SECURITIES AND EXCHANGE COMMISSION                     
                                                   
                          Washington, D.C.  20549 
 
                                 FORM 10-Q 
 
(Mark One) 
     
  [x]             QUARTERLY REPORT PURSUANT TO SECTION 13 OR                
                 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 
 
For the quarterly period ended   September 30, 1997 
                                --------------------
 
                                    OR 
 
     
  [ ]        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)  
                OF THE SECURITIES EXCHANGE ACT OF 1934 
 
For the transition period from                  to                         
 
                   Commission file number      1-8594      
                                               ------- 
 
 
                    PRESIDENTIAL REALTY CORPORATION                      
                    ------------------------------- 
          (Exact name of registrant as specified in its charter) 
 
       Delaware                                        13-1954619     
       ---------                                       ----------      
(State or other jurisdiction of                    (I.R.S. Employer  
  incorporation or organization)                   Identification No.) 
 
  180 South Broadway, White Plains, New York              10605 
  ------------------------------------------              ------      
  (Address of principal executive offices)              (Zip Code)     
 
Registrant's telephone number, indicating area code     914-948-1300       
                                                        ------------  
 
Indicate by check mark whether the registrant (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months (or for such shorter period that the 
registrant was required to file such reports), and (2) has been subject to 
such filing requirements for the past 90 days.  Yes    x      No  
                                                     ------        ------ 
 
The number of shares outstanding of each of the issuer's classes of common 
stock as of the close of business on November 7, 1997 was 478,940 shares of 
Class A common and 3,093,835 shares of Class B common.


 
 


 
 
              PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES 
 
 
 
 
                              Index to Form 10-Q 
 
                          For the Nine Months Ended 

                              September 30, 1997
 
 
 
Part I - Financial Information (Unaudited)                        
 
 
     Consolidated Balance Sheets                                    
 
     Consolidated Statements of Operations                           
 
     Consolidated Statements of Cash Flows                           
 
     Notes to Consolidated Financial Statements                       
  
     Management's Discussion and Analysis of 
       Financial Condition and Results of Operations                
 
Part II - Other Information 
 
     Item 6.  Exhibits and Reports on Form 8-K                    
                            
 


<TABLE>
 PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS (Unaudited)
<CAPTION>
 
 
 <S>
 Assets                                                                 September 30,        December 31,
                                                                            1997                1996
                                                                        -------------       ------------
   Mortgage portfolio (Note 2):                                          <C>                <C>
     Sold properties, accrual                                            $47,485,562        $46,522,752
     Related parties, accrual                                                862,873            976,141
     Sold properties, impaired                                            14,538,278         14,659,841
     Related parties, impaired                                             1,549,560          1,567,400
                                                                        -------------       ------------
     Total mortgage portfolio                                             64,436,273         63,726,134
                                                                        -------------       ------------
   Less discounts:
     Sold properties, accrual                                              5,275,444          6,322,402
     Related parties, accrual                                                123,484            145,915
     Sold properties, impaired                                             7,701,567          7,765,964
                                                                        -------------       ------------
     Total discounts                                                      13,100,495         14,234,281
                                                                        -------------       ------------
   Less deferred gains:
     Sold properties, accrual                                             13,573,927         14,046,423
     Sold properties, impaired                                             5,431,947          5,489,113
     Related parties, impaired                                             1,549,560          1,567,400
                                                                        -------------       ------------
     Total deferred gains                                                 20,555,434         21,102,936
                                                                        -------------       ------------
   Net mortgage portfolio (of which $750,201 in 1997
     and $587,839 in 1996 are due within one year)                        30,780,344         28,388,917
                                                                        -------------       ------------
 
   Real estate (Note 3)                                                   27,467,711         25,369,405
     Less: accumulated depreciation                                        6,210,779          5,680,108
                                                                        -------------       ------------
   Net real estate                                                        21,256,932         19,689,297
                                                                        -------------       ------------
 
   Foreclosed properties (Note 4)                                                               588,683
   Minority partners' interest (Note 5)                                    3,795,212          3,830,024
   Prepaid expenses and deposits in escrow                                 1,329,148          1,123,697
   Other receivables (net of valuation allowance of
     $117,042 in 1997 and $184,790 in 1996)                                  581,087            635,848
   Other receivables (related party)                                           9,680             10,109
   Securities available for sale (Note 6)                                    415,098            975,208
   Cash and cash equivalents                                               1,170,846          1,392,135
   Other assets                                                            1,132,111          1,166,115
                                                                        -------------       ------------
   Total Assets                                                          $60,470,458        $57,800,033
                                                                        =============       ============
 
 
 <FN>
   See notes to consolidated financial statements.
</TABLE>
 
 

<TABLE>
 PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS (Unaudited)
<CAPTION>
 
 Liabilities and Stockholders' Equity
 
                                                                         September 30,         December 31, 
                                                                             1997                  1996
                                                                         -------------         -------------
<S>                                                                      <C>                   <C>
    Liabilities:
      Mortgage debt:
        Properties owned (Note 7)                                         $26,426,344           $26,513,465
        Wrap mortgage debt on sold properties                               5,266,736             5,613,041
                                                                         -------------         -------------
      Total (of which $1,080,823 in 1997 and $1,053,553
        in 1996 are due within one year)                                   31,693,080            32,126,506
 
      Note payable to bank (of which $144,195 in 1997
        and $93,377 in 1996 are due within one year) (Note 8)              10,663,224             8,642,600
      Executive pension plan liability                                      1,630,314             1,716,112
      Accrued liabilities                                                   2,405,022             2,092,876
      Accrued postretirement costs                                            577,177               592,453
      Deferred income                                                         334,060               395,677
      Accounts payable                                                        475,459               271,126
      Distribution payable on common stock                                    535,864
      Other liabilities                                                       656,549               524,526
                                                                         -------------         -------------
    Total Liabilities                                                      48,970,749            46,361,876
                                                                         -------------         -------------
 
    Stockholders' Equity:
      Common stock; par value $.10 per share 
        Class A, authorized 700,000 shares, issued and
          outstanding  478,940 shares                                          47,894                47,894
        Class B       September 30, 1997  December 31, 1996                   310,771               308,675
        -----------   ---------------     ---------------
        Authorized:       10,000,000          10,000,000
        Issued:            3,107,710           3,086,750
        Treasury:             14,224              14,221
 
      Additional paid-in capital                                            2,005,776             1,874,341
      Retained earnings                                                     9,287,367             9,350,801
      Net unrealized gain on securities available for sale (Note 6)            40,488                49,014
      Class B, treasury stock (at cost)                                      (192,587)             (192,568)
                                                                         -------------         -------------
    Total Stockholders' Equity                                             11,499,709            11,438,157
                                                                         -------------         -------------
    Total Liabilities and Stockholders' Equity                            $60,470,458           $57,800,033
                                                                         =============         =============
 
