Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors
American Strategic Income Portfolio Inc. III

In planning and performing our audits of the financial statements of
American Strategic Income Portfolio Inc.  III (the Fund) as of and for the
year ended August 31, 2010, in accordance with the standards of the
Public Company Accounting Oversight Board (United States), we
considered the Funds internal control over financial reporting,
including controls over safeguarding securities, as a basis for
designing our auditing procedures for the purpose of expressing our
opinion on the financial statements and to comply with the requirements
of Form N-SAR, but not for the purpose of expressing an opinion on the
effectiveness of the Funds internal control over financial reporting.
Accordingly, we express no such opinion.
The management of the Fund is responsible for establishing and maintaining
effective internal control over financial reporting. In fulfilling this
responsibility, estimates and judgments by management are required to
assess the expected benefits and related costs of controls. The Funds
internal control over financial reporting is a process designed to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles.
The Funds internal control over financial reporting includes those
policies and procedures that (1) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions
and dispositions of the assets of the Fund; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation
of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the Fund are being made
only in accordance with authorizations of management and directors of the
Fund; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of the Funds
assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial
reporting may not prevent or detect misstatements. Also, projections of
any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or
that the degree of compliance with the policies or procedures
may deteriorate.
A deficiency in internal control over financial reporting exists when the
design or operation of a control does not allow management or employees,
in the normal course of performing their assigned functions, to prevent or
detect misstatements on a timely basis. A material weakness is a deficiency,
or a combination of deficiencies, in internal control over financial reporting,
such that there is a reasonable possibility that a material misstatement of
the Funds annual or interim financial statements will not be prevented or
detected on a timely basis.

Our consideration of the Funds internal control over financial reporting was
for the limited purpose described in the first paragraph and would not
necessarily disclose all deficiencies in internal control that might be
material weaknesses under standards established by the Public Company
Accounting Oversight Board (United States). However, we noted no deficiencies
in the Funds internal control over financial reporting and its operation,
including controls over safeguarding securities, that we consider to be a
material weakness as defined above as of August 31, 2010.
This report is intended solely for the information and use of management
and the Board of Directors of American Strategic Income Portfolio Inc. III and
the Securities and Exchange Commission and is not intended to be and should
not be used by anyone other than these specified parties.

				/s/ Ernst & Young LLP

Minneapolis, MN
October 22, 2010