UNITED STATES SECURITIES AND EXCHANGE
COMMISSION Washington, DC
20549  FORM 10-K  ANNUAL REPORT PURSUANT TO
SECTION 13 OF THE SECURITIES EXCHANGE ACT OF
1934 (THE ACT)  For the Fiscal Year Ended
December 31, 2007  Commission filenumber 000-32633  Belmar Capital Fund LLC (the
Fund) (Exact Name of Registrant as
Specified in Its Charter)  Delaware
  
  04-3508106(State of Organization)
  
  (I.R.S. Employer Identification
  No.)
  The Eaton Vance
Building 255 State Street Boston,
Massachusetts 02109 (Address and Zip Code of Principal
Executive Offices)  617-482-8260 (Registrants telephone number,
including area code)  Securities
registered pursuant to Section 12(g) of the Act: Limited
Liability Company Interests in the Fund (Shares)  Indicate
by check mark if Registrant is a well-known seasoned issuer, as defined in Rule 405
of the Securities Act of 1933.xYesoNo  Indicate
by check mark if Registrant is not required to file reports pursuant to Section 13
or Section 15(d) of the Act.oYesxNo  Indicate
by check mark whether Registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Act 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.xYesoNo  Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of Registrants knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.x  Indicate by check
mark whether the registrant is a large accelerated filer, an accelerated filer,
a non-accelerated filer or a smaller reporting company.  See the definitions of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2
of the Exchange Act.  (Check one):  Large
  accelerated filerx
  Accelerated
  fileroNon-accelerated
  filero
  Smaller
  reporting companyo
  Indicate by check mark
whether the Registrant is a shell company (as defined in Rule 12b-2 of the
Act).YesoNox  Aggregate
market value of the Shares held by non-affiliates of Registrant, based on the
closing net asset value on June 29, 2007 was $1,835,532,140. Calculation
of holdings by non-affiliates is based upon the assumption, for these purposes only, that the Registrants manager, its executive officers
and directors and persons holding 5% or more of the Registrants Shares are
affiliates.  Incorporations
by Reference: None.  The Exhibit Index is located
on page 80.


Belmar Capital Fund LLC
Index to Form 10-K  Item
  
  
  
  PagePART I1
  Business
  
  5Fund Overview
  
  5Structure
  of the Fund
  
  5Fund
  Management
  
  5The
  Funds Offering
  
  6The Funds Investment in
  Belvedere Capital Fund Company LLC and Tax-Managed Growth Portfolio
  
  6Belvedere Company
  
  6The Portfolio
  
  7The Portfolios Investment
  Objective and Policies
  
  7The Portfolios
  Tax-Sensitive Management Strategies
  
  7The Funds Real Estate
  Investments
  
  8Real Estate Joint Venture
  Investments
  
  9Wholly Owned Property
  
  9Co-owned Property
  
  10Partnership Preference Units
  
  10Organization of Belmar
  Realty
  
  10Fund Borrowings
  
  10Interest Rate Swap
  Agreements
  
  11The Eaton Vance Organization
  
  11Conflicts of Interest
  
  111A
  Risk Factors
  
  121B
  Unresolved Staff Comments
  
  122
  Properties
  
  123
  Legal Proceedings
  
  124
  Submission of Matters to a
  Vote of Security Holders
  
  12PART II5
  Determining
  Net Asset Value, Market for Fund Shares, Related Shareholder Matters and
  Issuer Purchases of Equity Securities
  
  13Market Information,
  Restrictions on Transfers and Redemption of Shares
  
  13Transfers of Fund Shares
  
  13Redemption of Fund Shares
  
  13Determining Net Asset Value
  
  14Historic Net Asset Values
  
  15Record Holders of Shares of the Fund
  
  16Distributions
  
  16Income and Capital Gain Distributions
  
  16  2


Special Distributions
  166
  Selected
  Financial Data
  17Table of Selected Financial Data
  177
  Managements
  Discussion and Analysis of Financial Condition and Results of Operations
  (MD&A)
  17Results
  of Operations
  18MD&A for
  the Year Ended December 31, 2007 Compared to the Year Ended
  December 31, 2006
  18Performance of the Fund
  18Performance of the Portfolio
  19Performance of Real Estate Investments
  19Performance of Interest Rate Swap Agreements
  20MD&A for
  the Year Ended December 31, 2006 Compared to the Year Ended
  December 31, 2005
  20Performance of the Fund
  20Performance of the Portfolio
  20Performance of Real Estate Investments
  21Performance of Interest Rate Swap Agreements
  22Liquidity and Capital Resources
  22Outstanding Borrowings
  22Liquidity
  22Off-Balance Sheet Arrangements
  23The Funds Contractual Obligations
  23Critical Accounting Estimates
  24Real Estate Joint Ventures
  24Wholly Owned and Co-owned Property
  25Partnership Preference Units
  257A
  Quantitative
  and Qualitative Disclosures About Market Risk
  26Quantitative Information About Market Risk
  26Interest Rate Risk
  26Qualitative Information About Market Risk
  28Risks Associated with Equity Investing
  28Risks of Investing in Foreign Securities
  29Risks of Certain Investment Techniques
  29Risks of Real Estate Investments
  30Risks of Interest Rate Swap Agreements
  32Risks of Leverage
  328
  Financial
  Statements and Supplementary Data
  339
  Changes in
  and Disagreements with Accountants on Accounting and Financial Disclosure
  339A
  Controls and
  Procedures
  33Fund Governance
  33Disclosure Controls and Procedures
  33Internal Control over Financial Reporting
  349B
  Other Information
  35  3


PART III10
  Directors,
  Executive Officers and Corporate Governance
  36Management
  36Compliance with Section 16(a) of the Act
  37Code of
  Ethics
  3711
  Executive
  Compensation
  3712
  Security
  Ownership of Certain Beneficial Owners and Management and Related Shareholder
  Matters
  37Security Ownership of Certain Beneficial Owners
  37Security Ownership of Management
  37Changes in Control
  3713
  Certain
  Relationships and Related Transactions, and Director Independence
  38The Funds Investment Advisory and Administrative Fee
  38Belmar Realtys Management Fee
  38The Portfolios Investment Advisory Fee
  39Servicing Fees Paid by the Fund
  39Servicing Fees Paid by Belvedere Company
  39Distribution Fees Paid to EV Distributors
  39Certain Real Estate Investment Transactions
  4014
  Principal Accountant
  Fees and Services
  40PART IV15
  Exhibits and
  Financial Statement Schedules
  41APPENDIX A
  42FINANCIAL
  STATEMENTS
  43SIGNATURES
  79EXHIBIT INDEX
  80  4


PART I  Item
1. Business.  Fund
Overview.Belmar Capital Fund LLC (the Fund) is a private
investment company organized by Eaton Vance Management (Eaton Vance) to provide
diversification and tax-sensitive investment management to investors holding
large and concentrated positions in equity securities of selected public
companies. The Funds investment objective is to achieve long-term, after-tax
returns for persons who have invested in the Fund (Shareholders). The Fund, a
Delaware limited liability company, commenced its investment operations on March 17,
2000. Limited liability company interests of the Fund (Shares) were issued to
Shareholders at five closings during 2000. At each Fund closing, the Fund
accepted contributions of stock from investors in exchange for Shares of the
Fund. The Fund discontinued offering Shares on November 29, 2000 and,
while the Fund is not prohibited from doing so, no future offering is
anticipated. As of December 31, 2007, the Fund had net assets of
approximately $1.6 billion.  Structure of the Fund.The Fund is
structured to provide tax-free diversification and tax-sensitive investment
management to Shareholders. To meet the objective of tax-free diversification,
the Fund must satisfy specific requirements of the Internal Revenue Code of
1986, as amended (the Code). In order for the contributions of appreciated
stock to the Fund by Shareholders to be nontaxable, not more than 80% of the
Funds assets (calculated in the manner prescribed) may consist of stocks and
securities as defined in the Code. To meet this requirement, the Fund normally
invests at least 20% of its assets as so determined in certain real estate
investments (see The Funds Real Estate Investments below). The Fund invests
up to 80% of its assets in a diversified portfolio of common stocks (see The
Funds Investment in Belvedere Capital Fund Company LLC and Tax-Managed Growth
Portfolio below). The Fund may also invest cash on a temporary basis in
short-term instruments including in an investment company, Cash Management
Portfolio, advised by an affiliate of Eaton Vance. The Fund acquires its real
estate investments with borrowed funds, as described below under Fund
Borrowings. See Appendix A for a chart detailing the investment structure of
the Fund.  In its investment
program, the Fund balances investment considerations and tax considerations,
and takes into account the taxes payable by Shareholders on allocated
investment income and realized capital gains. See The Funds Investment in
Belvedere Capital Fund Company LLC and Tax-Managed Growth Portfolio below.  There is no trading
market for the Funds Shares. As described further under Redemption of Fund
Shares in Item 5(a), Fund Shares may be redeemed on any business day. The Fund
satisfies redemption requests principally by distributing securities, but may
also distribute cash. The value of securities and cash distributed to satisfy a
redemption will equal the net asset value of the number of Shares redeemed.
Under most circumstances, a redemption from the Fund that is met by
distributing securities as described herein will not result in the recognition
of capital gains by the Fund or by the redeeming Shareholder. The redeeming
Shareholder would generally recognize capital gains upon the sale of the
securities received upon the redemption.  The Fund intends to
distribute at the end of each year, or shortly thereafter, all of its net
investment income for such year, if any. The Fund also intends to make annual
capital gain distributions equal to approximately 18% of the amount of its net
realized capital gains, if any, other than certain precontribution gains. The
Funds distributions generally are based on determinations of net investment
income and net realized capital gains for federal income tax purposes. Such
amounts may differ from net investment income or loss and net realized gain or
loss as set forth in the Funds consolidated financial statements due to
differences in the treatment of various income, gain, loss, expense and other
items for federal income tax purposes and under generally accepted accounting
principles (GAAP). See Note 2 to the Funds consolidated financial statements.
The Fund intends to pay any distributions on the last business day of each
fiscal year of the Fund (which concludes on December 31) or shortly
thereafter. See Distributions in Item 5(c).  Fund Management.The manager of the
Fund is Eaton Vance, a Massachusetts business trust registered as an investment
adviser under the Investment Advisers Act of 1940, as amended (the Advisers
Act). Eaton Vance and its subsidiary, Boston Management and Research (Boston
Management), provide management and advisory services to the Fund, its real
estate subsidiary and the investment portfolio in which the Fund invests.
Boston Management is also registered as an investment adviser under the
Advisers Act. Eaton Vance and Boston Management provide advisory,
administration and/or management services to over 150 investment companies, as
well as separate accounts managed for individual and institutional investors.
As of December 31, 2007, Eaton Vance and its affiliates managed
approximately $155 billion on behalf of clients. The fees payable to the Eaton
Vance organization, as well as other fees payable by the Fund, are described in
Item 13. The Eaton Vance organization is subject to certain conflicts of
interest in providing services to the  5


Fund, its subsidiaries
and the investment portfolio in which the Fund invests. See The Eaton Vance
Organization  Conflicts of Interest below.  The Funds Offering.Shares of the Fund
were privately offered and sold only to accredited investors as defined in Rule 501(a) under
the Securities Act of 1933, as amended (the Securities Act), who were qualified
purchasers (as defined in Section 2(a)(51)(A) of the Investment
Company Act of 1940, as amended (the 1940 Act)). The offering was conducted by
Eaton Vance Distributors, Inc. (EV Distributors), a wholly owned
subsidiary of Eaton Vance, as placement agent and by certain subagents
appointed by EV Distributors. The Shares were offered and sold in reliance upon
an exemption from registration provided by Rule 506 under the Securities
Act. The Fund issued Shares to Shareholders at closings taking place on March 17,
2000, May 16, 2000, July 19, 2000, September 27, 2000 and November 29,
2000. At the five closings, an aggregate of 25,888,893 Shares were issued in
exchange for Shareholder contributions totaling approximately $2.6 billion.  The Fund is registered
under the Act and files periodic reports (such as reports on Form 10-Q and
Form 10-K) thereunder. Copies of the reports filed by the Fund are
available: at the public reference room of the Securities and Exchange
Commission (SEC) in Washington, DC (call 1-202-551-8690 for information on the
operation of the public reference room); on the EDGAR Database on the SECs
Internet site (http://www.sec.gov); or, upon payment of copying fees, by
writing to the SECs public reference section, 100 F Street, NE, Washington, DC
20549-0102, or by electronic mail at publicinfo@sec.gov. The Fund does not have
a website. The Fund intends to provide Shareholders with an annual and
semiannual report containing the Funds consolidated financial statements,
audited by the Funds independent registered public accounting firm in the case
of the annual report.  The
Funds Investment in Belvedere Capital Fund Company LLC and Tax-Managed Growth
Portfolio.At each Fund closing, all of the securities
accepted for contribution to the Fund were contributed by the Fund to Belvedere
Capital Fund Company LLC (Belvedere Company), a Massachusetts limited liability
company, in exchange for shares of Belvedere Company. Belvedere Company, in
turn, immediately thereafter contributed the securities received from the Fund
to Tax-Managed Growth Portfolio (the Portfolio) in exchange for an interest in
the Portfolio. The Portfolio is a diversified, open-end management investment
company registered under the 1940 Act with net assets of approximately $19.9
billion as of December 31, 2007. As of December 31, 2007, the Funds
investment in the Portfolio through Belvedere Company had a value of
approximately $1.7 billion (equal to approximately 75.9% of the Funds total
assets on a consolidated basis).  Belvedere Company.Belvedere Company
was organized in 1997 by Eaton Vance to offer tax-free diversification and
tax-sensitive investment management to certain qualified investors who
contributed diversified portfolios of equity securities. As of December 31,
2007, the investment assets of Belvedere Company consisted exclusively of an
interest inthe Portfolio with a
value of approximately $14.8 billion. As of such date, the Fund owned
approximately 11.5% of Belvedere Companys outstanding shares. As of December 31,
2007, the other investors in Belvedere Company included twelve other investment
funds sponsored by the Eaton Vance organization (investment fund investors), as
well as qualified individual investors who acquired shares of Belvedere Company
in exchange for portfolios of acceptable securities (non-investment fund
investors).  Belvedere Company
considers for acceptance equity securities that (i) are listed on the New
York Stock Exchange (NYSE), the American Stock Exchange, the NASDAQ Global or
Global Select Market (NASDAQ) or a major foreign exchange, (ii) have a
trading price of at least $10.00 per share and (iii) are issued by issuers
having an equity market capitalization of at least $500 million. Because
Belvedere Company only accepts contributions of diversified baskets of
securities (as described below), it is not subject to the requirement that not
more than 80% of its assets consist of stocks and securities as defined in
the Code. For investors that own a diversified basket of securities, investing
in Belvedere Company (rather than in the Fund) avoids the costs and risks of
investing in real estate and the associated financial leverage to which the
Fund is subject. See Risks of Real Estate Investments and Risks of Leverage
in Item 7A(b).  Belvedere Company
provides a vehicle through which investment fund and non-investment fund
investors contributing a diversified basket of securities can acquire an
indirect interest in the Portfolio. A diversified basket of securities means
a group of securities that is diversified such that not more than 25% of the
value of the securities are investments in the securities of any one issuer and
not more than 50% of the value of the securities are investments in the
securities of five or fewer issuers. The securities contributed to Belvedere
Company at each Fund closing constituted a diversified basket of securities.
Because the Fund is required to hold a percentage of its investments in
non-Portfolio assets in order to meet certain tax requirements (see Structure
of the Fund above and The Funds Real Estate Investments below), it does not
satisfy the conditions of the 1940 Act for investing directly in the Portfolio.  6