 

<FN> 
      See notes to consolidated financial statements.
</TABLE>
 
 
 

<TABLE>
 PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
<CAPTION>
 
 
 
                                                                               NINE MONTHS ENDED
                                                                                 SEPTEMBER 30,
                                                                         ----------------------------
                                                                             1997           1996
 Income:                                                                 ------------   -------------
<S>                                                                       <C>             <C>
   Rental                                                                 $6,159,768      $6,419,504
   Interest on mortgages - sold properties                                 3,112,030       1,653,430
   Interest on wrap mortgages                                                976,361       1,048,207
   Interest on mortgages - related parties                                   174,021         197,131
   Investment income                                                         105,447         240,630
   Other                                                                      45,969          44,887
                                                                         ------------   -------------
 Total                                                                    10,573,596       9,603,789
                                                                         ------------   -------------
 Costs and Expenses:
   General and administrative                                              1,712,657       1,678,583
   Interest on note payable and other                                        775,050         106,278
   Interest on wrap mortgage debt                                            172,167         187,764
   Amortization of  loan acquisition costs                                    22,051
   Depreciation on non-rental property                                        18,406          19,271
   Rental property:
     Operating expenses                                                    3,095,087       2,857,844
     Interest on mortgages                                                 1,606,012       1,651,016
     Real estate taxes                                                       583,510         596,620
     Depreciation on real estate                                             543,976         484,302
     Amortization of mortgage costs                                          247,248          98,041
     Minority interest share of partnership income                           285,398         655,189
     Loss from operations of foreclosed properties (Note 4)                                   27,370
     Net gain from sales of foreclosed properties (Note 4)                                   (22,490)
                                                                         ------------   -------------
 Total                                                                     9,061,562       8,339,788
                                                                         ------------   -------------
 
 Income before net gain from sales of properties and securities            1,512,034       1,264,001
 
 Net gain from sales of properties and securities                            562,658         890,055
                                                                         ------------   -------------
 Net Income                                                               $2,074,692      $2,154,056
                                                                         ============   =============
 
 Earnings per Common Share (Note 1-C):
   Income before net gain from sales of properties and securities              $0.42           $0.36
 
   Net gain from sales of properties and securities                             0.16            0.25
                                                                         ------------   -------------
 Net Income per Common Share                                                   $0.58           $0.61
                                                                         ============   =============
 Cash Distributions Declared per Common Share                                  $0.60           $0.60
                                                                         ============   =============
 Weighted Average Number of Shares Outstanding                             3,560,549       3,535,878
                                                                         ============   =============
 
 
<FN> 
 See notes to consolidated financial statements.
</TABLE>
 
 

<TABLE>
 PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
<CAPTION>
 
 
 
                                                                                 THREE MONTHS ENDED  
                                                                                   SEPTEMBER 30,
                                                                         ----------------------------
                                                                             1997           1996
 Income:                                                                 ------------   -------------
<S>                                                                      <C>            <C>
   Rental                                                                 $2,119,482      $2,071,259
   Interest on mortgages - sold properties                                   929,904         490,978
   Interest on wrap mortgages                                                324,128         348,124
   Interest on mortgages - related parties                                    58,664          59,819
   Investment income                                                          18,227          98,445
   Other                                                                      11,487          15,812
                                                                         ------------   -------------
 Total                                                                     3,461,892       3,084,437
                                                                         ------------   -------------
 Costs and Expenses:
   General and administrative                                                583,562         533,608
   Interest on note payable and other                                        297,970          35,426
   Interest on wrap mortgage debt                                             56,063          61,310
   Amortization of  loan acquisition costs                                     8,011
   Depreciation on non-rental property                                         5,323           7,210
   Rental property:
     Operating expenses                                                    1,077,780       1,065,501
     Interest on mortgages                                                   522,445         549,779
     Real estate taxes                                                       234,172         195,888
     Depreciation on real estate                                             190,549         164,361
     Amortization of mortgage costs                                          179,772          33,906
     Minority interest share of partnership income                            69,742         179,538
     Loss from operations of foreclosed properties (Note 4)                                    9,897
     Net gain from sales of foreclosed properties (Note 4)                                   (22,490)
                                                                         ------------   -------------
 Total                                                                     3,225,389       2,813,934
                                                                         ------------   -------------
 
 Income before net gain from sales of properties and securities              236,503         270,503
 
 Net gain from sales of properties and securities                             54,785          33,962
                                                                         ------------   -------------
 Net Income                                                                 $291,288        $304,465
                                                                         ============   =============
 
 Earnings per Common Share (Note 1-C):
   Income before net gain from sales of properties and securities              $0.06           $0.08
 
   Net gain from sales of properties and securities                             0.02            0.01
                                                                         ------------   -------------
 Net Income per Common Share                                                   $0.08           $0.09
                                                                         ============   =============
 Cash Distributions Declared per Common Share                                  $0.30           $0.30
                                                                         ============   =============
 
 
<FN> 
 See notes to consolidated financial statements.
</TABLE>



 



<TABLE>
 PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)   
<CAPTION>
 
 
                                                                       NINE MONTHS ENDED SEPTEMBER 30,
                                                                    ------------------------------------
                                                                        1997                    1996
 Cash Flows from Operating Activities:                              ------------            ------------
<S>                                                                  <C>                     <C> 
   Cash received from rental properties                              $6,286,420              $6,437,570
   Interest received                                                  3,153,392               2,511,530
   Miscellaneous income (disbursements)                                  58,412                 (13,633)
   Interest paid on rental property mortgages                        (1,601,631)             (1,663,178)
   Interest paid on wrap mortgage debt                                 (172,167)               (187,764)
   Interest paid on note payable                                       (621,470)
   Cash disbursed for rental and foreclosed property operations      (3,525,980)             (3,163,182)
   Cash disbursed for general and administrative costs               (1,250,233)             (1,216,515)
                                                                    ------------            ------------
 Net cash provided by operating activities                            2,326,743               2,704,828
                                                                    ------------            ------------
 
 Cash Flows from Investing Activities:
   Payments received on notes receivable                              2,243,184               2,857,791
   Payments disbursed for investments in notes receivable            (3,009,946)                (25,696)
   Net payments received on sales of foreclosed properties                                       69,530
   Payments disbursed for additions and improvements                 (1,373,328)               (663,434)
   Proceeds from sales of securities                                    645,943                 100,496
   Purchases of securities                                              (79,202)             (1,231,479)
   Purchase of 1% interest in partnership                               (60,000)
   Net cash receipts from operations of foreclosed properties                                     3,223
                                                                    ------------            ------------
 Net cash provided by (used in) investing activities                 (1,633,349)              1,110,431
                                                                    ------------            ------------
 Cash Flows from Financing Activities:
   Principal payments on mortgage debt:
     Properties owned                                                  (435,575)               (397,756)
     Wrap mortgage debt on sold properties                             (346,305)               (334,114)
   Mortgage debt payment from proceeds of mortgage refinancing       (7,771,546)               (238,181)
   Mortgage proceeds                                                  8,120,000                 300,000
   Note payable proceeds                                              2,500,000
   Principal payments on note payable                                  (479,376)
   Mortgage costs                                                      (192,875)                (45,019)
   Cash distributions on common stock                                (2,138,126)             (2,122,987)
   Proceeds from dividend reinvestment and share purchase plan          133,531                 102,030
   Distributions to minority partners                                  (304,411)               (359,845)
                                                                    ------------            ------------
 Net cash used in financing activities                                 (914,683)             (3,095,872)
                                                                    ------------            ------------
 
