplement  thereto) in reliance upon, and in conformity  with,
written information furnished to us by the selling shareholder  specifically for
use in, or the preparation of, such registration statement or prospectus (or any
amendment or supplement thereto),  or (ii) such selling shareholder's failure to
deliver an amended or supplemental prospectus, after having been provided copies
of any such amended or supplemental  prospectus by us, if such loss,  liability,
claim, damage or expense would not have arisen had such delivery occurred.

     (ii) Issuance of securities in connection  with our  acquisition of Related
Capital.  In connection with our acquisition of Related Capital, we entered into
registration  rights  agreement  with the former  selling  principals of Related
Capital  pursuant  to which we  agreed  to file a shelf  registration  statement
registering  (i) the resale of our Common  Shares  issuable upon exchange of the
special common units and (ii) exercise of options  issued to Mr. Ross.  Pursuant
to the terms of the registration rights agreement,  we are obligated to file the
shelf  registration  statement within 60 days of the closing of the acquisition.
We  have  agreed  to use our  commercially  reasonable  efforts  to  cause  this
registration  statement to be declared  effective by the SEC as soon as possible
after its filing. We will bear the costs of registration, including, among other
things,  registration  and filing  fees,  printing  expenses,  attorneys'  fees,
accountants' fees and other reasonable expenses.

     The registration  rights agreement provides that we will indemnify and hold
harmless the selling  shareholders  (and each person who  controls  such selling
shareholder) and each officer,  director,  trustee, partner and employee of such
selling  shareholder under that agreement against losses,  claims,  damages,  or
liabilities  and expenses  incurred by such party  arising out of (i) any untrue
statement  or alleged  untrue  statement  of a material  fact  contained  in the
registration  statement  (or any amendment or  supplement  thereto)  pursuant to
which their Common Shares were  registered  under the Securities Act of 1933, as
amended,  (ii) any untrue  statement or alleged  untrue  statement of a material
fact contained in any

                                       24
prospectus  (or any amendment or supplement  thereto),  or (iii) the omission or
alleged  omission from a  registration  statement or prospectus  (or  amendments
thereto) of a material fact necessary in order to make the  statements  therein,
in the light of the  circumstances  under which they were made, not  misleading.
The  registration  rights  agreements  also provide that we will  reimburse  the
selling  shareholder (and the officers,  directors or controlling persons of the
selling  shareholder) for any legal or any other expenses reasonably incurred by
such  individuals in connection with  investigating  or defending any such loss,
claim, damage, liability or action or (iv) any violation or alleged violation by
our  Company  of  federal  or  state  securities  laws in  connection  with  the
registration statement.

     However,  the  indemnity  discussed  above  does not  apply to the  selling
shareholder  if the loss,  claim,  damage or liability  arises out of any untrue
statement or omission made by us in the registration statement or prospectus (or
any amendment or supplement  thereto) in reliance upon, and in conformity  with,
written information furnished to us by the selling shareholder  specifically for
use in, or the preparation of, such registration statement or prospectus (or any
amendment or supplement thereto).

Description of our Subsidiaries' Preferred Shares and Special Common Units

     Community Reinvestment Act Preferred Shares

     We have  issued,  and may in the  future  issue,  two  separate  series  of
preferred shares  designated  Convertible  Community  Reinvestment Act Preferred
Shares.  We  collectively  refer to both  series  of our  Convertible  Community
Reinvestment  Act  Preferred  Shares as our "CRA  Shares."  Our CRA  Shares  are
entitled  to the same  economic  benefits  as our Common  Shares  but  receive a
preference  with  respect to certain  regulatory  benefits  which are  described
below.  With the exception of the  conversion  rate and notice  provisions,  the
terms of both series of CRA Shares are the same.

     Our CRA Shares are  intended to enable  banks and similar  institutions  to
obtain  positive   consideration  under  the  Community  Reinvestment  Act.  The
Community  Reinvestment  Act,  enacted  in 1977,  encourages  banks and  similar
institutions  insured by the Federal Deposit Insurance  Corporation to invest in
projects that promote  community  development,  particularly in low and moderate
income neighborhoods.  The Community Reinvestment Act does this by awarding such
banks and similar  institutions,  "credits"  based upon the amount of funds they
invest in "qualifying" projects.  Examples of qualifying projects include, among
others,  those investments that provide  affordable  housing for low or moderate
income  individuals,  or fund  activities  that  revitalize  or stabilize low or
moderate  income  areas.  We invest in revenue  bonds  that fund these  types of
investments. We believe that an investment in our Company through our CRA Shares
will  qualify  for  credits  under  the  Community  Reinvestment  Act.  Each CRA
shareholder  may be entitled to an  allocation  of these  credits based upon the
aggregate  amount of their  investment  in us, for  Community  Reinvestment  Act
purposes.

     Our CRA Shares  rank (i) on parity (pro rata based on the number of shares)
with our  Common  Shares  and all other CRA  Shares  with  respect to payment of
distributions  and rights upon our  liquidation,  dissolution and winding up and
(ii)  pari  passu  with  all  other  CRA  Shares  with  respect  to  CRA  Credit
allocations. Our income and loss is also allocated pro rata (based on the number
of  shares)  among our common  shareholders  and our CRA  shareholders.  In this
regard,  in the event of (i) the payment of distributions  payable in our Common
Shares or securities  convertible  into our Common Shares,  (ii) the issuance to
all  holders  of our  Common  Shares of  certain  rights,  options  or  warrants
entitling  them to subscribe for or purchase  Common Shares at a price per share
less  than the  fair  market  value  per  Common  Share,  and  (iii)  all  other
distributions  to  the  holders  of  our  Common  Shares  or  evidences  of  our
indebtedness or our assets, our CRA shareholders will receive for each CRA Share
held, the same payment,  issuance or distribution  payable for each Common Share
held. For example, if we pay a distribution with respect to our Common Shares or
to securities  convertible into our Common Shares,  and common  shareholders are
entitled to receive two Common  Shares for each Common Share they hold,  the CRA
shareholders  will also receive two Common  Shares for each CRA Share they hold.
In connection with the foregoing payments,  issuances or distributions,  we will
take whatever actions we consider to be

                                       25
advisable in order that both our common and CRA shareholders will be treated the
same for federal income tax purposes.

  Charter Mac Equity Issuer Trust--Preferred Shares

     Our  subsidiary  the  Equity  Trust,   has  issued   preferred   shares  to
institutional  investors with an aggregate  liquidation  amount of approximately
$273.5 million.  Attributes of each series of Cumulative Preferred Shares are as
follows:
Preferred Series          Total
                               Liquidation
                               Amount                          Annual
                               ($ in thousands)                Dividend Rate
--------------------------------------------------------------------------------
Series A                  90,000                          6.625%
     Series A-1                24,000                          7.100%
     Series A-2                31,000                          6.300%
     Series A-3                30,000                          6.800%
     Series B                  55,000                          7.600%
     Series B-1                18,500                          6.800%
     Series B-2                25,000                          7.200%
--------------------------------------------------------------------------------
We collectively refer to the Series A Cumulative  Preferred Shares,  Series
A-1 Cumulative  Preferred  Shares,  Series A-2 Cumulative  Preferred  Shares and
Series A-3 Cumulative Preferred Shares as the "Series A Shares." We collectively
refer to the  Series B  Subordinate  Cumulative  Preferred  Shares,  Series  B-1
Subordinate  Cumulative  Preferred Shares and Series B-2 Subordinate  Cumulative
Preferred  Shares as the  "Series B Shares." We also  collectively  refer to the
Series A Shares and the Series B Shares as the "Cumulative Preferred Shares."

     The Cumulative  Preferred  Shares are not convertible into common shares of
the Equity Trust or our Common Shares.  The Cumulative  Preferred Shares have an
annual preferred  dividend payable quarterly in arrears on January 31, April 30,
July 31 and October 31 of each year,  but only upon  declaration  thereof by the
Equity  Trust's  board of trustees and only to the extent of the Equity  Trust's
tax-exempt income (net of expenses) for the particular quarter. Since inception,
all quarterly distributions have been declared at the stated annualized dividend
rate for each respective series.

     The Series A Shares all have identical terms except as to the  distribution
commencement date, the annual preferred dividend rate, the remarketing date, the
mandatory repurchase date and the liquidation amount per share. The Equity Trust
may not redeem the Series A, A-1 and A-2  preferred  shares before June 30, 2009
and they are subject to mandatory  tender for  remarketing  and purchase on such
date and each  remarketing  date thereafter at a price equal to their respective
per share liquidation amounts plus an amount equal to all distributions  accrued
but unpaid on the Series A, A-1 and A-2 preferred  shares.  The Equity Trust may
not redeem the Series A-3 preferred  shares before October 31, 2014 and they are
subject to mandatory  tender for  remarketing and purchase on such date and each
remarketing date thereafter at a price equal to its per share liquidation amount
plus an amount equal to all  distributions  accrued but unpaid on the Series A-3
preferred  shares.  Holders  of the  Series A Shares  may elect to retain  their
shares upon remarketing,  with a distribution rate to be determined  immediately
prior to the  remarketing  date by the  remarketing  agent.  After  the  initial
remarketing  dates,  all or a portion of the shares may be redeemed,  subject to
certain  conditions.  Each  holder of the  Series A,  Series  A-1 and Series A-2
preferred shares,  and each holder of the Series A-3 preferred  shares,  will be
required to tender its shares to the Equity Trust for  mandatory  repurchase  on
June 30,  2049 and  October  31,  2052,  respectively,  unless the Equity  Trust
decides to remarket the shares on such dates.

