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

FORM 10-K
(Mark One)
[X] Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
[Fee Required]

For the fiscal year ended
December 31, 1997

[ ] Transition Report to Section 13 or 15(d) of the Securities
Exchange Act of 1934
[Fee Required]
For the transition period from_______to_______

Commission File Number
33-18089-A

HICKORY HILLS, LTD.

(Exact name of Registrant as specified in its chapter)

Tennessee 62-1336904

(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number.)

One Belle Meade Place, 4400 Harding Road, Suite 500, Nashville,
Tennessee 37205
(Address of principal executive office) (Zip Code)

Registrant's telephone number, including area code: (615) 292-1040

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

Title of each class Name of each exchange
on which registered
None None

Securities registered pursuant to Section 12 (g) of the Act:
UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class)

Indicated by check mark whether the Registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the Registrant was required to file
such reports), and (2) has been subject to such filing requirements
for at least the past 90 days.
YES X NO

Indicated by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K (229,405 of this chapter) is
not contained herein, and will not be contained, to the best of the
registrant's knowledge, in definitive proxy of information
statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K.
[X]

The aggregate sales price of the Units of Limited Partnership
Interest to non-affiliates was $1,800,000 as of February 28, 1998.
This does not reflect market value, but is the price at which these
Units of Limited Partnership Interest were sold to the public.
There is no current market for these Units.

Document Incorporated by Reference in Part IV:

Prospectus of Registrant, dated December 3, 1987 as filed pursuant
to rule 424 (b) of the Securities and Exchange Commission.

PART I
Item 1. Business

Hickory Hills, Ltd. ("Registrant"), is a Tennessee limited
partnership organized on September 15, 1987 pursuant to the
provisions of the Tennessee Uniform Limited Partnership Act,
Chapter 2, Title 61, Tennessee Code Annotated, as amended. The
General Partner of Registrant is 222 Hickory, Ltd., a Tennessee
limited partnership. 222 Partners, Inc. is the general partner of
222 Hickory, Ltd.

Registrant's primary business is to acquire, develop and
dispose of certain undeveloped real properties located in
Nashville, Davidson County, Tennessee and Hendersonville, Sumner
County, Tennessee (the "Properties"). Registrant's investment
objectives are preservation of capital, and capital appreciation
through the passage of time, growth in the surrounding areas and
the development of the Properties prior to resale.

Financial Information About Industry Segments

The Registrant's activity, investment in land, is within one
industry segment and geographical area. Therefore, financial data
relating to the industry segment and geographical area is included
in Item 6-Selected Financial Data.

Narrative Description of Business

The Registrant is holding for investment two properties in the
metropolitan Nashville, Tennessee area. The Properties will be
referred to respectively as the Nashville Property and the
Hendersonville Property in the remainder of this report. The
Properties are held for resale.

The majority of the proceeds used to purchase the Property
were from a $3,454,300 promissory note (the "Lender Financing")
maturing on December 31, 1998 to Hickory Lenders, Ltd. (the
"Lender"), an affiliated partnership sharing the same General
Partner. The principal balance accrues interest at a simple
interest rate of 10% per annum. Prior to maturity, the Registrant
is not required to make any payments with respect to the Lender
Financing, except upon the sale, exchange or condemnation of all or
any portion of the Property. From sale proceeds, the Lender
receives a priority return of interest and principal, and 55% of
the "Net Revenues", if any. Net revenues, as defined by the
Participating Loan Agreement, represent the difference between cash
proceeds earned and the following, in this order: 1) accrued but
unpaid interest and Applicable Principal Balances; 2)accrued
preferred return (12%) on the net offering proceeds of the
Registrant; and 3) the Applicable Equity Balance. The cumulative
Applicable Principal balance due to the Lender is $1,872,216 and is
payable from future sale proceeds, after all accrued interest is
paid. The note was due on December 31, 1997 but the Registrant was
unable to repay the note. The Lender has extended the due date to
December 31, 1998. However, the General Partner does not expect the
Partnership to have the liquidity to retire the debt in full. The
General Partner plans to negotiate another extension of the loan
term. If an extension is not received and the Partnership does not
repay the Note, the Lender could foreclose and take the
Partnership's assets. The partnership would then be dissolved.

The Nashville Property is approximately 230 acres of partially
developed land and is comprised of two main parcels located in
northern Davidson County, Tennessee. During 1997, 1996 and 1995,
grading work was done on the Property as required by prior sales
and in 1995, a contribution was made to the City toward the future
improvements of Old Hickory Boulevard. All development was
specific to the site sold. The General Partner has no plans for
development of this property except for what may be required by
future sales.

