SEC FORM 3

SEC Form 3

FORM 3

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

INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person^*

REALTY ADVISORS INC

(Last)

(First)

(Middle)

1800 VALLEY VIEW LANE

SUITE 300

(Street)

DALLAS

75234

(City)

(State)

(Zip)

2. Date of Event Requiring Statement (Month/Day/Year)
09/30/2003

3. Issuer Name and Ticker or Trading Symbol
AMERICAN REALTY INVESTORS INC [ ARL ]

4. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

Director	X	10% Owner
Officer (give title below)		Other (specify below)

5. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Beneficially Owned
1. Title of Security (Instr. 4)	2. Amount of Securities Beneficially Owned (Instr. 4)	3. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	4. Nature of Indirect Beneficial Ownership (Instr. 5)
Common Stock, par value $0.01 per share	1,437,208	I⁽¹⁾	By subsidiary Prime Income Asset Management, Inc.
Common Stock, par value $0.01 per Share	6,667,045	I⁽¹⁾	By Subsidiary Basic Capital Management, Inc.

Table II - Derivative Securities Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 4)	2. Date Exercisable and Expiration Date (Month/Day/Year)		3. Title and Amount of Securities Underlying Derivative Security (Instr. 4)		4. Conversion or Exercise Price of Derivative Security	5. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)
1. Title of Derivative Security (Instr. 4)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	4. Conversion or Exercise Price of Derivative Security	5. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)

Explanation of Responses:

1. On September 30, 2003, Basic Capital Management, Inc. ("BCM"), a wholly-owned subsidiary distributed to Realty Advisors, Inc. ("RAI") as a dividend 1,437,208 Shares of Common Stock of American Realty Advisors, Inc. ("ARL") at a transferee cost basis of $10.60 per Share. BCM retained ownership of 6,667,045 Shares of ARL stock. Also on September 30, 2003, RAI contributed such 1,437,208 Shares of ARL stock to the capital of Prime Income Asset Management, Inc. ("Prime"), of which RAI owns 79% of the voting equity securities at a transferee cost basis of $10.60 per Share.

	Mark W. Branigan, Vice President	10/23/2003
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 5 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
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