The Portfolio.The Portfolio was
organized in 1995 by Eaton Vance as the successor to the investment operations
of Eaton Vance Tax-Managed Growth Fund 1.0 (Tax-Managed Growth 1.0), a mutual
fund established in 1966 by Eaton Vance and managed from inception for
long-term, after-tax returns. As of December 31, 2007, investors in the
Portfolio included six investors in addition to Belvedere Company and
Tax-Managed Growth 1.0, each of which acquired or is acquiring on a continuous
basis interests in the Portfolio with cash. All investors in the Portfolio are
sponsored by or affiliated with Eaton Vance. As of December 31, 2007, Belvedere
Company owned approximately 74.3% of the Portfolios net assets.  The Fund invests in the
Portfolio (on an indirect basis through Belvedere Company) because it is a
well-established investment portfolio that has an investment objective and
policies that are compatible to those of the Fund. Investing in the Portfolio
enables the Fund to participate in a substantially larger and more diversified
investment portfolio than it could achieve by managing the contributed
securities directly. The audited financial statements of the Portfolio for the
year ended December 31, 2007 are included as pages 62 to 78 of this
Annual Report on Form 10-K. The Portfolios audited financial statements
include information about the assets and liabilities of the Portfolio, including
Portfolio income and expenses. For a discussion of the Portfolios performance
for the year ended December 31, 2007, see Performance of the Portfolio
in Item 7(a). For a description of the investment advisory fee payable by the
Portfolio, see The Portfolios Investment Advisory Fee in Item 13.  The Portfolios Investment Objective and Policies.The
investment objective of the Portfolio is to achieve long-term, after-tax
returns for its investors by investing in a diversified portfolio of equity
securities. The Portfolio invests primarily in common stocks of domestic and
foreign growth companies that are considered by its investment adviser to be
high in quality and attractive in their long-term investment prospects. The
Portfolio seeks to invest in a broadly diversified portfolio of stocks and to
invest primarily in established companies with characteristics of above-average
growth, predictability and stability that are acquired with the expectation of
being held for a period of years. Under normal market conditions, the Portfolio
invests primarily in common stocks. The Portfolio has acquired securities
through contributions from Belvedere Company, Tax-Managed Growth 1.0 and Eaton
Vance Tax-Managed Growth Fund 1.1, and through purchases of securities with
cash invested in the Portfolio by certain of these and other investors.  Although the Portfolio
may, in addition to investing in common stocks, invest in investment-grade
preferred stocks and debt securities, purchases of such securities are normally
limited to securities convertible into common stocks and temporary investments
in short-term notes and government obligations. During periods in which the
investment adviser to the Portfolio believes that returns on common stock
investments may be unfavorable, the Portfolio may invest a significant portion
of its assets in U.S. government obligations and high quality short-term notes,
including such investments held through Cash Management Portfolio. The
Portfolios holdings represent a number of different industries. Not more than
25% of the Portfolios assets may be invested inthe securities of issuers having their principal business
activity in the same industry, determined as of the time of acquisition of any
such securities.  The Portfolios Tax-Sensitive Management Strategies.In
its operations, the Portfolio seeks to achieve long-term, after-tax returns in
part by minimizing the taxes incurred by investors in the Portfolio in
connection with the Portfolios investment income and realized capital gains.
Taxes on investment incomeare
minimized by investing primarily in lower-yielding securities and stocks that
pay dividends that qualify for favorable federal tax treatment. Taxes on
realized capital gains are minimized by minimizing the sale of securities
holdings with large accumulated capital gains. The Portfolio generally seeks to
avoid net realized short-term capital gains.  When the Portfolio
decides to sell a particular appreciated security, the Portfolio will select
for sale the share lots resulting in the most favorable tax treatment,
generally those with holding periods sufficient to qualify for long-term
capital gain treatment that have the highest cost basis. The Portfolio may,
when deemed prudent by its investment adviser, sell securities to realize
capital losses that can be used to offset realized gains. While the Portfolio
generally retains the securities contributed to the Portfolio by Belvedere
Company, the Portfolio has the flexibility to sell contributed securities.
Securities acquired by the Portfolio with cash may be sold in accordance with
its management strategies. In lieu of selling a security, the Portfolio may
hedge its exposure to that security by using the techniques described below.
The Portfolio also disposes of appreciated securities through its practice of
settling redemptions by investors in the Portfolio that contributed securities
primarily by distributing securities as described in Item 5(a) under Redemption
of Fund Shares. The Portfolio may also settle redemptions by investors with
distributions of securities upon request. As described in Item 5(a), settling
redemptions with appreciated securities can result in certain tax benefits to
the Portfolio, Belvedere Company, the Fund and the redeeming Shareholder.  To reduce its exposure to
adverse price movements in individual securities or groups of securities
holdings with large accumulated gains, the Portfolio may use various investment
techniques, including, but not limited to, the purchase of put  7


options on securities
held, equity collars (combining the purchase of a put option and the sale of a
call option), equity swaps, short sales of individual securities held, short
sales of index or basket securities whose constituents are held in whole or in
part, forward sales of stocks held, and the purchase and sale of futures
contracts on stocks and stock indexes and options thereon. By using these
techniques rather than selling such securities, the Portfolio can, within certain
limits, reduce its exposure to price declines in the securities without
realizing substantial capital gains under current tax law.  The Portfolios ability
to utilize covered short sales, certain equity swaps, forward sales, futures
contracts and certain equity collar strategies as a tax-efficient management
technique with respect to holdings of appreciated securities is limited to
circumstances in which the hedging transaction isclosed out within 30 days after the end of the Portfolios
taxable year in which the hedging transaction was initiated and the underlying
appreciated securities position is held unhedged for at least the next 60 days
after such hedging transaction is closed. In addition, dividends received on
stock for which the Portfolio is obligated to make related payments (pursuant
to a short sale or otherwise) with respect to positions in substantially
similar or related property are subject to federal income tax at ordinary rates
and do not qualify for favorable tax treatment. Also, the holding periods
required to receive tax-advantaged treatment of qualified dividends on a stock
are suspended whenever the Portfolio has an option (other than a qualified
covered call option not in the money when written) or contractual obligation to
sell or an open short sale of substantially identical stock, is the grantor of
an option (other than a qualified covered call option not in the money when
written) to buy substantially identical stock or has diminished risk of loss in
such stock by holding positions with respect to substantially similar or
related property. The use of these investment techniques may require the
Portfolio to commit or make available cash and, therefore, may not be available
at such times as the Portfolio has limited holdings of cash. The Portfolio did
not employ any of the techniques described above on securities holdings during
the year ended December 31, 2007. See Risks of Certain Investment
Techniques in Item 7A(b).  The
Funds Real Estate Investments.Separate from its investment
in the Portfolio through Belvedere Company, the Fund invests in certain real
estate investments through Belmar Realty Corporation (Belmar Realty). The
ownership structure of Belmar Realty is described below under Organization of
Belmar Realty. As referred to above under Fund Overview  Structure of the
Fund, the Fund invests in real estate investments to satisfy certain
requirements of the Code for contributions of appreciated stocks to the Fund by
Shareholders to be nontaxable. As of December 31, 2007, the real estate
investments of Belmar Realty totaled approximately $535.4 million and
represented 23.9% of the Funds total assets. The Fund acquires its real estate
investments with borrowed funds, as described below under Fund Borrowings.
The Fund seeks a return on its real estate investments over the long term that
exceeds the cost of the borrowings incurred to acquire such investments. For a
description of material real estate investment transactions during the year
ended December 31, 2007, see Performance of Real Estate Investments in
Item 7(a).  At December 31,
2007, Belmar Realty held investments in: a real estate joint venture (Real
Estate Joint Venture), Brazos Property Trust (Brazos), in which Belmar Realty
owns a majority economic interest; a wholly owned real property (Wholly Owned
Property) subject to a long-term net lease (Net Leased Property), Bel Stamford
Investors LLC (Bel Stamford); two tenancy-in-common interests in real property
(Co-owned Properties), Bel SML I, LLC (Bel SML I) and Bel Marquette I, LLC (Bel
Marquette I); and a portfolio of income-producing preferred equity interests in
real estate operating partnerships that generally are affiliated with and
controlled by real estate investment trusts (REITs) that are publicly traded
(Partnership Preference Units). Certain of the Partnership Preference Units are
held indirectly through Belvorn Holdings LLC (Belvorn). Belvorn is a Delaware
limited liability company formed in 2005 and treated as a partnership for tax
purposes. At December 31, 2007, Belvorns sole investment was Partnership
Preference Units issued by Vornado Realty L.P. At December 31, 2007,
Belmar Realty owned 30% of Belvorns outstanding units. Information included
herein about Belmar Realtys Partnership Preference Units includes the
Partnership Preference Units held directly through Belmar Realty and indirectly
through Belvorn. As of December 31, 2007, approximately 17.5% of the real
estate investments of the Fund consisted of its investment in Brazos,
approximately 56.4% was the investment in Bel Stamford, approximately 3.8% was
the investments in Co-owned Properties and approximately 22.3% was investments
in Partnership Preference Units.  In the future, Belmar
Realty may invest in other types of real estate investments, including other
real property investments held directly or through majority-owned affiliates.
Real Estate Joint Ventures, Wholly Owned Property and Co-owned Properties are
sometimes referred to herein as Subsidiary Real Estate Investments. Belmar Realty
may purchase real estate investments from, and sell them to, real estate
investment affiliates of other investment funds advised by Boston Management.
See Certain Real Estate Investment Transactions in Item 13.  8


Boston Management serves
as manager of Belmar Realty. In that capacity, Boston Management manages the
investment and reinvestment of Belmar Realtys assets and administers its
affairs. See Belmar Realtys Management Fee in Item 13 for a description of
the management fee payable by Belmar Realty to Boston Management.  Real Estate Joint Venture Investments.At
December 31, 2007, Belmar Realty owned a majority economic interest in a
Real Estate Joint Venture, Brazos. Brazos owns real property through its
interest in ProLogis Six Rivers Limited Partnership and the ProLogis Brazos
Fund L.P. At December 31, 2007, the average occupancy rate of the
properties owned by Brazos was approximately 92%.  A board of trustees
controls the business of Brazos. Each of Belmar Realty and the minority
investor in Brazos has representation on the board and the unanimous consent of
the board is required for all major decisions. The board of Brazos has
delegated the day-to-day administration of Brazos and the day-to-day management
of its real properties to the principal minority investor in Brazos or an
affiliated company thereof (the Operating Partner). The Operating Partner
receives management related fees from Brazos and, in addition, is reimbursed
for certain payroll and other direct expenses incurred.  At December 31,
2007, the assets of Brazos consisted of 23 industrial distribution properties.
When Brazos was established, the properties held by Brazos were acquired from
or in conjunction with the Operating Partner. See Item 2. Distributable cash
flows from Brazos are allocated in a manner that provides Belmar Realty: 1) a
priority with respect to a fixed annual preferred return; and 2) participation
on a pro rata or reduced basis in distributable cash flows in excess of the
annual preferred return of Belmar Realty and the subordinated preferred return
of the Operating Partner.  Financing for Brazos
consists primarily of fixed-rate secured mortgage debt obligations of Brazos
that are without recourse to Fund Shareholders and generally without recourse
to Belmar Realty and the Fund, as described under Risks of Real Estate
Investments in Item 7A(b). Both Belmar Realty and the Operating Partner
invested equity in Brazos. Belmar Realtys equity in Brazos was acquired using
the proceeds of Fund borrowings.  The Operating Partner of
Brazos also serves as an operating partner of other Real Estate Joint Ventures
in which affiliates of other investment funds advised by Boston Management hold
a majority economic interest. The persons serving as trustees of Brazos on
behalf of Belmar Realty are employees or affiliates of Boston Management. See Directors,
Executive Officers and Corporate Governance in Item 10. No director of Belmar
Realty or trustee of Brazos is a Shareholder of the Fund. No company in the
Eaton Vance organization has a material financial interest in Brazos.  The Operating Partner of
Brazos is ProLogis, a publicly owned REIT. Common shares of ProLogis are traded
on the NYSE under the symbol PLD. ProLogis owns 20% of the voting shares of
Brazos. Belmar Realty owns the balance of such shares. Pursuant to an agreement
with ProLogis, upon unanimous consent or from and after August 4, 2014,
either Belmar Realty or ProLogis may cause a liquidation of Brazos. If Belmar
Realty or ProLogis elects to liquidate Brazos, Brazos will retain an
independent third party to effectuate the liquidation.  The sale to Belmar Realty
by ProLogis of its interest in Brazos would not affect the REIT qualification
of Brazos. If Belmar Realty were to dispose of its interest in Brazos pursuant
to the liquidation agreement or otherwise, it may acquire an interest in a
different real estate investment to replace the investment sold.  Wholly Owned Property.At December 31,
2007, Belmar Realty owned a Wholly Owned Property, Bel Stamford. The Bel
Stamford property is a Net Leased Property consisting of leasehold improvements
in an office building and attached facilities. The Bel Stamford property is
financed by fixed-rate secured mortgage debt obligations of Bel Stamford that
are without recourse to Fund Shareholders and generally without recourse to
Belmar Realty and the Fund as described under Risks of Real Estate Investments
in Item 7A(b). Belmar Realtys equity in Bel Stamford was acquired using the
proceeds of Fund borrowings.  The Bel Stamford property
is leased on a long-term basis to one tenant that is obligated to pay rent
sufficient to service the associated mortgage debt and to pay all costs and
expenses associated with the operation and maintenance of the property,
including real estate taxes, repairs and insurance. The tenant has also
generally indemnified Bel Stamford against certain liabilities in connection
with the property. Because all or substantially all of the rental payments are
dedicated to debt service, realized returns on Belmar Realtys investment in
the Bel Stamford property generally will be deferred until the property is
re-leased following the initial lease term or sold.  9


Co-owned Property.At December 31,
2007, Belmar Realty owned Co-owned Properties through its two subsidiaries, Bel
SML I and Bel Marquette I. Bel SML I owns a 40% tenancy-in-common interest in
two office properties located in New Jersey and California. Bel Marquette I
owns a 40% tenancy-in-common interest in an office property located in
Wisconsin. The Co-owned Properties are financed by fixed-rate secured mortgage
debt obligations of Bel SML I and Bel Marquette I that are without recourse to
Fund Shareholders and generally without recourse to Belmar Realty and the Fund
as described under Risks of Real Estate Investments in Item 7A(b). Belmar
Realtys equity in the Co-owned Properties was acquired using the proceeds of
Fund borrowings.  The Bel SML I New Jersey
property is leased on a net basis through December 2016 (with the option
to extend the lease for two option periods of five years each) to a single
tenant that is obligated to make specified rental payments and to bear all
costs and expenses associated with the operation and maintenance of the
property, including real estate taxes, repairs and insurance. The Bel SML I
California property is leased on a gross basis through October 2019 (with
the option to extend the lease for an additional five year period) to a single
tenant that is obligated to make specified rental payments and to bear certain
costs and expenses associated with the operation of the property.  The Bel Marquette I
property is leased on a net basis through January 2018 (with the option to
extend the lease for two option periods of five years each) to a single tenant
that is obligated to make specified rental payments and to bear the costs and
expenses associated with the operation and maintenance of the property,
excluding roof repair and roof replacement.  Partnership Preference Units.Belmar
Realtys investments in Partnership Preference Units represent preferred equity
interests in real estate operating partnerships. The assets of the partnerships
that issued the Partnership Preference Units owned by Belmar Realty on December 31,
2007 consisted primarily of direct or indirect ownership interests in real
properties, including multifamily properties, manufactured home communities,
self-storage facilities, office and industrial properties and shopping centers.
The Partnership Preference Units owned by Belmar Realty as of December 31,
2007 are listed in Item 7A(a) and in the consolidated portfolio of
investments included in the Funds consolidated financial statements, which are
included as pages 43 to 61 of this Annual Report on Form 10-K. Eaton
Vance is not, and has not been, involved in the management or operation of the
real estate operating partnerships that issued the Partnership Preference Units
owned by Belmar Realty.  The Partnership
Preference Units held by Belmar Realty were issued by partnerships that are not
publicly traded partnerships within the meaning of Code Section 7704(b).
The Partnership Preference Units are perpetual life instruments (subject to
call provisions) and are not, by their terms, readily convertible or
exchangeable into cash or securities of an affiliated public company.
Partnership Preference Units are not rated by a nationally recognized rating
agency, and such interests may not be as high in quality as issues that are
rated investment grade.  Each issue of Partnership
Preference Units held by Belmar Realty normally pays regular quarterly
distributions at fixed rates from the net profits or gross income of the
issuing partnership, with preferential rights over common and other
subordinated units. None of the Partnership Preference Units is or will be
registered under the Securities Act and each issue is thus subject to
restrictions on transfer.  Organization of Belmar Realty.Belmar
Realty operates in such a manner as to qualify for taxation as a REIT under the
Code. As a REIT, Belmar Realty generally is not subject to federal income tax
on that portion of its ordinary income or taxable gain that is distributed to
stockholders each year. The Fund owns 100% of the common stock issued by Belmar
Realty, and intends to hold all of the common stock at all times.  Belmar Realty also has
issued preferred shares to satisfy certain provisions of the Code, which
require that a REIT be beneficially owned in the aggregate by 100 or more
persons. The preferred shares of Belmar Realty are owned by not less than 100
charitable organizations that received the preferred shares as gifts. Each
charitable organization that received a preferred share was an accredited
investor (as defined in the Securities Act) with total assets in excess of $5
million at the time the organization received the preferred shares. Eaton Vance
selected the charitable organizations from the charities for which it has
matched employee contributions and/or based on suggestions from its employees.
As of December 31, 2007, the total value of the preferred shares
outstanding of Belmar Realty was $213,000. Dividends on preferred shares are
cumulative and payable annually at a dividend rate of 8% per year. The dividends
paid on preferred shares have priority over payments on common shares. For the
year ended December 31, 2007, Belmar Realty paid distributions to
preferred shareholders of $17,816.  Fund
Borrowings.To finance its real estate investments, the
Fund has entered into credit arrangements with Dresdner Kleinwort Holdings I, Inc.
(the DKH Credit Facility) and Merrill Lynch Mortgage Capital, Inc. (the
MLMC Credit  10