     The Series A Shares  rank,  with  respect to payment of  distributions  and
amounts upon liquidation,  dissolution or winding-up of the Equity Trust, senior
to the Series B Shares and all classes or series of

                                       26
common shares of the Equity Trust and, therefore, effectively rank senior to our
Common Shares, our CRA Shares and our preferred shares, if any.

     The Series B Shares all have identical terms, except as to the distribution
commencement  date, the annual preferred dividend rate, the remarketing date and
the mandatory  repurchase date. The Equity Trust may not redeem the Series B and
Series B-1  preferred  shares  before  November 30, 2010 and they are subject to
mandatory  tender for remarketing and purchase on such date and each remarketing
date thereafter at a price equal to their per share  liquidation  amount plus an
amount equal to all distributions  accrued but unpaid on the Series B and Series
B-1 preferred  shares.  The Equity Trust may not redeem the Series B-2 preferred
shares  before  October 31, 2014,  and they are subject to mandatory  tender for
remarketing and purchase on such date and each  remarketing date thereafter at a
price  equal to its per share  liquidation  amount  plus an amount  equal to all
distributions accrued but unpaid on the Series B-2 preferred shares.  Holders of
the Series B Shares may elect to retain  their shares upon  remarketing,  with a
distribution rate to be determined  immediately prior to the remarketing date by
the remarketing agent. After the initial  remarketing dates, all or a portion of
the shares may be redeemed,  subject to certain  conditions.  Each holder of the
Series B and  Series  B-1  preferred  shares  and each  holder of the Series B-2
preferred  shares will be required to tender its shares to the Equity  Trust for
mandatory  repurchase  on November 30, 2050 and October 31, 2052,  respectively,
unless the Equity Trust decides to remarket the shares on such dates.

     The Series B Shares  rank,  with  respect to payment of  distributions  and
amounts upon liquidation,  dissolution or winding up of the Equity Trust, senior
to all classes or series of common  shares of the Equity  Trust and,  therefore,
effectively  rank senior to our Common Shares,  our CRA Shares and our preferred
shares, if any, and junior to the Series A Shares.

     The Equity Trust is subject to, among others, the following  covenants with
respect to the Cumulative Preferred Shares:

     Tax-exempt  interest and  distributions.  The Equity Trust may only acquire
new  investments  that  it  reasonably   believes  will  generate  interest  and
distributions  excludable from gross income for federal income tax purposes. The
Equity  Trust will  dispose of any  investment  the  interest  on which  becomes
includable in gross income for federal income tax purposes,  for any reason,  as
soon as commercially practicable.

     Leverage.  The  Equity  Trust  will  not,  and will not  permit  any of its
subsidiaries to, directly or indirectly,  incur any obligation except if (i) the
Equity Trust is not in default under its trust agreement,  (ii) the Equity Trust
has  paid or  declared  and  set  aside  for  payment  all  accrued  and  unpaid
distributions on the Cumulative  Preferred Shares, and (iii) after giving effect
to the incurrence of the obligation, the leverage ratio on the portfolio is less
than 0.6 to 1.0.

     Failure to pay distributions.  If the Equity Trust has not paid in full six
consecutive  quarterly  distributions on the Cumulative  Preferred  Shares,  the
Equity  Trust is  required  to  reconstitute  its  board of  trustees  so that a
majority of the board of trustees  consists of trustees who are independent with
respect to the Equity Trust, us, or our subsidiaries.

     Allocation of Taxable Interest Income and Market Discount. The Equity Trust
will specially  allocate  taxable  interest  income and market  discount that is
taxable as ordinary income to us. Market  discount,  if any, may arise where the
Equity Trust acquires a bond other than upon its original issuance for less than
its stated  redemption price at maturity and the difference is greater than a de
minimis  amount  (generally  1/4 of 1% of a bond's  stated  redemption  price at
maturity multiplied by the number of complete years to maturity).

     Limitation on Issuance of Preferred Equity Interests.  The Equity Trust may
not issue  preferred  equity  interests  that are  senior to the Series A Shares
without the  consent of a majority  of the  holders of

                                       27
the  Series A Shares.  The  Equity  Trust may not  issue  any  preferred  equity
interests  that are  equal in rank to the  Cumulative  Preferred  Shares  unless
certain  conditions are met,  including that the amount of such preferred equity
interests  is limited,  the Equity  Trust has paid or declared and set aside for
payment all accrued and unpaid  distributions on the Cumulative Preferred Shares
to holders, and there is no default or event of default under the Equity Trust's
trust agreement.

  Special Common Units

     In  connection  with  our  acquisition  of  Related  Capital,   the  former
principals  of Related  Capital were issued  membership  interests in CCC in the
form of "special common units."

     Features of the Special  Common Units.  The features of the special  common
units are as follows: (a) the special common units will be exchangeable, subject
to  anti-dilution  adjustments  and some  other  restrictions  set  forth in the
exchange  rights  agreement (see  "-Exchange  rights  agreement,"  below) at the
election  of the  holders of the  special  common  units,  for cash equal to the
average closing price of our Common Shares for the five consecutive trading days
immediately preceding the date we receive a notice of exchange;  provided,  that
we may  choose,  at our sole  discretion,  to  satisfy  this  exchange  right by
exchanging the special common units for Common Shares on a one-for-one basis, in
lieu of cash;  (b)  distributions  will be paid to the holders of special common
units at the same time as, and only if, distributions are paid to holders of our
Common Shares; and (c) distributions paid to the holders of special common units
will consist of taxable income.

     Distributions on the special common units.  Holders of special common units
will be entitled to  distributions  at the same time as, and only if,  dividends
are paid on our Common Shares.  However,  unlike dividends payable to holders of
our  Common  Shares,   which  consist  of   substantially   tax-exempt   income,
distributions  payable to holders of the special  common  units will  consist of
taxable  income.  In order to take into account the  difference in tax treatment
and  enable  holders  of the  special  common  units to  receive  an  equivalent
after-tax  return on  distributions  as holders of our Common Shares  receive on
their  dividends,  the amount of their initial  distribution  will equal our per
share dividend,  annualized as of the closing date of our acquisition of Related
Capital,  divided by 0.72.  Subsequent  distributions  to the holders of special
common units will be increased (or decreased) proportionately with increases (or
decreases) in dividends paid to holders of our Common Shares.

     To the extent that, in any year, CCC does not have  sufficient cash flow to
pay the entire  distribution  due on the special common units, we have agreed to
contribute  or to lend to CCC all but $5  million  of these  distributions.  The
remaining  shortfall,  if any, will earn interest at a market rate and will only
be payable at the time CCC has sufficient cash flow.

     Governance/voting  rights. Holders of the special common units may not take
part in the  operation,  management or control of CCC's business and do not have
any voting  rights.  This  notwithstanding,  the  consent  of a majority  of the
holders of the special  common  units will be required to approve the  following
"Capital  Transactions"  related to CCC: (a) the  dissolution  or liquidation of
CCC; (b) the sale,  assignment,  transfer or pledge of assets of CCC outside the
ordinary course of business;  (c) a merger or consolidation  with another entity
where CCC (1) is not the surviving  entity;  (2) issues  special common units in
connection with the merger or consolidation;  or (3) makes any change to the CCC
operating  agreement or certificate of formation;  (d) any  distribution  by CCC
(other than cash  distributions);  (e)  specified  transfers of assets and other
transactions  that would result in  recognition  of taxable income to the former
principals of Related  Capital;  or (f) the issuance of additional  interests in
CCC.

     Consent  will not be  required  with  respect to any action  referred to in
clause (b) or (e) above, if the action is with an  unaffiliated  third party and
at the time of the transaction, CCC distributes to the holders of special common
units  cash in an  amount  sufficient  to  offset  any tax  payable  on any gain
recognized by them as a result of these actions.

                                       28
If we  decide  to  sell  or  dispose  of  all or  substantially  all of our
Company's   assets  or  equity  interests  (an   "Extraordinary   Transaction"),
structured  in a way that  requires  a  Capital  Transaction  to  occur,  we may
consummate the Extraordinary  Transaction  without the consent of the holders of
the special common units provided that the Extraordinary  Transaction either (a)
entitles the holders of the special  common units to retain their special common
units,  (b) allows our  shareholders  to receive more than 50% of the  aggregate
value of the  consideration  to be paid to them in cash or (c) occurs  more than
five  years  after the  closing  of the  acquisition  transaction,  and  further
provided  that if the holders of the special  common  units are not  entitled to
retain their special  common  units,  those holders will be required to exchange
their special common units pursuant to the exchange rights agreement.

     Exchange  Rights.  Each holder of special common units has the right,  upon
expiration  of any lock-up  period,  to (a)  exchange  all or a portion of their
special  common  units for cash and (b) receive  cash in an amount  equal to any
accrued but unpaid  distributions with respect to the special common units being
exchanged  (not  including  accrued and unpaid  distributions  for the quarterly
period  in  which  the  exchange  occurs).  In lieu  of  cash,  we  may,  at our
discretion,  exchange  such  special  common  units (and any  accrued but unpaid
distributions)   for  Common   Shares  on  a  one-for-one   basis,   subject  to
anti-dilution adjustments.  The Common Shares will be issued at a price equal to
the average  closing market price of our Common Shares for the five  consecutive
trading  days  prior to the date upon which CCC and CM Corp.  receive  notice of
conversion. Exchanges may only be made in amounts equal to or greater than 1,000
special common units, unless a holder owns less than 1,000 special common units,
in which case that holder may exchange the entire amount held.