The Hendersonville Property is a residential subdivision on
Old Hickory Lake in Hendersonville, Tennessee (the "Harbortowne
Development") with 243 lots, of which 7 lots remain unsold as of
December 31, 1997. The Property is zoned as residential planned
unit development. Roadways for the Property have been paved, and
gas, water and sewer lines have been installed. The final phase of
road and utility development was completed in 1996.

Competition

Nashville Property

There is a significant amount of competition for
industrial/office distribution property in northern Davidson
County, near the airport and along Brick Church Pike, south of the
Property. As competitive sites nearer the City are absorbed, the
Registrant's site should experience more activity. The
Registrant's prices are comparable to its competition.

Hendersonville Property

There is currently limited competition surrounding the
Harbortowne Development. The Registrant had an exclusive contract
with Phillips Builders, Inc. pursuant to which Phillips will build
new homes in the $140,000 - $180,000 price range. The remaining
seven lots are mostly lake front lots and were not included in the
Phillips contract. The Property is located one mile to the east of
Highway 31-E by-pass which provides excellent access to downtown
Nashville. The development offers landscaped home sites, gas heat,
and other amenities such as a swimming pool, tennis courts, and
clubhouse.

The Registrant has no employees. Partnership management
services are being provided under a contractual agreement with
Landmark Realty Services Corporation, an affiliate of the General
Partner.

Item 2. Properties

As of December 31, 1997, Registrant owned two parcels of land
in Tennessee, composed of 230 acres in Nashville and 7 residential
lots in Hendersonville. See Item 1 above for more detailed
description.

Item 3. Legal Proceedings

Registrant is not a party to, nor is any of Registrant's
property the subject of, any legal proceedings.

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

The security holders of Registrant did not vote on any matter
during the fiscal year covered by this report.

PART II

Item 5. Market for Registrant's Units of Limited Partnership

Interest and Related Security Holder Matters

There is no established market for the Units, and it is not
anticipated that any will exist in the future. The Registrant
commenced an offering to the public on December 3, 1987 of 1,800
Units of limited partnership interests. The offering of $1,800,000
was fully subscribed on December 3, 1988. As of February 28, 1998
there were 190 holders of record of the 1,800 Units of limited
partnership interest.

There were no distributions made to Unit holders during 1997.
There are no material restrictions upon Registrant's present or
future ability to make distributions in accordance with the
provisions of Registrant's Limited Partnership Agreement, other
than the obligations to Hickory Lenders, Ltd. with respect to the
Lender Financing, as described below.

Item 6. Selected Financial Data

For the Year Ended
December 31,

1997 1996 1995 1994 1993

Total Revenues $ 283,851 335,416 176,707 28,242 (242,235)
Net Loss (177,739) (118,124) (260,709) (405,133) -
Net Loss per Limited
Partner Unit (98.74) (65.62) (144.84) (225.07) (382.23)
Total Assets 2,420,214 2,875,140 357,454 3,592,621 3,941,564
Note Payable 3,454,300 3,454,300 3,454,300 3,454,300 3,454,300
to Affiliate
Accrued Interest
Payable to
Affiliate $ 831,855 1,126,627 1,526,399 1,486,171 1,410,944

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

Results of Operations

Sales

The Registrant sold 17, 39, and 38 lots in 1997, 1996, and 1995
respectively, on the Hendersonville property to Phillips Builders under the
terms of the exclusive option contract negotiated in 1991. Gross sales
proceeds were $ 436,000, $992,000, and $770,610 in 1997, 1996, and 1995
respectively. Of the lots sold, one of 17 in 1997 and three of the 39 in
1996 were lake front lots which sold for significantly higher prices and
carried a higher applicable principal balance. The Registrant also sold
6.14, 2.5, and 3.86 acres in 1997, 1996, and 1995, respectively, of the
Nashville property for gross proceeds of $ 500,050, $188,250, and $154,400,
respectively. From the proceeds of all sales, $ 645,000, $750,000, and
$310,000 in 1997, 1996, and 1995, respectively, was paid to the Lender in
interest and the remainder was retained for operations and development. The
Applicable Principal Balance assigned to 1997, 1996, and 1995 sales is
$275,212, $314,855, and $316,860, respectively. The cumulative Applicable
Principal Balance as of December 31, 1997 is $1,866,516 and is payable from
future sales after all accrued interest is paid.

Comparative Analysis

Except for the fluctuations in sales described above, overall operations
of the Registrant have not changed significantly during the last three years.

The increase in land maintenance costs in 1997 and 1996 relate to extensive
landscaping. This landscaping was done after the infrastructure development
was complete. The landscaping includes a walking trail running throughout
the Property, several fences, bushes and trees.

Liquidity

At February 28, 1998 the Registrant has cash and cash equivalents of
$286,042, of which $225,194 is restricted for future development, leaving an
operating cash balance of approximately $60,848. This cash is expected to
be sufficient to cover operating expenses and the infrastructure development
currently underway. The Registrant has reserved cash of $55,250 to pay
impact fees to the City of Hendersonville in the amount of $250 per lot sold.
The impact fees will be used to improve Rockland Road. The fees will be paid
to the city when the design work on the road begins.