Facility) (collectively,
the Credit Facility). The Credit Facility is secured by a pledge of the Funds
assets, excluding the Funds investment in Brazos and in the Co-Owned
Properties and the assets of Bel Stamford, and expires in June 2010. At December 31,
2007, the total principal amount outstanding under the Credit Facility was
$420.4 million. The Credit Facility was also used to provide for selling
commissions and the Funds organizational expenses, as well as any ongoing
liquidity needs of the Fund.  The DKH Credit Facility
is a term credit arrangement. Borrowings under the DKH Credit Facility accrue
interest at a rate of one-month LIBOR plus 0.20% per annum. As of December 31,
2007, outstanding borrowings under the DKH Credit Facility totaled $401.0
million.  The MLMC Credit Facility
is a revolving credit arrangement. The Fund may borrow up to $118.5 million
under the MLMC Credit Facility of which up to $10.0 million may be letters of
credit. Borrowings under the MLMC Credit Facility accrue interest at a rate of
one-month LIBOR plus 0.38% per annum. As of December 31, 2007, outstanding
borrowings under the MLMC Credit Facility totaled $19.4 million. There were no
letters of credit outstanding as of December 31, 2007. The unused loan
commitment amount totaled $99.1 million as of December 31, 2007. A
commitment fee of 0.10% per annum is paid on the unused commitment amount. The
Fund pays all fees associated with issuing letters of credit.  Obligations under the
Credit Facility are without recourse to Fund Shareholders. As described above,
financing for Brazos, Bel Stamford, Bel SML I and Bel Marquette I consists
primarily of fixed-rate secured mortgage debt obligations of Brazos, Bel
Stamford, Bel SML I and Bel Marquette I that are without recourse to Fund
Shareholders and generally without recourse to Belmar Realty and the Fund. See Risks
of Real Estate Investments in Item 7A(b).  Interest Rate Swap Agreements.The
Fund has entered into interest rate swap agreements with Merrill Lynch Capital
Services, Inc. (MLCS) to fix the cost of a substantial portion of its
borrowings under the Credit Facility and to mitigate in part the impact of
interest rate changes on the Funds net asset value. Pursuant to the interest
rate swap agreements, the Fund makes cash payments to MLCS at fixed rates in
exchange for floating rate payments from MLCS that fluctuate with one-month
LIBOR. The interest rate swap agreements currently in effect extend until June 25,
2010, subject to the Funds earlier termination rights in the case of certain
swaps, and provide for the Fund to make payments to MLCS at fixed rates
averaging 4.53%. The variable one-month LIBOR rate on which payments from MLCS
are based was 4.60% on December 31, 2007. See Note 9 to the Funds
consolidated financial statements included as pages 43 to 61 of this
Annual Report on Form 10-K.  The
Eaton Vance Organization.The Eaton Vance organization
sponsors the Fund. Eaton Vance serves as the Funds manager. Boston Management
serves as the Funds investment adviser and as manager of Belmar Realty. EV
Distributors served as the Funds placement agent. The Funds business affairs
are conducted by Eaton Vance (as its manager) and its investment operations are
conducted by Boston Management (as its investment adviser). The Funds officers
are employees of Eaton Vance. Eaton Vance, Boston Management and EV
Distributors are wholly owned subsidiaries of Eaton Vance Corp., a publicly
traded holding company that, through its affiliates and subsidiaries, engages
primarily in investment management, administration and marketing activities.  As described above, the
Fund pursues its objective primarily by investing in Belvedere Company.
Belvedere Company invests exclusively in the Portfolio. Boston Management acts
as investment adviser of the Portfolio and manager of Belvedere Company. EV
Distributors acts as placement agent for Belvedere Company and the Portfolio.
As of December 31, 2007, the assets of the Fund represented approximately
1.4% of assets under management by Eaton Vance and its affiliates. The offices
of the Fund, Eaton Vance, Boston Management and EV Distributors are located at
255 State Street, Boston, Massachusetts 02109.  Conflicts of Interest.Boston
Management and other Eaton Vance affiliates are subject to certain conflicts of
interest in their dealings with the Fund, Belmar Realty, Belvedere Company and
the Portfolio, as well as with other investment companies advised by Boston
Management that invest in the Portfolio. Eaton Vance and Boston Management have
determined and will determine which of their sponsored investment companies
invest in the Portfolio, the securities each of them contributes to the
Portfolio when making an investment therein and, subject to the rights of
redeeming investors in the Portfolio, the securities and/or cash received in
redemptions from the Portfolio. Such determinations are inherently subject to
potential conflicts of interest. In addition, Portfolio management activities
with respect to securities contributed to the Portfolio may have different tax
consequences for the contributing investor in the Portfolio than for other
investors in the Portfolio. Gains and losses on sales of other securities may
also be allocated disproportionately. Boston Management manages the Portfolio
in pursuit of long-term, after-tax returns for all investors in the Portfolio
and, with respect to contributed securities, takes into account the tax
position of the contributing investor in the Portfolio. Whenever conflicts  11


of interest arise, Eaton
Vance, Boston Management and other Eaton Vance affiliates will endeavor to
exercise their discretion in a manner that they believe is equitable to all
interested persons.  Belmar Realty may
purchase real estate investments from real estate investment affiliates of other
investment funds advised by Boston Management. Belmar Realty may also co-invest
with such entities in real estate investments and sell real estate investments
to such entities. In any such transaction, the assets purchased and sold will
be valued in good faith by Boston Management, after consideration of factors,
data and information that Boston Management considers relevant. Transaction
prices generally will include an allocation of the original costs incurred in
creating and acquiring the transferred real estate investments. Real estate
investments are often difficult to value and others could in good faith arrive
at valuations different from those of Boston Management. See Critical
Accounting Estimates in Item 7(e).  Item
1A. Risk Factors.  The Fund invests
primarily in a diversified portfolio of common stocks and is thereby subject to
general stock market risk. There can be no assurance that the performance of
the Fund will match that of the U.S. stock market or that of other equity
funds. In managing the Portfolio for long-term, after-tax returns, Boston
Management generally seeks to avoid or minimize sales of securities with large
accumulated capital gains, including contributed securities. Such securities
constitute a substantial portion of the assets of the Portfolio. Although the
Portfolio may utilize certain management strategies in lieu of selling
appreciated securities, the Portfolios, and hence the Funds, exposure to
losses during stock market declines may nonetheless be higher than funds that
do not follow a general policy of avoiding sales of highly appreciated
securities. The Fund is also subject to risks associated with real estate
investments and certain other risks, which are described under Qualitative
Information About Market Risk in Item 7A(b).  Item
1B. Unresolved Staff Comments.  None.  Item
2. Properties.  The Fund does not own any
physical properties, other than indirectly through Belmar Realtys investments.
At December 31, 2007, Belmar Realty held investments in: Partnership
Preference Units of six issuers; Brazos, which owned 23 industrial distribution
properties located in eight states (Florida, Indiana, New Jersey, North
Carolina, Ohio, Pennsylvania, South Carolina and Tennessee); Bel Stamford,
which owned an interest in leashold improvements of an office building and
attached facilities in Stamford, Connecticut; Bel SML I, which owned a 40%
interest in Co-owned Properties located in New Jersey and California; and Bel
Marquette I, which owned a 40% interest in a Co-owned Property located in
Wisconsin.  Item
3. Legal Proceedings.  Although in the ordinary
course of business the Fund and its subsidiaries may become involved in legal
proceedings, the Fund is not aware of any material pending legal proceedings to
which they are subject.  Item
4. Submission of Matters to a Vote of Security Holders.  No matters were submitted
to a vote of security holders during the quarter ended December 31, 2007.  12


PART II  Item
5. Determining Net Asset Value, Market for Fund Shares, Related Shareholder
Matters and Issuer Purchases of Equity Securities.  This Item and other Items
in this report contain summaries of certain provisions contained in the Limited
Liability Company Agreement of the Fund (the LLC Agreement), which was filed as
an exhibit to the Funds registration statement on Form 10. All such
summaries are qualified in their entirety by the actual provisions of the LLC
Agreement, which are incorporated by reference herein.  (a) Market
Information, Restrictions on Transfers and Redemption of Shares.  Transfers of Fund Shares.There is no
established public trading market for the Shares of the Fund. Other than
transfers to the Fund in a redemption, transfers of Shares are expressly
prohibited by the LLC Agreement without the consent of Eaton Vance. Eaton Vances
consent to a transfer may be withheld in its sole discretion for any reason or
for no reason.  The Shares have not been
and will not be registered under the Securities Act, and may not be resold
unless an exemption from such registration is available. Shareholders have no
right to require registration of the Shares and the Fund does not intend to
register the Shares under the Securities Act or take any action to cause an
exemption (whether pursuant to Rule 144 of the Securities Act or
otherwise) to be available.  The Fund is not and will
not be registered under the 1940 Act, and no transfer of Shares may be made if,
as determined by Eaton Vance or counsel to the Fund, such transfer would result
in the Fund being required to be registered under the 1940 Act. In addition, no
transfer of Shares may be made unless, in the opinion of counsel to the Fund,
such transfer would not result in termination of the Fund for purposes of Section 708
of the Code or result in the classification of the Fund as an association or a
publicly traded partnership taxable as a corporation under the Code.  In no event shall all or
any part of a Shareholders Shares be assigned to a minor or an incompetent,
unless in trust for the benefit of such person. Shares may be sold,
transferred, assigned or otherwise disposed of by a Shareholder only if it is
determined by Eaton Vance or counsel to the Fund that such transfer, assignment
or disposition would not violate federal securities or state securities or blue
sky laws (including investor qualification standards).  There are no outstanding
options or warrants to purchase, or securities convertible into, Shares of the
Fund. Shares of the Fund cannot be sold pursuant to Rule 144 under the
Securities Act, and the Fund does not propose to publicly offer any of its
Shares at any time.  Redemption of Fund Shares.Shares of
the Fund may be redeemed on any business day. The redemption price will be
based on the net asset value next computed after receipt by the Fund of a
written redemption request from a Shareholder, including a proper form of
signature guarantee and such other documentation the Fund and the transfer
agent may then require. The Fund may, at its discretion, accept redemption
requests submitted by facsimile transmission. Once accepted, a redemption
request may not be revoked without the consent of the Fund. Settlement of
redemptions will ordinarily occur within five business days of receipt by the
Funds transfer agent of the original redemption request in good order, and (if
applicable) promptly following registration and processing of stock
certificates by the transfer agent of the issuer of the distributed securities.
The right to redeem is available to all Shareholders and all outstanding Fund
Shares are eligible for redemption (except for Shares subject to an estate
freeze election). During each month in the quarter ended December 31,
2007, the total number of Shares redeemed and the average price paid per Share
were as follows:  Total No. of Shares
  
  Average Price PaidMonth Ended
  
  Redeemed(1)
  
  Per ShareOctober
  
  189,516.460
  
  $
  117.33November
  
  356,299.004
  
  $
  110.69December
  
  235,942.126
  
  $
  112.30Total
  
  781,757.590
  
  $
  113.03
  
 (1)All Shares
redeemed during the periods were redeemed at the option of Shareholders
pursuant to the Funds redemption policy. The Fund has not announced any plans
or programs to repurchase Shares other than at the option of Shareholders.  13


The Fund satisfies
redemption requests principally by distributing securities drawn from the
Portfolio, but may also distribute cash. If requested by a redeeming
Shareholder, the Fund will satisfy a redemption request by distributing
securities that were contributed by the redeeming Shareholder, provided that
such securities are held in the Portfolio at the time of redemption.  Under most circumstances,
a redemption from the Fund that is settled with securities as described herein
will not result in the recognition of capital gains by the Fund or by the
redeeming Shareholder. The redeeming Shareholder would generally recognize
capital gains upon the sale of the securities received through redemption. If a
redeeming Shareholder receives cash in addition to securities to settle a
redemption, the amount of cash received will be taxable to the Shareholder to
the extent it exceeds such Shareholders tax basis in Fund Shares. Shareholders
should consult their tax advisors about the tax consequences of redeeming Fund
Shares.  Securities contributed by
a Shareholder may be distributed to other Shareholders in the Fund (or to other
investors in Belvedere Company or the Portfolio) and, if so distributed, would
not be available to meet subsequent redemption requests made by the
contributing Shareholder.  If requested by a
redeeming Shareholder making a redemption of at least $1 million, the Fund will
generally distribute to the redeeming Shareholder a diversified basket of
securities representing a range of industry groups that is drawn from the
Portfolio. The selection of individual securities would be made by Boston
Management in its sole discretion. No interests in Real Estate Joint Ventures,
Wholly Owned Property, Co-owned Property, Partnership Preference Units or other
real property investments will be distributed to meet a redemption request, and
restricted securities will be distributed only to the Shareholder who
contributed such securities or such Shareholders successor in interest. The
Fund will not provide a redeeming Shareholder with a diversified basket of
securities if such a distribution is expected to cause, directly or indirectly,
any other Shareholder, any investor in Belvedere Company or any investor in the
Portfolio to realize taxable gain.  Other than as set forth
above, the allocation of each redemption between securities and cash and the
selection of securities to be distributed will be at the sole discretion of
Boston Management. Distributed securities may include securities contributed by
Shareholders as well as other readily marketable securities held in the
Portfolio. The value of securities and cash distributed to meet a redemption
will equal the net asset value of the number of Shares being redeemed. The Funds
Credit Facility prohibits the Fund from honoring redemption requests while
there is an event of default outstanding under the Credit Facility.  The Fund may compulsorily
redeem all or a portion of the Shares of a Shareholder if the Fund has
determined that such redemption is necessary or appropriate to avoid
registration of the Fund or Belvedere Company under the 1940 Act, or to avoid
adverse tax or other consequences to the Portfolio, Belvedere Company, the Fund
or Shareholders, including those redemptions arising as the result of
applicable anti-money laundering requirements.  The right of a
Shareholder to redeem can be suspended and the payment of the redemption price
may be deferred while there is an outstanding event of default under the Credit
Facility, when the NYSE is closed, during periods when trading on the NYSE is
restricted or during any emergency as determined by the SEC, at any time when
it is impracticable for the Portfolio or the Fund to dispose of or value its assets,
or during any other period permitted by order of the SEC for the protection of
investors.  A capital account for
each Shareholder is maintained on the books of the Fund. The account reflects
the value of such Shareholders interest in the Fund, which is adjusted for
profits, liabilities and distributions allocable to such account in accordance
with Article 6 of the Funds LLC Agreement.  Subject to the consent of
the manager of the Fund, a Shareholder may make an estate freeze election
pursuant to which all or a portion of such Shareholders Shares will be divided
into Preferred Shares and Common Shares (Estate Freeze Shares). Such division
will be made in accordance with the terms of the LLC Agreement. Estate Freeze
Shares are not transferable without the consent of the Funds manager and have
no redemption rights or voting or consent rights.  Determining Net Asset Value.Boston
Management, as investment adviser, is responsible for determining the value of
the Funds assets. The Funds custodian, State Street Bank and Trust Company,
calculates the value of the assets of the Fund, Belvedere Company and the
Portfolio each day that the NYSE is open for trading, as of the close of
regular trading on the NYSE. The Funds net asset value per Share is calculated
by dividing the value of the Funds total assets, less its liabilities, by the
number of Shares outstanding.  14