 Net Increase (Decrease) in Cash and Cash Equivalents                  (221,289)                719,387
 
 Cash and Cash Equivalents, Beginning of Period                       1,392,135               1,306,505
                                                                    ------------            ------------
 Cash and Cash Equivalents, End of Period                            $1,170,846              $2,025,892
                                                                    ============            ============
 
<FN> 
 See notes to consolidated financial statements.
</TABLE>


<TABLE>
 PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)  
<CAPTION>
 
 
                                                                    NINE MONTHS ENDED SEPTEMBER 30,
                                                                 ------------------------------------
                                                                     1997                    1996
                                                                 ------------            ------------
<S>                                                              <C>                     <C>  
 Reconciliation of Net Income to Net Cash
   Provided by Operating Activities
 
 Net Income                                                       $2,074,692              $2,154,056
                                                                 ------------            ------------
 
 Adjustments to reconcile net income to net
   cash provided by operating activities:
     Depreciation and amortization                                   831,681                 601,614
     Gain from sales of properties and securities                   (562,658)               (890,055)
     Net gain from sales of foreclosed properties                                            (22,490)
     Amortization of discounts on notes and fees                  (1,122,928)               (615,192)
     Decrease in accounts receivable                                  55,190                  35,153
     Increase in accounts payable and accrued liabilities            415,405                 292,279
     Decrease in deferred income                                     (61,617)                (82,657)
     Decrease (increase) in prepaid expenses, deposits in escrow
       and deferred charges                                         (205,451)                 28,571
     Increase (decrease) in security deposit liabilities              68,723                  (3,752)
     Miscellaneous                                                    12,444                  20,164
     Minority share of partnership income                            285,398                 655,189
     Distribution payable on common stock                            535,864                 531,948
                                                                 ------------            ------------
 Total adjustments                                                   252,051                 550,772
                                                                 ------------            ------------
 
 Net cash provided by operating activities                        $2,326,743              $2,704,828
                                                                 ============            ============
 
 Supplemental noncash disclosures:
 
     Net carrying value of foreclosed properties
       reclassified to real estate                                  $588,683
                                                                 ============
 
     Property received in satisfaction of debt                       $45,765
                                                                 ============
 
 
 
<FN> 
 See notes to consolidated financial statements.
</TABLE>





PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. General - Presidential Realty Corporation ("Presidential" or the "Company"),
a Real Estate Investment Trust ("REIT"), is engaged principally in the holding
of notes and mortgages secured by real estate and in the ownership of income
producing real estate.  

B. Principles of Consolidation - The consolidated financial statements include
the accounts of Presidential Realty Corporation and its wholly owned
subsidiaries.  Additionally, the accompanying consolidated financial statements
include 100% of the account balances of UTB Associates and PDL, Inc. and
Associates Limited Co-Partnership ("Metmor Plaza Associates"), partnerships in
which Presidential is the General Partner.  

All significant intercompany balances and transactions have been eliminated. 

C. Earnings Per Common Share - Per share data is based on the weighted average
number of shares of Class A and Class B common stock outstanding and common   
stock equivalents during each period.  

D. Basis of Presentation - The accompanying unaudited consolidated financial
statements have been prepared in accordance with generally accepted accounting
principles for interim financial information.  In the opinion of management,  
all adjustments (consisting of only normal recurring accruals) considered
necessary for a fair presentation of the results for the respective periods   
have been reflected.  These financial statements and accompanying notes should 
be read in conjunction with the Company's Form 10-K for the year ended December
31, 1996.

E. Management Estimates - In preparing the consolidated financial statements,
management is required to make estimates and assumptions that affect the
reported amounts of assets and liabilities as of the date of the consolidated
balance sheets and income and expense for the period.  Actual results could
differ from those estimates.

F. Recently Issued Accounting Pronouncements - The Financial Accounting       
Standards Board has recently issued several new accounting pronouncements.
Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings per   
Share" establishes standards for computing and presenting earnings per share, 
and SFAS No. 129, "Disclosure of Information about Capital Structure"         
establishes standards for disclosing information about an entity's capital
structure.  These two standards will be applied by the Company in the fourth
quarter of 1997.  SFAS No. 130, "Reporting Comprehensive Income" establishes
standards for reporting and display of comprehensive income and its components. 
SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
Information" establishes standards for the way that public business enterprises
report information about operating segments in annual financial statements and
requires that those enterprises report selected information about operating
segments in interim financial reports issued to shareholders.  It also
establishes standards for related disclosures about products and services,
geographic areas, and major customers.  These two standards will be applied by 
the Company in its 1998 financial statements.

Management of the Company does not believe that these new standards will have
a material effect on the Company's reported operating results, per share      
amounts, financial position or cash flows.


2. MORTGAGE PORTFOLIO

The Company's mortgage portfolio includes notes receivable - sold properties  
and notes receivable - related parties and includes both accrual and impaired 
loans. 

Notes receivable - sold properties consist of: 

(1) Long-term purchase money notes from sales of properties previously owned by
the Company.  These purchase money notes have varying interest rates with     
balloon payments due at maturity.  Also included in this category is the
Fairfield Towers First Mortgage which the Company purchased in the fourth     
quarter of 1996.

(2) Notes receivable from sales of cooperative apartment units.  Substantially
all of these notes were either received from Ivy Properties, Ltd. or its
affiliates (collectively "Ivy") in connection with a settlement agreement     
between the Company and Ivy executed in November, 1991 (the "Settlement
Agreement") or from sales of foreclosed cooperative apartments received from  
Ivy pursuant to the Settlement Agreement (see Note 4).  These notes generally
have market interest rates and the majority of these notes amortize monthly   
with balloon payments due at maturity. 

Notes receivable - related parties are all due from Ivy and consist of: 

(1) Purchase money notes resulting from sales of property or partnership
interests to Ivy. 

(2) Notes receivable relating to loans made by the Company to Ivy in connection
with Ivy's cooperative conversion business.