  Special Preferred Voting Shares

     In  connection  with our  acquisition  of Related  Capital,  each holder of
special  common units acquired one special  preferred  voting share (at $.01 per
share) for each special common unit they received.

     Voting rights.  The special  preferred voting shares entitle the holders of
the special common units to vote, on a one-for-one basis, on all matters subject
to a vote of the holders of our Common Shares. We have the right to require that
each  special  preferred  voting  share be  redeemed  (for $.01 per  share)  and
cancelled  simultaneously  upon the  exchange  of a special  common  unit by the
holder  thereof  into cash or our Common  Shares.  Other than the payment of the
$.01 per share upon  redemption  of the special  preferred  voting shares or the
liquidation of our Company, the special preferred voting shares are not entitled
to any distributions or other economic rights.

     Voting  Agreement.  The former principals of Related Capital entered into a
voting  agreement  which  governs the voting of all of their  special  preferred
voting  shares,  Common Shares  issuable  upon exchange of their special  common
units and any other Common  Shares  currently  owned or which may be acquired by
them in the future.  The voting agreement provides that the former principals of
Related  Capital  will (a) vote on any  matter  requiring  a vote of our  common
shareholders  not more than 90% of the voting power  represented  by the special
preferred  voting shares (and any Common Shares to be issued in exchange for the
special common units) for a period of two years; (b) vote their Common Shares or
special  preferred  voting  shares in favor of the  election of any  independent
trustee  approved  by our board of  trustees  or in the same  proportion  as the
unaffiliated  holders of our Common  Shares vote in such  election,  and (b) not
exercise any right as a shareholder  of our Company to nominate any  independent
trustee.  With the  exception of Mr. Ross,  whose  voting  agreement  remains in
effect as long as he owns any of our special  preferred  voting shares or Common
Shares,  the voting  agreement  will  terminate for each of the  remaining  four
former  principals  at the time he or she is no longer an  employee,  officer or
trustee of our Company.

                                       29
Trust Agreement and Bylaw Provisions and Certain Provisions of Delaware Law

     Our Board of Trustees. Our business and affairs are managed by our board of
trustees.  Our board of  trustees  consists of not less than three nor more than
sixteen trustees, of which eight shall be independent,  which means they may not
be our officers or employees, related to our officers nor represent concentrated
or family holdings of our voting interests, and who, in the view of our board of
trustees,  are free from any relationship that would interfere with the exercise
of  independent  judgment with respect to matters  relating or pertaining to our
affairs.  As long as Thomas W. White is on the board of trustees,  a majority of
the board of trustees by at least one managing trustee must be independent. Upon
Thomas  W.  White's  ceasing  to serve as a  managing  trustee  for any  reason,
including by reason of his resignation or removal or otherwise, and at all times
thereafter,  a  majority  of the  board of  trustees  by at least  two  managing
trustees  must be  independent  trustees  (e.g.  if the total number of managing
trustees is nine, independent trustees must comprise at least six members of the
board of  trustees).  The total number of managing  trustees may be increased or
decreased  pursuant  to the  bylaws,  but shall  never be less than the  minimum
number, if any, required by the Delaware Act nor more than sixteen.

     Our board of trustees  currently has fifteen  managing  trustees,  eight of
whom are  independent  trustees.  Our  board  of  trustees  establishes  written
policies  on  investments   and  borrowings  and  monitors  our   administrative
procedures,  investment  operations  and  performance  as well as monitoring our
management  team to assure that such  policies are carried out. The  independent
trustees are  responsible  for reviewing our investment  policies not less often
than annually and with sufficient frequency to determine that the policies being
followed are in the best interests of our shareholders.

     We have annual  shareholder  meetings to re-elect a portion of our managing
trustees, who will generally serve staggered, three-year terms. Election of each
managing  trustee  requires the approval of a plurality of the votes cast by the
holders of Common Shares in person or by proxy at our annual meeting.  Our trust
agreement  provides that (i) with respect to an annual meeting of  shareholders,
nominations of persons for election to the board of trustees and the proposal of
business to be considered by  shareholders  may be made only (a) pursuant to our
Company's  notice  of the  meeting,  (b) by the board of  trustees,  or (c) by a
shareholder  who is entitled to vote at the  meeting and has  complied  with the
advance  notice  procedures  set  forth in our  trust  agreement,  and (ii) with
respect to special meetings of shareholders,  only the business specified in our
Company's notice of meeting may be brought before the meeting of shareholders.

     A vacancy in our board of trustees  created by the death,  resignation,  or
incapacity of a managing  trustee  (within the limits  referred to above) may be
filled  by the vote of a  majority  of the  remaining  managing  trustees  (with
respect to a vacancy  created by the death,  resignation,  or  incapacity  of an
independent  trustee,  the  remaining  independent  trustees  shall  nominate  a
replacement).  A vacancy in our board of trustees  created by an increase in the
number of managing trustees may be filled by a majority vote of the entire board
of trustees.  Any managing  trustee may resign at any time. Our trust  agreement
provides  that,  subject  to the right of the  holders of any class of shares to
elect  additional  managing  trustees,  managing  trustees may be removed by the
affirmative  vote of a majority of our Common  Shares then  outstanding  with or
without cause. Wilmington Trust Company, a Delaware banking corporation, is also
one of our trustees.  Wilmington  Trust Company has been appointed as registered
trustee  solely to satisfy  certain  requirements  of the  Delaware  Act and its
duties and  responsibilities  with respect to us and our  shareholders  are very
limited.

     So long as the holders of the special  common units own, in the  aggregate,
7.5% or more of our  outstanding  voting  securities  (a) there must be at least
fourteen  trustees  on  our  board  of  trustees,  consisting  of at  least  six
non-independent trustees and at least eight independent trustees and (b) holders
of a majority of the outstanding  special voting  preferred shares will have the
right,  in lieu of our board of trustees (or  nominating  committee  thereof) to
elect to our board of trustees  any  non-independent  trustees to fill a vacancy
and to  nominate  any  non-independent  trustees  for  election at any annual or
special

                                       30
meeting of our shareholders.  This power of nomination will not affect the right
of the  holders of our Common  Shares to also  nominate  their  choices  for the
non-independent  trustee nominees.  After the date upon which the holders of the
special  preferred  voting shares own, in the  aggregate,  less than 7.5% of our
outstanding voting securities,  the nominating  committee will have the right to
nominate  non-independent  trustees to fill a vacancy  (which  vacancies will be
filled by the  affirmative  vote of a majority of our board of  trustees)  or to
stand for election at any annual or special meeting.

     Additional Classes and Series of Shares. Our trust agreement  authorizes us
to issue 100,000,000  shares and authorizes our board of trustees to classify or
reclassify  any unissued  beneficial  interests,  to provide for the issuance of
beneficial interests in other classes or series of securities,  to establish the
number  of  beneficial  interests  in  each  class  or  series  and to  fix  the
preferences,   conversion  and  other  rights,   voting  powers,   restrictions,
limitations  as to  distributions,  qualifications  or  terms or  conditions  of
redemption of such class or series.  We believe that the ability of our board of
trustees to issue one or more classes or series of beneficial interests provides
us with  increased  flexibility in structuring  possible  future  financings and
acquisitions,  and in meeting  other  needs which  might  arise.  Subject to the
American  Stock Exchange  rules which require  shareholder  approval for certain
issuances of securities, the additional classes or series, as well as the Common
Shares,   will  be  available  for  issuance   without  further  action  by  our
shareholders. See "Risk Factors--Risks relating to our Company and the operation
of our business--There are possible adverse effect arising from shares available
for future sale." Although our board of trustees has no intention at the present
time of doing so, it could issue a class or series that could,  depending on the
terms of such class or series, delay, defer or prevent a transaction or a change
in control of our Company that might  involve a premium price for holders of our
Common Shares or otherwise be in their best interest.

     Advance Notice of Managing Trustee Nominations and New Business. Our bylaws
provide  that (i) with  respect  to an annual  meeting  of common  shareholders,
nominations of persons for election to our board of trustees and the proposal of
business to be considered by common  shareholders  may be made only (a) pursuant
to our  notice  of  meeting,  (b) by our board of  trustees,  or (c) by a common
shareholder  who is entitled to vote at the  meeting and has  complied  with the
advance  notice  procedures  set  forth in our  trust  agreement,  and (ii) with
respect to special meetings of common shareholders,  only the business specified
in  our  notice  of  meeting  may  be  brought  before  the  meeting  of  common
shareholders,  and  nominations of persons for election to our board of trustees
may be made only (a) pursuant to our notice of the meeting,  (b) by our board of
trustees,  or (c)  provided  that our  board of  trustees  has  determined  that
managing trustees shall be elected at such meeting,  by a common shareholder who
is  entitled to vote at the meeting  and has  complied  with the advance  notice
provisions set forth in our bylaws.

     The advance notice provisions set forth in our bylaws could have the effect
of delaying, deferring or preventing a transaction or a change in control of our
Company  that might  involve a premium  price for  holders  of Common  Shares or
otherwise be in their best interest.

     Term and Dissolution.  We have perpetual existence, but may be dissolved at
an earlier  date (i) upon the  recommendation  of our board of trustees  and the
approval  of  shareholders  by  majority  vote  and  (ii) by order of a court of
competent  jurisdiction  to  judicially  dissolve our Company if it is no longer
reasonably  practicable  to continue  the business and affairs of our Company as
contemplated by our trust agreement.