The Funds net assets are
valued in accordance with the Funds valuation procedures and reflect the value
of its directly held assets and liabilities, as well as the net asset value of
the Funds investment in the Portfolio held through Belvedere Company and in
real estate investments held through Belmar Realty. The trustees of the
Portfolio have established procedures for the valuation of the Portfolios
assets under normal market conditions. Pursuant to these procedures, marketable
securities listed on U.S. securities exchanges generally are valued at the last
sale price on the day of the valuation or, if there were no sales, at the mean
between the closing bid and asked prices therefor on the exchange where such
securities are principally traded. Marketable securities listed on the NASDAQ
generally are valued at the NASDAQ official closing price. Unlisted or listed
securities for which closing sale prices are not available are valued at the
mean between the last available bid and asked prices or by an independent
pricing service. Exchange-traded options are valued at the last sale price for
the day of valuation as quoted on the principal exchange or board of trade on
which the options are traded, or in the absence of a sale on such day, at the
mean between the latest bid and asked prices therefor. Futures positions on
securities or currencies are generally valued at closing settlement prices.
Short-term debt securities with a remaining maturity of 60 days or less are
valued at amortized cost. Other fixed income and debt securities, including
listed securities and securities for which price quotations are available, will
normally be valued on the basis of valuations furnished by a pricing service.  Foreign securities and
currencies held by the Portfolio are valued in U.S. dollars, as calculated by
the Portfolios custodian based on foreign currency exchange rate quotations
supplied by an independent quotation service. Valuation of foreign securities
may be adjusted from prices in effect at the close of trading on foreign
exchanges to more accurately reflect their fair value as of the close of regular
trading on the NYSE. In adjusting the value of foreign equity securities the
Portfolio may rely on an independent fair valuation service. Investments for
which valuations or market quotations are not readily available are valued at
fair value as determined in good faith by or at the direction of the Portfolios
trustees, considering relevant factors, data and information including, in the
case of restricted securities, the market value of freely tradable securities
of the same class in the principal market on which such securities are normally
traded.  The Funds real estate
investments are valued each day as determined in good faith by Boston
Management after consideration of relevant factors, data and information. The
procedures for valuing real estate investments are described under Critical
Accounting Estimates in Item 7(e). The Funds interest rate swap agreements
are normally valued by an independent pricing service. Fixed liabilities of the
Fund generally are stated at principal value.  Historic Net Asset Values.Set forth
below are the high and low net asset values per Share (NAVs) of the Fund for
each quarter during the two years ended December 31, 2007 and 2006, the
closing NAV on the last business day of each quarter, and the percentage change
in NAV during each such quarter.  NAV at
  
  Quarterly %Quarter Ended
  
  High NAV
  
  Low NAV
  
  Quarter End
  
  Change in NAV(1)12/31/07
  
  $
  118.73
  
  $
  107.17
  
  $
  112.22
  
  -3.14
  %9/30/07
  
  $
  118.33
  
  $
  107.16
  
  $
  115.86
  
  1.05
  %6/30/07
  
  $
  116.53
  
  $
  107.58
  
  $
  114.66
  
  6.67
  %3/31/07
  
  $
  113.11
  
  $
  106.13
  
  $
  107.49
  
  -3.07
  %12/31/06
  
  $
  110.89
  
  $
  102.22
  
  $
  110.89
  
  8.11
  %9/30/06
  
  $
  102.62
  
  $
  94.92
  
  $
  102.57
  
  4.59
  %6/30/06
  
  $
  102.28
  
  $
  94.00
  
  $
  98.07
  
  -1.32
  %3/31/06
  
  $
  100.11
  
  $
  95.36
  
  $
  99.38
  
  3.89
  %
  
 (1)
  
  Past performance is no guarantee of future results.
  Investment return and principal value will fluctuate so that Shares, when
  redeemed, may be worth more or less than their original cost. Changes in NAV
  are historical. Performance is for the stated time period only; due to market
  volatility, the Funds current performance may be lower or higher. For more
  information about the performance of the Fund, see Managements Discussion
  and Analysis of Financial Condition and Results of Operations (MD&A) in
  Item 7(a).  15


(b) Record
Holders of Shares of the Fund.  As of February 15,
2008, there were 485 record holders of Shares of the Fund.  (c) Distributions.  Income and Capital Gain Distributions.The
Fund intends to distribute each year the amount of its net investment income
for such year, if any. The Fund also intends to make annual capital gain
distributions equal to approximately 18% of the amount of its net realized
capital gains, if any, other than certain precontribution gains allocated to a
Shareholder in connection with a taxable tender offer or other taxable
corporate event for a security contributed to the Fund by that Shareholder or
that Shareholders predecessor in interest. The Funds net investment income
and net realized gains include the Funds allocated share of the net investment
income and net realized gains of Belvedere Company and, indirectly, the
Portfolio, as well as income and capital gains, if any, distributed by Belmar
Realty. The Funds distributions generally are based on determinations of net
investment income and net realized capital gains for federal income tax
purposes. Such amounts may differ from net investment income or loss and net
realized gain or loss as set forth in the Funds consolidated financial
statements due to differences in the treatment of various income, gain, loss,
expense and other items for federal income tax purposes and under GAAP. The
Fund intends to pay distributions, if any, on the last business day of each
fiscal year of the Fund (which concludes on December 31) or shortly
thereafter. The Funds distribution rates with respect to realized gains may be
adjusted in the future to reflect changes in the effective maximum marginal
individual federal tax rate applicable to long-term capital gains.  Shareholder distributions
with respect to net investment income, realized post-contribution gains and
certain other realized gains are made pro rata in proportion to the number of
Shares held as of the record date of the distribution. All income and capital
gain distributions (including Special Distributions described below) are paid
by the Fund in cash. Distributions are generally not taxable to the recipient
Shareholder unless the distributions exceed the recipient Shareholders tax
basis in Fund Shares. The Funds Credit Facility prohibits the Fund from making
any distribution to Shareholders while there is an event of default outstanding
under the Credit Facility.  On January 30, 2008,
the Fund made a distribution of $1.31 per Share to Shareholders of record on January 29,
2008. On January 26, 2007, the Fund made a distribution of $1.25 per Share
to Shareholders of record on January 25, 2007. On January 26, 2006,
the Fund made a distribution of $0.74 per Share to Shareholders of record on January 25,
2006.  Special Distributions.In addition to
the pro rata income and capital gain distributions described above, the Fund
also makes distributions to Shareholders allocated precontribution gain (other
than certain precontribution gains allocated to a Shareholder in connection
with a taxable tender offer or other taxable corporate event involving a
security contributed by such Shareholder or such Shareholders predecessor in
interest) (a Special Distribution). Special Distributions generally equal
approximately 18% of the amount of realized precontribution gains plus
approximately 4% of the allocated precontribution gain or such other percentage
as deemed appropriate to compensate Shareholders receiving such distributions
for taxes that may be due on income specially allocated in connection with the
precontribution gain and Special Distributions. Special Distributions are made
solely to the Shareholders to whom the precontribution gain is allocated. The
Fund does not intend to make Special Distributions to a Shareholder in respect
of realized precontribution gain allocated to a Shareholder or such Shareholders
predecessor in interest in connection with a taxable tender offer or other
taxable corporate event involving a security contributed by such Shareholder or
such Shareholders predecessor in interest. The Fund made no Special
Distributions during the years ended December 31, 2007 and 2006.  16


Item
6. Selected Financial Data.  Table
of Selected Financial Data.The consolidated data
referred to below reflects the Funds historical results for the years ended December 31,
2007, 2006, 2005, 2004 and 2003. The following information should be read in
conjunction with all of the consolidated financial statements and related notes
appearing on pages 43 to 78 of this Annual Report on Form 10-K. The
other consolidated data referred to below is as of each year end.  Year Ended
  
  Year Ended
  
  Year Ended
  
  Year Ended
  
  Year EndedDecember 31, 2007
  
  December 31, 2006
  
  December 31, 2005
  
  December 31, 2004
  
  December 31, 2003Total investment income
  
  $
  57,211,449
  
  $
  48,447,751
  
  $
  47,791,819
  
  $
  58,398,806
  
  $
  61,971,601Interest expense
  
  $
  35,602,386
  
  $
  29,511,803
  
  $
  24,413,082
  
  $
  21,660,516
  
  $
  8,670,248Net expenses (including interest expense)
  
  $
  45,702,565
  
  $
  38,776,596
  
  $
  33,957,771
  
  $
  33,137,017
  
  $
  18,247,582Net investment income
  
  $
  11,508,884
  
  $
  9,671,155
  
  $
  13,834,048
  
  $
  25,224,494
  
  $
  43,724,019Net realized gain (loss)
  
  $
  77,748,932
  
  $
  64,745,627
  
  $
  8,498,697
  
  $
  17,553,879
  
  $
  (37,704,437
  )Net change in unrealized appreciation
  (depreciation)
  
  $
  (42,108,687
  )
  $
  217,467,992
  
  $
  82,218,493
  
  $
  92,190,413
  
  $
  405,769,668Net increase in net assets from operations
  
  $
  47,149,129
  
  $
  291,884,774
  
  $
  104,551,238
  
  $
  134,968,786
  
  $
  411,789,250Total assets
  
  $
  2,237,793,487
  
  $
  2,485,947,095
  
  $
  2,408,023,197
  
  $
  2,427,729,821
  
  $
  2,435,838,354Loan payable  Credit Facility
  
  $
  420,400,000
  
  $
  309,000,000
  
  $
  304,000,000
  
  $
  290,000,000
  
  $
  513,000,000Mortgage notes payable
  
  $
  211,217,114
  
  $
  216,358,763
  
  $
  221,197,696
  
  $
  225,751,737
  
  $
  Net assets
  
  $
  1,594,013,164
  
  $
  1,956,020,593
  
  $
  1,876,369,119
  
  $
  1,910,487,498
  
  $
  1,920,611,857Shares outstanding
  
  14,204,446
  
  17,639,300
  
  19,614,094
  
  20,880,411
  
  22,261,334Net asset value and redemption price per
  Share
  
  $
  112.22
  
  $
  110.89
  
  $
  95.66
  
  $
  91.50
  
  $
  86.28Net increase in net assets from operations per
  Share(1)
  
  $
  2.58
  
  $
  15.97
  
  $
  5.28
  
  $
  6.37
  
  $
  18.11Distribution paid per Share(2)
  
  $
  1.25
  
  $
  0.74
  
  $
  1.12
  
  $
  1.15
  
  $
  1.70  
 (1)
  
  Based on average Shares outstanding.(2)
  
  Distributions of net investment income and net realized
  capital gains are normally paid at the end of each year, or shortly
  thereafter, to Shareholders of record as of the record date. See
  Distributions in Item 5(c).  Item
7. Managements Discussion and Analysis of Financial Condition and Results of
Operations (MD&A).  The
information in this report contains forward-looking statements within the
meaning of Section 27A of the Securities Act and Section 21E of the
Act. Forward-looking statements typically are identified by use of terms such
as may, will, should, might, expect, anticipate, estimate, and
similar words, although some forward-looking statements are expressed
differently. The actual results of the Fund could differ materially from those
contained in the forward-looking statements due to a number of factors. The
Fund undertakes no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events, or
otherwise, except as required by applicable law. Factors that could affect the
Funds performance include a decline in the U.S. stock markets or in general
economic conditions, adverse developments affecting the real estate industry,
or fluctuations in interest rates. See Qualitative Information About Market
Risk in Item 7A(b) below.  The following
discussion should be read in conjunction with the Funds consolidated financial
statements and related notes appearing on pages 43 to 61 of this Annual
Report on Form 10-K.  17


(a) Results
of Operations.  Increases and decreases
in the Funds net asset value per share are based on net investment income or
loss and realized and unrealized gains and losses on investments. The Funds
net investment income or loss is determined by subtracting the Funds total
expenses from its investment income. The Funds investment income generally
includes the net investment income allocated to the Fund from Belvedere
Company, rental income from Wholly Owned Property, net investment income
allocated to the Fund from the Real Estate Joint Venture and Co-owned
Properties, partnership income allocated from the Partnership Preference Units
and interest earned on the Funds short-term investments, including investments
in Cash Management Portfolio. The net investment income of Belvedere Company
allocated to the Fund includes dividends, interest and expenses allocated to
Belvedere Company by the Portfolio less the expenses of Belvedere Company
allocated to the Fund. The Funds total expenses generally include the Funds
investment advisory and administrative fees, distribution and servicing fees,
interest expense from mortgage notes on Wholly Owned Property, interest expense
on the Funds Credit Facility, and other miscellaneous expenses. The Funds
realized and unrealized gains and losses are the result of transactions in, or
changes in value of, security investments held through the Funds indirect
interest (through Belvedere Company) in the Portfolio, real estate investments
held through Belmar Realty, the Funds interest rate swap agreements and any
other direct investments of the Fund, as well as periodic payments made by the
Fund pursuant to interest rate swap agreements.  Realized and unrealized
gains and losses on investments have the most significant impact on the Funds
net asset value per share and result primarily from sales of such investments
and changes in their underlying value. The investments of the Portfolio consist
primarily of common stocks of domestic and foreign growth companies that are
considered by its investment adviser to be high in quality and attractive in
their long-term investment prospects. Because the securities holdings of the
Portfolio are broadly diversified, the performance of the Portfolio cannot be
attributed to one particular stock or one particular industry or market sector.
The performance of the Portfolio and the Fund are substantially influenced by
the overall performance of the U.S. stock market, as well as by the relative
performance versus the overall market of specific stocks and classes of stocks
in which the Portfolio maintains large positions.  MD&A
for the Year Ended December 31, 2007 Compared to the Year Ended December 31,
2006.  Performance of the Fund.(1) The
Funds investment objective is to achieve long-term, after-tax returns for
Shareholders. Eaton Vance, as the Funds manager, measures the Funds success
in achieving its objective based on the investment returns of the Fund, using
the S&P 500 Index as the Funds primary performance benchmark. The S&P
500 Index is a broad-based, unmanaged index of common stocks commonly used as a
measure of U.S. stock market performance. Eaton Vances primary focus in
pursuing total return is on the Funds common stock portfolio, which consists
of its indirect interest in the Portfolio. The Fund invests in the Portfolio
through its interest in Belvedere Company. The Funds performance will differ
from that of the Portfolio primarily due to its investments outside the
Portfolio. In measuring the performance of the Funds real estate investments,
Eaton Vance considers whether, through current returns and changes in
valuation, the real estate investments achieve returns that over the long-term
exceed the cost of the borrowings incurred to acquire such investments and
thereby add to Fund returns. The Fund has entered into interest rate swap
agreements to fix the cost of a substantial portion of its borrowings under the
Credit Facility to mitigate in part the impact of interest rate changes on the
Funds net asset value.  The Funds total return
for the year ended December 31, 2007 was 2.34%. This return reflects an
increase in the Funds net asset value per Share from $110.89 to $112.22 and a
distribution of $1.25 per Share during the period. For comparison, the S&P
500 Index had a total return of 5.49% over the same period. The combined impact
on performance of the Funds investment activities outside of the Portfolio was
negative for the year ended December 31, 2007.  The Fund had a total
return of 16.82% for the year ended December 31, 2006. This return
reflected an increase in the Funds net asset value per Share from $95.66 to
$110.89 and a distribution of $0.74 per Share during the period. For
comparison, the S&P 500 Index had a total return of 15.78% over the same
period.  
 (1)
  
