November 27, 1995

Balcor Partners - XIX
Balcor Realty Investors 86-Series I
c/o The Balcor Company
2355 Waukegan Road, Suite A200
Bannockburn, Illinois  60015

Dear Sirs:

In connection with an offer (the "Offer") by Walton Street Capital Acquisition
Co., L.L.C. for the purchase of up to 45% of the outstanding limited partner
interests ("Units") of Balcor Realty Investors 86-Series I (the "Partnership"),
you have asked us to provide a range of values for the Units assuming orderly
liquidation over twelve months by application of a current income analysis
based on (a) historical and anticipated net operating income for 1995 data
provided to us by you; (b) capitalization assumptions prepared by us based in
part upon relevant real-estate profiles provided to us by you; and, (c) on site
visits of properties and interviews with property managers at a sample of
properties we deemed appropriate.  Solely by such methodology, we believe that
such liquidation value of the Units is approximately $209 to $273 per Unit,
depending on assumptions made about prepayment penalties.

The above valuation estimate is subject to the following limitations and
conditions:

i.   The valuation estimate is based in part on actual operating results for
the first nine months and anticipated operating results for the remaining three
for 1995 as provided by you.  There can be no assurance that such anticipated
results will  actually be achieved.

ii.  We did not perform any procedures concerning the possible effect of
present or future federal, state or local legislation that could affect the
sale of properties including, without limitation, legislation and regulations
relating to income taxes, civil rights, zoning, building codes, disabilities,
and environmental matters.

iii. We assume no responsibility for changes in market conditions or for the
inability of the Partnership to achieve its anticipated results based upon our
review of the assets.

iv.  We have not considered any federal, state or local tax consequences that
would occur as a result of the sale of Units in response to the Offer.

v.   The amounts of prepayment penalties used in determining our range of
values have been based upon review of mortgages and loan documents provided to
us by you.  We have not independently determined whether those documents have
been amended, superseded, or modified.

vi.  We assume no responsibility for the accuracy or completeness of any
information (financial or other) provided to us by you.

The valuation estimate stated herein is provided solely for your benefit and is
not intended to confer rights or remedies upon any holders of the Units or any
other person.  The valuation stated herein does not constitute a recommendation
to the holders of the units, nor are we expressing any opinion on the fairness
or adequacy of the Offer.  Neither you nor your general partner may disclose,
quote from or refer to the analysis described herein except (a) with our prior
written consent, which consent shall not be unreasonably withheld, or (b) in
the event The Balcor Company or you is legally compelled to do so; provided
however, that we consent to a reference to this analysis in any communication
with Unit holders or filing with the Securities and Exchange Commission in
response to the Offer or other tender offers you receive prior to June 30,
1996, provided that this letter is reproduced therein or attached thereto in
its entirety.

                              Sincerely,

                              ALEX. BROWN & SONS INCORPORATED



                              By:  /s/John E. Glennon
                                   --------------------------