In January, 1997, the Company modified its Woodland notes receivable, extending 
the maturity date from 2000 to 2005, with interest rates increasing in 2002   
from 9% to 9.25%.  In March, 1997, the Company received prepayment of its
$1,074,200 Cedarbrooke note receivable resulting in the recognition of income
from the amortization of discount of $382,796 and recognition of a deferred   
gain on sale of $472,497.  In addition, in March and May, 1997, the Company
advanced an additional $600,018 and $2,400,000, respectively, on the Fairfield
Towers First Mortgage to the owners of the unsold condominium units to be used
for payment of a portion of the unpaid real estate taxes (and interest accrued
thereon) on these condominium units (see Note 8).  In July, 1997, the Company
modified its $1,175,500 Woodgate note receivable, reducing the maturity date  
from 2015 to 2007, with interest rates of 8.25% through 1999 and 9.25%
thereafter.


In September of 1997, the Company extended and modified its $6,250,000
Presidential Park note receivable.  This note, which had previously been      
modified and extended in August of 1994 and which was due to mature on July 31, 
2001, was extended until July 31, 2006.  The interest rate will remain at 6%  
per annum through July 31, 1999.  Thereafter, the interest rate will be at a  
rate equal to two hundred basis points in excess of the yield on specified
Treasury bills, but not less than 7-1/2% per annum from August 1, 1999 through
July 31, 2001.  From August 1, 2001 through maturity the interest rate will be
at a rate equal to one hundred fifty basis points in excess of the yield on
specified Treasury bills.  In connection with the current modification, the
borrower made a $100,000 principal payment on the note reducing the outstanding
principal balance to $6,150,000.
 
At September 30, 1997, all of the notes in the Company's mortgage portfolio are 
current with the exception of the Fairfield Towers Second Mortgage (sold
properties) and the Overlook loan (related parties), which are classified as
impaired loans.  These two loans are in the aggregate amount of $16,087,838 and
have a net carrying value of $1,404,764 after deducting discounts of $7,701,567
and deferred gains of $6,981,507.  The Company has determined that no         
allowances for credit losses are required for these loans because the net
carrying value of these loans is less than the fair value of the underlying
collateral.  The Company recognizes income on the impaired loans only to the
extent that such income is actually received.  The average recorded investment
in impaired loans during the nine months ended September 30, 1997 and September
30, 1996 was $16,162,040 and $16,592,845, respectively.

There have been no significant changes in the status of the impaired loans    
since December 31, 1996.  Condominium sales at the Fairfield Towers property
have continued and an additional 17 units were sold during the nine months   
ended September 30, 1997. 

The following table reflects the activity in impaired loans:

<TABLE>
    IMPAIRED LOANS
    ----------------------------                                              
<CAPTION>
                                                                              
                                                Impaired                          Impaired
                                                Loan             Additions        Loan
                                                Balance          (Payments)       Balance
    Loan Description                            12/31/96         1997             9/30/97
    ------------------------------------        ------------     -------------    ------------
<S>                                             <C>              <C>
    Notes receivable-sold properties:                                         
      Properties previously owned-                                            
          Fairfield Towers Second Mortgage       $14,659,841        ($121,563)    $14,538,278
                                                                              
    Notes receivable-related parties:                                         
      Sold properties-                                                        
          Overlook                                 1,567,400          (17,840)      1,549,560
                                                -------------    -------------    ------------
    Total                                        $16,227,241        ($139,403)    $16,087,838
                                                =============    =============    ============
                                                                              
    
                                                Discount                          Net
                                                on               Deferred         Carrying
                                                Loans            Gain             Value
    Loan Description                            9/30/97          9/30/97          9/30/97
    -----------------------------------         ------------    -------------    ------------
    Notes receivable-sold properties:                                         
      Properties previously owned-                                            
          Fairfield Towers Second Mortgage       ($7,701,567)     ($5,431,947)     $1,404,764
                                                                              
    Notes receivable-related parties:                                         
      Sold properties-                                                        
          Overlook                                                 (1,549,560)
                                                -------------    -------------    ------------
     Total                                       ($7,701,567)     ($6,981,507)     $1,404,764
                                                =============    =============    ============
    
    
    
    
    
    
    
                                                                              
                                                                 Nine months ended September 30,
                                                                 -------------------------------
                                                                     1997             1996
                                                                 -------------    ------------
    Reported Interest Income and                                              
    Amortization of Discount (Cash Basis)                                     
    ------------------------------------------------------                    
                                                                              
    Fairfield Towers Second Mortgage - interest income                $62,579        $114,630
    Fairfield Towers Second Mortgage - amortization of discount        64,397          56,314
    Overlook - interest income                                         70,869          73,114
    Overlook - additional interest income                              17,527          28,062
                                                                 -------------    ------------
    Total                                                            $215,372        $272,120
                                                                 =============    ============
                                                                              
                                                                              
    Recognized Gain from Sale of Property                                     
    --------------------------------------------------------                  
                                                                              
    Fairfield Towers Second Mortgage                                  $57,166         $49,990
    Overlook                                                           17,840          66,311
                                                                 -------------    ------------
    Total                                                             $75,006        $116,301
                                                                 =============    ============
                                                                              
                                                                              
    Nonreported Interest Income and Amortization of Discount                  
    ---------------------------------------------------------                 
    The following additional amounts would have been reported                 
    if these loans had been fully performing:                                 
                                                                              
    Fairfield Towers Second Mortgage - interest income               $683,043        $635,514
    Fairfield Towers Second Mortgage - additional interest income      69,634         191,537
    Fairfield Towers Second Mortgage - amortization of discount       792,046         670,904
                                                                 -------------    ------------
    Total                                                          $1,544,723      $1,497,955
                                                                 =============    ============
</TABLE>
                                                         




3. REAL ESTATE 

   Real estate is comprised of the following:

                              September 30,     December 31,                 
                                   1997             1996      
                              -------------     ------------

Land                           $ 3,774,298      $ 3,664,548
Buildings and leaseholds        23,517,965       21,580,207
Furniture and equipment            175,448          124,650
                               -----------      -----------
Total real estate              $27,467,711      $25,369,405
                               ===========      =========== 

4. FORECLOSED PROPERTIES 

At December 31, 1996, Presidential owned 53 cooperative apartment units which
it had received from Ivy in satisfaction of certain loans due Presidential. 
These cooperative apartment units are located at four locations: Towne House,
New Rochelle, N.Y. (39 units); 6300 Riverdale Avenue, Bronx, N.Y. (8 units);  
Sherwood House, Long Beach, N.Y. (3 units) and 330 W. 72nd St., New York, N.Y. 
(3 units).
         
At December 31, 1996, these cooperative apartment units were reported as
foreclosed properties on Presidential's consolidated balance sheet.  The      
Company now intends to hold these cooperative apartment units as rental       
property and, accordingly, reclassified them from foreclosed properties to    
real estate effective January 1, 1997. 
    
