424B3: Prospectus filed pursuant to Rule 424(b)(3)

FILED PURSUANT TO RULE 424(B)(3)
REGISTRATION NO. 333-15407

PROSPECTUS

943,973 SHARES


BAY APARTMENT COMMUNITIES, INC.


COMMON STOCK

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This Prospectus relates to the offer and sale of (i) up to 289,428 shares
(the "Redemption Shares") of common stock, $.01 par value (the "Common Stock"),
of Bay Apartment Communities, Inc. (the "Company"), to the extent the Company
has previously elected, or may in the future elect, to issue such shares to the
holders of units of limited partnership interest (the "Units") in Bay
Countrybrook L.P., a Delaware limited partnership (the "Partnership"), the
general partner of which is Bay GP, Inc., a Maryland corporation (the "General
Partner"), a wholly-owned subsidiary of the Company, and (ii) up to 654,545
shares of Common Stock, which were issued in connection with the corporate
reorganization of the Company prior to its initial public offering (the
"Original Shares"), which may be sold by the holders thereof (the holders of the
Redemption Shares and the Original Shares are collectively referred to herein as
the "Selling Stockholders"). Under the terms of the Agreement of Limited
Partnership of the Partnership, holders of Units in the Partnership have the
right to require the Partnership to redeem their Units for cash, subject to
certain conditions. The Company may, however, elect to deliver an equivalent
number of shares of Common Stock to the holders of Units in satisfaction of the
Partnership's obligation to redeem the Units for cash.

The Company is registering the Redemption Shares and the Original Shares
(collectively, the "Shares") pursuant to the Company's obligations under certain
registration rights agreements. The registration of the Shares does not
necessarily mean that all of the Redemption Shares will be issued by the Company
in satisfaction of the Unit holders' redemption rights or that any of the Shares
will be offered or sold by the Selling Stockholders. The Company has been
advised by each Selling Stockholder who is an executive officer of the Company
that, notwithstanding the registration of the Original Shares pursuant to the
Registration Statement of which this Prospectus is a part, such Selling
Stockholder has no present intention to sell any of the Original Shares, but may
determine to do so in the future. See "Plan of Distribution" and "Selling
Stockholders."

Each of the Selling Stockholders, directly or through agents, dealers or
underwriters, may offer and sell all or a portion of the Shares offered hereby
from time to time on terms to be determined at the time of sale. To the extent
required by law, the names of any such agent, dealer or underwriter, any
applicable commissions or discounts and any other required information with
respect to a particular offer will be set forth in an accompanying Prospectus
Supplement. See "Plan of Distribution." Each Selling Stockholder reserves the
right to accept and, together with such Selling Stockholder's agents, dealers or
underwriters, to reject, in whole or in part, any proposed purchase of Shares to
be made directly or through agents, dealers or underwriters. The Selling
Stockholders and any agents, dealers or underwriters that participate with the
Selling Stockholders in the distribution of the Shares may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"), in which case any commissions received by them and any profit
on the resale of the Shares purchased by them may be deemed underwriting
commissions or discounts under the Securities Act. See "Registration Rights" for
indemnification arrangements between the Company and the Selling Stockholders.

The Common Stock is listed on the New York Stock Exchange (the "NYSE") and
the Pacific Exchange (the "PCX") under the symbol "BYA." On May 29, 1997, the
last reported sale price for the Common Stock on the NYSE was $34.875 per
share. The Company will not receive any proceeds from the sale of Shares by the
Selling Stockholders, but has agreed to bear certain expenses of the
registration of such Shares under federal and state securities laws.

SEE "RISK FACTORS" COMMENCING ON PAGE 5 FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE SHARES
OFFERED HEREBY.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
-------------------


The date of this Prospectus is June 4, 1997.
AVAILABLE INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"SEC" or "Commission") a Registration Statement on Form S-3 under the Securities
Act with respect to the Securities (the "Registration Statement"). This
Prospectus, which constitutes part of the Registration Statement, omits certain
of the information contained in the Registration Statement and the exhibits
thereto on file with the Commission pursuant to the Securities Act and the rules
and regulations of the Commission thereunder. The Registration Statement,
including exhibits thereto, may be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, and at the Commission's Regional Offices at 7 World
Trade Center, 13th Floor, New York, New York 10048, and Northwestern Atrium
Center, 500 W. Madison Street, Suite 1400, Chicago, Illinois 60661-2511, and
copies may be obtained at the prescribed rates from the Public Reference Section
of the Commission at its principal office in Washington, D.C. In addition, the
Company is required to file electronic versions of these documents with the
Commission through the Commission's Electronic Data Gathering, Analysis and
Retrieval ("EDGAR") system, and such electronic versions are available to the
public at the Commission's World-Wide Web Site, http://www.sec.gov. Statements
contained in this Prospectus as to the contents of any contract or other
document referred to are not necessarily complete, and in each instance
reference is made to the copy of such contract or other document filed as an
exhibit to the Registration Statement, each such statement being qualified in
all respects by such reference.