     Upon  dissolution  of our Company,  our assets will be  liquidated  and the
proceeds of liquidation  will be applied first to the  satisfaction  (whether by
payment or  reasonable  provision  for payment  thereof) of  obligations  of our
Company to third parties  (including holders of senior interests created through
our securitization  programs and preferred shareholders of our subsidiaries) and
then to payment of  liquidation  expenses.  Any remaining  proceeds will then be
distributed to our shareholders.

     Change of Control;  Anti-Takeover Provisions.  Our trust agreement contains
provisions  that might have the effect of delaying,  deferring  or  preventing a
transaction  or a change of control of our

                                       31
Company that might involve a premium price for our Common  Shares,  or otherwise
be in the best interest of our shareholders.  See "Risk Factors--Risks  relating
to our Company and the operation of our business--Our  anti-takeover  provisions
may discourage  third-party  proposals" for a discussion of these  anti-takeover
provisions.

     Voting  Rights  of our  Shareholders.  Our  shareholders  have no  right to
participate  in the control of our business.  However,  our common  shareholders
have  been  granted  certain  voting  rights  which  are set  forth in our trust
agreement. The common shareholders, as a class, have the right to vote upon:

     a.   the election of our board of trustees;

     b.   merger, consolidation or conversion and dissolution of our Company;

     c.   sale of all or substantially all of our assets; and

     d.   amendment  of  our  trust   agreement   (except  in  certain   limited
circumstances), provided that provisions relating to the limitation of liability
and indemnification may only be amended prospectively.

     Amendments to our Trust Agreement.  In general,  our trust agreement may be
amended by the  affirmative  vote or written  consent of the holders of not less
than a majority  of the Common  Shares  then  outstanding  and  entitled to vote
thereon.

     Meetings.  We will hold annual meetings of our common shareholders to elect
managing  trustees  whose terms have  expired.  Our board of trustees may at any
time  call a  meeting  of  common  shareholders  or call for a vote,  without  a
meeting,  of the common  shareholders  on matters on which they are  entitled to
vote,  and shall call for such  meeting or vote  following  receipt of a written
request therefor of common  shareholders  holding 10% or more of the outstanding
Common Shares.

     Borrowing Policies. Our trust agreement provides that we will be allowed to
incur  aggregate  financing  or leverage  (as defined in our Second  Amended and
Restated Trust Agreement) of up to 50% of our total market value  (calculated at
the time any additional financing or leverage is incurred).

     Indemnification  and  Limitation  of  Liability.  The Delaware Act provides
that, except to the extent otherwise  provided in the governing  instrument of a
statutory  trust,  a  trustee,  when  acting  in  such  capacity,  shall  not be
personally  liable to any person other than the statutory  trust or a beneficial
owner for any act,  omission or obligation of the statutory trust or any trustee
thereof.  In addition,  the Delaware  Act  provides  that,  except to the extent
otherwise provided in the governing instrument of a statutory trust, an officer,
employee,  manager or other person acting on behalf of the statutory trust, when
acting in such capacity, shall not be personally liable to any person other than
the statutory trust or the beneficial owner for any act,  omission or obligation
of the statutory trust or any trustee thereof.

     The Delaware Act provides that, subject to such standards and restrictions,
if any, as are set forth in the  governing  instrument of a statutory  trust,  a
statutory  trust shall have the power to indemnify and hold harmless any trustee
or  beneficial  owner or other  person  from and  against any and all claims and
demands whatsoever.

     Our trust  agreement  requires  us to  indemnify  our  present  and  former
trustees,  among  others (any such  person,  an  "indemnified  party"),  against
judgments,  penalties,  fines,  settlements  and  reasonable  expenses  actually
incurred by them in connection  with any  proceeding to which they may be made a
party by  reason  of their  service  in those or other  capacities  unless it is
established  that (a) the act or omission  of the  trustee  was  material to the
matter giving rise to the  proceeding and (i) was committed in bad faith or (ii)
was the result of active and deliberate  dishonesty,  (b) the indemnified  party
actually received an improper  personal benefit in money,  property or services,
or (c) in the  case  of any  criminal  proceeding,

                                       32
the indemnified  party had reasonable  cause to believe that the act or omission
was unlawful.  In addition,  our trust  agreement  requires us, as conditions to
advancing expenses, to obtain (i) a written affirmation by the indemnified party
of his or its  good-faith  belief that he or it has met the  standard of conduct
necessary  for  indemnification  by our  Company  as  authorized  by  our  trust
agreement  and (ii) a written  statement by him or it or on his or its behalf to
repay the amount paid or reimbursed  by us if it shall  ultimately be determined
that the standard of conduct was not met. Our trust  agreement  also requires us
to  provide  indemnification  and  advance  of  expenses  to a present or former
indemnified party who served a predecessor of our Company in such capacity,  and
to any employee or agent of our Company or a predecessor of our Company.

     We  have  obtained  a  liability  insurance  policy  for our  trustees  and
officers, as well as the trustees and officers of our subsidiaries.

     Liability  of  Shareholders.  We are  governed  by the laws of the State of
Delaware.  Under our trust agreement and the Delaware Act, our shareholders will
be  entitled  to  the  same  limitation  of  personal   liability   extended  to
stockholders  of private  corporations  for profit  organized  under the General
Corporation Law of the State of Delaware.

     In general, stockholders of Delaware corporations are not personally liable
for the payment of a corporation's  debts and obligations.  They are liable only
to the extent of their  investment  in the  Delaware  corporation.  In addition,
under the Delaware  Act,  neither the  existence of certain  powers in our trust
agreement  that may be  exercised by our  shareholders  nor the exercise of such
powers will cause such  shareholders to be deemed to be a trustee of our Company
or to be held personally liable for our acts, omissions and obligations.

     The  principles of law governing the  limitation of liability of beneficial
owners of a  statutory  trust have not been  authoritatively  established  as to
statutory  trusts  organized under the laws of one jurisdiction but operating or
owning property, incurring obligations or having beneficiaries resident in other
jurisdictions. A number of states have adopted legislation containing provisions
comparable to the provisions of the Delaware Act.  Accordingly,  in such states,
the  limitation  of liability of our  shareholders  provided by the Delaware Act
should be respected.

     In  those   jurisdictions   which  have  not  adopted  similar  legislative
provisions,  questions exist as to whether such jurisdictions  would recognize a
statutory  trust,  absent  a  state  statute,   and  whether  a  court  in  such
jurisdictions  would recognize the Delaware Act as controlling.  If not, a court
in such  jurisdiction  could hold that the  shareholders are not entitled to the
limitation  of liability  set forth in our trust  agreement and the Delaware Act
and, as a result, are personally liable for our debts and obligations.

                                       33
FEDERAL INCOME TAX CONSIDERATIONS

The following is a summary of certain of the federal  income tax  considerations
which may be material to a typical shareholder who is a United States person and
is based  upon the Code,  judicial  decisions,  final,  temporary  and  proposed
treasury  regulations and administrative  rulings and pronouncements of the IRS.
No attempt has been made to comment on all federal income tax matters  affecting
our Company or our  shareholders.  The discussion  does not purport to deal with
federal income or other tax consequences  applicable to an investment by certain
categories  of   shareholders,   including,   without   limitation,   tax-exempt
organizations,  dealers in securities, banks, insurance companies,  Subchapter S
corporations,  regulated investment companies, real estate investment trusts and
persons who are not citizens or residents of the United States, and is not to be
construed as tax advice.

No ruling on the  federal,  state or local tax  considerations  relevant  to the
issuance of the common and preferred shares,  the debt  characterization  of the
revenue bonds,  the  tax-exempt  character of interest on certain of the revenue
bonds or other bond-related investments,  the classification of our Company as a
partnership,  or any other issue relevant to this offering has been, or will be,
requested from the IRS or from any other tax authority.  Moreover,  no assurance
can be given that the  conclusions  reached by Paul Hastings will be accepted by
the IRS or, if challenged by the IRS, sustained in court.

This summary is based on current legal  authority and there is no assurance that
legislative or  administrative  changes or court  decisions will not occur which
could  significantly  modify  the  statements  and  opinions  expressed  herein,
possibly with retroactive effect.

YOU SHOULD CONSULT YOUR OWN TAX ADVISORS REGARDING THE FEDERAL, STATE, LOCAL AND
FOREIGN INCOME TAX  CONSEQUENCES TO YOU PRIOR TO PURCHASING OUR COMPANY'S COMMON
SHARES.

General

Entity  status of our  Company and our  subsidiaries.  Each holder of our Shares
will agree to treat our Shares as a partnership  interest for federal income tax
purposes.  Based upon  representations  from us, Paul  Hastings has rendered its
opinion  that,  although the issue is not free from doubt,  we have been and are
properly treated as a partnership,  and not as a publicly traded  partnership or
association  taxable  as  a  corporation,   for  federal  income  tax  purposes.
Accordingly,  our  shareholders,  subject to the discussion  regarding  publicly
traded  partnerships  below,  will be partners in such  partnership  for federal
income tax  purposes,  and the  allocations  of  tax-exempt  income by us to the
shareholders will be excludable from gross income for purposes of federal income
taxation.