The net carrying value of the foreclosed properties reclassified to real estate 
on January 1, 1997 was as follows:

Towne House                  $404,337
6300 Riverdale Avenue          76,196     
Sherwood House                 59,246
330 W. 72nd Street             48,904
                             --------
Total net carrying value     $588,683
                             ========

Loss from operations of foreclosed properties for the nine months ended 
September 30, 1996 consisted of the following:

Towne House                  $ 2,081
6300 Riverdale Avenue         11,996
Sherwood House                 4,936
Hastings Gardens (1)           8,357
                             -------                             
Total loss                   $27,370
                             =======

(1) The cooperative apartments at Hastings Gardens, Hastings, N.Y. were sold in
    September, 1996 resulting in a gain of $22,490.

5. MINORITY PARTNERS' INTEREST

Presidential is the General Partner of UTB Associates and Metmor Plaza
Associates, partnerships in which in 1996 Presidential had a 66-2/3% interest
and a 25% interest, respectively.  In January, 1997, Presidential acquired an
additional 1% interest in Metmor Plaza Associates for a purchase price of     
$60,000, which increased its interest in this partnership to 26%.  As the     
General Partner of these partnerships, Presidential exercises effective control
over the business of these partnerships, and, accordingly, has included 100% of
the account balances of these partnerships in the accompanying financial
statements.  The minority partners' interest reflects the minority partners'
equity in the partnerships.  

Included in the Company's mortgage debt is a mortgage note payable by the     
Metmor Plaza Associates partnership which is substantially in excess of the
historical cost of the property.  This was due to a refinancing of the original
mortgage note on the building and subsequent distribution of these proceeds to
the partners.  This event resulted in a negative partnership interest for each
partner and a negative minority partners' interest on the Company's books.  The
estimated fair value of the building is significantly greater than the mortgage
debt and the minority partners' interest is expected to be recovered when the
building is sold and the partnership is liquidated.

Minority partners' interest is comprised of the following:

                                    September 30,   December 31,
                                         1997          1996
                                    -------------   ------------        
Metmor Plaza Associates              $3,983,589      $4,036,858  
UTB Associates                         (188,377)       (206,834)
                                     ----------      ----------
Total minority partners' interest    $3,795,212      $3,830,024 
                                     ==========      ==========

6. SECURITIES AVAILABLE FOR SALE

The Company's investments are in marketable equity securities consisting of
stocks of listed corporations. The Company does not acquire securities for
purposes of engaging in trading activities and, as a result, the Company's
investments are classified as securities available for sale in accordance with
SFAS No. 115, "Accounting for Certain Investments in Debt and Equity 
Securities". Disposition of such securities may be appropriate for either
liquidity management or in response to changing economic conditions.  

The cost and fair value of securities available for sale are as follows:

                                    September 30,  December 31,   
                                         1997          1996      
                                    ------------   ------------   
Cost                                  $374,610        $926,194
Gross unrealized gains                  40,586          71,033
Gross unrealized losses                    (98)        (22,019)
                                      --------        --------
Fair value                            $415,098        $975,208 
                                      ========        ========

Sales activity results for securities available for sale are as follows:

                                    Nine Months Ended September 30,
                                    ------------------------------
                                           1997        1996
                                           ----        ----

Gross sales proceeds                    $649,110     $101,500
                                        ========     ========

Gross realized gains                    $ 52,420     $    496
Gross realized losses                    (37,264)            
                                        --------     --------
Net realized gain                       $ 15,156     $    496
                                        ========     ========

Gains and losses on sales of securities are determined using the specific
identification method.


7. MORTGAGE DEBT

In July, 1997, the Company completed the refinancing of the mortgage on its
Continental Gardens property.  The existing mortgage of $7,771,546 was repaid
from the proceeds of a new $8,120,000 mortgage.  The new mortgage bears       
interest at the rate of 8.16% per annum, requires monthly payments of principal 
and interest of $60,490 and matures in August, 2007 with a $7,158,323 balloon
payment due at maturity. 


8. NOTE PAYABLE TO BANK

The Company obtained an $8,650,000 bank loan in the fourth quarter of 1996 from
Fleet Bank, N.A. ("Fleet") in connection with the purchase of the Fairfield
Towers First Mortgage.  The note, which matures on October 30, 2001, is secured
by a collateral assignment of the Fairfield Towers First Mortgage and is
nonrecourse to Presidential except for a limited guarantee, the amount of    
which reduces as the principal balance is reduced.  This limited guarantee was 
$1,434,514 at September 30, 1997.  The interest rate is variable and is based
at the Company's election on either the bank's prime rate plus 1%, a cost of
funds rate plus 3%, or various LIBOR rates plus 3%.  The note amortizes monthly
based on a 9.25% interest rate for a 25 year term.  In addition, upon the sale
of condominium units, the Company is required to make principal payments to   
Fleet in an amount equal to the amount of principal payments received by the
Company on the Fairfield Towers First Mortgage.  In March and May, 1997, the
Company received additional advances of $600,018 and $1,899,982, respectively,
on this loan from Fleet.  These advances were obtained to substantially       
reimburse the Company for its $600,018 and $2,400,000 advances on the Fairfield
Towers First Mortgage (see Note 2).  At September 30, 1997 payments on the    
Fleet note payable were current.  The outstanding note balance at September  
30, 1997 and December 31, 1996 was $10,663,224 and $8,642,600, respectively. 

In January, 1997, the Company obtained a $250,000 line of credit from Citibank,
N.A.  The interest rate is 1% above the prime rate and the line of credit     
expires in January, 1998.  Presidential paid a 1% annual fee for the line of
credit.  At September 30, 1997, no advances are outstanding on this line of
credit.


9. INCOME TAXES

Presidential elected to qualify as a Real Estate Investment Trust effective
January 1, 1982 under Sections 856-860 of the Internal Revenue Code.  Under   
those sections, a REIT which distributes at least 95% of its real estate
investment trust taxable income to its shareholders each year by the end of   
the following year and which meets certain other conditions will not be taxed
on that portion of its taxable income which is distributed to its shareholders. 

Upon filing the Company's income tax return for the year ended December 31,   
1996, Presidential applied its available 1996 stockholders' distributions and
elected to apply (under Section 858 of the Internal Revenue Code) all but
approximately $557,000 of its 1997 stockholders' distributions to reduce its
taxable income for 1996 to zero.

Furthermore, the Company had taxable income (before distributions to
stockholders) for the nine months ended September 30, 1997 of approximately   
$2,094,000 ($.59 per share), which included approximately $1,378,000 ($.39 per 
share) of capital gains.  This amount will be reduced by the $557,000 of its  
1997 distributions that were not utilized in reducing the Company's 1996      
taxable income and by any eligible 1998 distributions that the Company may    
elect to utilize as a reduction of its 1997 taxable income.  

