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

                                    FORM 8-K

                                 CURRENT REPORT

     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

         Date of Report (Date of earliest event reported): April 4, 2001


                      CORNERSTONE REALTY INCOME TRUST, INC.
             (Exact name of registrant as specified in its charter)

        VIRGINIA                       001-12875              54-1589139
(State or other jurisdiction          (Commission          (I.R.S. Employer
    of incorporation)                  File Number)     Identification Number)


        306 EAST MAIN STREET, RICHMOND, VA              23219
     (Address of principal executive offices)         (Zip Code)

                                 (804) 643-1761
              (Registrant's telephone number, including area code)

ITEM 2.  Acquisition or Disposition of Assets

         Cornerstone Realty Income Trust, Inc. (which is referred to below as
the Company or as "we," "us" or "our") is filing this report pursuant to Item 2
of Form 8-K to describe a financing transaction in which certain assets were
mortgaged. The mortgage constitutes a "disposition" of assets within the meaning
of the General Instructions to Form 8-K. Certain related matters also are
reported below.

SUMMARY OF FINANCING

         On April 4, 2001, we obtained long-term financing in the amount of
$15,680,000 through a new subsidiary. This financing was arranged by ARCS
Commercial Mortgage Co., L.P., which assigned its beneficial interest in the
financing to Fannie Mae. We expect to use the proceeds from this financing to
fund a portion of the cash payments required from us in connection with our
tender offer for our Series A Convertible Preferred Shares. The tender offer
expired on April 17, 2001.

<PAGE>

         In connection with the new financing, and at the request of the lender,
we formed three new  subsidiaries  that will operate as "single asset entities."
These single  asset  entities  have  organizational  documents  that limit their
operations to those required for the financing.

         One of these single asset entities, CAC III Limited Partnership, is the
borrower for the financing. Because the borrower is a limited partnership, the
lender requested that we form two other single asset entities, which serve as
the general partner and limited partner of the borrower.

         The financing is evidenced by a promissory note and is secured by the
Silver Brook I Apartment community in Grand Prairie, Texas, which is owned by
the borrower. To achieve this ownership, we caused an existing subsidiary to
transfer this property to the borrower.

PROMISSORY NOTE

         The promissory note for the financing is made in the principal amount
of $15,680,000 and provides for the following:

         o  a stated annual interest rate of 6.83%

         o  a maturity date of May 1, 2011

         o  payment of principal and interest in consecutive monthly
            installments of $102,535.40, beginning June 1, 2001 (computed using
            a 30-year amortization)

         o  a balloon payment at maturity of approximately $14,112,000

         o  acceleration, at the option of the lender, of all amounts due under
            the note if there is any event of default, whether as to payment or
            otherwise

         o  a late charge of 5% on any payment that is not made within 10 days
            of its due date

         o  an increase of 4% in the applicable interest rate if any payment
            remains past due for 30 days or more

         o  a restriction on voluntary prepayment, which generally is not
            permitted without premium or penalty more than 90 days before the
            maturity date

         In general, the borrower has no personal liability under the promissory
note, and the lender's only recourse for non-payment is to exercise its remedies
against the collateral (as described in the section below). The borrower,
however, would have personal liability for repayment of all indebtedness upon
certain events of default. Those events of default include prohibited transfers
of the collateral or of a controlling interest in the borrower, and changes in
the borrower's status as a single asset entity.

<PAGE>

MORTGAGE

         As indicated above, the financing is secured by a mortgage and other
encumbrances on the apartment property owned by the borrower. The other
encumbrances include a security interest in the related personal property and
various assignments of leases, rents and contracts, all in favor of the lender.
These encumbrances are created by a Multifamily Deed of Trust, Assignment of
Rents, Security Agreement and Fixture Filing, which will be referred to as the
"Deed of Trust" for simplicity.

         The Deed of Trust imposes a number of requirements on the borrower,
including obligations to maintain adequate insurance. The Deed of Trust also
prohibits any further encumbrances or any further assignments of leases or rents
with respect to the apartment property.

         Upon a default under the promissory note or the Deed of Trust, various
remedies are available to the lender. Those remedies include, for example (1)
declaring the entire principal balance under the promissory note, together with
all accrued and unpaid interest, to be due and payable immediately; (2) taking
possession of the collateral, including the apartment property; and (3)
collecting rents from the apartment property, or foreclosing on it, to satisfy
unpaid amounts under the promissory note. The lender is entitled to recover any
costs that may be incurred in exercising such remedies.