The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and proxy statements and other information with the
Commission. Such reports, proxy statements and other information can be
inspected and copied at the locations described above. Copies of such materials
can be reviewed at the Commission's World-Wide Web Site (http://www.sec.gov.) or
obtained by mail from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549, at prescribed rates. In
addition, the Common Stock is listed on the NYSE and the PCX, and such materials
can be inspected and copied at the NYSE at 20 Broad Street, New York, New York
10005 and at the PCX at 301 Pine Street, San Francisco, California 94104.


INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents previously filed by the Company with the Commission
pursuant to the Exchange Act are incorporated by reference in this Prospectus:
(i) the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1996, (ii) the Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended March 31, 1997, (iii) the Company's Current Report on Form 8-K
dated January 21, 1997, (iv) the Company's Current Report on Form 8-K, dated
April 18, 1997, as amended by the Company's Current Report on Form 8-K/A, dated
April 18, 1997, and (v) the description of the Company's Common Stock contained
in the Company's Registration Statement on Form 8-A dated December 7, 1993.

All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to
the termination of the offering of all of the Shares shall be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents. The Company will provide, without charge, to
each person, including any beneficial owner, to whom a copy of this Prospectus
is delivered, at the request of such person, a copy of any or all of the
documents incorporated herein by reference (other than exhibits thereto, unless
such exhibits are specifically incorporated by reference into such documents).
Written or oral requests for such copies should be directed to: Chief Financial
Officer, Bay Apartment Communities, Inc., 4340 Stevens Creek Blvd., Suite 275,
San Jose, California 95129, telephone (408) 983-1500.


2
Any statement contained herein or in a document incorporated or deemed to
be incorporated herein by reference shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
(or in an applicable Prospectus Supplement) or in any subsequently filed
document that is incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed to
constitute a part of this Prospectus or any Prospectus Supplement, except as so
modified or superseded.


3
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PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information included elsewhere in this Prospectus. Unless the context otherwise
requires, all references in this Prospectus to the "Company" shall also refer to
Bay G.P., Inc., a Maryland corporation. This Prospectus, including the
information incorporated herein by reference, contains forward-looking
statements within the meaning of Section 27A of the Securities Act and Section
21E of the Exchange Act. The Company's actual results could differ materially
from those projected in the forward-looking statements set forth in this
Prospectus including the information incorporated herein by reference. Investors
should carefully consider the discussion of risk factors commencing on page 5,
in addition to the other information contained in this Prospectus, in connection
with an investment in the Shares offered hereby.

THE COMPANY

The Company has engaged in apartment community acquisition, development,
construction, reconstruction, marketing, leasing and management since 1978 and
is one of the most experienced developers and operators of upscale apartment
communities in the San Francisco Bay Area. As a self-administered and
self-managed real estate investment trust ("REIT"), the Company owns and manages
apartment communities (the "Communities") located in Northern California
(principally in the San Francisco Bay Area) and in Southern California
(including Orange, Los Angeles and San Diego Counties).

The Company is a fully-integrated real estate organization with in-house
development, construction, acquisition, reconstruction, financing, marketing,
leasing and management expertise. This in-house expertise has allowed the
Company to maintain its reputation for developing and constructing apartment
communities on time and on budget. With its experience and in-house
capabilities, the Company is well-positioned to continue to take advantage of
the strong demand for upscale apartment homes and the development and
acquisition opportunities presented by the current economic conditions in
Northern and Southern California. The Company has elected to qualify as a REIT
for federal income tax purposes. The Company pays regular quarterly dividends to
its shareholders.

The Company was incorporated under the laws of the State of California in
1978 and reincorporated under the laws of the State of Maryland, pursuant to a
reincorporation merger, in July 1995. Its executive offices are located at 4340
Stevens Creek Boulevard, Suite 275, San Jose, California 95129, and its
telephone number is (408) 983-1500.

RISK FACTORS

An investment in the Shares involves various risks, and prospective
investors should carefully consider the matters discussed under "Risk Factors"
prior to any investment in the Company.

SECURITIES TO BE OFFERED

This Prospectus relates to the offer and sale of (i) up to 289,428
Redemption Shares of the Company, to the extent the Company has previously
elected, or may in the future elect, to issue such shares to the holders of
Units in the Partnership, and (ii) up to 654,545 Original Shares, which may be
sold by the Selling Stockholders. Under the terms of the Agreement of Limited
Partnership of the Partnership, holders of Units in the Partnership have the
right to require the Partnership to redeem their Units for cash, subject to
certain conditions. The Company may, however, elect to deliver an equivalent
number of shares of Common Stock to the holders of Units in satisfaction of the
Partnership's obligation to redeem the Units for cash. The Company is
registering the Shares pursuant to the Company's obligations under certain
registration rights agreements.