During 1996, the Registrant completed Phase IV and V development plans
for the Hendersonville Property. Phase IV cost approximately $300,000 and
opened up an additional 31 lots. Phase V cost approximately $300,000 and
opened up an additional 45 lots. All Phase IV lots sold in 1996 and 7 lots
remain in Phase V.

Due to the nature of the Lender Financing, no interest or principal
payments are due until the Properties, or portions thereof, are sold and cash
is available, or December 31, 1998 whichever is earlier.

Accrued interest payable relating to the Lender Financing was
approximately $831,855 at December 31, 1997. The Registrant made
payments totalling $645,000 on the Accrued interest from 1997 sale proceeds.
The cumulative Applicable Principal Balance unpaid as of December 31, 1997,
is $1,866,516 and is payable from future sales proceeds, after all accrued
interest is paid.

The Registrant has retained a portion of the sales proceeds for
development of future phases and operations of the properties and did not use
all sale proceeds to reduce accrued interest and applicable principal. The
Registrant's and Lender's joint general partner believes that this use of
sales proceeds was contemplated by the loan agreement. However, the loan
agreement is ambiguous on this point; therefore, this treatment could
constitute a default on the loan agreement. In such an event the Lender
is required to foreclose the loan and accelerate the amounts due. Currently,
the Lender has not foreclosed or accelerated the amounts due under the
loan agreement.

We have considered the impact of the Year 2000 issues on our computer systems
and applications and developed a remediation plan. We expect the cost of
upgrading computers and software to be immaterial to the Partnership.

Item 8. Financial Statements and Supplementary Data

The Financial Statements required by Item 8 are filed at the end of this
report.

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

None.

PART III

Item 10. Directors and Executive Officers of the Registrant

Registrant does not have any directors or officers. 222 Hickory, Ltd.
is the General Partner. 222 Partners, Inc. is the general partner of the
General Partner and, as such, has general responsibility and ultimate
authority in matters affecting Registrant's business.

222 Partners, Inc.

222 Partners, Inc. was formed September, 1986 and serves as general
partner for several other real estate investment limited partnerships. The
directors of 222 Partners, Inc. are W. Gerald Ezell, Steven D. Ezell, and
Michael A. Hartley.

W. Gerald Ezell, age 67, serves on the Board of Directors of 222
Partners, Inc. Until November, 1985, Mr. Ezell had been for over 20 years an
agency manager for Fidelity Mutual Life Insurance Company and a registered
securities principal of Capital Analysts Incorporated, a wholly owned
subsidiary of Fidelity Mutual Life Insurance Company.

Steven D. Ezell, age 45, is the President and sole shareholder of 222
Partners, Inc. He has been an officer of 222 Partners Inc. from September
17, 1986 through the current period. Mr. Ezell is President and 50% owner of
Landmark Realty Services Corporation. He was for the prior four years
involved in property acquisitions for Dean Witter Realty Inc. in New York
City, most recently as Senior Vice President. Steven D. Ezell is the son of
W. Gerald Ezell.

Michael A. Hartley, age 38, serves as a Secretary/Treasurer and Vice
President of 222 Partners, Inc. He has been an officer of 222 Partners, Inc.
from September 17, 1986 through the current period. He is Vice President and
50% owner of Landmark Realty Services Corporation. Prior to joining
Landmark, Mr. Hartley was Vice President of Dean Witter Realty Inc., a New
York-based real estate investment firm.

Item 11. Executive Compensation

During 1997, Registrant was not required to and did not pay remuneration
to any executives, partners of the General Partner or any affiliates, except
as set forth in Item 13 of this report, "Certain Relationships and Related
Transactions."

The General Partner does participate in the Profits, Losses, and
Distributions of the Partnership as set forth in the Partnership Agreement.

Item 12. Security Ownership of Certain Beneficial Owners and Management

(a) Security ownership of certain beneficial owners

Name and Amount and
Title Address of Nature of Percent
of Beneficial Beneficial of
Class Owner Ownership Class

Limited Partnership Michael A. Hartley 52.5 Units 2.92%
Units Steven D. Ezell 52.5 Units 2.92%
4400 Harding Road (Directly
Suite 500 owned)
Nashville, TN 37205

(b) Security ownership of management

Name and Amount and
Title Address of Nature of Percent
of Beneficial Beneficial of
Class Owner Ownership Class

Limited Partnership Michael A. Hartley 52.5 Units 2.92%
Units Steven D. Ezell 52.5 Units 2.92%
(Directly
owned)

There are no arrangements known to the Registrant, the operation of which
may, at a subsequent date, result in a change in control of the Registrant.