  Past performance is no guarantee of future results.
  Investment return and principal value will fluctuate so that Shares, when
  redeemed, may be worth more or less than their original cost. Total returns
  are historical and are calculated by determining the percentage change in net
  asset value with all distributions reinvested. The Portfolios total return
  for the period reflects the total return of another fund that invests in the
  Portfolio adjusted for non-Portfolio expenses of that fund. Performance is
  for the stated time period only; due to market volatility, the Funds current
  performance may be lower or higher. The performance of the Fund and the
  Portfolio is compared to that of their benchmark, the S&P 500 Index. It
  is not possible to invest directly in an Index.  18


Performance of the Portfolio.Broad equity markets finished the year
ended December 31, 2007, with respectable gains, despite increased
volatility and ongoing concerns regarding the credit and housing markets.
Global equities were booming early in 2007 as strong momentum continued from
the previous year, but global markets encountered a turbulent second half of
the year. Troubles with sub-prime mortgages and the U.S. housing crisis rattled
the financial markets, leading to concerns of an economic slowdown.
Additionally, crude oil prices continued to rise to new highs, while the U.S.
dollar fell to record lows versus other major currencies, boosting many foreign
market indices. Despite the Federal Reserves decision to lower interest rates
during the second half of 2007, volatility in the equity and fixed income
markets continued through year-end.  For the year ended December 31,
2007, eight of the ten major sectors within the S&P 500 Index registered
positive returns. Energy, materials and utilities were the top-performing
S&P 500 Index sectors during the year, while the financials and consumer
discretionary sectors produced the weakest performance. Market-leading
industries of 2007 included energy equipment and services, metals and mining,
machinery, as well as independent power producers and energy traders. In
contrast, the thrifts and mortgage finance, household durables, real estate
management and development, and consumer finance industries all realized negative
returns for the year. On average during the course of the year,
large-capitalization stocks outperformed small-capitalization stocks and
growth-style investments reversed course to outperform value-style investments.  The Portfolios
performance for the year ended December 31, 2007 was 4.72%, which trailed
the return of the S&P 500 Index by 0.77%. The Portfolio underperformed its
benchmark due in part to differences in sector allocation and stock selection
versus the S&P 500 Index. The total return of the Portfolio for the year
ended December 31, 2006, was 13.69%, which trailed the S&P 500 Index
by 2.09%.  During the year ended December 31,
2007, the Portfolio remained overweight in the industrials, consumer staples
and consumer discretionary sectors, while continuing to underweight in the
technology, materials, telecommunications and utilities sectors. The Portfolios
computers and peripherals investments within the information technology sector
were the largest detractors from relative performance, as the Portfolios
underweight industry allocation and investment selections hurt relative
results. The energy sector was also a weak contributor to relative performance
as the Portfolios lighter exposure to the market-leading energy equipment and
services industry and its stock holdings hampered performance. Additionally,
the Portfolios allocation and relatively weaker selection within the
underperforming biotechnology stocks detracted from returns during the year.  During the year ended December 31,
2007, the Portfolio benefited from its investments in the industrials,
financials and consumer staples sectors. Its above-benchmark commitment to
industrials and its investment selections among machinery stocks significantly
added to results. The Portfolios underweight exposure to financial services,
mortgage finance and REIT stocks, relative to its benchmark, proved beneficial
as brokerage firms and mortgage and real estate companies suffered in the wake
of the sub-prime mortgage and domestic housing crises. Stock selection within
the insurance industry additionally boosted the Portfolios results. Finally,
its overweight position in the consumer staples sector added value versus its
benchmark, as investors favored defensive investments during this period of economic
uncertainty.  Performance of Real Estate Investments.The Funds real estate investments are
held through Belmar Realty. As of December 31, 2007, real estate
investments included: a Real Estate Joint Venture (Brazos); a Wholly Owned
Property (Bel Stamford); Co-owned Properties (Bel SML I and Bel Marquette I);
and a portfolio of Partnership Preference Units. Brazos owns industrial
distribution properties. Bel Stamford, Bel SML I and Bel Marquette I own
interests in office buildings leased to single tenants.  On May 31, 2007,
Belmar Investment Corporation (Belmar Investment), a wholly owned subsidiary of
the Fund, purchased a direct investment in real property for approximately
$30.1 million. Subsequently, on June 21, 2007, Belmar Investment sold its
investment in the property to Bel SML I, a wholly owned subsidiary of Belmar
Realty, and to real estate investment affiliates of other investment funds
advised by Boston Management. No gain or loss was recognized on the
transactions. On July 12, 2007, Bel SML I acquired an additional Co-owned
Property for a purchase price of approximately $13.8 million. In the fourth
quarter of 2007, Bel SML I obtained mortgage financing secured by its interest
in Co-owned Properties, the proceeds from which were used to pay down a portion
of the Funds Credit Facility.  On July 2, 2007, Bel
Marquette I, a wholly owned subsidiary of Belmar Realty, and Bel Marquette III,
LLC (Bel Marquette III), a wholly owned subsidiary of Belmar Investment, each
purchased an interest in a Co-owned Property for a total of approximately $69.1
million. Subsequently, on August 21, 2007, Belmar Investment sold its
investment in Bel Marquette III for approximately $29.5 million to a real
estate investment affiliate of another investment fund advised by Boston  19


Management. No gain or
loss was recognized on the transaction. In the fourth quarter of 2007, Bel
Marquette I obtained mortgage financing secured by its interest in Co-owned
Property, the proceeds from which were used to pay down a portion of the Funds
Credit Facility.  During the year ended December 31,
2007, Belmar Realty acquired interests in additional Partnership Preference
Units for approximately $97.6 million (including purchases from real estate
investment affiliates of other investment funds advised by Boston Management).  During the year ended December 31,
2007, the Funds net investment income from real estate investments held
through Belmar Realty was approximately $17.2 million compared to approximately
$10.6 million for the year ended December 31, 2006, an increase of $6.6
million or 62%. The increase was principally due to higher distributions from
investments in Partnership Preference Units due to higher average holdings of
Partnership Preference Units during the year, an increase in the net investment
income from Brazos, and the acquisitions of the Co-owned Properties mentioned
above.  The estimated fair value
of the Funds real estate investments was approximately $535.4 million at December 31,
2007 compared to approximately $443.8 million at December 31, 2006, a net
increase of $91.6 million or 21%. This net increase was due to more Partnership
Preference Units held at year end, net increases in the estimated fair value of
Belmar Realtys investment in Brazos and the acquisition of the Co-owned
Properties, partially offset by a decrease in the estimated fair value of Bel
Stamford and a net decline in the estimated fair values of Partnership
Preference Units as discussed below.  The Funds investments in
real properties achieved modest returns during the year, benefiting from
earnings in the expected range offset however by capitalization rates and
discount rates which widened slightly. These rates reflected the reduced
availability of debt financing and uncertainty on the direction of valuations
for institutional-grade real estate causing a decrease in transactional
activity towards the end of the year. The estimated fair values for Partnership
Preference Units decreased during the year due to widening credit spreads,
partially offset by a decline in interest rates during the year ended December 31,
2007.  During the year ended December 31,
2007, the Fund saw net unrealized depreciation of the estimated fair value of
its real estate investments of approximately $26.7 million compared to net
unrealized appreciation of approximately $53.7 million during the year ended December 31,
2006. Net unrealized depreciation of approximately $26.7 million consisted
primarily of $28.0 million of net unrealized depreciation in Bel Stamford and
$9.7 million of net unrealized depreciation in the value of the Partnership
Preference Units, partially offset by $11.0 million of net unrealized
appreciation in Belmar Realtys investment in Brazos.  Performance of Interest Rate Swap Agreements.
For the year ended December 31, 2007, net realized and unrealized losses
on the Funds interest rate swap agreements totaled approximately $5.4 million,
compared to net realized and unrealized gains of approximately $2.4 million for
the year ended December 31, 2006. Net realized and unrealized losses on
swap agreements in 2007 consisted of $8.9 million of unrealized losses due to
changes in swap agreement valuations, offset in part by $3.5 million of
periodic payments received pursuant to outstanding swap agreements (and
classified as net realized gains on interest rate swap agreements in the Funds
consolidated financial statements). The negative contribution to Fund
performance from changes in swap agreement valuations in 2007 was attributable
to decreases in swap rates during the year and a decrease in the remaining term
of the agreements.  MD&A
for the Year Ended December 31, 2006 Compared to the Year Ended December 31,
2005.  Performance of the Fund.The Fund had a total return of 16.82% for
the year ended December 31, 2006. This return reflected an increase in the
Funds net asset value per Share from $95.66 to $110.89 and a distribution of
$0.74 per Share during the period. For comparison, the S&P 500 Index had a
total return of 15.78% over the same period.  The Fund had a total
return of 5.89% for the year ended December 31, 2005. This return
reflected an increase in the Funds net asset value per Share from $91.50 to
$95.66 and a distribution of $1.12 per Share during the period. For comparison,
the S&P 500 Index had a total return of 4.91% over the same period.  Performance of the Portfolio.The year ended December 31, 2006
marked another impressive year for equities as broad U.S. markets locked in a
fourth consecutive annual gain. Helping fuel the rally were easing inflation
and housing concerns, as well as declining oil prices and a continued pause in
interest rate increases. Record levels of mergers and private equity activity
further supported higher stock prices during the year, as did better than
expected earnings and profit results. Price  20


gains for the year were
broad-based, but of particular note were the double digit gains realized by the
blue chip Dow Jones Industrial Average and the S&P 500 Index.  For the year ended December 31,
2006, each of the ten major sectors included in the S&P 500 Index
registered positive returns. Telecommunications, energy and utilities were the
top performing S&P 500 Index sectors during the year, while the health care
and information technology sectors had the weakest performance. Market leading
industries of 2006 included diversified telecommunications, real estate
investment trusts and investment banking and brokerage. In contrast, the
internet and catalog retailers, biotechnology and educational service
industries realized weaker returns for the year. During the course of the year,
on average, small-cap stocks outperformed large-cap stocks and the value
investment style continued to outperform the growth investment style.  The Portfolio invests on
a long term basis in a broadly diversified portfolio consisting primarily of
common stocks of established growth companies. The Portfolios performance for
the year ended December 31, 2006 was 13.69%, which trailed the return of
the S&P 500 Index by 2.09%. The Portfolio underperformed its benchmark due
in part to differences in sector allocation and stock selection versus the
S&P 500 Index. The total return of the Portfolio for the year ended December 31,
2005 was 4.70%.  During the year ended December 31,
2006, the Portfolio remained overweight in the industrials, consumer staples
and consumer discretionary sectors, while continuing to underweight the
technology, telecommunications and utilities sectors. The Portfolio benefited
from its emphasis of the strong performing energy and consumer discretionary
sectors and relatively stronger investment selection within commercial banks
and metals and mining versus the S&P 500 Index. The Portfolios underweight
of the technology sector was also helpful, particularly within the
semiconductor and internet software industries, as stocks in those sectors
experienced significant declines over the course of the year.  During the year ended December 31,
2006, the Portfolios de-emphasis of high dividend yielding stocks, such as
those in the utilities and telecommunications sectors, hurt performance, as did
the weak performance of certain of the Portfolios holdings in the health care
and consumer staples sectors. Despite positive performance from holdings in the
air freight and machinery industries, the Portfolios overweight of the lagging
industrials sector negatively impacted returns.  Performance of Real Estate Investments.As
of December 31, 2006, real estate investments included investments in a
Real Estate Joint Venture (Brazos), a Wholly Owned Property (Bel Stamford) and
a portfolio of Partnership Preference Units.  During the year ended December 31,
2006, Belmar Realty sold certain of its Partnership Preference Units for
approximately $21.1 million (representing sales to real estate investment
affiliates of other investment funds advised by Boston Management), recognizing
a net gain of approximately $0.2 million on the transactions.  During the year ended December 31,
2006, the Funds net investment income from real estate investments held
through Belmar Realty was approximately $10.6 million compared to approximately
$12.3 million for the year ended December 31, 2005, a decrease of $1.7
million or 14%. The decrease was principally due to lower distributions from
investments in Partnership Preference Units due to lower average holdings of
Partnership Preference Units during the year and a decrease in the net
investment income from Brazos primarily due to a net increase in vacancy rates
at properties held by Brazos.  The estimated fair value
of the Funds real estate investments was approximately $443.8 million at December 31,
2006 compared to approximately $410.1 million at December 31, 2005, a net
increase of $33.7 million or 8%. This net increase was due to an increase in
the estimated fair value of Bel Stamford and modest net increases in the
estimated fair value of Belmar Realtys investment in Brazos, partially offset
by fewer Partnership Preference Units held at year end.  During the year ended December 31,
2006, the Funds investments in real properties achieved modest returns,
benefiting from capital appreciation as investor demand for institutional-grade
real estate remained robust. Both capitalization rates and discount rates
declined in most markets and for most property types, causing increases in
estimated fair values even in cases where operating performance was down. The
estimated fair values of Partnership Preference Units were negatively impacted
by higher interest rates at December 31, 2006.  During the year ended December 31,
2006, the Fund saw net unrealized appreciation of the estimated fair value of
its real estate investments of approximately $53.7 million compared to net
unrealized appreciation of approximately $17.5 million during the year ended December 31,
2005. Net unrealized appreciation of approximately $53.7 million consisted
primarily  21