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4
RISK FACTORS

DEVELOPMENT AND ACQUISITION RISKS

The Company intends to continue to pursue the development and construction
of apartment home communities in accordance with the Company's development and
underwriting policies. Risks associated with the Company's development and
construction activities may include: the abandonment of development and
acquisition opportunities explored by the Company; construction costs of a
community may exceed original estimates due to increased materials, labor or
other expenses, which could make completion of the community uneconomical;
occupancy rates and rents at a newly completed community are dependent on a
number of factors, including market and general economic conditions, and may not
be sufficient to make the community profitable; financing may not be available
on favorable terms for the development of a community; and construction and
lease-up may not be completed on schedule, resulting in increased debt service
expense and construction costs. Development activities are also subject to risks
relating to the inability to obtain, or delays in obtaining, all necessary
zoning, land-use, building, occupancy, and other required governmental permits
and authorizations. The occurrence of any of the events described above could
adversely affect the Company's ability to achieve its projected yields on
communities under development or reconstruction and could prevent the Company
from making expected distributions.

Acquisitions entail risks that investments will fail to perform in
accordance with expectations and that judgments with respect to the costs of
improvements to bring an acquired community up to standards established for the
market position intended for that community will prove inaccurate, as well as
general investment risks associated with any new real estate investment.
Although the Company undertakes an evaluation of the physical condition of each
new community before it is acquired, certain defects or necessary repairs may
not be detected until after the community is acquired, which could significantly
increase the Company's total acquisition costs.

REAL ESTATE INVESTMENT RISKS

General Risks. Real property investments are subject to varying degrees of
risk. The yields available from equity investments in real estate depend on the
amount of income generated and expenses incurred. If the Communities do not
generate revenues sufficient to meet operating expenses, including debt service
and capital expenditures, the Company's cash flow and ability to pay
distributions to its stockholders will be adversely affected.

An apartment community's revenues and value may be adversely affected by a
number of factors, including the national economic climate; the local economic
climate (which may be adversely impacted by plant closings, industry slowdowns,
military base closings and other factors); local real estate conditions (such as
an oversupply of or a reduced demand for apartment homes); the perceptions by
prospective residents of the safety, convenience and attractiveness of the
community; the ability of the owner to provide adequate management, maintenance
and insurance; and increased operating costs (including real estate taxes and
utilities). Certain significant expenditures associated with each equity
investment (such as mortgage payments, if any, real estate taxes, insurance and
maintenance costs) are generally not reduced when circumstances cause a
reduction in income from the investment. If a community is mortgaged to secure
payment of indebtedness, and if the Company is unable to meet its mortgage
payments, a loss could be sustained as a result of foreclosure on the community
or the exercise of other remedies by the mortgagee. In addition, real estate
values and income from communities are also affected by such factors as the cost
of compliance with government regulation, including zoning and tax laws,
interest rate levels and the availability of financing.

Operating Risks. Each of the Communities is subject to all operating risks
common to apartment communities in general, any and all of which might adversely
affect unit occupancy or rental rates. Increases in unemployment and a decline
in household formation in Northern or Southern California might adversely affect
occupancy or rental rates. Increases in operating costs due to inflation and
other factors may not be offset by increased rents. Residents may be unable or
unwilling to pay rent increases. Rent control or rent stabilization laws or
other laws regulating housing are applicable in certain of the cities where the
Company owns Communities and may be enacted in the future in other jurisdictions
in which one or more Communities are located or in which additional apartment
communities may be acquired or developed; if enacted, compliance with these laws
may increase the Company's operating costs.


5
If operating expenses increase, the local rental market may limit the extent to
which rents may be increased to meet increased expenses without decreasing
occupancy rates. If any of the above occurs, the Company's ability to achieve
its projected yields on the Communities and to make distributions to
stockholders could be adversely affected.

Market Illiquidity. Equity real estate investments are relatively illiquid.
Such illiquidity will tend to limit the ability of the Company to vary its
portfolio promptly in response to changes in economic or other conditions. In
addition, the Internal Revenue Code of 1986, as amended (the "Code"), limits the
Company's ability to sell properties held for fewer than four years, which may
affect the Company's ability to sell properties without adversely affecting
returns to holders of Common Stock.

Competition. There are numerous housing alternatives that compete with the
Communities in attracting residents. The Communities compete directly with other
rental apartments and single-family homes that are available for rent in the
markets in which the Communities are located. The Communities also compete for
residents with the new and existing home market. The number of competitive
residential properties in a particular area could have a material effect on the
Company's ability to lease apartment homes and on the rents charged. In
addition, competitors for acquisitions and development projects may have greater
resources than the Company.

Affordable Housing Laws or Restrictions. A number of the Communities are,
and additional apartment communities acquired or developed by the Company likely
will be in the future, subject to federal, state and local statutes or other
restrictions requiring that a percentage of apartment homes be made available to
residents satisfying certain income requirements. These laws and restrictions,
as well as any changes thereto making it more difficult to meet such
requirements, or a reduction in or elimination of certain financing advantages
available in some instances to persons satisfying such requirements, could
adversely affect the Company's profitability and its development and acquisition
projects in the future.