         In connection with the Deed of Trust and the corresponding promissory
note, the borrower entered into a replacement reserve and security agreement,
which requires the following monthly deposits for the benefit of the lender:

         o  $10,030.00 each month from June 1, 2001 through May 1, 2004

         o  $12,586.67 each month from June 1, 2004 through the maturity date
            under the promissory note


MANAGEMENT OF PROPERTY

         The borrower has engaged us to manage the apartment property that
secures the financing. The property management agreement provides for the
following:

         o  an initial term of two years

         o  automatic renewal for additional terms of two years each, unless
            written notice of termination is delivered from one party to the
            other at least 60 days before the end of any term

         o  collection of all rents by the manager

         o  a property management fee equal to 5% of the monthly gross revenues
            from the apartment properties

<PAGE>

ITEM 5.   Other Events

         On April 18, 2001, we temporarily increased our financing capacity
under our existing unsecured credit facility by $50 million. This increase
changed our maximum credit facility from $50 million to $100 million. We expect
to use our credit facility to fund a portion of the cash payments required from
us in connection with our tender offer for our Series A Convertible Preferred
Shares, which expired on April 17, 2001.

         Any amount borrowed against the increased capacity may be used only for
tender offer cash payments, and must be repaid by October 15, 2001. Amounts
borrowed against the increased capacity will bear interest at a variable rate
equal to LIBOR (a rate determined by banks in the London interbank market) plus:
(a) 90 basis points if the total amount outstanding under the credit facility is
$50 million or less; or (b) 120 basis points, otherwise. A non-refundable
repayment fee also will be due in the amount of $250,000, unless repayment
occurs through new financing issued by the same lender.

ITEM 7.   Financial Statements and Exhibits

c.  Exhibits.

4.1         Multifamily Note dated April 4, 2001 in the principal amount of
            $15,680,000 made payable to ARCS Commercial Mortgage Co., L.P. by
            CAC III Limited Partnership, with respect to Silverbrook I
            Apartments in Grand Prairie, Texas. (Incorporated by reference to
            Exhibit (b)(19) to Schedule TO/A (amendment no. 1) filed by
            Cornerstone Realty Income Trust, Inc. on April 11, 2001).

4.2         Multifamily Deed of Trust, Assignment of Rents, Security Agreement
            and Fixture Filing dated as of April 4, 2001 from CAC III Limited
            Partnership, as Grantor to trustee for ARCS Commercial Mortgage Co.,
            L.P. with respect to the Silverbrook I Apartments in Grand Prairie,
            Texas. (Incorporated by reference to Exhibit (b)(20) to Schedule
            TO/A (amendment no. 1) filed by Cornerstone Realty Income Trust,
            Inc. on April 11, 2001).

4.3         Replacement Reserve and Security Agreement dated as of April 4, 2001
            by and between CAC III Limited Partnership and ARCS Commercial
            Mortgage Co., L.P. with respect to Silverbrook I Apartments in Grant
            Prairie, Texas. (Incorporated by reference to Exhibit (b)(21) to
            Schedule TO/A (amendment no. 1) filed by Cornerstone Realty Income
            Trust, Inc. on April 11, 2001).

4.4         Assignment of Multifamily Deed of Trust, Assignment of Rents,
            Security Agreement and Fixture Filing dated as of April 4, 2001 from
            ARCS Commercial Mortgage Co., L.P. to Fannie Mae with respect to the
            Silverbrook I Apartments in Grand Prairie, Texas. (Incorporated by
            reference to Exhibit (b)(22) to Schedule TO/A (amendment no. 1)
            filed by Cornerstone Realty Income Trust, Inc. on April 11, 2001).

<PAGE>

4.5         First Amendment to and Waiver of Credit Agreement dated as of April
            18, 2001 by and among Cornerstone Realty Income Trust, Inc.,
            CRIT-NC, LLC, and First Union National Bank. (Incorporated by
            reference to Exhibit (b)(17) to Schedule TO/A (amendment no. 3)
            filed by Cornerstone Realty Income Trust, Inc. on April 18, 2001).

4.6         Amended and Restated Revolving Credit Note by and among Cornerstone
            Realty Income Trust, Inc. and CRIT-NC, LLC as borrower and First
            Union National Bank as lender dated as of April 18, 2001.
            (Incorporated by reference to Exhibit (b)(18) to Schedule TO/A
            (amendment no. 3) filed by Cornerstone Realty Income Trust, Inc. on
            April 18, 2001).

10.1        Property Management Agreement dated as of April 4, 2001 between CAC
            III Limited Partnership as Owner and Apple General, Inc. as Manager.
            (FILED HEREWITH).

<PAGE>



                                   SIGNATURES

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

                                       Cornerstone Realty Income Trust, Inc.