of $40.0 million of net
unrealized appreciation in Bel Stamford and $14.5 million of net unrealized
appreciation in Belmar Realtys investment in Brazos.  Performance of Interest Rate Swap Agreements.For the year ended December 31, 2006, net realized and unrealized
gains on the Funds interest rate swap agreements totaled approximately $2.4
million, compared to approximately $3.6 million of net realized and unrealized
gains for the year ended December 31, 2005. Net realized and unrealized
gains on swap agreements in 2006 consisted of $2.8 million of periodic payments
received pursuant to outstanding swap agreements (and classified as net
realized gains on interest rate swap agreements in the Funds consolidated
financial statements), offset in part by $0.4 million of net realized and
unrealized losses due to changes in swap agreement valuations. The negative
contribution to Fund performance from changes in swap agreement valuations in
2006 was attributable to a decrease in the remaining term of the agreements,
offset in part by modest increases to the swap rates during the year.  (b) Liquidity
and Capital Resources.  Outstanding Borrowings.The Fund has
entered into the Credit Facility primarily to finance the Funds real estate
investments and to satisfy the liquidity needs of the Fund. The Fund will
continue to use the Credit Facility for such purposes in the future.  During the year ended December 31,
2007, the Fund amended the DKH Credit Facility twice. On August 8, 2007,
the Fund amended the DKH Credit Facility to increase the amount of borrowings
by $94.0 million to an aggregate amount of borrowings of $384.0 million. On August 24,
2007, the Fund further amended the DKH Credit Facility to increase the amount
of borrowings by $17.0 million to an aggregate amount of borrowings of $401.0
million.  During the year ended December 31,
2007, the Fund amended the MLMC Credit Facility twice. On May 9, 2007, the
Fund amended the MLMC Credit Facility to increase the amount of borrowings by
$60.0 million to an aggregate amount available for borrowing of $118.5 million.
On June 18, 2007, the Fund further amended the MLMC Credit Facility to
temporarily increase for a period of approximately up to ninety days, the
amount of borrowings by $125.0 million to an aggregate amount available for
borrowing of $243.5 million (the MLMC Temporary Increase). Funds borrowed under
the MLMC Temporary Increase were at a rate of LIBOR plus 1.00% per annum. On September 14,
2007, the MLMC Temporary Increase of $125.0 million expired. All funds
outstanding under the MLMC Temporary Increase were repaid by September 14,
2007.  As of December 31,
2007, the Fund had outstanding borrowings of $420.4 million and unused loan
commitments of $99.1 million under the Credit Facility. Any increase in the
size of the Credit Facility or Fund borrowings will be subject to lender
consent and may result in a change to the interst and fees paid thereunder.  As of December 31,
2007, Bel Stamford had outstanding borrowings consisting of fixed-rate secured
mortgage debt obligations of $211.2 million.  Liquidity.The Fund may redeem shares
of Belvedere Company at any time. During the year ended December 31, 2007,
Fund redemptions from Belvedere Company included a redemption of shares of
Belvedere Company for cash in the amount of $45.0 million. Such proceeds were
used to paydown outstanding borrowings under the Credit Facility. Both
Belvedere Company and the Portfolio normally follow the practice of satisfying
redemptions primarily by distributing securities drawn from the Portfolio.
Belvedere Company and the Portfolio may also satisfy redemptions by
distributing cash. As of December 31, 2007, the Portfolio had cash and
short-term investments in the amount of $193.9 million. The Portfolio
participates in a $150.0 million multi-fund unsecured line of credit agreement
with a group of banks. The Portfolio may temporarily borrow from the line of
credit to satisfy redemption requests in cash or to settle investment
transactions. The Portfolio had no outstanding borrowings at December 31,
2007. To ensure liquidity for investors in the Portfolio, the Portfolio may not
invest more than 15% of its net assets in illiquid assets. As of December 31,
2007, illiquid assets (consisting of restricted securities not available for
current public sale) constituted 0.01% of the net assets of the Portfolio.  The liquidity of Belmar Realtys investments in Brazos is extremely
limited and relies principally upon the liquidation agreement with ProLogis
that is described in Real Estate Joint Venture Investments under The Funds Real
Estate Investments in Item 1. Transfers of Belmar Realtys interest in Brazos
to parties other than ProLogis are restricted by the terms of Brazos operative
agreements and lender consent requirements. The Partnership Preference Units
held by Belmar Realty are not registered under the Securities Act and are
subject to substantial restrictions on transfer. As such, they are considered
illiquid.  22


(c) Off-Balance
Sheet Arrangements.  The Fund does not have
any relationships with unconsolidated entities that have been established
solely for the purpose of facilitating off-balance sheet arrangements.  (d) The
Funds Contractual Obligations.  The following table sets
forth the amounts of payments due under the specified contractual obligations
outstanding as of December 31, 2007:  Payments due:Less than 1
  
  
  
  
  
  More than 5Type of Obligation
  
  Total
  
  Year
  
  1-3 Years
  
  3-5 Years
  
  YearsLong Term Debt:Mortgage Debt(1)
  
  $
  211,217,114
  
  $
  5,426,600
  
  $
  11,968,574
  
  $
  13,480,403
  
  $
  180,341,535Borrowings under Credit Facility(2)
  
  $
  420,400,000
  
  $
  
  
  $
  420,400,000
  
  $
  
  
  $
  Service Agreements(3)Other Long Term Liabilities:Interest Rate Swap Agreements(4)
  
  $
  43,723,619
  
  $
  17,614,924
  
  $
  26,108,695
  
  $
  
  
  $
  Total
  
  $
  675,340,732
  
  $
  23,041,524
  
  $
  458,477,270
  
  $
  13,480,403
  
  $
  180,341,535  
 (1)
  
  The property held by Belmar Realty is financed in
  part through a mortgage note issued to Bel Stamford. The mortgage note is
  secured by the underlying property and is without recourse to Fund
  Shareholders and generally without recourse to the other assets of the Fund or
  Belmar Realty, as described in Risks of Real Estate Investments in Item
  7A(b). The mortgage note matures during 2016. Amount does not reflect
  interest. The mortgage note cannot be prepaid or otherwise disposed of
  without incurring a substantial prepayment penalty.(2)
  
  The Fund has entered into a
  Credit Facility as described in Liquidity and Capital Resources above. The
  Credit Facility is secured by a pledge of the Funds assets, excluding the
  Funds investment in Brazos, in the Co-owned Properties and the assets of Bel
  Stamford, andexpires on
  June 25, 2010. The Credit Facility is primarily used to finance the
  Funds equity in its real estate investments and to satisfy the liquidity
  needs of the Fund. The Fund will continue to use the Credit Facility for such
  purposes in the future. Amount does not reflect interest.(3)
  
  The Fund and Belmar Realty
  have entered into agreements with certain service providers pursuant to which
  the Fund and Belmar Realty pay fees as a percentage of assets. These fees
  include fees paid to Eaton Vance and its affiliates (which are described in
  Item 13).These
  agreements generally continue indefinitely unless terminated by the Fund or
  Belmar Realty (as applicable) or the service provider. For the year ended
  December 31, 2007, fees paid to Eaton Vance and its affiliates equaled
  approximately 1.12% of the Funds average net assets. Because these fees are
  based on the Funds assets (which will fluctuate over time) it is not
  possible to specify the dollar amounts payable in the future.(4)
  
  The Fund has entered into
  interest rate swap agreements to fix the cost of a substantial portion of its
  borrowings under the Credit Facility and to mitigate in part the impact of
  interest rate changes on the Funds net asset value. Pursuant to the interest
  rate swap agreements, the Fund makes cash payments to MLCS at fixed rates in
  exchange for floating rate payments from MLCS that fluctuate with one-month
  LIBOR. The amounts disclosed in the table represent the fixed interest amounts
  payable by the Fund. The periodic floating rate payments that the Fund
  expects to receive pursuant to the agreements reduce the fixed interest cost
  to the Fund. The swap agreements expire on June 25, 2010, subject to the
  Funds right to terminate earlier in the case of some swaps.  23


(e) Critical
Accounting Estimates.  The Funds consolidated
financial statements are prepared in accordance with GAAP. The preparation of
these financial statements requires the Fund to make estimates, judgments and
assumptions that affect the reported amounts of assets, liabilities, revenues
and expenses. Estimates are deemed critical when a different estimate could
have reasonably been used or where changes in the estimate are reasonably
likely to occur from period to period, and where such different or changed
estimates would materially impact the Funds financial condition, changes in
financial condition or results of operations. The Funds significant accounting
policies are discussed in Note 2 of the notes to the consolidated financial
statements; critical estimates inherent in these accounting policies are
discussed in the following paragraphs.  The Fund has determined
that the valuation of the Funds real estate investments involve critical
estimates. The Funds investments in real estate are an important component of
its total investment program. Market prices for these investments are not
readily available and therefore the investments are stated in the Funds
consolidated financial statements at estimated fair value. The estimated fair
value of an investment represents the amount at which Boston Management
believes the investment could be sold in a current transaction between willing
parties in an orderly disposition, that is, other than in a forced or
liquidation sale. The Fund reports the estimated fair value of its real estate
investments on its consolidated statements of assets and liabilities, with any
changes to estimated fair value recorded as unrealized appreciation or
depreciation in the Funds consolidated statements of operations.  The need to estimate the
fair value of the Funds real estate investments introduces uncertainty into
the Funds reported financial condition and performance because:  ·such
assets are, by their nature, difficult to value and estimated fair values may
not accurately reflect what the Fund could realize in a current sale between
willing parties;  ·property
appraisals and other factors used to determine the estimated fair value of the
Funds real estate investments depend on estimates of future operating results
and supply and demand assumptions that may not reflect actual current market
conditions and full consideration of all factors relevant to valuations;  ·property
appraisals and other factors used to determine the estimated fair value of the
Funds real estate investments are not continuously updated and therefore may
not be current as of specific dates; and  ·if
the Fund were forced to sell illiquid assets on a distressed basis, the
proceeds may be substantially less than stated values.  As of December 31,
2007, the estimated fair value of the Funds real estate investments
represented 23.9% of the Funds total assets. The estimated fair value of the
Funds real estate investments may change due to changes in market conditions
and changes in valuation assumptions made by property appraisers and third
party valuation service providers as described below.  Real Estate Joint Ventures.Boston Management determines the estimated
fair value of the Funds interests in Real Estate Joint Ventures based
primarily on annual appraisals of the properties owned by such Real Estate
Joint Ventures (provided such appraisals are available) and an allocation of
the equity value of a Real Estate Joint Venture between the Fund and the
Operating Partner. Appraisals of Real Estate Joint Venture properties may be
conducted more frequently than once a year if Boston Management determines that
significant changes in economic circumstances that may materially impact
estimated fair values have occurred since the most recent appraisal.  In deriving the estimated
fair value of a property, an appraiser considers numerous factors, including
the expected future cash flows from the property, recent sale prices for
similar properties and, if applicable, the replacement cost of the property, in
order to derive an indication of the amount that a prudent, informed
purchaser-investor would pay for the property. More specifically, the appraiser
considers the revenues and expenses of the property and the estimated future
growth or decline thereof, which may be based on tenant quality, property
condition, change in market or submarket conditions, market trends, interest
rates, inflation rates or other factors deemed relevant by the appraiser. The
appraiser estimates operating cash flows from the property and the sale
proceeds of a hypothetical transaction at the end of a hypothetical holding
period. The cash flows are discounted to their present values using a market-derived
discount rate and are added together to obtain a value indication. This value
indication is compared to the value indication that results from applying a
market-derived capitalization rate to a single years stabilized net operating
income for the property. The assumed capitalization rate may be extracted from
local market transactions or, when transaction evidence is lacking,  24


obtained from trade
sources. The appraiser considers the value indications derived by these two
methods, as well as the value indicated by recent market transactions involving
similar properties, in order to produce a final fair value estimate for the
property.  Appraisals of properties
owned by Real Estate Joint Ventures are conducted by independent, licensed
appraisers who are not affiliated with Eaton Vance or the Operating Partner.
Such appraisers may perform other services for the Fund. Each appraisal is
conducted in accordance with the Uniform Standards Board and the Code of
Professional Appraisal Practice of the Appraisal Institute (as well as other
relevant standards). Boston Management reviews the appraisal of each property
and generally relies on the assumptions and judgments made by the appraiser
when determining estimated fair value. Property appraisals are inherently
uncertain because they apply assumed discount rates, capitalization rates,
growth rates and inflation rates to the appraisers estimated stabilized cash
flows, and due to the unique characteristics of a property. If the assumptions
and estimates used by the appraisers to determine the value of the properties
owned by the Real Estate Joint Ventures were to change, it could materially
impact the estimated fair value of the Real Estate Joint Ventures. When a
property owned by a Real Estate Joint Venture has not been appraised (such as
when the Real Estate Joint Venture recently acquired the property), Boston
Management determines the estimated fair value of the property based on the
transaction value of the property, which equals the total acquisition cost of
the property exclusive of certain legal and transaction costs, provided such
amount is deemed indicative of fair value. Appraisals of newly acquired
properties are conducted in the year following the acquisition or when Boston
Management determines there has been a significant change in economic
circumstances that may materially impact the estimated fair value. If the
initial appraised value of a newly acquired property differs significantly from
the transaction value of the property, it may materially impact the estimated
fair value of the Real Estate Joint Venture that holds the property. Interim
valuations of Real Estate Joint Venture assets may be adjusted to reflect
results of operations, significant changes in economic circumstances and/or
recent independent valuations of similar properties and distributions. As of December 31,
2007, all of the properties owned by Brazos had been appraised during the year.  Boston Management
determines the estimated fair value of the Funds equity interest in a Real
Estate Joint Venture based on an estimate of the allocation of equity interests
between the Fund and the Operating Partner. This allocation is generally
calculated by a third party specialist, using current appraisals of the
properties owned by the Real Estate Joint Venture. The specialist uses a
financial model that considers (i) the terms of the joint venture
agreement relating to allocation of distributable cash flow, (ii) the
expected duration of the joint venture, and (iii) the projected property
values and cash flows from the properties based on estimates used in the
independent valuations. The estimated allocation of equity interests between
the Fund and the Operating Partner of a Real Estate Joint Venture is prepared
quarterly and reviewed by Boston Management. If the estimate of the allocation
of equity interests in the Real Estate Joint Venture were to change (for
example, because the appraisers estimate of property values or projected cash
flows of the Real Estate Joint Venture changed), it may materially impact the
estimated fair value of the Funds equity interest in the Real Estate Joint
Venture.  Wholly Owned and Co-owned Property.Boston
Management determines the estimated fair value of Wholly Owned Property based
on an annual appraisal of the property which are conducted in a manner
consistent with the appraisals of the properties owned by a Real Estate Joint
Venture (described above). When a Wholly Owned Property has not been appraised
(such as when it was recently acquired), Boston Management determines its
estimated fair value based on the transaction value of the Wholly Owned
Property, which would equal the total acquisition cost of the Wholly Owned
Property exclusive of certain legal and transaction costs, provided such amount
is deemed indicative of fair value.  Boston Management reviews
the appraisal of Wholly Owned Property and generally relies on the assumptions
and judgments made by the appraiser when determining estimated fair value.
Appraisals of Wholly Owned Property may be conducted more frequently than once
a year if Boston Management determines that significant changes in economic
circumstances have occurred since the most recent appraisal. Appraisals of
Wholly Owned Property are inherently uncertain because they apply assumed
discount rates, capitalization rates, growth rates and inflation rates to the
expected income stream from the property as defined by the contract terms of
the lease(s), and due to the unique characteristics of the property. If the
assumptions and estimates used by the appraisers to determine the value of the
property owned by the Funds subsidiary were to change, it could materially
impact the estimated fair value of the Funds equity interest in Wholly Owned
Property. As of December 31, 2007, the property owned by Bel Stamford was
appraised during the year.  Boston Management
determines the estimated fair value of Co-owned Property in the same manner
used for Wholly Owned Property, applying the Funds ownership interest to the
estimated fair value of the property.  Partnership Preference Units.Boston
Management determines the estimated fair value of the Funds Partnership
Preference Units based on analysis and calculations performed primarily on a
monthly basis by a third party service  25


provider. The service
provider calculates an estimated price and yield (before accrued distributions)
for each issue of Partnership Preference Units based on descriptions of such
issue provided by Boston Management and certain publicly available information
including, but not limited to, the trading prices of publicly issued debt
and/or preferred stock instruments of the same or similar issuers, which may be
adjusted to reflect the illiquidity and other structural characteristics of the
Partnership Preference Units (such as call provisions). Daily valuations of
Partnership Preference Units are determined by adjusting prices from the
service provider to account for accrued distributions under the terms of the
Partnership Preference Units. If changes in relevant markets, events that
materially affect an issuer or other events that have a significant effect on
the price or yield of Partnership Preference Units occur, relevant prices or
yields may be adjusted to take such occurrences into account.  Valuations of Partnership
Preference Units are inherently uncertain because they are based on adjustments
from the market prices of publicly traded debt and/or preferred stock
instruments of the same or similar issuers to account for the Partnership
Preference Units illiquidity, structural features (such as call provisions)
and other relevant factors. Each month Boston Management reviews the analysis
and calculations performed by the service provider. Boston Management generally
relies on the assumptions and judgments made by the service provider when
determining the estimated fair value of the Partnership Preference Units. If
the assumptions and estimates used by the service provider to calculate prices
for Partnership Preference Units were to change, it could materially impact the
estimated fair value of the Funds holdings of Partnership Preference Units.  Item
7A. Quantitative and Qualitative Disclosures About Market Risk.  (a) Quantitative
Information About Market Risk.  Interest Rate Risk.The Funds primary
exposure to interest rate risk arises from its real estate investments that are
financed by the Fund with floating rate borrowings under the Credit Facility
and by fixed-rate secured mortgage debt obligations of the Subsidiary Real
Estate Investments. Partnership Preference Units are fixed rate instruments
whose values will generally decrease when interest rates rise and increase when
interest rates fall. The interest rates on borrowings under the Credit Facility
are reset at regular intervals based on one-month LIBOR. The Fund has entered
into interest rate swap agreements to fix the cost of a substantial portion of
its borrowings under the Credit Facility to mitigate in part the impact of
interest rate changes on the Funds net asset value. Under the terms of the
interest rate swap agreements, the Fund makes cash payments at fixed rates in
exchange for floating rate payments that fluctuate with one-month LIBOR. The
Funds interest rate swap agreements will generally increase in value when
interest rates rise and decrease in value when interest rates fall. In the
future, the Fund may use other interest rate hedging arrangements (such as
caps, floors and collars) to fix or limit borrowing costs. The use of interest
rate hedging arrangements is a specialized activity that can expose the Fund to
significant loss.  The following table
summarizes the contractual maturities and weighted-average interest rates
associated with the Funds significant non-trading financial instruments. The
Fund has no market risk sensitive instruments held for trading purposes. This
information should be read in conjunction with Notes 9 and 10 to the Funds
consolidated financial statements appearing on pages 43 to 61 of this
Annual Report on Form 10-K.  26