DEPENDENCE ON NORTHERN CALIFORNIA

Although the Company may expand further outside of Northern California and
intends to make additional selective acquisitions in Southern California from
time to time, currently a substantial majority of the Communities are located in
Northern California (principally in the San Francisco Bay Area) where the
Company has most of its acquisition, development, construction and marketing
expertise. The Company's performance, therefore, is dependent upon economic
conditions in these markets. A decline in the economy in these markets may
adversely affect the ability of the Company to make expected distributions to
stockholders. Similarly, a decline in demand for discretionary consumer goods
and leisure travel as well as heightened competition in high technology
industries, could have an adverse impact upon Northern California. Reductions in
the level of government spending in the defense industry may also have an impact
upon employment and demand for residential real estate in the Company's markets.

NEW SOUTHERN CALIFORNIA MARKETS

In 1996, the Company expanded beyond Northern California and has since
acquired several Communities located in Southern California (including Orange,
Los Angeles and San Diego Counties). The Company also intends to make other
selective acquisitions in Southern California from time to time. The Company's
historical experience is in Northern California, primarily in the San Francisco
Bay Area, and it is possible that the Company's expertise in those markets may
not assist it in Southern California. In such event, the Company may be exposed
to, among others, risks associated with (i) a lack of market knowledge and
understanding of the local economy, (ii) an inability to access land and
property acquisition opportunities, (iii) an inability to obtain construction
tradespeople, (iv) sudden adverse shifts in supply and demand factors and (v) an
unfamiliarity with local governmental procedures.


6
NATURAL DISASTERS

Many of the Communities are located in the general vicinity of active
earthquake faults. In July 1996, the Company obtained a seismic risk analysis
from an engineering firm which estimated the probable maximum loss ("PML") for
each of the 27 Communities owned at that time individually and for all of such
Communities combined. To establish a PML, the engineers first define a severe
earthquake event for the applicable geographic area, which is an earthquake that
has only a 10% likelihood of occurring over a 50-year period. The PML is
determined as the structural and architectural damage and business interruption
loss that has a 10% probability of being exceeded in the event of such an
earthquake. Because the Communities are concentrated in the San Francisco Bay
Area, the engineers' analysis defined an earthquake on the San Andreas Fault
with a Richter Scale magnitude of 8.0 as a severe earthquake with a 10%
probability of occurring within a 50-year period, and established an aggregate
PML of $45.9 million for the 27 Communities, which is a PML level that is
expected to be exceeded only 10% of the time in the event of such a severe
earthquake. This aggregate PML could be higher as a result of variations in soil
classifications and structural vulnerabilities. One Community's individual PML
was 30%, while four Communities had PMLs of 25%, and the remaining 22
Communities each had PMLs of 20% or less. However, no assurance can be given
that an earthquake would not cause damage or losses greater than the PML
assessments indicate, or that future acquisitions or developments will not have
PML assessments indicating the possibility of greater damage or losses. The
Company has obtained individual PML assessments for thirteen of the fourteen
Communities acquired since July 1996. One of those Communities has an
individual PML of 30%, three of those Communities have individual PMLs of 25%
and the remaining Communities have individual PMLs of 20% or less. The Company
obtained an initial seismic risk analysis on the fourteenth Community, which
indicated a PML of approximately 31%. The Company is in the process of
obtaining a final seismic risk analysis for this Community from the same
engineering firm that conducted the seismic risk analysis for the other
Communities. While the Company has not yet obtained an engineers' analysis
establishing an aggregate PML for all of the Communities combined, the Company
intends to obtain such an aggregate PML in order to assist it in evaluating
appropriate levels of insurance coverage.

In July 1996, the Company obtained earthquake insurance, both for physical
damage and lost revenues, with respect to the Communities. For any single
occurrence, the Company self-insures the first $20 million of loss, and has in
place $25 million of coverage above this amount, with a 20% deductible. In
addition, the Company's general liability and property casualty insurance
provides coverage for personal liability and fire damage. In the event that an
uninsured disaster or a loss in excess of insured limits were to occur, the
Company could lose its capital invested in the affected Community, as well as
anticipated future revenues from such Community, and would continue to be
obligated to repay any mortgage indebtedness or other obligations related to the
Community. Any such loss could materially and adversely affect the business of
the Company and its financial condition and results of operations.

REAL ESTATE FINANCING RISKS

Risks Relating to the Credit Enhancement. As of March 31, 1997, the
Company was obligated for certain mortgage indebtedness funded by tax-exempt
bonds (the "Bonds") in the aggregate principal amount of approximately $224.5
million on 12 Communities (Waterford Apartments, Villa Mariposa, Fairway Glen
Apartments, Foxchase Apartments, Barrington Hills, Crossbrook, Rivershore,
Canyon Creek, Sea Ridge, City Heights, Countrybrook and Larkspur Canyon).
Principal and interest payments due to holders of the Bonds (the "Bondholders")
are secured by a first deed of trust on the Community associated with the
respective Bond issue.