                                       By:   /s/  Glade M. Knight
                                            ------------------------------------
                                              Glade M. Knight, President


                                       April 19, 2001


                                      -6-
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{"company-data": {"conformed-name": "CORNERSTONE REALTY INCOME TRUST INC", "cik": "0000854875", "assigned-sic": "6798", "irs-number": "541589139", "state-of-incorporation": "VA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-12875", "film-number": "1606870"}, "business-address": {"street1": "306 E MAIN ST", "city": "RICHMOND", "state": "VA", "zip": "23219", "phone": "8046431761"}, "mail-address": {"street1": "306 E MAIN ST", "city": "RICHMOND", "state": "VA", "zip": "23219"}}
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT

     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

         Date of Report (Date of earliest event reported): April 4, 2001

                      CORNERSTONE REALTY INCOME TRUST, INC.
             (Exact name of registrant as specified in its charter)

        VIRGINIA                       001-12875              54-1589139
(State or other jurisdiction          (Commission          (I.R.S. Employer
    of incorporation)                  File Number)     Identification Number)

        306 EAST MAIN STREET, RICHMOND, VA              23219
     (Address of principal executive offices)         (Zip Code)

                                 (804) 643-1761
              (Registrant's telephone number, including area code)

ITEM 2.  Acquisition or Disposition of Assets

         Cornerstone Realty Income Trust, Inc. (which is referred to below as
the Company or as "we," "us" or "our") is filing this report pursuant to Item 2
of Form 8-K to describe a financing transaction in which certain assets were
mortgaged. The mortgage constitutes a "disposition" of assets within the meaning
of the General Instructions to Form 8-K. Certain related matters also are
reported below.

SUMMARY OF FINANCING

         On April 4, 2001, we obtained long-term financing in the amount of
$15,680,000 through a new subsidiary. This financing was arranged by ARCS
Commercial Mortgage Co., L.P., which assigned its beneficial interest in the
financing to Fannie Mae. We expect to use the proceeds from this financing to
fund a portion of the cash payments required from us in connection with our
tender offer for our Series A Convertible Preferred Shares. The tender offer
expired on April 17, 2001.
In connection with the new financing, and at the request of the lender,
we formed three new  subsidiaries  that will operate as "single asset entities."
These single  asset  entities  have  organizational  documents  that limit their
operations to those required for the financing.

         One of these single asset entities, CAC III Limited Partnership, is the
borrower for the financing. Because the borrower is a limited partnership, the
lender requested that we form two other single asset entities, which serve as
the general partner and limited partner of the borrower.

         The financing is evidenced by a promissory note and is secured by the
Silver Brook I Apartment community in Grand Prairie, Texas, which is owned by
the borrower. To achieve this ownership, we caused an existing subsidiary to
transfer this property to the borrower.

PROMISSORY NOTE

         The promissory note for the financing is made in the principal amount
of $15,680,000 and provides for the following:

         o  a stated annual interest rate of 6.83%

         o  a maturity date of May 1, 2011

         o  payment of principal and interest in consecutive monthly
            installments of $102,535.40, beginning June 1, 2001 (computed using
            a 30-year amortization)

         o  a balloon payment at maturity of approximately $14,112,000

         o  acceleration, at the option of the lender, of all amounts due under
            the note if there is any event of default, whether as to payment or
            otherwise

         o  a late charge of 5% on any payment that is not made within 10 days
            of its due date

         o  an increase of 4% in the applicable interest rate if any payment
            remains past due for 30 days or more

         o  a restriction on voluntary prepayment, which generally is not
            permitted without premium or penalty more than 90 days before the
            maturity date

         In general, the borrower has no personal liability under the promissory
note, and the lender's only recourse for non-payment is to exercise its remedies
against the collateral (as described in the section below). The borrower,
however, would have personal liability for repayment of all indebtedness upon
certain events of default. Those events of default include prohibited transfers
of the collateral or of a controlling interest in the borrower, and changes in
the borrower's status as a single asset entity.
MORTGAGE

         As indicated above, the financing is secured by a mortgage and other
encumbrances on the apartment property owned by the borrower. The other
encumbrances include a security interest in the related personal property and
various assignments of leases, rents and contracts, all in favor of the lender.
These encumbrances are created by a Multifamily Deed of Trust, Assignment of
Rents, Security Agreement and Fixture Filing, which will be referred to as the
"Deed of Trust" for simplicity.

         The Deed of Trust imposes a number of requirements on the borrower,
including obligations to maintain adequate insurance. The Deed of Trust also
prohibits any further encumbrances or any further assignments of leases or rents
with respect to the apartment property.

         Upon a default under the promissory note or the Deed of Trust, various
remedies are available to the lender. Those remedies include, for example (1)
declaring the entire principal balance under the promissory note, together with
all accrued and unpaid interest, to be due and payable immediately; (2) taking
possession of the collateral, including the apartment property; and (3)
collecting rents from the apartment property, or foreclosing on it, to satisfy
unpaid amounts under the promissory note. The lender is entitled to recover any
costs that may be incurred in exercising such remedies.