Presidential intends to continue to maintain its REIT status and although no
assurances can be given at this time, the Company expects that it will not have 
to pay Federal income taxes for 1997 because its present intention is to
distribute all of its 1997 taxable income during 1997 and 1998.  Therefore, no
provision for income tax has been made at September 30, 1997.

Presidential has, for tax purposes, reported the gain from the sale of certain
of its properties using the installment method. 


10. COMMITMENTS AND CONTINGENCIES

The Company has incurred costs for environmental site investigations and the
related response action outcome for potentially hazardous drums found at one  
site on its Mapletree Industrial Center property in Palmer, Massachusetts.  In
1996, the site investigation at this disposal site had been completed and as a
result, in the third quarter of 1996, the Company accrued $120,500 to complete
further site investigations and cleanup costs at this site.  This work, which
started in February, 1997, is scheduled to be accomplished over the next four
years.  At September 30, 1997, there have been no changes to the 1996 estimated
costs.  Actual costs incurred may vary from these estimates due to the inherent
uncertainties involved. 




PRESIDENTIAL REALTY CORPORATION AND SUBSIDIARIES  

MANAGEMENT'S DISCUSSION AND ANALYSIS OF  
FINANCIAL CONDITION AND RESULTS OF OPERATIONS  
FOR THE NINE AND THREE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996

Results of Operations  
  
Financial Information for the nine months ended September 30, 1997 and 1996:  
----------------------------------------------------------------------------

Income increased by $969,807 from $9,603,789 in 1996 to $10,573,596 in 1997
primarily as a result of an increase in interest on mortgages-sold properties,
partially offset by decreases in rental income, interest on wrap mortgages and
investment income.    

Rental income decreased by $259,736 from $6,419,504 in 1996 to $6,159,768 in  
1997 primarily as a result of decreases of $480,122 at the Metmor Plaza       
property, of which $118,645 is the result of lease cancellation fees received
in 1996, $263,987 is the result of increased vacancy loss in 1997 and
$91,919 pertains to decreases in office rental income in 1997.  In addition,
rental income decreased by $76,628 at the Cambridge Green and Crown Court
properties.  These decreases were partially offset by an increase of $297,590
as a result of the reclassification  of the operations of foreclosed properties
into rental property operations in 1997. 

Interest on mortgages-sold properties increased by $1,458,600 from $1,653,430
in 1996 to $3,112,030 in 1997 primarily due to interest income of $1,153,914  
from the Fairfield Towers First Mortgage, which the Company purchased in the
fourth quarter of 1996.  In addition, the 1997 period had an increase of      
$512,194 from amortization of discounts on notes, of which $382,796 pertains to
the Cedarbrooke note which was prepaid in March, 1997.  These increases were
partially offset by decreases in interest income of $141,266 as a result of the
prepayments in 1997 and 1996 on the Cedarbrooke, Town House and Hoboken notes
and a decrease in interest income of $52,051 on the Fairfield Towers Second
Mortgage.

Interest on wrap mortgages decreased by $71,846 from $1,048,207 in 1996 to   
$976,361 in 1997 primarily as a result of a $56,250 decrease in interest     
income on the Grant Manor purchase money mortgage.

Investment income decreased by $135,183 from $240,630 in 1996 to $105,447 in  
1997 primarily as a result of decreased dividend income on securities 
available for sale.  
  
Costs and expenses increased by $721,774 from $8,339,788 in 1996 to $9,061,562
in 1997 primarily due to increases in interest on note payable, rental property
operating expenses, depreciation expense and amortization of mortgage costs. 
These increases were offset by a decrease in minority interest share of
partnership income. 

Interest on note payable and other increased by $668,772 from $106,278 in 1996 
to $775,050 in 1997 primarily as a result of the note payable to Fleet Bank,  
N.A. ("Fleet") obtained in the fourth quarter of 1996. 

Rental property operating expenses increased by $237,243 from $2,857,844 in
1996 to $3,095,087 in 1997 primarily as a result of the reclassification of
foreclosed properties operations to rental property operations which resulted
in an increase in rental property operating expenses of $298,383.  In addition,
there were increases in operating expenses of $53,244 at the Kent Terrace
property and $35,362 at the Continental Gardens property.  These increases were
partially offset by decreases in operating expenses of $140,293 at the        
Mapletree Industrial Center property primarily as a result of environmental 
expenses of $120,500 recorded in 1996.  

Depreciation expense increased by $59,674 from $484,302 in 1996 to $543,976 in
1997 primarily as a result of the additions and improvements made at the Kent
Terrace, Metmor Plaza and Continental Gardens properties.

Amortization of mortgage costs increased by $149,207 from $98,041 in 1996 to
$247,248 in 1997 as a result of the $146,097 write-off of unamortized mortgage
costs associated with the prior Continental Gardens mortgage.  The mortgage on
the Continental Gardens property was refinanced in July, 1997 and the prior   
mortgage was repaid from the proceeds of the new mortgage.

Minority interest share of partnership income decreased by $369,791 from      
$655,189 in 1996 to $285,398 in 1997 as a result of a decrease in           
partnership income on the Metmor Plaza property.  

Loss from operations of foreclosed properties was $27,370 in 1996.  In 1997,
foreclosed properties were reclassified to real estate and their operations are 
now included in rental property operations. 

Net gain from sales of properties and securities are sporadic (as they depend
on the timing of sales or the receipt of installments or prepayments on       
purchase money notes).  In 1997, the net gain from sales of properties and
securities was $562,658 compared with $890,055 in 1996.  In the 1997 period,  
the Company recognized $472,497 of deferred gain from the sale of the         
Cedarbrooke property as a result of a $1,074,200 principal prepayment received
on that note.  In addition, the Company recognized deferred gains of $57,166  
and $17,840, respectively, from principal payments received on the Fairfield
Towers Second Mortgage and the Overlook loan.  In the 1996 period, the Company
recognized $773,258 of deferred gain from the sale of the Town House property
as a result of the $1,000,000 principal prepayment received on that note.  In
addition, during 1996, the Company recognized deferred gains of $49,990 and
$66,311, respectively, from the Fairfield Towers Second Mortgage and the      
Overlook loan.

Financial Information for the three months ended September 30, 1997 and 1996: 
-----------------------------------------------------------------------------

Income increased by $377,455 from $3,084,437 in 1996 to $3,461,892 in 1997
primarily as a result of increases in interest on mortgages-sold properties and
rental income, partially offset by decreases in interest on wrap mortgages and
investment income.    

Rental income increased by $48,223 from $2,071,259 in 1996 to $2,119,482 in  
1997 primarily as a result of an increase of $102,131 due to the reclassifica-
tion of the operations of foreclosed properties into rental property operations
in 1997.  In addition, rental income increased by $75,424 at the Kent Terrace
property as a result of the upgrading and rerenting program at the property. 
These increases were partially offset by decreases of $134,726 at the Metmor
Plaza property resulting from increased vacancy loss of $113,642 and decreases
of $14,539 in office rental income. 