Scheduled principal and interest payments due on the Bonds financing
Foxchase, Fairway Glen, Waterford and Villa Mariposa are guaranteed by an
insurance policy (the "FGIC Credit Enhancement") issued by the Financial
Guaranty Insurance Company ("FGIC"). The FGIC Credit Enhancement will terminate
on March 17, 2004 and, if the FGIC Credit Enhancement is not renewed or
replaced, the 1994 Bond documents may require balloon payments in 2004
aggregating approximately $87.4 million, less any unscheduled principal
amortization. Scheduled interest and principal payments due on the Bonds
financing Barrington Hills, Crossbrook, Rivershore, Canyon Creek and Sea Ridge
are supported by a 30-year credit enhancement (the "FNMA Credit Enhancement"
and, together with the FGIC Credit Enhancement, the "Credit Enhancements")
provided by the Federal National Mortgage Association.


7
Each of the Credit Enhancements contains certain provisions under which a
default of certain payment obligations or covenants would entitle FGIC or FNMA,
as the case may be, to declare a default under its respective Credit Enhancement
documents and exercise its remedies (including foreclosure) under mortgages that
encumber nine of the 12 Bond-financed Communities and eight additional
Communities, with a consequent loss of income and asset value to the Company. In
addition, gross rents collected from the residents of these 17 Communities have
been and will continue to be deposited in cash collateral accounts established
with financial institutions acceptable to FGIC or FNMA, as applicable. The
Company does not have access to these funds until all required monthly debt
service payments due on the Bonds and certain other payments are made. A default
under either of the Credit Enhancements or the Bond documents may adversely
affect the ability of the Company to make distributions to stockholders,
including distributions required to maintain its REIT status.

Bond Compliance Requirements. The 12 Bond-financed Communities are subject
to deed restrictions or restrictive covenants relating to tax-exempt bond
financing. In addition, the Code and the regulations promulgated thereunder
impose various restrictions, conditions and requirements relating to the
exclusion from gross income for federal income tax purposes of interest on
qualified bond obligations, including requirements that at least 20% of
apartment homes be made available to residents with gross incomes that do not
exceed 80% of the median income (50% in the case of the Canyon Creek, City
Heights and Sea Ridge Communities) in the area, measured annually. Some of the
Communities financed with Bonds are also subject to a requirement that the
rental rates for the 20% of the apartment homes that are subject to the
foregoing requirement may not exceed 30% of one-half of the applicable median
income. In addition to federal requirements, certain state and local authorities
may impose rental restrictions. The Bond compliance requirements and the
requirements of any future tax-exempt bond financing utilized by the Company may
have the effect of limiting the Company's income from the Bond-financed
Communities if the Company is required to lower its rental rates materially to
attract residents who satisfy the median income test. If the required number of
apartment homes are not reserved for residents satisfying these income
requirements, the tax-exempt status of the Bonds may be terminated, the
obligations of the Company under the Bond documents may be accelerated and other
contractual remedies against the Company may be available.

Risk of Rising Interest Rates. The Company had variable rate indebtedness
aggregating approximately $244.7 million outstanding as of March 31, 1997
consisting of $204.5 million of tax-exempt financing and $40.2 million of
borrowings under the Company's $200 million unsecured line of credit (the
"Unsecured Credit Facility"). Additional indebtedness that the Company may incur
under the Unsecured Credit Facility will also bear interest at a variable rate.
To the extent the Company uses variable rate debt for future financings, and
with respect to the portion of the Company's outstanding indebtedness that will
bear interest at a variable rate, increases in these interest rates could
adversely affect the Company's ability to make distributions to stockholders.
Consideration will be given to acquiring interest rate hedging or protection
agreements, if appropriate and cost effective, with respect to future variable
rate indebtedness to reduce exposure to interest rate increases on such debt.

POTENTIAL ENVIRONMENTAL LIABILITIES

Under various federal, state and local environmental laws, a current or
previous owner or operator of real estate may be required (typically regardless
of knowledge or responsibility) to investigate and remediate the effects of
hazardous or toxic substances or petroleum product releases at such property,
and may be held liable to a governmental entity or to third parties for property
damage and for investigation and remediation costs incurred by such parties in
connection with the contamination, which costs may be substantial. The presence
of such substances (or the failure to properly remediate the contamination) may
adversely affect the owner's ability to borrow against, sell or rent such
property.

Certain federal, state and local laws and regulations govern the removal,
encapsulation or disturbance of asbestos-containing materials ("ACMs") when such
materials are in poor condition or in the event of construction, remodeling,
renovation or demolition of a building. Such laws may impose liability for
release of ACMs and may provide for third parties to seek recovery from owners
or operators of real properties for personal injury associated with ACMS. In
connection with its ownership and operation of the Communities, the Company
potentially may be liable for such costs. The Company is not aware that any ACMs
were used in connection with (i) the construction


8
of the Communities developed by the Company, all of which were constructed after
1983, or (ii) the construction of any of the Communities acquired by the Company
other than Regatta Bay, Sea Ridge, Village Square, Sunset Towers, Mill Creek,
Crowne Ridge (formerly Channing Heights), Lafayette Place (formerly Martinique
Gardens), SummerWalk (formerly Rancho Penasquitos), The Village, Banbury Cross,
Cardiff Gardens and Genesee Gardens. The Company does not anticipate that it
will incur any material liabilities in connection with the presence of ACMs at
the Communities. The Company currently has in place or intends to implement an
operations and maintenance program for ACMs at the Regatta Bay, Sea Ridge,
Village Square, Sunset Towers, Mill Creek, Crowne Ridge, Lafayette Place,
SummerWalk, The Village, Banbury Cross, Cardiff Gardens and Genesee Gardens
Communities.