         In connection with the Deed of Trust and the corresponding promissory
note, the borrower entered into a replacement reserve and security agreement,
which requires the following monthly deposits for the benefit of the lender:

         o  $10,030.00 each month from June 1, 2001 through May 1, 2004

         o  $12,586.67 each month from June 1, 2004 through the maturity date
            under the promissory note

MANAGEMENT OF PROPERTY

         The borrower has engaged us to manage the apartment property that
secures the financing. The property management agreement provides for the
following:

         o  an initial term of two years

         o  automatic renewal for additional terms of two years each, unless
            written notice of termination is delivered from one party to the
            other at least 60 days before the end of any term

         o  collection of all rents by the manager

         o  a property management fee equal to 5% of the monthly gross revenues
            from the apartment properties
ITEM 5.   Other Events

         On April 18, 2001, we temporarily increased our financing capacity
under our existing unsecured credit facility by $50 million. This increase
changed our maximum credit facility from $50 million to $100 million. We expect
to use our credit facility to fund a portion of the cash payments required from
us in connection with our tender offer for our Series A Convertible Preferred
Shares, which expired on April 17, 2001.

         Any amount borrowed against the increased capacity may be used only for
tender offer cash payments, and must be repaid by October 15, 2001. Amounts
borrowed against the increased capacity will bear interest at a variable rate
equal to LIBOR (a rate determined by banks in the London interbank market) plus:
(a) 90 basis points if the total amount outstanding under the credit facility is
$50 million or less; or (b) 120 basis points, otherwise. A non-refundable
repayment fee also will be due in the amount of $250,000, unless repayment
occurs through new financing issued by the same lender.

ITEM 7.   Financial Statements and Exhibits

c.  Exhibits.

4.1         Multifamily Note dated April 4, 2001 in the principal amount of
            $15,680,000 made payable to ARCS Commercial Mortgage Co., L.P. by
            CAC III Limited Partnership, with respect to Silverbrook I
            Apartments in Grand Prairie, Texas. (Incorporated by reference to
            Exhibit (b)(19) to Schedule TO/A (amendment no. 1) filed by
            Cornerstone Realty Income Trust, Inc. on April 11, 2001).

4.2         Multifamily Deed of Trust, Assignment of Rents, Security Agreement
            and Fixture Filing dated as of April 4, 2001 from CAC III Limited
            Partnership, as Grantor to trustee for ARCS Commercial Mortgage Co.,
            L.P. with respect to the Silverbrook I Apartments in Grand Prairie,
            Texas. (Incorporated by reference to Exhibit (b)(20) to Schedule
            TO/A (amendment no. 1) filed by Cornerstone Realty Income Trust,
            Inc. on April 11, 2001).

4.3         Replacement Reserve and Security Agreement dated as of April 4, 2001
            by and between CAC III Limited Partnership and ARCS Commercial
            Mortgage Co., L.P. with respect to Silverbrook I Apartments in Grant
            Prairie, Texas. (Incorporated by reference to Exhibit (b)(21) to
            Schedule TO/A (amendment no. 1) filed by Cornerstone Realty Income
            Trust, Inc. on April 11, 2001).

4.4         Assignment of Multifamily Deed of Trust, Assignment of Rents,
            Security Agreement and Fixture Filing dated as of April 4, 2001 from
            ARCS Commercial Mortgage Co., L.P. to Fannie Mae with respect to the
            Silverbrook I Apartments in Grand Prairie, Texas. (Incorporated by
            reference to Exhibit (b)(22) to Schedule TO/A (amendment no. 1)
            filed by Cornerstone Realty Income Trust, Inc. on April 11, 2001).
4.5         First Amendment to and Waiver of Credit Agreement dated as of April
            18, 2001 by and among Cornerstone Realty Income Trust, Inc.,
            CRIT-NC, LLC, and First Union National Bank. (Incorporated by
            reference to Exhibit (b)(17) to Schedule TO/A (amendment no. 3)
            filed by Cornerstone Realty Income Trust, Inc. on April 18, 2001).

4.6         Amended and Restated Revolving Credit Note by and among Cornerstone
            Realty Income Trust, Inc. and CRIT-NC, LLC as borrower and First
            Union National Bank as lender dated as of April 18, 2001.
            (Incorporated by reference to Exhibit (b)(18) to Schedule TO/A
            (amendment no. 3) filed by Cornerstone Realty Income Trust, Inc. on
            April 18, 2001).

10.1        Property Management Agreement dated as of April 4, 2001 between CAC
            III Limited Partnership as Owner and Apple General, Inc. as Manager.
            (FILED HEREWITH).
SIGNATURES

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

                                       Cornerstone Realty Income Trust, Inc.

                                       By:   /s/  Glade M. Knight
                                            ------------------------------------
                                              Glade M. Knight, President

                                       April 19, 2001

                                      -6-