Our Common  Shares are publicly  traded.  In order for us not to be treated as a
publicly traded partnership  taxable as a corporation,  90% or more of our gross
income  each year must  consist of interest  and other types of passive  income.
Interest earned by our Company may only be included for purposes of this test if
(a) the interest  does not depend on the income or profits of any person and (b)
the  interest is not derived in the  conduct of a  financial  business.  We have
represented  that,  in the current  taxable year and future  taxable  years,  we
anticipate  that income  described in clause (a) will,  together  with any other
non-qualifying income, constitute less than 10% of its gross income. There is no
definitive guidance as to the level of activity that may, for purposes of clause
(b), cause us to be treated as if we were engaged in a financial business. There
is no assurance that the IRS will not  successfully  contend that our Company is
engaged in a financial  business or earns more than 10% of our gross income from
such a business and,  therefore,  is a publicly traded partnership  taxable as a
corporation.

If our Company in any taxable  year were  taxable as a  corporation  for federal
income tax purposes, our income and deductions would be reported only on our tax
return  rather than being  passed  through to our  shareholders  and we would be
required to pay income tax at corporate  rates on any portion of our income

                                       34
that did not  constitute  tax-exempt  income.  In this regard,  a portion of our
tax-exempt  income may be included in determining  our  alternative  minimum tax
liability.  The  imposition  of any such tax  would  reduce  the  amount of cash
available to be distributed to our shareholders. In addition, distributions from
our  Company  to our  shareholders  would be  ordinary  dividend  income to such
shareholders to the extent of our earnings and profits,  which would include our
tax-exempt income as well as any other taxable income we might have. Payments of
such distributions would not be deductible by our Company.  Similarly, if any of
our  subsidiaries  (other  than CM  Corp.  and PW  Funding)  were  treated  as a
corporation  for federal income tax purposes,  rather than as a partnership or a
disregarded entity, adverse consequences could result.

Treatment as a Taxable  Mortgage Pool Taxable as a Corporation.  If, for federal
income tax purposes,  we were  classified as a taxable  mortgage pool within the
meaning of Section 7701(i) of the Code, we would be taxable as a corporation.  A
taxable mortgage pool is an entity (i)  substantially all of the assets of which
consist of debt obligations and more than 50% of such debt obligations  consists
of real  estate  mortgages,  (ii)  which is an  obligor of debt with two or more
maturities and (iii) under the terms of the debt obligations  under clause (ii),
payments bear a relationship  to payments on the debt  obligations  described in
clause (i).  The IRS has the  authority  to treat  certain  equity  interests in
issuers as debt for purposes of the taxable  mortgage  pool rules.  However,  we
will not be treated as a taxable  mortgage  pool  because of the  absence of any
relationship  between  the timing of payments  on the debt  obligations  we hold
(i.e.,  revenue bonds) and the timing of  distributions  on our equity interests
(i.e., common and preferred shares).

Taxation of CM Corp. and PW Funding. Unlike our other subsidiaries, CM Corp. and
PW Funding are taxable  corporations,  and will be required to pay income tax to
the extent they  realize  taxable  income.  It is possible  that the IRS may not
agree with our determinations as to which expenses are allocable to CM Corp. and
PW Funding and their ability to reduce their taxable income,  and which expenses
are  allocable  to us or our  other  subsidiaries.  If all or a  portion  of the
expenses that we allocate to CM Corp.  and PW Funding are  determined  not to be
deductible by CM Corp. or PW Funding,  they could be required to pay  additional
tax, as well as interest and penalties.  Additional tax, as well as interest and
penalties,  could also be payable by CM Corp.  if the IRS  determined  that fees
that we pay to Related  Capital (a  subsidiary  of CM Corp.)  were less than the
amounts  that would be payable if  Related  Capital  were not  related to us. In
addition,  any  dividends  paid by CM Corp.  to us will be treated  as  ordinary
income to us to the extent of CM Corp.'s earnings and profits, and any gain that
may be realized  if all or a portion of our  ownership  interest in CM Corp.  is
sold will result in taxable income.

Certain income tax considerations relating to our Company and our shareholders

Taxation of our Company and our  shareholders.  A partnership  is not subject to
federal income tax. Assuming we are classified as a partnership for tax purposes
and not a publicly traded partnership taxable as a corporation, our Company will
not be subject to federal  income tax and each  shareholder  will be required to
report on their income tax return their distributive share of our income,  gain,
loss,  deduction and items of tax preference and will be subject to tax on their
distributive  share of our taxable income,  regardless of whether any portion of
that income is, in fact,  distributed to such  shareholder in the  shareholder's
taxable  year  within  which  or  with  which  our  taxable  year  ends.   Thus,
shareholders  may be required to accrue income,  without the current  receipt of
cash, if our Company does not make cash  distributions  while generating taxable
income.  Consequently,  although  it is not  anticipated,  a  shareholder's  tax
liability  with  respect to its share of our taxable  income may exceed the cash
actually distributed in a given taxable year. We currently use the calendar year
as our taxable year.

We will file a federal tax return on Form 1065 and will provide  information  as
to each shareholder's  distributive share of our income,  gain, loss,  deduction
and items of tax preference on a Schedule K-1 supplied to such shareholder after
the close of our fiscal year.  In preparing  such  information,  we will utilize
various  accounting  and  reporting  conventions,  some of which  are  discussed
herein, to determine each  shareholder's  allocable share of income,  gain, loss
and  deduction.  There is no  assurance  that the use of such  conventions  will
produce a result that conforms to the  requirements  of the Code,  temporary and

                                       35
proposed treasury regulations or IRS administrative  pronouncements and there is
no assurance that the IRS will not  successfully  contend that such  conventions
are impermissible.  Any such contentions could result in substantial expenses to
our Company and our shareholders as a result of contesting such contentions,  as
well as an increase in tax liability to  shareholders as a result of adjustments
to their  allocable share of our income,  gain,  loss and deduction.  See "--Tax
returns, audits, interest and penalties."

Tax-Exempt  Income. We expect that substantially all of our interest income will
constitute  tax-exempt income.  There are risks that certain amounts of interest
income  that our  Company  will  report as  tax-exempt  may not qualify for such
treatment. See "Risk Factors--Risks relating to our Company and the operation of
our business--The  value of our shares and our ability to make  distributions of
federally    tax-exempt   income   depends   upon   the   application   of   tax
laws--Tax-exemption  of our revenue bonds" and "--Taxable  income." In addition,
if the intended tax treatment of any of our subsidiaries other than CM Corp. and
PW Funding were successfully  challenged by the IRS, all or a part of the income
derived by such subsidiaries may be subject to tax.

Allocation  of income.  Generally,  built in gain or loss in our assets prior to
the   admission  of  our   shareholders   will  be  allocated  to  our  existing
shareholders. We are permitted to account for changes in the value of our assets
subsequent  to the date of the  admission  of a  shareholder  under one of three
methods.  A portion of the subsequent losses from appreciated assets (i.e., fair
market  value in excess of tax basis)  and  subsequent  gains  from  depreciated
assets (i.e.,  fair market value less than tax basis)  realized by a shareholder
may be deferred as a result of one method we may employ.

Capital gain upon sale of our assets.  We may, from time to time, sell,  dispose
of or otherwise be treated as disposing of, certain of our assets.  Such sale or
disposition may result in taxable capital gain.

Shareholder's  basis in Shares. Your adjusted basis in our Shares is relevant in
determining the gain or loss on the sale or other  disposition of our Shares and
the tax  consequences of a distribution  from our Company.  See  "--Treatment of
cash  distributions to our shareholders from our Company." In addition,  you are
entitled  to  deduct on your  income  tax  return,  subject  to the  limitations
discussed below, your distributive  share of our net loss, if any, to the extent
of your adjusted basis in your Shares.

Your  initial  basis in newly issued  Shares will be the purchase  price for the
Shares,  increased  by your share of items of our income  (including  tax-exempt
interest) and gain, and reduced,  but not below zero, by (a) your share of items
of Company loss and deduction (including any nondeductible expenses) and (b) any
cash distributions you have received from our Company.

Treatment of cash  distributions  to our  shareholders  from our  Company.  Cash
distributions   made  to  our  shareholders  will  generally  be  treated  as  a
non-taxable  return of capital and will not generally  increase or decrease your
share of taxable income or loss from our Company.  A return of capital generally
does not  result  in any  recognition  of gain or loss for  federal  income  tax
purposes but would reduce your adjusted basis in your Shares.  Distributions  of
cash in excess of your  adjusted  basis in your Common Shares will result in the
recognition of gain to the extent of such excess.

Limitations on deductibility of losses.  In the event you are allocated  losses,
you generally will be entitled to deduct your  distributive  share of any losses
of our Company to the extent of your tax basis of your Common  Shares at the end
of  the  year  in  which  such  losses  occur.  However,  shareholders  who  are
individuals,  trusts,  estates,  personal service  companies and certain closely
held C corporations may be subject to additional limitations on deducting losses
of our Company.

Limitation on the  deductibility  of interest  expense.  The Code  disallows any
deduction  for  interest  paid  by any  taxpayer  on  indebtedness  incurred  or
continued for the purpose of purchasing or carrying a tax-exempt  obligation.  A
purpose to carry  tax-exempt  obligations  will be inferred  whenever a taxpayer
owns tax-exempt  obligations and has outstanding  indebtedness  which is neither
directly connected with

                                       36
personal  expenditures  nor incurred in connection  with the active conduct of a
trade or business. The IRS may take the position that a shareholder's  allocable
portion of any interest paid by our Company on our borrowings,  and any interest
paid by a shareholder  on  indebtedness  incurred to purchase our Common Shares,
should be viewed in whole or in part as incurred to enable such  shareholder  to
continue carrying such tax-exempt obligations and, therefore, that the deduction
of any such  interest by such  shareholder  should be  disallowed in whole or in
part.