All of the Communities have been subjected to a Phase I or similar
environmental assessments (which involves general inspections without soil
sampling or groundwater analysis and generally without radon testing). These
assessments have not revealed any environmental liability that the Company
believes would have a material adverse effect on the Company's business, assets
or results of operations. However, one Community and one apartment community
currently under development are subject to soil and groundwater remediation of
contamination from adjacent landowners. In the case of one of the current
development communities, Toscana, National Semiconductor Corporation is causing
remediation to occur and has provided an indemnity which the Company may rely
upon for certain environmental liabilities. Additionally, another apartment
community currently under development, Paseo Alameda, may require underground
storage tank removal and other environmental cleanup. Nevertheless, it is
possible that the assessments do not reveal all environmental liabilities or
there are material environmental liabilities of which the Company is unaware. No
assurances can be given that (i) future laws, ordinances or regulations will not
impose material environmental liability, or (ii) the current environmental
condition of the Communities or the apartment communities currently under
development will not be affected by the condition of land or operations in the
vicinity of such communities (such as the presence of underground storage
tanks), or by third parties unrelated to the Company.

ADVERSE CONSEQUENCES OF FAILURE TO QUALIFY AS A REIT

The Company intends to operate in a manner that will enable it to qualify
as a REIT under the Code. Although management of the Company believes that the
Company is organized and operates in such a manner, no assurance can be given
that the Company qualifies or will remain qualified as a REIT. Qualification as
a REIT involves the application of highly technical and complex Code provisions
for which there are only limited judicial and administrative interpretations.
The determination of various factual matters and circumstances not entirely
within the Company's control may affect the Company's ability to qualify as a
REIT. If the Company fails to qualify as a REIT, it will be subject to federal
income tax (including any applicable alternative minimum tax) on its taxable
income at regular corporate rates. In addition, unless entitled to relief under
certain statutory provisions, the Company will be disqualified from treatment as
a REIT for the four taxable years following the year during which qualification
is lost. The additional tax would significantly reduce the cash flow available
for distribution to stockholders.

DESCRIPTION OF SECURITIES TO BE REGISTERED

The description of the Company's Common Stock set forth below does not
purport to be complete and is qualified in its entirety by reference to the
Company's Articles of Incorporation and Bylaws, as amended and in effect on the
date hereof.

GENERAL

Under the Articles of Incorporation, the Company has authority to issue 40
million shares of Common Stock, par value $.01 per share. Under Maryland law,
stockholders generally are not responsible for the Company's debts or
obligations. As of May 29, 1997, the Company had outstanding 22,273,241 shares
of Common Stock. The Common Stock is listed on the NYSE and the PCX under the
symbol "BYA."


9
TERMS

Subject to the preferential rights of any other shares or series of stock
and to the provisions of the Company's Articles of Incorporation regarding
Excess Stock, holders of shares of Common Stock will be entitled to receive
dividends on shares of Common Stock if, as and when authorized and declared by
the Board of Directors of the Company out of assets legally available therefor
and to share ratably in the assets of the Company legally available for
distribution to its stockholders in the event of its liquidation, dissolution or
winding-up after payment of, or adequate provision for, all known debts and
liabilities of the Company.

Subject to the provisions of the Company's Articles of Incorporation
regarding Excess Stock, each outstanding share of Common Stock entitles the
holder to one vote on all matters submitted to a vote of stockholders, including
the election of Directors and, except as otherwise required by law or except as
provided with respect to any other class or series of stock, the holders of
Common Stock will possess the exclusive voting power. There is no cumulative
voting in the election of Directors, which means that the holders of a majority
of the outstanding shares of Common Stock can elect all of the Directors then
standing for election, and the holders of the remaining shares of Common Stock
will not be able to elect any Directors.

Holders of Common Stock have no conversion, sinking fund or redemption
rights, or preemptive rights to subscribe for any securities of the Company.

The Company intends to furnish its stockholders with annual reports
containing audited consolidated financial statements and an opinion thereon
expressed by an independent public accounting firm and quarterly reports for the
first three quarters of each fiscal year containing unaudited financial
information.

Subject to the provisions of the Company's Articles of Incorporation
regarding Excess Stock, all shares of Common Stock will have equal dividend,
distribution, liquidation and other rights, and will have no preference,
appraisal or exchange rights.

Pursuant to Maryland law, a corporation generally cannot dissolve, amend
its Articles of Incorporation, merge, sell all or substantially all of its
assets, engage in a share exchange or engage in similar transactions outside the
ordinary course of business unless approved by the affirmative vote of
stockholders holding at least two-thirds of the shares entitled to vote on the
matter unless a lesser percentage is set forth in the Company's Articles of
Incorporation. The Company's Articles of Incorporation do not provide for a
lesser percentage in such situations.