Item 13. Certain Relationships and Related Transaction

No affiliated entities have, during 1997, earned compensation for
services from the Registrant in excess of $60,000. For a listing of
miscellaneous transactions with affiliates refer to Note 3 of the Financial
Statements at the end of this report.

The Registrant borrowed $3,454,300 from Hickory Lenders, Ltd., an
affiliated partnership, in 1988 and accrued interest payable of $831,855
was recorded on such obligation as of December 31, 1997.

PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

Page
(a) (1) Financial Statements
The following Financial Statements are
included herein:

Independent Auditors' Report F-1

Financial Statements
Balance Sheets F-2
Statements of Operations F-3
Statements of Partners' Deficit F-4
Statements of Cash Flows F-5
Notes to Financial Statements F-6

(2) Financial Statement Schedules

Additional financial information furnished
pursuant to the requirements of Form 10-K:

Financial Statement Schedule -

Independent Auditors' Report S-1

Schedule III - Real Estate and Accumulated
Depreciation S-2

All other Schedules have been omitted because they are inapplicable, not
required or the information is included in the Financial Statements or notes
thereto.

(3) Exhibits

3 Amended and Restated Certificate and Agreement of Limited
Partnership, incorporated by reference to Exhibit A2 to the
Prospectus of Registrant dated December 3, 1987 filed pursuant
to Rule 424(b) of the Securities and Exchange Commission.

10A Loan Agreement by and among Hickory Hills, Ltd. and
Hickory Lenders, Ltd., incorporated by reference to Exhibit
10.1 to Registrant's Form S-18 Registration Statement as Filed
on October 23, 1987.

10B Deed of Trust and Security Agreement by and among Hickory
Lenders, Ltd. and the Registrant, incorporated by reference to
Exhibit 10.2 of the Registrant's Form S-18 Registration
Statement as filed on October 23, 1987.

10C Promissory Note of Hickory Hills, Ltd. to Hickory Lenders,
Ltd., incorporated by reference to Exhibit 10.3 to
Registrant's Form S-18 Registration Statement as filed on
October 23, 1987.

22 Subsidiaries-Registrant has no subsidiaries.

27 Financial Data Schedule

(b) No reports on Form 8-K have been filed during the last quarter of
1997.

SIGNATURES

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

HICKORY HILLS, LTD.

By: 222 Hickory, Ltd.
General Partner

By: 222 Partners, Inc.
General Partner

DATE: March 31, 1998 By:/s/Steven D. Ezell
President and Director

DATE: March 31, 1998 By:/s/Michael A. Hartley
Vice-President and Director

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

HICKORY HILLS, LTD.

By: 222 Hickory, Ltd.
General Partner

By: 222 Partners, Inc.
General Partner

DATE: March 31, 1998 By:/s/Steven D. Ezell
President and Director

DATE: March 31, 1998 By:/s/Michael A. Hartley
Vice-President and Director

Supplemental Information to be Furnished with Reports filed Pursuant to
Section 15(d) of the Act by Registrant Which Have Not Registered Securities
Pursuant to Section 12 of the Act:

No annual report or proxy material has been sent to security holders.

Independent Auditors' Report

The Partners
Hickory Hills, Ltd.:

We have audited the accompanying balance sheets of Hickory Hills, Ltd. (a
limited partnership) as of December 31, 1997 and 1996, and the related
statements of operations, partners' deficit, and cash flows for each of the
years in the three-year period ended December 31, 1997. These financial
statements are the responsibility of the Partnership's management. Our
responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates make by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Hickory Hills, Ltd. at
December 31, 1997 and 1996, and the results of its operations and its cash
flows for each of the years in the three-year period ended December 31, 1997,
in conformity with generally accepted accounting principles.

As discussed in Note 1, the Partnership adopted the provisions of Statement
of Financial Accounting Standards (SFAS) No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
on January 1, 1996.

The accompanying financial statements have been prepared assuming that the
Partnership will continue as a going concern. As discussed in Note 8 to the
financial statements, the Partnership has suffered recurring losses from
operations, resulting in a net capital deficiency, and a note due in full on
December 31, 1998 which the Partnership will be unable to repay, that raise
substantial doubt about the Partnership's ability to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 8. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

KPMG Peat Marwick LLP

Nashville, Tennessee
January 30, 1998

F-1

HICKORY HILLS, LTD.
(A Limited Partnership)

Balance Sheets

December 31, 1997 and 1996

Assets 1997 1996

Cash and cash equivalents (note 5) $ 180,308 142,345
Restricted cash (note 2) 167,859 258,676
Land and improvements held for
investment (notes 4 and 5) 2,071,767 2,473,839
Other assets 280 280

Total assets $ 2,420,214 2,875,140

Liabilities and Partners' Deficit

Liabilities:

Note payable to affiliate (note 5) $ 3,454,300 3,454,300
Accrued interest payable to
affiliate (note 5) 831,855 1,126,627
Accrued property taxes 8,852 10,635
Other accrued expenses 101,270 81,902

Total liabilities 4,396,277 4,673,464

Partners' deficit:

Limited partners (1,800 units
outstanding) (1,976,163) (1,798,424)
General partner 100 100

Total partners' deficit (1,976,063) (1,798,324)
Commitments and contingencies
(notes 5, 6, and 8)

Total liabilities
and partners' deficit $ 2,420,214 2,875,140

See accompanying notes to financial statements.