In the  absence of direct  evidence  linking  debt with  purchasing  or carrying
tax-exempt  obligations  (for example,  the  tax-exempt  obligations  secure the
debt),  there is an exception to the interest  disallowance rule if the taxpayer
holds only an  insubstantial  amount of tax-exempt  obligations.  This exception
does not apply to banks,  certain other  financial  institutions,  or dealers in
tax-exempt  securities.  However, to the extent that an investor's debt would be
allocated  to  purchasing  or carrying  its Shares,  such Shares  should only be
treated as tax-exempt obligations for purposes of the interest disallowance rule
in  the  same  proportion  as the  assets  of our  Company  comprise  tax-exempt
obligations  (based on their  adjusted  tax  basis or  perhaps  capital  account
value).  We will  report to  shareholders  at the end of each  year the  average
percentage of our assets (based on adjusted tax basis and capital account value)
that were invested in  obligations we believe were  tax-exempt  each year. It is
uncertain whether an annual average or more frequent adjustments should be used.

Assuming interest on indebtedness is otherwise deductible,  the deductibility of
a non-corporate  taxpayer's  "investment interest" expense is further limited to
the amount of such taxpayer's "net investment income."

Alternative  minimum tax.  Except for  qualified  Section  501(c)(3)  bonds,  or
certain  revenue  bonds that are  grandfathered,  interest on the revenue  bonds
generally is an item of tax preference for purposes of the  alternative  minimum
tax. To the extent  interest on any of the revenue  bonds we own is such an item
of tax preference,  a portion of the income allocable to a shareholder also will
be a tax preference  item.  Substantially  all of our annual  interest income is
expected to  constitute  a tax  preference  item.  This  preference  item may be
reduced,  but not below zero, by interest  expense and other expenses that could
not be deducted  for regular tax purposes  because the expenses  were related to
tax-exempt  income generated by such preference bonds. To the extent interest on
any of the revenue bonds owned by our Company is not a tax preference  item, any
corporation  subject to the alternative  minimum tax must nevertheless take such
tax-exempt  interest into account in determining its adjusted  current  earnings
for purposes of computing its alternative minimum tax liability.

Other federal income tax  considerations.  The Code contains certain  provisions
that could  result in other tax  consequences  as a result of the  ownership  of
revenue bonds by our Company or the inclusion in certain computations including,
without limitation,  those related to the corporate  alternative minimum tax, of
interest that is excluded from gross income.

Ownership of tax-exempt  obligations by our Company may result in collateral tax
consequences to certain  taxpayers,  including,  without  limitation,  financial
institutions,   property  and  casualty  insurance  companies,  certain  foreign
corporations  doing business in the United States,  certain S corporations  with
excess  passive  income,  individual  recipients of social  security or railroad
retirement  benefits and  individuals  otherwise  eligible for the earned income
credit. Prospective purchasers of our Common Shares should consult their own tax
advisors as to the applicability of any such collateral consequences.

Company expenses.  We have incurred or will incur various expenses in connection
with our ongoing  administration  and operation.  Payment for services generally
are  deductible  if the  payments  are  ordinary  and  necessary  expenses,  are
reasonable in amount and are for services  performed  during the taxable year in
which paid or accrued.  We anticipate that a substantial portion of our ordinary
expenses will be allocable to tax-exempt interest income. The Code prohibits the
deduction  of any expense  otherwise  allowable  under Code Section 212 which is
allocable to tax-exempt  interest income. We allocate our expenses in proportion
to the  amount  of  tax-exempt  income  and  taxable  income  that  we  receive.

                                       37
Shareholders  generally  will not be  permitted  to deduct  the  portion  of our
expenses  related to tax-exempt  income in calculating  their federal income tax
liability.  Borrowers pay certain fees they incur in connection  with  obtaining
financing  from us  directly to Related  Capital.  We treat these fees as earned
directly  by  Related  Capital  for  services  Related  Capital  renders  to the
borrowers. It is possible that the IRS could contend such fees should be treated
as additional taxable income to us and additional expense. If such position were
asserted  and  upheld,  it would  result in us  recognizing  additional  taxable
income,  but all or a  substantial  portion of the  additional  expense would be
disallowed. In addition,  depending on the amount of such income relative to our
other  income,  it  could  result  in us  being  treated  as a  publicly  traded
partnership taxable as a corporation.

The IRS may not agree with our  determinations  as to the  deductibility of fees
and  expenses  and might  require  that  certain  expenses  be  capitalized  and
amortized or  depreciate  d over a period of years.  If all or a portion of such
deductions  were to be  disallowed,  on the  basis  that  some of the  foregoing
expenses are  non-deductible  syndication fees or otherwise,  our taxable income
would be increased or our losses would be reduced.

An  individual  shareholder's  share of expenses of our Company  (not  including
interest  expenses) is a  miscellaneous  itemized  deduction which is deductible
only to the extent  it,  along with  other  miscellaneous  itemized  deductions,
exceeds 2% of such  individual  shareholder's  adjusted  gross income and is not
deductible for purposes of determining AMT.

Section  754  election.  We have not  elected  under  Section 754 of the Code to
adjust the basis of  partnership  property  on the  transfer  of Shares,  by the
difference  between the  transferee's  basis for his Shares and the transferee's
allocable  share of the basis of all property of our  Company,  but may do so in
the future. Any such election would not apply to the contribution of cash to our
Company in exchange for our Shares.

Backup  withholding.  Distributions to shareholders whose Common Shares are held
on their behalf by a "broker" may  constitute  "reportable  payments"  under the
federal income tax rules regarding  "backup  withholding."  Backup  withholding,
however,  would apply only if the  shareholder  (i) failed to furnish its Social
Security number or other taxpayer identification number of the person subject to
the backup  withholding  requirement  (e.g.,  the "broker") or (ii) furnished an
incorrect Social Security number or taxpayer  identification  number. If "backup
withholding" were applicable to a shareholder, we would be required to withhold,
at the applicable  rate, with respect to each  distribution to such  shareholder
and to pay such amount to the IRS on behalf of such shareholder.

Issuance of additional  Shares. We may issue new Shares to additional  investors
to finance  the  acquisition  of  additional  investments.  On any  issuance  of
additional  Shares,  we expect that we will  adjust the capital  accounts of the
existing  shareholders  to reflect a revaluation of our property (based on their
then fair market value, net of liabilities to which they are then subject).

Tax returns,  audits, interest and penalties. We will supply Schedule K-1 to IRS
Form 1065 to each  shareholder of record as of the last day of each month during
a taxable  year after the end of each  calendar  year.  We are not  obligated to
provide tax information to persons who are not shareholders of record.

Any shareholder who sells or transfers a Common Share will be required to notify
us of such  transaction  in writing  within 30 days of the  transaction  (or, if
earlier,  by  January  25 of the  calendar  year  after  the year in  which  the
transaction  occurs).  The notification is required to include (i) the names and
addresses of the transferor and the transferee, (ii) the taxpayer identification
number of the transferor  and, if known, of the transferee and (iii) the date of
the sale or exchange.  A shareholder  will not be required to notify our Company
of a sale or exchange of a Common Share if an information  return is required to
be filed by a broker with respect to such sale or exchange.  Any  transferor who
fails to notify  our  Company  of a sale or  exchange  may be  subject  to a $50
penalty for each such  failure.  We will treat any  transferor  shareholder  who
provides all of the  information  requested of the  transferor on the depositary
receipt as having satisfied this notification requirement.

                                       38
In addition,  we must file a return notifying the IRS of any sale or exchange of
a Common  Share of which we have  notice and report the name and  address of the
transferee and the transferor who were parties to such  transaction,  along with
all other  information  required by applicable  temporary and proposed  treasury
regulations,  including  the  fair  market  value of the  selling  shareholder's
allocable share of unrealized receivables (including  depreciation recapture, if
any).  If we do not know the  identity  of the  beneficial  owner of the  Common
Share,  the record holder of such Common Share may be treated as the  transferor
or transferee, as the case may be.

State,  local and foreign  income taxes.  In addition to the federal  income tax
consequences  described  above,  shareholders  should consider  potential state,
local and  foreign  tax  consequences  of an  investment  in us and are urged to
consult their individual tax advisors in this regard.  The rules of some states,
localities and foreign  jurisdictions  for computing  and/or  reporting  taxable
income may differ from the federal rules. Interest income that is tax-exempt for
federal  purposes is generally  subject to state  taxes,  except in the state in
which the property securing our investment and the bond issuer are located.  All
the bonds and interest  income  thereon may be subject to taxation by localities
and foreign jurisdictions. An investment in our Common Shares could also require
our shareholders to file tax returns in various  jurisdictions,  although we are
not aware of any current filing obligations.

Under the tax laws of  certain  states,  we may be  subject  to state  income or
franchise tax or other taxes applicable to our Company.  Such taxes may decrease
the amount of  distributions  available to our  shareholders.  Shareholders  are
advised to consult with their tax advisors  concerning  the tax treatment of our
Company,  and the effects under the tax laws of the states  applicable to us and
our shareholders.