RESTRICTIONS ON OWNERSHIP

For the Company to qualify as a REIT under the Code, not more than 50% in
value of its outstanding capital stock may be owned, directly or indirectly, by
five or fewer individuals (as defined in the Code to include certain entities)
during the last half of a taxable year. To assist the Company in meeting this
requirement, the Company may take certain actions to limit the beneficial
ownership, directly or indirectly, by a single person of the Company's
outstanding equity securities.

TRANSFER AGENT

The transfer agent and registrar for the Common Stock is American Stock
Transfer & Trust Company of New York, New York.


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RESTRICTIONS ON TRANSFERS OF CAPITAL STOCK

For the Company to qualify as a REIT under the Code, among other things,
not more than 50% in value of its outstanding capital stock may be owned,
directly or indirectly, by five or fewer individuals (defined in the Code to
include certain entities) during the last half of a taxable year, and such
capital stock must be beneficially owned by 100 or more persons during at least
335 days of a taxable year of 12 months or during a proportionate part of a
shorter taxable year (in each case, other than the first such year). To ensure
that the Company remains a qualified REIT, the Articles of Incorporation,
subject to certain exceptions, provide that no holder may own, or be deemed to
own by virtue of the attribution provisions of the Code, more than nine percent
(9%) (the "Ownership Limit") of the Company's capital stock. The Board of
Directors may waive the Ownership Limit if evidence satisfactory to the Board of
Directors and the Company's tax counsel is presented that the changes in
ownership will not then or in the future jeopardize the Company's status as a
REIT. Any transfer of capital stock or any security convertible into capital
stock that would create a direct or indirect ownership of capital stock in
excess of the Ownership Limit or that would result in the disqualification of
the Company as a REIT, including any transfer that results in the capital stock
being owned by fewer than 100 persons or results in the Company being "closely
held" within the meaning of Section 856(h) of the Code, shall be null and void,
and the intended transferee will acquire no rights to the capital stock. The
foregoing restrictions on transferability and ownership will not apply if the
Board of Directors determines that it is no longer in the best interests of the
Company to attempt to qualify, or to continue to qualify, as a REIT.

Capital stock owned, or deemed to be owned, or transferred to a stockholder
in excess of the Ownership Limit will automatically be exchanged for shares of
Excess Stock that will be transferred, by operation of law, to the Company as
trustee of a trust for the exclusive benefit of the transferees to whom such
capital stock may be ultimately transferred without violating the Ownership
Limit. While the Excess Stock is held in trust, it will not be entitled to vote,
it will not be considered for purposes of any stockholder vote or the
determination of a quorum for such vote and, except upon liquidation, it will
not be entitled to participate in dividends or other distributions. Any dividend
or distribution paid to a proposed transferee of Excess Stock prior to the
discovery by the Company that capital stock has been transferred in violation of
the provisions of the Company's Articles of Incorporation shall be repaid to the
Company upon demand. The Excess Stock is not treasury stock, but rather
constitutes a separate class of issued and outstanding stock of the Company. The
original transferee-stockholder may, at any time the Excess Stock is held by the
Company in trust, transfer the interest in the trust representing the Excess
Stock to any individual whose ownership of the capital stock exchanged into such
Excess Stock would be permitted under the Ownership Limit, at a price not in
excess of the price paid by the original transferee-stockholder for the capital
stock that was exchanged in Excess Stock. Immediately upon the transfer to the
permitted transferee, the Excess Stock will automatically be exchanged for
capital stock of the class from which it was converted. If the foregoing
transfer restrictions are determined to be void or invalid by virtue of any
legal decision, statute, rule or regulation, then the intended transferee of any
Excess Stock may be deemed, at the option of the Company, to have acted as an
agent on behalf of the Company in acquiring the Excess Stock and to hold the
Excess Stock on behalf of the Company.

In addition to the foregoing transfer restrictions, the Company will have
the right, for a period of 90 days during the time any Excess Stock is held by
the Company in trust, to purchase all or any portion of the Excess Stock from
the original transferee-stockholder for the lesser of the price paid for the
capital stock by the original transferee-stockholder or the market price (as
determined in the manner set forth in the Articles of Incorporation) of the
capital stock on the date the Company exercises its option to purchase. The
90-day period begins on the date on which the Company receives written notice of
the transfer or other event resulting in the exchange of capital stock for
Excess Stock.

Each stockholder shall upon demand be required to disclose to the Company
in writing any information with respect to the direct, indirect and constructive
ownership of beneficial interests as the Board of Directors deems necessary to
comply with the provisions of the Code applicable to REITs, to comply with the
requirements of any taxing authority or governmental agency or to determine any
such compliance.

This ownership limitation may have the effect of precluding acquisition of
control of the Company unless the Board of Directors determines that maintenance
of REIT status is no longer in the best interests of the Company.