Interest on mortgages-sold properties increased by $438,926 from $490,978 in 
1996 to $929,904 in 1997 primarily due to interest income of $420,428 from  
the Fairfield Towers First Mortgage, which the Company purchased in the fourth
quarter of 1996.  

Interest on wrap mortgages decreased by $23,996 from $348,124 in 1996 to      
$324,128 in 1997 primarily as a result of an $18,750 decrease in interest     
income on the Grant Manor purchase money mortgage.

Investment income decreased by $80,218 from $98,445 in 1996 to $18,227 in  
1997 primarily as a result of decreased dividend income on securities 
available for sale.  
  
Costs and expenses increased by $411,455 from $2,813,934 in 1996 to $3,225,389
in 1997 primarily due to increases in general and administrative expenses, 
interest on note payable, real estate tax expense, depreciation expense and
amortization of mortgage costs.  These increases were offset by a decrease in
minority interest share of partnership income. 
  
General and administrative expenses increased by $49,954 from $533,608 in
1996 to $583,562 in 1997 primarily due to a $58,662 increase in salary expense,
of which $50,329 pertained to an increase in accrued executive bonuses.  This
increase was partially offset by a $10,287 decrease in franchise tax expense.

Interest on note payable and other increased by $262,544 from $35,426 in 1996 
to $297,970 in 1997 primarily as a result of the note payable to Fleet obtained
in the fourth quarter of 1996. 

Real estate tax expense increased by $38,284 from $195,888 in 1996 to $234,172 
in 1997 primarily as a result of an increase in real estate taxes of $34,779 on 
the Cambridge Green property.

Depreciation expense increased by $26,188 from $164,361 in 1996 to $190,549 in
1997 primarily as a result of additions and improvements at the Kent Terrace,
Metmor Plaza and Continental Gardens properties.
 
Amortization of mortgage costs increased by $145,866 from $33,906 in 1996 to
$179,772 in 1997 as a result of the $146,097 write-off of unamortized mortgage
costs associated with the prior Continental Gardens mortgage.  The mortgage on
the Continental Gardens property was refinanced in July, 1997 and the prior   
mortgage was repaid from the proceeds of the new mortgage.

Minority interest share of partnership income decreased by $109,796 from      
$179,538 in 1996 to $69,742 in 1997 as a result of a decrease in partnership
income on the Metmor Plaza property.  

Loss from operations of foreclosed properties was $9,897 in 1996.  In 1997,
foreclosed properties were reclassified to real estate and their operations are 
now included in rental property operations. 

Net gain from sales of properties and securities are sporadic (as they depend
on the timing of sales or the receipt of installments or prepayments on       
purchase money notes).  In 1997, the net gain from sales of properties and
securities was $54,785 compared with $33,962 in 1996.  In the 1997 period,   
the Company recognized deferred gains of $32,915 and $6,081, respectively, from
principal payments received on the Fairfield Towers Second Mortgage and the
Overlook loan.  In the 1996 period, the Company recognized deferred gains of
$28,402 and $5,560, respectively, from principal payments received on the
Fairfield Towers Second Mortgage and the Overlook loan.

Balance Sheet  
 
Net mortgage portfolio increased by $2,391,427 from $28,388,917 at December 31, 
1996 to $30,780,344 at September 30, 1997.  This increase was primarily the
result of advances to the owners of the Fairfield Towers property in the
aggregate amount of $3,000,018, which was added to the indebtedness secured by
the Fairfield Towers First Mortgage.  This increase was offset by payments of
$388,273 received on the Fairfield Towers First Mortgage and a net decrease of
$218,907 resulting from the prepayment in March, 1997 of the $1,074,200       
principal balance of the Cedarbrooke note receivable, which also resulted in  
the amortization of discount of $382,796 and the recognition of deferred gain
of $472,497. 

Real estate increased by $2,098,306 from $25,369,405 at December 31, 1996 to  
$27,467,711 at September 30, 1997.  This increase was primarily the result of
the January 1, 1997 reclassification of foreclosed properties having a net
carrying value of $588,683 to real estate.  The Company also recorded additions
and improvements of $553,045 to the Kent Terrace property and $371,339 to the
Metmor Plaza property.  Additions and improvements recorded to other properties
were $585,239.  

Note payable to bank increased by $2,020,624 from $8,642,600 at December 31, 
1996 to $10,663,224 at September 30, 1997.  This increase was primarily the
result of an additional $2,500,000 advanced by Fleet offset by principal      
payments made of $479,376. 
  
Accounts payable increased by $204,333 from $271,126 at December 31, 1996 to
$475,459 at September 30, 1997.  This increase was primarily the result of an
increase of $212,681 in rental property accounts payable and is due to the    
timing of the receipt of invoices as well as the scheduling of payments.

Liquidity and Capital Resources  
  
Management believes that the Company has sufficient liquidity and capital
resources to carry on its existing business and, barring any unforeseen
circumstances, to pay the dividends required to maintain REIT status in the
foreseeable future.  Except as discussed herein, management is not aware of any
other trends, events, commitments or uncertainties that will have a significant
effect on liquidity.

Presidential obtains funds for working capital and investment from its        
available cash and cash equivalents, from operating activities and from
repayments of its mortgage portfolio.  The Company also has at its disposal a
$250,000 line of credit from Citibank, N.A., which it obtained in January,  
1997. 

At September 30, 1997, Presidential had $1,170,846 in available cash and cash
equivalents, a decrease of $221,289 from December 31, 1996.  This decrease in 
cash and cash equivalents was due to cash provided by operating activities of
$2,326,743 being exceeded by cash used in investing activities ($1,633,349)  
and financing activities ($914,683).


Operating Activities  
  
Presidential's principal source of cash from operating activities is from
interest on its mortgage portfolio, which was $2,359,755 in 1997, net of
interest payments on wrap mortgage debt and note payable.  In 1997, net cash
received from rental property operations was $854,398, which is net of
distributions to minority partners but before additions and improvements and
mortgage amortization.  


Investing Activities  
  
Presidential holds a portfolio of mortgage notes receivable which consist
primarily of notes arising from sales of real properties previously owned by  
the Company.  Some of these notes wrap around underlying mortgage debt (the
"Underlying Debt") which is paid by Presidential only out of funds received on
its mortgage portfolio relating to the Underlying Debt.  During 1997, the     
Company received principal payments of $1,896,879 on its mortgage portfolio   
(net of any principal payments attributable to the Underlying Debt), of which 
$1,709,294 represented prepayments, which are sporadic and cannot be relied   
upon as a regular source of liquidity.  
  