Interest Rate Sensitivity 
Cost, Principal (Notional) Amount 
by Contractual Maturity and Callable Date 
for the Twelve Months Ended December 31,*  2008
  
  2009
  
  2010
  
  2011
  
  2012
  
  Thereafter
  
  Total
  
  Estimated
  Fair Value
  as of
  December
  31, 2007Rate sensitive liabilities:Long-term debt:Fixed-rate
  mortgages
  
  $
  5,426,600
  
  $
  5,802,782
  
  $
  6,165,794
  
  $
  6,551,516
  
  $
  6,928,887
  
  $
  180,341,535
  
  $
  211,217,114
  
  $
  213,900,000Average interest
  rate
  
  6.00
  %
  6.00
  %
  6.00
  %
  6.00
  %
  6.00
  %
  6.00
  %
  6.00
  %Variable-rate
  Credit Facility
  
  
  
  
  
  $
  420,400,000
  
  
  
  
  
  
  
  $
  420,400,000
  
  $
  420,400,000Average interest
  rate
  
  
  
  
  
  4.81
  %
  
  
  
  
  
  
  4.81
  %Rate sensitive derivative
  financial instruments:Pay fixed /
  receive variable interest rate swap agreements
  
  
  
  
  
  $
  388,668,000
  
  
  
  
  
  
  
  $
  388,668,000
  
  $
  1,006,924Average pay rate
  
  
  
  
  
  4.53
  %
  
  
  
  
  
  
  4.53
  %Average receive
  rate
  
  
  
  
  
  4.80
  %
  
  
  
  
  
  
  4.80
  %Rate sensitive investments:Fixed-rate
  Partnership Preference Units:Colonial Realty Limited
  Partnership, 7.25% Series B Cumulative Redeemable Perpetual Preferred
  Units, Callable 8/24/09, Current Yield: 8.32%
  
  
  
  $
  19,657,614
  
  
  
  
  
  
  
  
  
  $
  19,657,614
  
  $
  17,867,800Essex Portfolio,
  L.P., 7.875% Series B Cumulative Redeemable Preferred Units, Callable
  12/31/09, Current Yield: 8.45%
  
  
  
  $
  13,756,573
  
  
  
  
  
  
  
  
  
  $
  13,756,573
  
  $
  12,815,605  27


2008
  
  2009
  
  2010
  
  2011
  
  2012
  
  Thereafter
  
  Total
  
  Estimated
  Fair Value
  as of
  December
  31, 2007Essex Portfolio,
  L.P., 7.875% Series D Cumulative Redeemable Preferred Units, Callable
  7/28/10, Current Yield: 8.39%
  
  
  
  
  
  $
  12,873,400
  
  
  
  
  
  
  
  $
  12,873,400
  
  $
  11,733,050Liberty Property Limited
  Partnership, 7.40% Series H Cumulative Redeemable Preferred Units,
  Callable 8/21/12, Current Yield: 8.10%
  
  
  
  
  
  
  
  
  
  $
  15,000,000
  
  
  
  $
  15,000,000
  
  $
  13,710,000MHC Operating Limited
  Partnership, 8.0625% Series D Cumulative Redeemable Perpetual Preference
  Units, Callable 3/24/10, Current Yield: 8.69%
  
  
  
  
  
  $
  27,470,980
  
  
  
  
  
  
  
  $
  27,470,980
  
  $
  25,520,000PSA Institutional
  Partners, L.P., 6.4% Series NN Cumulative Redeemable Perpetual Preferred
  Units, Callable 3/17/10, Current Yield: 7.70%
  
  
  
  
  
  $
  13,387,322
  
  
  
  
  
  
  
  $
  13,387,322
  
  $
  11,538,450Vornado Realty
  L.P., 6.75% Series D-14 Cumulative Redeemable Preferred Units, Callable
  9/9/10, Current Yield: 7.72%(1)
  
  
  
  
  
  $
  27,446,516
  
  
  
  
  
  
  
  $
  27,446,516
  
  $
  26,226,357  
 *
  
  The
  amounts listed reflect the Funds positions as of December 31, 2007. The
  Funds current positions may differ.(1)
  
  Belmar
  Realtys interest in these Partnership Preference Units is held through
  Belvorn.  (b) Qualitative
Information About Market Risk.  Risks Associated with Equity Investing.The
Fund invests primarily in a diversified portfolio of common stocks and is
thereby subject to general stock market risk. There can be no assurance that
the performance of the Fund will match that of the U.S. stock market or that of
other equity funds. In managing the Portfolio for long-term, after-tax returns,
Boston Management generally seeks to avoid or minimize sales of securities with
large accumulated capital gains, including contributed securities. Such
securities constitute a substantial portion of the assets of the Portfolio.
Although the Portfolio may utilize certain management strategies in lieu of
selling appreciated securities, the Portfolios, and hence the Funds, exposure
to losses during stock market declines may nonetheless be higher than funds
that do not follow a general policy of avoiding sales of highly appreciated
securities.  28


Risks of Investing in Foreign Securities.The
Portfolio invests in securities issued by foreign companies and the Fund may
acquire foreign investments. Foreign investments involve considerations and
possible risks not typically associated with investing in the United States.
The value of foreign investments to U.S. investors may be adversely affected by
changes in currency rates. Foreign brokerage commissions, custody fees and other
costs of investing are generally higher than in the United States, and foreign
investments may be less liquid, more volatile and subject to more government
regulation than in the United States. Foreign investments could be adversely
affected by other factors not present in the United States, including
expropriation, confiscatory taxation, lack of uniform accounting and auditing
standards, armed conflict, and potential difficulty in enforcing contractual
obligations. These risks can be more significant for investments in emerging
markets.  Risks of Certain Investment Techniques.In
managing the Portfolio, Boston Management may purchase or sell derivative
instruments (which derive their value by reference to other securities,
indexes, instruments or currencies) to hedge against securities price declines
and currency movements, to add investment exposure to individual securities and
groups of securities and to enhance returns. Such transactions may include,
without limitation, the purchase and sale of futures contracts on stocks and
stock indexes and options thereon, the purchase of put options and the sale of
call options on securities held, equity swaps, forward sales of stocks, and the
purchase and sale of forward currency exchange contracts and currency futures.
The Portfolio may engage in short sales of individual securities held and short
sales of index or basket securities whose constituents are held in whole or in
part. The Portfolio may enter into private contracts for the forward sale of
stock held and may also lend portfolio securities.  The use of these
investment techniques is a specialized activity that may be considered
speculative and which can expose the Fund and the Portfolio to significant risk
of loss. Successful use of these investment techniques is subject to the
ability and performance of the investment adviser. The Funds and the Portfolios
ability to achieve their investment objectives may be adversely affected by the
use of these techniques. The writer of an option or a party to an equity swap
may incur losses that substantially exceed the payments, if any, received from
a counterparty. Forward sales, swaps, caps, floors, collars and
over-the-counter options are private contracts in which there is also a risk of
loss in the event of a default on an obligation to pay by the counterparty.
Such instruments may be difficult to value, may be illiquid and may be subject
to wide swings in valuation caused by changes in the price of the underlying
security, index, instrument or currency. In addition, if the Fund or the
Portfolio has insufficient cash to meet margin, collateral or settlement
requirements, it may have to sell assets to meet such requirements.
Alternatively, should the Fund or the Portfolio fail to meet these
requirements, the counterparty or broker may liquidate positions of the Fund or
the Portfolio. The Portfolio may also have to sell or deliver securities
holdings in the event that it is not able to purchase securities on the open
market to cover its short positions or to close out or satisfy an exercise
notice with respect to options positions it has sold. In any of these cases,
such sales may be made at prices or in circumstances that Boston Management
considers unfavorable.  The Portfolios ability
to utilize covered short sales, certain equity swaps, forward sales, futures
and certain equity collar strategies (combining the purchase of a put option
and the sale of a call option) as a tax-efficient management technique with
respect to holdings of appreciated securities is limited to circumstances in
which the hedging transaction is closed out within 30 days of the end of the
Portfolios taxable year in which the hedging transaction was initiated and the
underlying appreciated securities position is held unhedged for at least the
next 60 days after such hedging transaction is closed. In addition, dividends
received on stock for which the Portfolio is obligated to make related payments
(pursuant to a short sale or otherwise) with respect to positions in
substantially similar or related property are subject to federal income
taxation at ordinary rates and do not qualify for favorable tax treatment.
Also, holding periods required to receive tax-advantaged treatment of qualified
dividends on a stock are suspended whenever the Portfolio has an option (other
than a qualified covered call option not in the money when written) or
contractual obligation to sell or an open short sale of substantially identical
stock, is the grantor of an option (other than a qualified covered call option
not in the money when written) to buy substantially identical stock or has
diminished risk of loss in such stock by holding positions with respect to
substantially similar or related property. There can be no assurance that
counterparties will at all times be willing to enter into covered short sales,
forward sales of stocks, interest rate hedges, equity swaps and other
derivative instrument transactions on terms satisfactory to the Fund or the
Portfolio. The Funds and the Portfolios ability to enter into such transactions
may also be limited by covenants under the Funds Credit Facility, the federal
margin regulations and other laws and regulations. The Portfolios use of
certain investment techniques may be constrained because the Portfolio is a
diversified, open-end management investment company registered under the 1940
Act and because other investors in the Portfolio are regulated investment
companies under Subchapter M of the Code. Moreover, the Fund and the Portfolio
are subject to restrictions under the federal securities laws on their ability
to enter into transactions in respect of securities that are subject to
restrictions on transfer pursuant to the Securities Act.  29


Risks of Real Estate Investments.The
success of the Funds real estate investments depends in part on many factors
related to the real estate market in general, and to the specific sub-markets
in which the real estate investments are held. These factors include, without
limitation, general economic conditions, the supply and demand for different
types of real properties, the financial health of tenants, changing
transportation and logistics patterns (in the case of industrial distribution
properties), the timing of lease expirations and terminations, fluctuations in
rental rates and operating costs, exposure to adverse environmental conditions
and losses from casualty or condemnation, fluctuations in interest rates,
availability of financing, managerial performance, government rules and
regulations, and acts of God (whether
or not insured against). There can be no assurance that Belmar Realtys
ownership of real estate investments will be an economic success.  Interests in Real Estate
Joint Ventures and Partnership Preference Units are not registered under the
federal securities laws and are subject to restrictions on transfer. Due to
their illiquidity, they may be difficult to value and the ongoing value of the
investments is uncertain. See Critical Accounting Estimates in Item 7(e).  The performance of Real
Estate Joint Ventures is substantially influenced by the property management
capabilities of the Operating Partner and conditions in the specific real
estate submarkets in which the properties owned by the Real Estate Joint
Venture are located. The Operating Partner is subject to substantial conflicts
of interest in structuring, operating and winding up the Real Estate Joint
Venture. The Operating Partner has an economic incentive to maximize the prices
at which it sells properties to the Real Estate Joint Venture and has a similar
incentive to minimize the prices at which it may acquire properties from the
Real Estate Joint Venture. The Operating Partner may devote greater attention
or more resources to managing other properties in which it holds an interest
than to managing properties held by the Real Estate Joint Venture. Future
investment opportunities identified by the Operating Partner will more likely
be pursued independently, rather than through the Real Estate Joint Venture.
Financial difficulties encountered by the Operating Partner in its other
businesses may interfere with the operations of the Real Estate Joint Venture.  Belmar Realtys
investment in Real Estate Joint Ventures may be significantly concentrated in
terms of geographic regions, property types and operators, increasing the Funds
exposure to regional, property type and operator-specific risks. Given a lack
of stand-alone operating history, limited diversification and relatively high
financial leverage, the Real Estate Joint Venture is not equivalent in quality
to real estate companies whose preferred equity or senior debt securities are
rated investment grade. Distributable cash flows from a Real Estate Joint
Venture may not be sufficient for Belmar Realty to receive its fixed annual
preferred return, or any returns in excess thereof.  The debt of Brazos is
fixed-rate, secured by the underlying properties and without recourse to Fund
Shareholders and generally without recourse to Belmar Realty and the Fund.
Belmar Realty and the Fund may be directly or indirectly responsible for
certain liabilities constituting exceptions to the generally non-recourse
nature of the mortgage indebtedness, including liabilities associated with
fraud, misrepresentation, misappropriation of funds, breach of material
covenants or liabilities arising from environmental conditions involving or
affecting Real Estate Joint Venture properties. To the extent practicable, the
Fund and Belmar Realty will seek indemnification from the Operating Partner for
certain of such potential liabilities. The availability of financing and other
financial conditions can have a material impact on property values and
therefore on the value of Real Estate Joint Venture assets. Mortgage debt of
Brazos normally cannot be refinanced prior to maturity without substantial
penalties.  The ongoing value of
Belmar Realtys investments in Brazos is substantially uncertain. The real
property held through Brazos is stated at the estimated fair value as described
in Item 7(e). The policies for estimating the fair value of real estate
investments involve significant judgments that are based upon a number of
factors, which may include, without limitation, general economic conditions,
the supply and demand for different types of real properties, the financial
health of tenants, the timing of lease expirations and terminations,
fluctuations in rental rates and operating costs, exposure to adverse
environmental conditions and losses from casualty or condemnation, interest
rates, availability of financing, managerial performance and government rules and
regulations. Given that such valuations include many assumptions, estimated
fair values may differ from amounts ultimately realized.  Belmar Realtys
investments in Wholly Owned Property are subject to general real estate market
risks similar to those of an investment in a Real Estate Joint Venture.
Investments in Wholly Owned Property are also subject to risks specific to
these types of investments, including a concentration of risk exposure to
specific real estate submarkets and individual properties and tenants.
Principal among the risks of investing in the Wholly Owned Property is the risk
that a major tenant fails to satisfy its lease obligations due to financial
distress or other reasons. A major tenants failure to meet its lease
obligations would expose Belmar Realty to substantial loss of income without a
commensurate reduction in debt service costs and other expenses, and may
transfer to Belmar Realty all the costs, expenses and liabilities of property
ownership and  30