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REGISTRATION RIGHTS

The registration of the Shares pursuant to the Registration Statement of
which this Prospectus is a part will discharge certain of the Company's
obligations under the terms of (i) a Registration Rights Agreement dated as of
July 12, 1996, which the Company entered into in connection with the
Partnership's acquisition of a multifamily apartment home community from
Countrybrook of Berryessa Associates, a California limited partnership, and (ii)
a Registration Rights Agreement dated as of March 16, 1994, which the Company
entered into in connection with the corporate reorganization of the Company
prior to its initial public offering (collectively, the "Registration Rights
Agreements").

Pursuant to the Registration Rights Agreements, the Company has agreed to
pay all expenses of registering the Shares (other than brokerage and
underwriting commissions, taxes of any kind and any legal, accounting and other
expenses incurred by a holder thereunder). The Company also has agreed under the
Registration Rights Agreements to indemnify each Selling Stockholder and its
officers, directors and other affiliated persons and any person who controls any
Selling Stockholder against losses, claims, damages and expenses arising under
the securities laws in connection with the Registration Statement or this
Prospectus, subject to certain limitations. In addition, each Selling
Stockholder under the Registration Rights Agreements severally agreed to
indemnify the Company and its respective directors, officers and any person who
controls the Company against all losses, claims, damages and expenses arising
under the securities laws insofar as such loss, claim, damage or expense relates
to information furnished to the Company by such Selling Stockholder for use in
the Registration Statement or Prospectus or an amendment or supplement thereto
or the failure by such Selling Stockholder (through no fault of the Company) to
deliver or cause to be delivered this Prospectus or any amendment or supplement
thereto to any purchaser of Shares covered by the Registration Statement from
such Selling Stockholder.

FEDERAL INCOME TAX CONSIDERATIONS

The Company believes it has operated, and the Company intends to continue
to operate, in such a manner as to qualify as a REIT under the Code, but no
assurance can be given that it will at all times so qualify.

The provisions of the Code pertaining to REITs are highly technical and
complex. The following is a brief and general summary of certain provisions that
currently govern the federal income tax treatment of the Company and its
stockholders. For the particular provisions that govern the federal income tax
treatment of the Company and its stockholders, reference is made to Sections 856
through 860 of the Code and the regulations thereunder. The following summary is
qualified in its entirety by such reference.

Under the Code, if certain requirements are met in a taxable year, a REIT
generally will not be subject to federal income tax with respect to income that
it distributes to its stockholders. If the Company fails to qualify during any
taxable year as a REIT, unless certain relief provisions are available, it will
be subject to tax (including any applicable alternative minimum tax) on its
taxable income at regular corporate rates, which could have a material adverse
effect upon its stockholders.

In any year in which the Company qualifies to be taxed as a REIT,
distributions made to its stockholders out of current or accumulated earnings
and profits will be taxed to stockholders as ordinary income except that
distributions of net capital gains designated by the Company as capital gain
dividends will be taxed as long-term capital gain income to the stockholders. To
the extent that distributions exceed current or accumulated earnings and
profits, they will constitute a return of capital, rather than a dividend or
capital gain income, and will reduce the basis for the stockholder's capital
stock with respect to the distribution paid or, to the extent that they exceed
such basis, will be taxed in the same manner as gain from the sale of such
capital stock.

Investors are urged to consult their own tax advisors with respect to the
appropriateness of an investment in the Common Stock offered hereby and with
respect to the tax consequences arising under federal law and the laws of any
state, municipality or other taxing jurisdiction, including tax consequences
resulting from such investor's own tax characteristics. In particular, foreign
investors should consult their own tax advisors concerning the tax


12
consequences of an investment in the Company, including the possibility of
United States income tax withholding on Company distributions.


SELLING STOCKHOLDERS

As used herein, "Selling Stockholders" are those persons listed below who
currently hold the Original Shares and those persons listed below who have
received or who may, at the Company's option, receive Redemption Shares upon the
exercise of their rights to require the redemption of their Units.

The following table provides the names of and the number of shares of
Common Stock and Units owned by each Selling Stockholder as of May 29, 1997. The
Shares offered by this Prospectus may be offered from time to time by the
Selling Stockholders. Since the Company is not required to issue Redemption
Shares upon the redemption of Units and the Selling Stockholders may sell all,
some or none of the Original Shares, the Company can only estimate, by assuming
that the Selling Stockholders sell all of the Shares, the number and percentage
of shares of Common Stock that each Selling Stockholder will own upon completion
of the offering to which this Prospectus relates.

The Company has been advised by each Selling Stockholder who is an
executive officer of the Company that, notwithstanding the registration of their
Original Shares pursuant to the Registration Statement of which this Prospectus
is a part, such Selling Stockholder has no present intention to sell any of the
Original Shares, but may in the future determine to do so. Except for Messrs.
Meyer and Baker and Mr. and Mrs. Newman, the amounts set forth below are based
upon a review of a list of stockholders of the Company provided by American
Stock Transfer & Trust Company. It is possible, however, that those Selling
Stockholders beneficially own additional shares of the Company's Common Stock
through a broker or other nominee. All of the amounts set forth below are
accurate to the Company's knowledge.


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