During 1997, the Company advanced an additional $3,000,018 under the Fairfield 
Towers First Mortgage which was used by the owners of the property to pay a
portion of unpaid real estate taxes (and interest accrued thereon) on the     
unsold Fairfield Towers condominium units which secure the mortgage           
indebtedness. 

The Company also holds a portfolio of marketable equity securities which
decreased by $560,110 during 1997, to $415,098, due primarily to security     
sales.  

During 1997, the Company invested $1,373,328 in additions and improvements to
its properties, which includes $553,045 of additions and improvements at the  
Kent Terrace property and $371,339 at the Metmor Plaza property.  At September
30, 1997, the upgrading and rerental program at the Kent Terrace property has
been substantially completed and the renovations to the vacant office suites at
the Metmor Plaza property are approximately seventy-five percent completed.

Financing Activities   
   
The Company's indebtedness at September 30, 1997, consisted of $31,693,080 of
mortgages (including $5,266,736 of underlying indebtedness on properties not
owned by the Company but on which the Company holds wraparound mortgages). 
The mortgage debt, which is secured by individual properties, is nonrecourse
to the Company with the exception of the $286,706 Mapletree Industrial Center
mortgage, which is secured by the property and a guarantee of repayment by
Presidential. Generally, mortgage debt repayment is serviced with cash flow
from the operations of the individual properties.  During 1997, the Company
has made $435,575 of principal payments on mortgage debt on properties which
it owns. The Company refinanced the mortgage on its Continental Gardens
property in Miami, Florida in July of 1997 and the prior mortgage of
$7,771,546 was paid from the proceeds of the new $8,120,000 mortgage.
The mortgage matures in August, 2007 with a balloon payment of
$7,158,323 due at maturity.  The mortgage requires monthly payments of
principal and interest in the amount of $60,490 and has an interest rate of
8.16% per annum.  The mortgages on the Company's properties are
self-liquidating at fixed rates of interest with the exception of the mortgages
on Metmor Plaza, Building Industries Center and Continental Gardens.
  
The Company's indebtedness at September 30, 1997 includes a $10,663,224 bank  
loan payable to Fleet.  This loan was obtained in the fourth quarter of 1996 in
connection with the acquisition of the Fairfield Towers First Mortgage.  The
note, which matures on October 30, 2001, is nonrecourse to Presidential except
for a limited guarantee, the amount of which reduces as the principal balance
is reduced and was limited to $1,434,514 at September 30, 1997.  The interest
rate is variable and is based at the Company's election on either the bank's
prime rate plus 1%, a cost of funds rate plus 3%, or various LIBOR rates plus
3%.  The note amortizes monthly based on a 9.25% interest rate for a 25 year  
term with additional principal payments due upon the sale of condominium units. 
During 1997, the Company made principal payments of $479,376 and received
additional advances of $2,500,000 from Fleet which were added to the bank loan. 
These advances were obtained in order to allow Presidential to advance        
$3,000,018 on the Fairfield Towers First Mortgage.

During 1997, Presidential declared cash distributions of $2,138,126 (including
$535,864 payable in the fourth quarter) to its shareholders and received
proceeds from dividend reinvestments of $133,531.

Fairfield Towers

The Company's financial performance and liquidity in 1997 and subsequent years
will be affected by the results of the condominium conversion of Fairfield    
Towers Apartments in Brooklyn, New York by the owner of that property and the
rental operations of the unsold condominium units.  At September 30, 1997, the
outstanding principal balances on the Fairfield Towers First Mortgage and the
Fairfield Towers Second Mortgage were $17,262,611 and $14,538,278,            
respectively.  The Fairfield Towers First Mortgage provides for monthly       
interest payments of 1% above Fleet's prime rate and principal repayments prior
to maturity upon the sale of individual condominium units.  Until the Fairfield
Towers First Mortgage is repaid, Presidential will receive basic interest on  
the Fairfield Towers Second Mortgage only out of net cash flow from operations
of the property and release payments upon the sale of each condominium unit in
the amount of $3,000 per unit.  All unpaid basic interest and additional      
interest (which is based on percentages of gross sales proceeds) will be      
deferred until after repayment of the Fairfield Towers First Mortgage.  

In June of 1994, the owners of the Fairfield Towers property closed the first
sales of the condominium units pursuant to the conversion of the property to
condominium status.  At September 30, 1997, a total of 152 units had been sold
and 1,000 units remained to be sold, the majority of which are occupied as   
rental units.

The success of the condominium conversion could be adversely affected by the
existence of unpaid real estate taxes and interest accrued thereon in the
approximate amount, as of December 31, 1996, of $4,800,000 owed by the owners
of the property.  Approximately $3,000,000 of this amount arose prior to the
condominium conversion of the property and was covered by a deferred payment
agreement with the City of New York which required payments as condominium    
units were sold.  However, as a result of the slower than projected pace of
sales, the term of the deferred payment agreement expired.  In 1997, the      
Company advanced an additional $3,000,018 to the owners of the property to be
used to pay a portion of the unpaid real estate taxes and interest (thus      
reducing the $4,800,000 to $1,800,000), which amount was added to the         
indebtedness secured by the Fairfield Towers First Mortgage, and Fleet advanced
$2,500,000 to Presidential to substantially reimburse it for its $3,000,018
advance.  

Environmental Matters   
   
At September 30, 1997, the Company is continuing with its environmental project
for the investigation and removal of potentially hazardous drums found at one
site on its Mapletree Industrial Center property in Palmer, Massachusetts. 
Accrued liabilities for environmental matters have been recorded in operating
expenses when it is probable that a liability has been incurred and the amount
of the liability can be reasonably estimated.  These estimates are exclusive of
claims against third parties and have not been discounted.  Actual costs      
incurred may vary from these estimates due to the inherent uncertainties
involved.  The Company believes that any additional liability in excess of
amounts provided which may result from the resolution of this matter will not
have a material adverse effect on the financial condition, liquidity or the   
cash flow of the Company.  In 1996, the site investigation at this site had   
been completed and, as a result, during the third quarter of 1996, the Company
accrued an additional $120,500 in order to complete further site investigations
and cleanup costs at this disposal site.  This work, which started in February,
1997, is scheduled to be accomplished over the next four years.  For the nine
months ended September 30, 1997, there were no environmental costs charged to
operations.  















PART II - OTHER INFORMATION



Item 6.  Exhibits and Reports on Form 8-K.

(a)    Exhibit 27.  Financial Data Schedule.

(b)    No reports on form 8-K have been filed during the quarter ended 
       September 30, 1997.



SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


PRESIDENTIAL REALTY CORPORATION
       (Registrant)


DATE:  November 12, 1997          By:  /s/ Jeffrey F. Joseph                
                                      ---------------------
                                      Jeffrey F. Joseph                       
                                      President 



DATE:  November 12, 1997          By:  /s/ Elizabeth Delgado               
                                      ---------------------
                                      Elizabeth Delgado
                                      Treasurer