F-2

HICKORY HILLS, LTD.
(A Limited Partnership)

Statements of Operations

Years ended December 31, 1997, 1996, and 1995

1997 1996 1995

Revenues:
Sales of land
and improvements $ 936,050 1,180,250 925,010
Cost of sales of land and
improvements held for (587,687) (774,505) (707,893)
investment
Selling expenses(note 3) (78,089) (81,660) (64,648)

Income on sales of
land and improvements
held for investment 270,274 324,085 152,469

Interest income 12,200 31,331 24,238
Miscellaneous income 1,377 - -

Total revenues 283,851 355,416 176,707

Expenses:
Property management
fee (note 3) 3,000 3,000 3,000
Legal and accounting
(note 3) 13,070 13,782 12,925
General and administrative 4,101 8,270 8,381
Property taxes 27,816 35,058 39,683
Land maintenance fees 63,375 63,202 23,199
Interest (notes 3 and 5) 350,228 350,228 350,228

Total expenses 461,590 473,540 437,416

Net loss $ (177,739) (118,124) (260,709)

Net loss allocated to:
Limited partners $ (177,739) (118,124) (260,709)
General partner $ - - -

Net loss per limited
partner unit $ (98.74) (65.62) (144.84)

Weighted average units
outstanding 1,800 1,800 1,800
See accompanying notes to financial statements.
F-3

HICKORY HILLS, LTD.
(A Limited Partnership)

Statements of Partners' Deficit

Years ended December 31, 1997, 1996, and 1995

Limited General
partners partner Total
Units Amount
Balance at
December 31, 1994 1,800 $ (1,419,591) 100 (1,419,491)

Net loss - (260,709) - (260,709)
-------- -------- -------- ---------
Balance at
December 31, 1995 1,800 (1,608,300) 100 (1,680,200)

Net loss - (118,124) - (118,124)
------- -------- -------- --------
Balance at
December 31, 1996 1,800 (1,798,424) 100 (1,798,324)

Net loss - (177,739) - (177,739)
------- -------- -------- ---------
Balance at
December 31, 1997
1,800 $(1,976,163) 100 (1,976,063)
------- -------- -------- --------

See accompanying notes to financial statements.

F-4

HICKORY HILLS, LTD.
(A Limited Partnership)

Statements of Cash Flows

Years ended December 31, 1997, 1996, and 1995

1997 1996 1995
____ ____ ____
Cash flows from operating
activities:
Net loss $ (177,739) (118,124) (260,709)
Adjustments to reconcile net
loss to net cash provided
(used) by operating
activities:
Cost of sales of land and
improvements held for
investments 587,687 774,505 707,893
Cost of land and
improvements held for
investment (185,615) (507,369) (244,042)
Decrease (increase)
in restricted cash 90,817 77,436 (81,261)
Decrease (increase) in
other assets - 21,013 (20,828)
(Decrease) increase
in accrued interest
payable to affiliate (294,772) (399,772) 40,228
(Decrease) increase
in accrued property taxes (1,783) 780 (25,586)
Increase in other
accrued expenses 19,368 34,802 10,900
------- ------- --------
Net cash provided by/
(used in) operating
activities 37,963 (116,729) 126,595
------- ------- --------
Net change in cash and
cash equivalents 37,963 (116,729) 126,595

Cash and cash equivalents
at beginning of year 142,345 259,074 132,479
Cash and cash equivalents
at end of year $ 180,308 142,345 259,074

Supplemental Disclosures of
Cash Flow Information:

Cash paid during the year
for interest $ 645,000 750,000 310,000

See accompanying notes to financial statements.
F-5

HICKORY HILLS, LTD.
(A Limited Partnership)
Notes to Financial Statements

December 31, 1997 and 1996

(1) Summary of Significant Accounting Policies

(a) Organization

Hickory Hills, Ltd. (the Partnership), a Tennessee limited
partnership, was organized on September 15, 1987, to acquire three
tracts of undeveloped land located in the Nashville metropolitan
and Hendersonville, Tennessee areas. The General Partner is 222
Hickory, Ltd., and the general partner of 222 Hickory, Ltd. is 222
Partners, Inc. The Partnership prepares financial statements and
income tax returns on the accrual method and includes only those
assets, liabilities, and results of operations which relate to the
business of the Partnership. In the event that the Partnership has
short-term cash deficiencies, the General Partner can defer the
collection of fees for certain related party expenses or grant
interest-free loans from related parties until cash becomes
available.