The summary tax consequences set forth above is for general information only and
does not address the  circumstances  of any particular  shareholder.  You should
consult  your  own tax  advisors  as to the  specific  tax  consequences  of the
purchase,   ownership  and  disposition  of  our  Common  Shares  including  the
application of state, local and foreign tax laws.

                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     This  re-offer  prospectus  and  the  information  incorporated  herein  by
reference  contain  certain  statements  and  other  written  material  and oral
statements  made from time to time by us do not relate strictly to historical or
current facts. As such, they are considered "forward-looking  statements" within
the  meaning of the  Private  Securities  Litigation  Reform Act of 1995.  These
forward-looking statements are not historical facts, but rather are based on our
current expectations,  estimates and projections about our industry, beliefs and
assumptions.   Words  such  as  "anticipates,"  "expects,"  "intends,"  "plans,"
"believes,"  "seeks,"  "estimates"  and  similar  expressions  are  intended  to
identify  forward-looking  statements.  These  statements  are not guarantees of
future  performance and are subject to risks,  uncertainties  and other factors,
some of which are beyond our control,  are  difficult to predict and could cause
actual results to differ  materially  from those  expressed or forecasted in the
forward-looking statements. These risks and uncertainties are described in "Risk
Factors" and elsewhere in this re-offer prospectus.  We caution you not to place
undue reliance on these forward-looking statements,  which reflect our view only
as of the respective  date of this re-offer  prospectus or other dates which are
specified herein.

                                 USE OF PROCEEDS

     CharterMac will not receive any proceeds from the sale of the Common Shares
which may be sold pursuant to this re-offer  prospectus  for the accounts of the
Selling  Securityholders.  All such proceeds, net of brokerage  commissions,  if
any,   will  be   received  by  the  Selling   Securityholders.   See   "Selling
Securityholders" and "Plan of Distribution."

                                       39
SELLING SECURITYHOLDERS

     This re-offer  prospectus  covers offers and sales from time to time by the
Selling  Securityholders of up to 1,025,867 Common Shares issued or to be issued
to the Selling  Securityholders  (i) upon exercise of options granted to Stephen
Ross pursuant to the Ross Option Agreement and (ii) pursuant to the terms of the
Restricted   Plan.   Under  Rule  416  of  the   Securities   Act,  the  Selling
Securityholders  may also offer and sell  Common  Shares  issued to the  Selling
Securityholders  as a  result  of,  among  other  events,  stock  splits,  stock
dividends and similar events that affect the number of Common Shares held by the
Selling  Securityholders.  The Selling  Securityholders  are  affiliates  of the
Company pursuant to Rule 144 of the Securities Act.

     The following  table sets forth certain  information  as to the  beneficial
ownership of CharterMac's Common Shares as of November 21, 2003 for each Selling
Securityholder:
---------------------------------------------------------------------------------------------------------------
Name                   Relationship      Common Shares   Percentage  Common         Common Shares    Percentage
                       to the            Beneficially    of Common   Shares         Beneficially     of Common
                       Company           Owned Before    Shares      Offered        Owned After      Shares to
                                         Offering (1)    Owned                      Offering (1)     be Owned
                                                         Before                                      After
                                                         Offering                                    Offering
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Stephen M. Ross        Chairman of
                       the Board of
                       Trustees of
                       CharterMac        11,257,661(2)   17.1%       1,000,000      10,257,661       15.6%
---------------------------------------------------------------------------------------------------------------
Stuart A. Rothstein    Chief Financial
                       Officer of
                       CharterMac        66,867(3)       *              25,867          41,000       *
---------------------------------------------------------------------------------------------------------------
*less than 1%

(1)  The  number  of  shares   beneficially  owned  is  determined  under  rules
promulgated  by  the  Commission  and  includes  outstanding  Common  Shares  or
restricted  Common Shares and options for Common Shares that have vested or will
vest within 60 days.

(2) Includes 255,487 Common Shares, 10,000,000 special common units of CCC which
are  convertible  on a one-to-one  basis into Common  Shares;  2,174 options for
Common  Shares that are  exercisable  within 60 days of November 21,  2003;  and
1,000,000 options exercisable for Common Shares thereafter.

(3) Includes  1,000 Common  Shares;  25,867  restricted  Common  Shares;  13,333
options for Common Shares  exercisable  within 60 days of November 21, 2003; and
26,667 options exercisable for Common Shares thereafter.

                              PLAN OF DISTRIBUTION

Common  Shares  offered  hereby may be sold from time to time  directly by or on
behalf of the Selling  Securityholders  in one or more transactions on any stock
exchange or stock market on which the Common Shares may be listed at the time of
sale, in privately  negotiated  transactions,  or through a combination  of such
methods,  at market prices  prevailing at the time of sale, at prices related to
such  prevailing  market  prices,  at fixed prices  (which may be changed) or at
negotiated  prices.  The  Selling  Securityholders  may sell the  Common  Shares
through one or more agents,  brokers or dealers or directly

                                       40
to purchasers.  Such brokers or dealers may receive  compensation in the form of
commissions,  discounts or concessions from the Selling  Securityholders  and/or
purchasers of the Common Shares or both (which  compensation  as to a particular
broker or dealer may be in excess of customary commissions).

In connection with such sales, the Selling Securityholders and any participating
broker or dealer may be deemed to be  "underwriters"  within the  meaning of the
Securities Act, and any commissions they receive and the proceeds of any sale of
Common Shares may be deemed to be underwriting  discounts and commissions  under
the Securities Act.

In order to comply with certain state securities laws, if applicable, the Common
Shares may be sold in certain  jurisdictions only through registered or licensed
brokers or dealers.  In certain states, the Common Shares may not be sold unless
the Common Shares have been registered or qualified for sale in such state or an
exemption from  regulation or  qualification  is available and is complied with.
Sales of Common  Shares  must  also be made by the  Selling  Securityholders  in
compliance with all other applicable state securities laws and regulations.

In addition to any Common Shares sold hereunder, Selling Securityholders may, at
the same time,  sell any Common  Shares of  beneficial  interest,  including the
Common Shares,  owned by them in compliance with all of the requirements of Rule
144, regardless of whether such shares are covered by this re-offer prospectus.

There can be no assurance that the Selling  Securityholders will sell any or all
of the  Common  Shares  offered  hereby.  In  addition,  there  may  be  certain
contractual  restrictions on the ability of the Selling  Securityholders to sell
any or all of their Common Shares.

The Company will pay all expenses of the  registration  of the Common Shares and
will not receive any proceeds  from the sale of any Common Shares by the Selling
Securityholders.

The Company has  notified the Selling  Securityholders  of the need to deliver a
copy of this  re-offer  prospectus  in  connection  with any sale of the  Common
Shares.

                                 LEGAL MATTERS

     Certain  legal  matters  have been  passed  upon for us by Paul,  Hastings,
Janofsky & Walker LLP, New York, New York. The validity of the restricted Common
Shares  have been  passed  upon for us by  Richards,  Layton and  Finger,  P.A.,
Wilmington, Delaware.

                                     EXPERTS

     The consolidated  financial  statements and the related financial statement
schedule  incorporated in this re-offer  prospectus by reference from our annual
report  on Form 10-K for the  fiscal  year  ended  December  31,  2002 have been
audited  by  Deloitte & Touche  LLP,  independent  auditors,  as stated in their
report which is incorporated herein by reference,  and have been so incorporated
in reliance  upon the report of such firm given upon their  authority as experts
in accounting and auditing.

                                       41
1,025,867 COMMON SHARES OF

                                   CHARTERMAC

                               RE-OFFER PROSPECTUS

                                NOVEMBER 25, 2003

                                       42
PART II
              INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Documents by Reference

     The following documents and information previously filed by Registrant with
the  Commission  are  hereby  incorporated  by  reference  in this  Registration
Statement:

          (a) The Company's Annual Report on Form 10-K for the fiscal year ended
     December 31, 2002,  filed with the Commission on April 2, 2003  (Commission
     File No. 001-13237);

          (b) The Company's  Quarterly Report on Form 10-Q for the period ending
     September  30,  2003,  filed  with the  Commission  on  November  14,  2003
     (Commission File No. 001-13237)

          (c) The Company's  Quarterly Report on Form 10-Q for the period ending
     June 30, 2003,  filed with the  Commission  on August 14, 2003  (Commission
     File No. 001-13237);

          (d) The Company's  Quarterly Report on Form 10-Q for the period ending
     March 31, 2003,  filed with the Commission on May 15, 2003 (Commission File
     No. 001-13237);

          (e) The Company's  Definitive  Proxy Statement dated September 5, 2003
     on  Schedule  14A  prepared  in  connection  with  our  Annual  Meeting  of
     Shareholders held on November 17, 2003 (Commission File No. 001-13237);

          (f) The Company's Current Report on Form 8-K filed with the Commission
     on October 31, 2003 (Commission File No. 001-13237); and

          (g) The Company's Current Report on Form 8-K filed with the Commission
     on September 8, 2003 (Commission File No. 001-13237).

All  documents  subsequently  filed by the Company  pursuant to Sections  13(a),
13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment that  indicates  that all  securities  offered have been sold or which
deregisters  all  securities  then  remaining  unsold,  shall  be  deemed  to be
incorporated by reference in this Registration Statement and to be a part hereof
from the respective dates of the filing of those documents.

