Distribution Reinvestment Plan

Exhibit 10.1

DISTRIBUTION REINVESTMENT PLAN

American Real Estate Partners, L.P. (the " Partnership" ), a Delaware limited partnership, governed under the Agreement of Limited Partnership of the Partnership, dated as of April 29, 1987 (the " Partnership Agreement" ), by and among American property Investors, Inc., a Delaware corporation, as general partner (the " General Partner" ), Julia DeSantis, as organizational limited partner, and the limited partners of the Partnership (the " Limited Partners" ), has adopted a Distribution Reinvestment Plan (the " Plan" ), the terms and conditions of which follow. Any term used herein which is defined in the Partnership Agreement shall have the same meaning herein as therein, unless otherwise defined or unless the context otherwise indicates.

1. The effective date of the Plan shall be January 1, 1988.

2. As agent for participants (the " Participants" ) in the Plan, Registrar and Transfer Company (the " Agent" ) will receive all distributions paid after the effective date of the Plan in respect of Units and Depositary Units held by each Participant and in respect of any Depositary Units acquired under the Plan. The Agent will apply such funds, after deducting applicable service charges specified in Paragraph 8 below, as follows:

Commencing with the distribution for the first full calendar quarter after the effective date of the Plan, all distributions in respect of the Depositary Units and Units of the Participants will be paid over to the Agent, which will purchase additional Depositary Units, to the extent available at a price deemed reasonable by the Agent, for the Participants' accounts from securities broker-dealers to whom it will pay commissions.

Purchases hereunder may be made on any securities exchange on which such Depositary Units are traded, in the over-the-counter market, or in negotiated transactions, and shall be made at prices competitive with prevailing market prices and on such other terms as the Agent may determine.

3. Limited Partners may become Participants in the Plan at any time commencing with the effective date of the Plan by completing the appropriate authorization form available from the Agent or the General Partner. Only Limited Partners may become Participants in the Plan, not Non-Consenting Investors or Subsequent Transferees.

4. In making purchases for the Participants' accounts, the Agent may commingle the funds of any Participant with those of other Participants. The price at which Depositary Units shall be deemed to have been acquired for a Participant' s account shall be the market price (including such Participant' s allocable portion of the aggregate brokerage commissions and all costs of purchasing except the service charge specified in Paragraph 8 below) of all Depositary Units purchased for the Participants in the Plan with the proceeds of a single distribution. Such distributions shall be invested by the Agent promptly following the payment date with respect thereto, and in no event later than 30 days from such receipt. However, under certain circumstances, observance of the rules and regulations of the Securities and Exchange Commission may require temporary suspension of such purchases or may require that purchases be spread over a period of more than 30 days, in which event such purchases will be made or resumed as or when permitted by such rules and regulations. The Agent may rely and act upon an opinion of counsel in this respect, and in such event will not be accountable for such inability


to make all purchases prior to the end of such 30-day period. To the extent the Agent is unable to make purchases in accordance with the terms of this paragraph, distributions received by the Agent on behalf of the Participants will be distributed by the Agent to the Participants. The Agent will hold the Depositary Units of all Participants together in the name of its nominee.

Neither the Partnership nor the Agent shall have any responsibility or liability as to the ...