(b) Estimates

Management of the Partnership has made estimates and assumptions to
prepare these financial statements in accordance with generally
accepted accounting principles. These estimates include the
determination of the estimated fair value of the land and
improvements held for investment in accordance with the provisions
of Statement of Financial Accounting Standards (SFAS) No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to be Disposed Of". Actual results could differ from
those estimates.

The Partnership considers all short-term investments with
original maturities of three months or less at the time of
purchase to be cash equivalents. At December 31, 1997 and
1996, the management of the Partnership has reserved cash
balances of $55,250 and $53,500, respectively, for payment
of impact fees. Cash belonging to the Partnership is
combined in an account with funds from other partnerships
related to the general partner.

(d) Land and Improvements Held for Investments

Land is recorded at cost and includes two tracts of
undeveloped land representing approximately 230 and 235
acres at December 31, 1997 and 1996, respectively. In
addition, the Partnership owns one tract of land developed
into residential lots with 7 and 24 lots remaining at
December 31, 1997 and 1996, respectively. Land costs
include amounts to acquire and hold land, including interest
and property taxes during the development period. Costs to
hold land, including interest and property taxes are charged
to expense once development is substantially complete.
F-6

HICKORY HILLS, LTD.
(A Limited Partnership)
Notes to Financial Statements

(1) Summary of Significant Accounting Policies (continued)

Land improvement costs include development costs expended
subsequent to the acquisition of a tract.

The Partnership adopted the provisions of SFAS NO. 121,
"Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed Of" on January 1, 1996.
SFAS No. 121 requires that long-lived assets to be disposed
of be reported at the lower of the carrying amount or fair
value less estimated costs to sell. The fair value of the
assets can be determined externally, using appraisals, or
internally using discounted future net cash flows. If such
assets are considered impaired, the impairment to be
recognized is measured by the amount by which the carrying
amount of the assets exceeds the fair value of the assets
less estimated costs to sell. Impairment is recognized
through the establishment of an allowance for impairment
with a corresponding charge to operations. Losses upon the
sale of the assets are charged to the allowance. Based upon
management's analysis of discounted future net cash flows,
the Partnership's land and improvements held for investment
does not meet definitions of impairment under SFAS No. 121.
Accordingly, land held for investment is recorded at cost
with no allowance for impairment necessary. The adoption of
SFAS No. 121 did not have an impact on the Partnership's
financial position, result of operations, or liquidity.

(e) Income Recognition

Income from sales of land and improvements held for
investment is generally recorded on the accrual basis when
the buyer's financial commitment is sufficient to provide
economic substance to the transaction, and when other
criteria of SFAS No. 66 "Accounting for Sales of Real
Estate" are satisfied. For sales of real estate where both
cost recovery is reasonably certain and the collectibility
of the contract price is reasonably assured, but the
transaction does not meet the remaining requirements to be
recorded on the accrual basis, profit is deferred and
recognized under the installment method, which recognizes
profit as collections of principal are received. If
developments subsequent to the adoption of the installment
method occur which cause the transaction to meet the
requirements of the full accrual method, the remaining
deferred profit is recognized at that time. Any losses on
sales of real estate are recognized at the time of the sale.
F-7
HICKORY HILLS, LTD.
(A Limited Partnership)

Notes to Financial Statements

(1) Summary of Significant Accounting Policies (continued)

(f) Income Taxes

No provision has or will be made for Federal or state income
taxes since such taxes are the responsibility of the
partners. Annually, the partners receive, from the
Partnership, IRS Form K-1's which provides them with their
respective share of taxable income or losses, deductions,
and other tax related information. The only difference
between the tax basis and reported amounts of the
Partnership's assets and liabilities relates to the
valuation of land and improvements held for investment. For
income tax purposes certain costs were capitalized as
additional land improvement costs.

(g) Partnership Allocations

Net profits, losses and distribution of cash flow of the
Partnership are allocated to the Partners in accordance with
the Partnership agreement as follows:

Partnership net profits are allocated first to any partner
with a negative balance in their capital account, determined
at the end of the taxable year as if the Partnership has
distributed cash flow, in proportion to the negative capital
balance account of all partners until no partner's capital
account is negative. Net profit allocations are then made
to the limited partners up to the difference between their
capital account balances and the sum of their adjusted
capital contributions (capital balance, net of cumulative
cash distributions in excess of preferred returns - 12%
annual cumulative return on capital contributed). Any
remaining net profit allocations are then made to the
limited partners until the taxable year in which cumulative
profits to the limited partners equal their adjusted capital
contribution plus an unpaid preferred return (12% annual
cumulative return on capital contributed). Net profits are
then allocated to the general partner until the ratio of the
general partner's capital account balance to the capital
account balances, in excess of adjusted capital
contributions and unpaid preferred return, of all limited
partners is 27% to 73%. Thereafter, profits are generally
allocated 27% to the general partner and 73% to the limited
partners. Net losses are allocated to the partners in
proportion to their positive capital accounts.