Any  statement  contained  herein  or  in a  document  incorporated,  or  deemed
incorporated,  by reference  herein or therein shall be deemed to be modified or
superseded  for  purposes  of the  Registration  Statement  to the extent that a
statement  contained  herein  or  therein  or in any  other  subsequently  filed
document which also is deemed to be incorporated by reference  herein or therein
modifies or supersedes such statement. Any such statement shall not be deemed to
constitute a part of this Registration  Statement or the Prospectus except as so
modified or replaced.

Item 4. Description of Securities

     Not Applicable.

Item 5. Interests of Named Experts and Counsel

     Not Applicable.

Item 6. Indemnification of Trustees and Officers
Section  3817(a)  of the  Delaware  Code  authorizes  a  business  trust to
indemnify  and hold harmless any trustee,  or  beneficial  owner or other person
from and against any and all claims and demands whatsoever.  Section 14.1 of our
Company's Amended and Restated Trust Agreement provides for the  indemnification
of directors and officers. Article XII of the Registrant's By-laws also provides
for indemnification of its officers.

     In addition to the above, our Company has purchased and maintains insurance
on  behalf of all of its  trustees  and  executive  officers  against  liability
asserted  against or  incurred  by them in their  official  capacities  with our
Company,  whether or not our Company is  required or has the power to  indemnify
them against the same liability.

Item 7. Exemption from Registration Claimed

     Not Applicable

Item 8. Exhibits.
Exhibit No.   Description
-----------   -----------
3.1            Certificate of Business Trust of the Registrant*

3.2            Certificate of Amendment of Certificate of Business Trust of the
               Registrant, dated as of April 30, 1997*

3.3            Certificate of Amendment of the Restated Certificate of Trust of
               the Registrant, dated as of November 17, 2003**

3.4            Second Amended and Restated Trust Agreement of the Registrant,
               dated as of November 17, 2003**

3.5            Second Amended and Restated Bylaws of the Registrant, dated as of
               November 17, 2003**

4.1            Specimen Share Certificate**

4.2            Chartermac Restricted Share Plan**

4.3            Chartermac Ross Non-Qualified Share Option Agreement**

5.1            Opinion of Richards, Layton & Finger, P.A. regarding the legality
               of the securities being registered**

23.1           Consent of Deloitte & Touche LLP**

23.2           Consent of Richards, Layton & Finger, P.A.(included in Exhibit
               5.1)**

24.1           Power of Attorney (included on signature page hereto)**

99.1           Registration Rights Agreement, dated November 17, 2003**
*       Previously Filed.

**      Filed Herewith.

                                       2
Item 9.Undertakings

     The Company hereby undertakes:

     A. (1) To file, during any period in which it offers or sells securities, a
post-effective amendment to this Registration Statement to;

     (i) Include any prospectus  required by Section  10(a)(3) of the Securities
Act;

     (ii) Reflect in the prospectus any facts or events which,  individually  or
together,  represent a fundamental change in the information in the Registration
Statement.  Notwithstanding the foregoing, any increase or decrease in volume of
securities  offered (if the total dollar value of  securities  offered would not
exceed that which was  registered) and any deviation from the low or high end of
the estimated  maximum offering range may be reflected in the form of prospectus
filed with the  Commission  pursuant  to Rule 424(b) if, in the  aggregate,  the
changes in volume and price  represent  no more than a 20 percent  change in the
maximum  aggregate  offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement; and

     (iii)Include any additional or changed material  information on the plan of
distribution; provided, however, that the statements in paragraphs (A)(1)(i) and
(A)(1)(ii)  do  not  apply  if  the  information  required  in a  post-effective
amendment  is  incorporated  by reference  from  periodic  reports  filed by the
Company under the  Securities  Exchange Act of 1934,  as amended (the  "Exchange
Act").

     (2) That, for  determining  liability  under the Securities Act, treat each
such post-effective  amendment as a new registration statement of the securities
offered,  and the offering of the securities at that time to be the initial bona
fide offering.

     (3) To file a post-effective  amendment to remove from  registration any of
the securities that remain unsold at the end of the offering.

     (B) That  insofar as  indemnification  for  liabilities  arising  under the
Securities Act may be permitted to trustees, officers and controlling persons of
the Company pursuant to the foregoing provisions,  or otherwise, the Company has
been  advised  that in the opinion of the  Commission  such  indemnification  is
against  public  policy as expressed in the  Securities  Act and is,  therefore,
unenforceable.

     In the event  that a claim for  indemnification  against  such  liabilities
(other  than the  payment  by the  Company  of  expenses  incurred  or paid by a
director, officer or controlling person of the Company in the successful defense
of any action,  suit or  proceeding)  is asserted  by such  trustee,  officer or
controlling  person in connection  with the  securities  being  registered,  the
Company  will,  unless in the opinion of its counsel the matter has been settled
by  controlling  precedent,  submit to a court of appropriate  jurisdiction  the
question  whether  such  indemnification  by  it is  against  public  policy  as
expressed in the Securities  Act and will be governed by the final  adjudication
of such issue.

                                       3
SIGNATURES

Pursuant to the  requirements  of the  Securities  Act of 1933,  the  registrant
certifies  that it has  reasonable  grounds to believe  that it meets all of the
requirements  for  filing  on Form S-8 and has  duly  caused  this  registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the City of New  York,  State of New  York,  on this 24th day of
November, 2003.

                                     CHARTERMAC
                                     A Delaware statutory trust(registrant)

                                     By: /s/ Stuart J. Boesky
                                         --------------------
                                         Stuart J. Boesky
                                         Chief Executive Officer

                                POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Stuart
J.  Boesky and  Stuart A.  Rothstein,  and each or either of them,  his true and
lawful  attorney-in-fact  with full power of substitution and resubstitution and
revocation,  for each of him and in his name,  place,  and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
and additions to this registration  statement,  and to file or cause to be filed
the  same,  with  all  exhibits  thereto,  and  other  documents  in  connection
therewith,  with the Securities and Exchange  Commission,  and hereby grant unto
such  attorneys-in-fact  and agents,  and each of them, the full power to do and
perform each and every act and thing  requisite  and necessary to be done in and
about the foregoing,  as fully to all intents and purposes, as each of him might
or  could  do  in  person,   hereby  ratifying  and  confirming  all  that  said
attorneys-in-fact  and agents, or any of them, or their respective  substitutes,
may lawfully do or cause to be done by virtue hereof.

Pursuant to the  requirements of the Securities Act of 1933,  this  registration
statement has been signed by the following  persons in the capacities and on the
dates indicated.
Signature                        Title                         Date
/s/ Stuart J. Boesky             Managing Trustee and          November 24, 2003
------------------------------   Chief Executive Officer
        Stuart J. Boesky

/s/ Stephen M. Ross              Managing Trustee and          November 24, 2003
---------------------------      Chairman of the Board
        Stephen M. Ross

/s/ Marc D. Schnitzer            Managing Trustee and          November 24, 2003
---------------------------      President
        Marc D. Schnitzer

/s/ Alan P. Hirmes               Managing Trustee and          November 24, 2003
---------------------------      Chief Operating Officer
        Alan P. Hirmes

/s/ Denise L. Kiley              Managing Trustee and          November 24, 2003
---------------------------      Chief Credit Officer
        Denise L. Kiley
4
Signature                        Title                         Date
/s/ Peter T. Allen               Managing Trustee              November 24, 2003
---------------------------
        Peter T. Allen

/s/ Charles L. Edson             Managing Trustee              November 24, 2003
---------------------------
        Charles L. Edson

/s/ Arthur P. Fisch              Managing Trustee              November 24, 2003
---------------------------
        Arthur P. Fisch

/s/ Thomas W. White              Managing Trustee              November 24, 2003
---------------------------
        Thomas W. White

/s/ Jeff T. Blau                 Managing Trustee              November 24, 2003
---------------------------
        Jeff T. Blau

/s/ Robert A. Meister            Managing Trustee              November 24, 2003
---------------------------
        Robert A. Meister

/s/ Jerome Y. Halperin           Managing Trustee              November 24, 2003
---------------------------
        Jerome Y. Halperin

/s/ Janice Cook Roberts          Managing Trustee              November 24, 2003
---------------------------
        Janice Cook Roberts

/s/ Nathan Gantcher              Managing Trustee              November 24, 2003
---------------------------
        Nathan Gantcher

/s/ Robert L. Loverd             Managing Trustee              November 24, 2003
---------------------------
        Robert L. Loverd
5
INDEX TO EXHIBITS
                                   CHARTERMAC
Exhibit No.    Description
-----------    -----------
3.1            Certificate of Business Trust of the Registrant*

3.2            Certificate of Amendment of Certificate of Business Trust of the
               Registrant, dated as of April 30, 1997*

3.3            Certificate of Amendment of the Restated Certificate of Trust of
               the Registrant, dated as of November 17, 2003**

3.4            Second Amended and Restated Trust Agreement of the Registrant,
               dated as of November 17, 2003**

3.5            Second Amended and Restated Bylaws of the Registrant, dated as of
               November 17, 2003**

4.1            Specimen Share Certificate**

4.2            Chartermac Restricted Share Plan**

4.3            Chartermac Ross Non-Qualified Share Option Agreement**

5.1            Opinion of Richards, Layton & Finger, P.A. regarding the legality
               of the securities being registered**

23.1           Consent of Deloitte & Touche LLP**

23.2           Consent of Richards, Layton & Finger, P.A.(included in Exhibit
               5.1)**

24.1           Power of Attorney (included on signature page hereto)**

99.1           Registration Rights Agreement, dated November 17, 2003**
*       Previously Filed.

**      Filed Herewith.