Partnership distributions are allocated 99% to the limited
partners and 1% to the general partner in an amount equal to
their preferred return (12% annual, cumulative return on
capital contributed), 99% to the limited partners and 1% to
the general partner until the limited partners have received
F-8

HICKORY HILLS, LTD.
(A Limited Partnership)

Notes to Financial Statements

(1) Summary of Significant Accounting Policies (continued)

an amount equal to their adjusted capital contributions,
and then 73% to the limited partners and 27% to the
general partner.

Cumulative unpaid preferred returns are $2,214,000 and $1,998,000
at December 31, 1997 and 1996, respectively.

(h) Reclassifications

Certain prior year amounts have been reclassified to conform
with the current year presentation.

(2) Restricted Cash

At December 31, 1997 and 1996, the Partnership has
restricted cash balances of $167,859 and $258,676,
respectively, to be used to fund property improvements,
consisting of road and utility work.

(3) Related Party Transactions

The general partner and its affiliates have been actively
involved in managing the Partnership. Affiliates of the
general partner receive fees and commissions for performing
certain services. Expenses incurred for these services
during 1997, 1996, and 1995 are as follows:

1997 1996 1995

Accounting fees $ 2,100 2,100 1,500
Property management fee 3,000 3,000 3,000
Engineering fees 9,025 24,765 -
Real estate commissions 42,034 37,290 23,694
Interest expense $350,228 350,228 350,228

(4) Land and Improvements Held for Investment

The components of land and improvements held for investment
at December 31, are as follows:
1997 1996

Land $1,180,334 1,538,626
Land Improvements 891,433 935,213
--------- ----------
$2,071,767 2,473,839

The aggregate cost of land and improvements held for
investment for Federal income tax purposes was $2,850,629
and $ 3,378,273 at December 31, 1997 and 1996, respectively.

F-9

HICKORY HILLS, LTD.
(A Limited Partnership)
Notes to Financial Statements

(5) Note Payable to Affiliate

The note payable to affiliate represents a $3,454,300 note
payable to Hickory Lenders, Ltd. (the Lender), an
affiliate sharing the same General Partner. The note
accrues simple interest at an annual rate of 10% plus
"additional interest" upon the sale of any portion of the
collateral equal to 55% of the "net revenues", as defined in
the Participating Loan Agreement. The note is secured by a
mortgage on the land and improvements held for investment
and by a security interest in any unrestricted cash or
investment securities held by the Partnership. The note
maturity date was extended by one year to December 1998.
Interest and principal payments become due upon the sale of
the collateral or any portion thereof to the extent cash is
available, but no later than December 31, 1998.

During 1997 and prior years, the Partnership retained
portions of the net proceeds from sales without paying the
applicable principal balance or accrued interest to the
Lender. The cumulative principal balance currently payable
to the Lender is $1,866,516 and $1,591,304 at
December 31, 1997 and 1996, respectively. The General
Partner believes that retaining sales proceeds for
development and distributing only net available cash to the
Lender was contemplated by the note agreement. However, the
note agreement does not explicitly authorize the retention of
these funds; therefore, this treatment could constitute a
default on the note agreement. In such an event the Lender
is required to foreclose the loan and accelerate the amounts
due or foreclose upon the note. To date, the Lender has not
foreclosed or accelerated the amounts due under the loan
agreement.

(6) Commitments

The Partnership has granted an exclusive option to a home
builder to purchase all remaining lots in the Harbortowne
Subdivision in accordance with a specified takedown and
pricing schedule. The per lot price will increase to
$25,500, in May 1998 and will increase $2,000 annually
thereafter.

F-10

HICKORY HILLS, LTD.
(A Limited Partnership)
Notes to Financial Statements

(7) Fair Value of Financial Instruments

At December 31, 1997 and 1996, the carrying amounts of cash
and cash equivalents, restricted cash, and accrued
liabilities approximate their fair values because of the
short maturity of those financial instruments.

The determination of the estimated fair values of the note
payable and the related accrued interest payable was not
practicable as the note agreement does not provide for a
predictable cash payment stream.

(8) Going Concern

The accompanying financial statements have been prepared
assuming that the Partnership will continue as a going
concern. The Partnership had a note due on December 31,
1997 and was unable to repay the note. The Lender has
extended the due date to December 31, 1998. However, the
General Partner does not expect the Partnership to have
the liquidity to retire the debt in full. The General
Partner plans to negotiate another extension of the loan
term. If an extension is not received and the Partnership
does not repay the Note, the Lender could foreclose and take
the Partnership's assets. The partnership would then be dissolved.

This uncertainty raises substantial doubt about the Partnership's
ability to continue as a going concern. The financial statements do
not include any adjustments that might result from the
outcome of this uncertainty.

F-11

Independent Auditors' Report

The Partners
Hickory Hills, Ltd.:

Under date of January 30, 1998, we reported on the balance sheets
of Hickory Hills, Ltd. as of December 31, 1997 and 1996, and the
related statements of operations, partners' deficit, and cash flows
for each of the years in the three-year period ended December 31,
1997. These financial statements and our report thereon are
included elsewhere herein. In connection with our audits of the
aforementioned financial statements, we have also audited the
related financial statement schedule as listed in the accompanying
index. This financial statement schedule is the responsibility of
the Partnership's management. Our responsibility is to express an
opinion on this financial statement schedule based on our audits.

In our opinion, such financial statement schedule, when considered
in relation to the basic financial statements taken as a whole,
presents fairly, in all material respects, the information set
forth therein.

As discussed in Note 1, the Partnership adopted the provisions of
Statement of Financial Accounting Standards (SFAS) No. 121,
"Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed Of" on January 1, 1996.

The accompanying financial statements have been prepared assuming
that the Partnership will continue as a going concern. As discussed
in Note 8 to the financial statements, the Partnership has suffered
recurring losses from operations, resulting in a net capital deficiency,
and a note due in full on December 31, 1998 which the Partnership will be
unable to repay, that raise substantial doubt about the Partnership's
ability to continue as a going concern. Management's plans in regard to
these matters are also described in Note 8. The financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.

KPMG Peat Marwick LLP

Nashville, Tennessee
January 30, 1998

S-1

HICKORY HILLS, LTD.
(A Limited Partnership)

Schedule III

Real Estate and Accumulated Depreciation
December 31, 1997

Initial Cost to Cost capitalized Gross amount at
Partnership subsequent which carried
to acquisition at close of period

Description Encum- Land Building Improve- Carrying Land Building Total Accumu- Date of Date
brances and improve- ments costs and improve- lated de- construc-acquired
ments ments preciation tion
----------- ------ ---- ----------------------------------------- ------- -----------
7 residential
lots in
Sumner Co., TN $3,454,300 - - 769,835 104,978 874,813 874,813 - 5/89- 9/87
12/96
230 acres of
land in
Davidson Co., TN same 1,180,334 - 10,138 6,482 1,180,334 16,620 1,196,954 - 6/95 11/87

Total $3,454,300 1,180,334 - 779,973 111,460 1,180,334 891,433 2,071,767 -

Assets scheduled above represent land and non-depreciable land improvements, therefore accumulated depreciation and depreciable
lives are non applicable.

/TABLE

HICKORY HILLS, LTD.
(A Limited Partnership)

Schedule III

Real Estate and Accumulated Depreciation

1997 1996 1995

(1) Balance at beginning $2,473,839 2,740,975 3,204,826
of Period
Additions during period:
Improvements 185,615 507,369 244,042
_______ _______ ________
185,615 507,369 244,042

Deductions during period:
Cost of real estate sold 587,687 774,505 707,893
_______ _______ ________
587,687 774,505 707,893

Balance at end of period $2,071,767 2,473,839 2,740,975

(2) Aggregate cost for
Federal income tax purposes $2,850,629 3,378,273 3,487,713

See accompanying independent auditors' report.

S-2

Exhibits filed pursuant to Item 14 (a) (3)

HICKORY HILLS, LTD.
(A Limited Partnership)

Exhibit Index

Exhibit

3 Amended and Restated Certificate and Agreement of Limited
Partnership, incorporated by reference to Exhibit A2 to
the Prospectus of Registrant dated December 3, 1987 filed
pursuant to Rule 424(b) of the Securities and Exchange
Commission.

10A Loan Agreement by and among Hickory Hills, Ltd. and
Hickory Lenders, Ltd., incorporated by reference to
Exhibit 10.1 to Registrant's Form S-18 Registration
Statement as filed on October 23, 1987.

10B Deed of Trust and Security Agreement by and among Hickory
Lenders, Ltd. and the Registrant, incorporated by
reference to Exhibit 10.2 of the Registrant's Form S-18
Registration Statement as filed on October 23, 1987.

10C Promissory Note of Hickory Hills, Ltd. to Hickory
Lenders, Ltd., incorporated by reference to Exhibit 10.3
to Registrant's Form S-18 Registration Statement as filed
on October 23, 1987.

22 Subsidiaries-Registrant has no subsidiaries.

27 Financial Data Schedule