management borne by the
tenant under the terms of the lease. Re-leasing a property could involve
considerable time and expense. Re-leasing opportunities may be limited by the
nature and location of the property, which may not be well suited to the needs
of other possible tenants. Even if a property is re-leased, the property may
not generate sufficient rental income to cover debt service and other expenses.  Wholly Owned Property is
generally illiquid, and the ongoing value of Belmar Realtys investments in Bel
Stamford is substantially uncertain. Wholly Owned Property held is generally
stated at estimated fair value as described in Item 7(e). Because the value of
Bel Stamford reflects in part the creditworthiness of its tenant, any change in
the financial status of the tenant could affect the appraised value of the
property and the value realized upon the disposition of such property. Tenants
may hold rights to renew or extend expiring leases, and exercise of such rights
would extend Belmar Realtys risk exposure to a particular tenant beyond the
initial lease term. A tenant may also hold options to purchase properties,
including options to purchase at below market levels. The value received upon
the disposition of Wholly Owned Property will depend on real estate market
conditions, lease and mortgage terms, tenant credit quality, tenant purchase
options, lender approvals and other factors affecting valuation as may then apply.
Because a sale of Wholly Owned Property is not expected to occur for many
years, market conditions and other valuation factors at the time of sale cannot
be predicted. Since the valuations of Wholly Owned Property assume an orderly
disposition of assets, amounts realized in a distressed sale may differ
substantially from stated values.  The leveraged nature of
most anticipated Wholly Owned Property investments means that a relatively
small decline in the value of a property could result in the loss by Belmar
Realty of all or a substantial portion of its equity in such property. Mortgage
debt associated with Wholly Owned Property generally cannot be refinanced prior
to maturity without substantial penalties. The terms of the outstanding lease
and mortgage debt obligations and restrictions on refinancing such debt may
limit Belmar Realtys ability to dispose of Wholly Owned Property.  Because the mortgage debt
obligation of Bel Stamford is without recourse to Fund Shareholders and
generally without recourse to Belmar Realty and the Fund, the potential loss
from Belmar Realtys investments in Bel Stamford is normally limited to the
amount of its equity investment. The Fund and Belmar Realty may, however, be
directly or indirectly responsible for certain liabilities constituting
exceptions to the generally non-recourse nature of the mortgage indebtedness,
including liabilities associated with fraud, misrepresentation,
misappropriation of funds, or breach of material covenants, and liabilities
arising from environmental conditions involving or affecting Bel Stamford,
increasing the potential for loss under extraordinary circumstances.  Substantially all of the
rental payments on certain Wholly Owned Property that is Net Leased Property
may be dedicated to servicing the associated mortgage debt, in which case
significant amounts of cash would not be available to offset operating expenses
and the cost of Fund borrowings used to finance Belmar Realtys equity in the
properties. Such costs and expenses generally must be provided from other
sources of cash flow for Belmar Realty and the Fund, which may include
additional Fund borrowings under the Credit Facility. Realized returns on
investments in Net Leased Property may be deferred until the property is
re-leased following the initial lease term or sold.  The risks of investing in
Co-owned Property are substantially the same as investing in Wholly Owned
Property, as well as certain additional risks relating to the ownership of real
properties as tenants-in-common. Included in these risks are the inability to
make independent decisions regarding the property and the risk that other
owners may not properly perform their obligations relating to the property. The
Co-owned Properties are financed through mortgage notes. The mortgage notes are
secured by the real property and are generally without recourse to Belmar
Realty and the Fund, except that there may be recourse for certain liabilities
arising from actions such as fraud, misrepresentation, misappropriation of
funds or breach of material covenants and liabilities arising from
environmental conditions.  The success of
investments in Partnership Preference Units depends upon factors relating to
the issuing partnerships that may affect such partnerships profitability and
their ability to make distributions to holders of Partnership Preference Units.
Investments in Partnership Preference Units are valued primarily by referencing
market trading prices for comparable preferred equity securities or other
fixed-rate instruments having similar investment characteristics. The
valuations of Partnership Preference Units fluctuate over time to reflect,
among other factors, changes in interest rates, changes in the perceived
riskiness of such units (including call risk), changes in the perceived
riskiness of comparable or similar securities trading in the public market and
the relationship between supply and demand for comparable or similar securities
trading in the public market. The valuation of Partnership Preference Units
will be adversely affected by increases in interest rates and increases in the
perceived riskiness of such units or comparable or similar securities.
Fluctuations in the value of Partnership Preference Units derived from changes
in general interest rates can be expected to be offset in part (but not
entirely) by changes in the value of interest rate swap agreements or other
interest rate hedges entered into by the Fund with  31


respect to its borrowings
under the Credit Facility. Fluctuations in the value of Partnership Preference
Units that are derived from other factors besides general interest rate
movements (including issuer-specific and sector-specific credit concerns,
property or tenant-specific concerns, and changes in interest rate spread
relationships) will not be offset by changes in the value of interest rate swap
agreements or other interest rate hedges entered into by the Fund. Because the
Partnership Preference Units are not rated by a nationally recognized rating
agency, they may be subject to more credit risk than securities that are rated
investment grade.  Changes in the estimated
fair value of real estate investments and other factors will cause the
performance of the Fund to deviate from the performance of the Portfolio. Over
time, the performance of the Fund can be expected to be more volatile than the
performance of the Portfolio.  Risks of Interest Rate Swap Agreements.Interest
rate swap agreements are subject to changes in valuation caused principally by
movements in interest rates. Interest rate swap agreements are private
contracts in which there is a risk of loss in the event of a default on an
obligation to pay by the counterparty. Interest rate swap agreements may be
difficult to value and may be illiquid. Fluctuations in the value of
Partnership Preference Units derived from changes in general interest rates can
be expected to be offset in part (but not entirely) by changes in the value of
interest rate swap agreements applying to those Partnership Preference Units
for which they were purchased, or other interest rate hedges that may be
entered into by the Fund with respect to its borrowings.  Risks of Leverage.Although intended
to add to returns, the borrowing of funds to purchase real estate investments
exposes the Fund to the risk that the returns achieved on the real estate
investments will be lower than the cost of borrowing to purchase such assets
and that the leveraging of the Fund to buy such assets will therefore
diminish the returns achieved by the Fund as a whole. In addition, there is a
risk that the availability of financing will be interrupted at some future
time, requiring the Fund to sell assets to repay outstanding borrowings or a
portion thereof. It may be necessary to make such sales at unfavorable prices.
The Funds obligations under the Credit Facility are secured by a pledge of its
assets, excluding the Funds investment in Subsidiary Real Estate Investments.
In the event of default, the lender could elect to sell assets of the Fund
without regard to consequences of such action for Shareholders. The rights of
the lender to receive payments of interest on and repayments of principal of
borrowings under the Credit Facility are senior to the rights of the
Shareholders.  Under the terms of the
Credit Facility, the Fund is not permitted to make distributions of cash or
securities while there is an event of default outstanding under the Credit
Facility. During such periods, the Fund would not be able to honor redemption
requests or make cash distributions. In addition, the rights of lenders under
the mortgage notes used to finance Real Estate Joint Venture properties are
senior to Belmar Realtys right to receive cash distributions from Brazos.  32


Item
8. Financial Statements and Supplementary Data.  The consolidated
financial statements required by Item 8 are contained on pages 43 to 78 of
this Annual Report on Form 10-K. The following is a summary of unaudited
quarterly results of operations of the Fund for the years ended December 31,
2007 and 2006.  2007First
  
  Second
  
  Third
  
  FourthQuarter
  
  Quarter
  
  Quarter
  
  QuarterInvestment income
  
  $
  12,953,402
  
  $
  14,346,049
  
  $
  15,705,956
  
  $
  14,206,042Net investment income
  
  $
  2,734,611
  
  $
  3,562,651
  
  $
  2,605,691
  
  $
  2,605,931Net increase (decrease) in net assets from
  operations
  
  $
  (38,138,967
  )
  $
  121,067,995
  
  $
  18,556,081
  
  $
  (54,335,980
  )Per share data:(1)Investment income
  
  $
  0.74
  
  $
  0.86
  
  $
  1.02
  
  $
  0.97Net investment income
  
  $
  0.16
  
  $
  0.21
  
  $
  0.17
  
  $
  0.18Net increase (decrease) in net assets from
  operations
  
  $
  (2.17
  )
  $
  7.30
  
  $
  1.20
  
  $
  (3.72
  )  2006First
  
  Second
  
  Third
  
  FourthQuarter
  
  Quarter
  
  Quarter
  
  QuarterInvestment income
  
  $
  11,683,523
  
  $
  12,758,255
  
  $
  11,832,603
  
  $
  12,173,370Net investment income
  
  $
  2,483,164
  
  $
  3,156,788
  
  $
  1,915,176
  
  $
  2,116,027Net increase (decrease) in net assets from
  operations
  
  $
  85,686,365
  
  $
  (24,077,220
  )
  $
  81,660,635
  
  $
  148,614,994Per share data:(1)Investment income
  
  $
  0.61
  
  $
  0.69
  
  $
  0.65
  
  $
  0.68Net investment income
  
  $
  0.13
  
  $
  0.17
  
  $
  0.10
  
  $
  0.12Net increase (decrease) in net assets from
  operations
  
  $
  4.49
  
  $
  (1.29
  )
  $
  4.46
  
  $
  8.33  
 (1)           Based on average Shares outstanding.   Item
9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure.  There have been no
changes in, or disagreements with, accountants on accounting and financial disclosure.  Item
9A. Controls and Procedures.  Effective November 1,
2007, the directors of Eaton Vance, Inc. retired and were replaced by
Thomas E. Faust Jr., John E. Pelletier and Robert J. Whelan. At that time, the
directors created an Audit Committee whose members include Messrs. Pelletier
and Whelan. The Audit Committee of Eaton Vance, Inc. acts as the audit
committee of the Fund.  Fund
Governance.As the Funds manager, the complete and
entire management, control and operation of the Fund are vested in Eaton Vance.
The Funds Chief Executive Officer and Chief Financial Officer intend to report
to the Audit Committee of the Board of Directors of Eaton Vance, Inc. (the
sole trustee of Eaton Vance) any significant deficiency in the design or
operation of internal control over financial reporting which could adversely
affect the Funds ability to record, process, summarize and report financial
data, and any fraud, whether or not material, that involves management or other
employees who have a significant role in the Funds internal control over
financial reporting.  Disclosure
Controls and Procedures.Eaton Vance, as the Funds
manager, evaluated the effectiveness of the Funds disclosure controls and
procedures (as defined by Rule 13a-15(e) of the Act) as of the end of
the period covered by this report, with the participation of the Funds Chief
Executive Officer and Chief Financial Officer. The Funds disclosure controls
and procedures are the controls and other procedures that the Fund designed to
ensure that information required to be disclosed by the issuer in the reports
that it files or submits under the Act is recorded, processed, summarized and
reported, within the time periods specified in the Commissions rules and
forms. Based on that evaluation, the Funds  33


Chief Executive Officer
and Chief Financial Officer concluded that, as of December 31, 2007, the
Funds disclosure controls and procedures were effective.  Internal
Control Over Financial Reporting.The Funds Chief
Executive Officer and Chief Financial Officer have established and maintain
internal control over financial reporting as defined in Rules 13a-15(f) and
15d-15(f) of the Act.  MANAGEMENTS
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING  Eaton Vance
Management (Eaton Vance), as manager of Belmar Capital Fund LLC (the Fund),
with the participation of the Funds Chief Executive Officer and Chief
Financial Officer, (collectively referred to in this report as management) is
responsible for establishing and maintaining adequate internal control over
financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under
the 1934 Act. The Funds internal control over financial reporting is 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.  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.  Management
assessed the effectiveness of the Funds internal control over financial
reporting as of December 31, 2007. In making this assessment, management
used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission in Internal
Control-Integrated Framework. Based on its assessment and those
criteria, management believes that the Fund maintained effective internal
control over financial reporting as of December 31, 2007.  The Funds
independent registered public accounting firm has issued an attestation report
on the Funds internal control over financial reporting. That report appears on
the following page.  February 27,
2008  34


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM  To
the Shareholders of Belmar Capital Fund LLC and Subsidiaries  We have audited
the internal control over financial reporting of Belmar Capital Fund LLC and
subsidiaries (the Fund) as of December 31, 2007, based on criteria
established in Internal ControlIntegrated
Frameworkissued by the Committee of Sponsoring Organizations of the
Treadway Commission. The Funds management is responsible for maintaining
effective internal control over financial reporting and for its assessment of
the effectiveness of internal control over financial reporting, included in the
accompanying Managements Report on Internal Control over Financial Reporting.
Our responsibility is to express an opinion on the Funds internal control over
financial reporting based on our audit.  We conducted our
audit in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control
over financial reporting, assessing the risk that a material weakness exists, testing
and evaluating the design and operating effectiveness of internal control based
on the assessed risk, and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable
basis for our opinion.  A companys
internal control over financial reporting is a process designed by, or under
the supervision of, the companys principal executive and principal financial
officers, or persons performing similar functions, and effected by the companys
board of directors, management, and other personnel 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. A companys 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 company; (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 company are
being made only in accordance with authorizations of management and directors
of the company; and (3) provide reasonable assurance regarding prevention
or timely detection of unauthorized acquisition, use, or disposition of the
companys assets that could have a material effect on the financial statements.  Because of the
inherent limitations of internal control over financial reporting, including
the possibility of collusion or improper management override of controls,
material misstatements due to error or fraud may not be prevented or detected
on a timely basis. Also, projections of any evaluation of the effectiveness of
the internal control over financial reporting to future periods are subject to
the risk that the controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures
may deteriorate.  In our opinion,
the Fund maintained, in all material respects, effective internal control over
financial reporting as of December 31, 2007, based on the criteria
established in Internal ControlIntegrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission.  We have also
audited, in accordance with the standards of the Public Company Accounting Oversight
Board (United States), the consolidated financial statements and financial
highlights as of and for the year ended December 31, 2007 of the Fund and
our report dated February 27, 2008 expressed an unqualified opinion on
those financial statements and financial highlights.  DELOITTE &
TOUCHE LLP 
Boston, Massachusetts 
February 27, 2008  Item
9B. Other Information.  None.  35


PART III  Item
10. Directors, Executive Officers and Corporate Governance.  (a) Management.  Pursuant to the Funds
LLC Agreement, the Funds manager, Eaton Vance, has the authority to conduct
the Funds business. Eaton Vance appointed Thomas E. Faust Jr. to serve
indefinitely as the Funds Chief Executive Officer on October 16, 2002. On
January 22, 2007, Andrew C. Frenette replaced Michelle A. Green as the
Funds Chief Financial Officer. Ms. Green had served as the Funds Chief
Financial Officer since 2002. Information about Mr. Faust appears below. Mr. Frenette,
33, is a Vice President of Eaton Vance and Boston Management. He also serves as
Chief Financial Officer of Belair Capital Fund LLC, Belcrest Capital Fund LLC,
Belport Capital Fund LLC and Belrose Capital Fund LLC. Mr. Frenette has
been an employee of Eaton Vance since April 2006. Prior to joining Eaton
Vance, Mr. Frenette was Manager of Finance - Investments and Acquisitions
for GE Real Estate, a business unit of GE Commercial Finance. Mr. Frenette
serves as a Vice President of Belmar Realty, as well as the REIT subsidiary of
each of the other above-mentioned funds. As members of the Eaton Vance
organization, Messrs. Faust and Frenette receive no compensation from the
Fund for serving as Fund officers. There are no other officers of the Fund. The
Fund does not have a board of directors or similar governing body.  The Audit Committee of
the Board of Directors of Eaton Vance, Inc., the sole trustee of Eaton
Vance, oversees the accounting and financial reporting processes of the Fund,
audits of the Funds financial statements and otherwise serves as the Funds
audit committee. The Fund has no nominating or compensation committee. The
members of the Audit Committee of the Board of Directors of Eaton Vance, Inc.
are John E. Pelletier and Robert J. Whelan. The Funds audit committee
financial expert (as that term is defined in Item 7(d)(3)(iv) of Schedule
14A under the Act) is Mr. Whelan. Messrs. Pelletier and Whelan are
senior officers of Eaton Vance and, as such, are not independent of Fund
management. Information about Mr. Pelletier and Mr. Whelan appears
below.  Boston Management is
investment adviser to the Fund and the Portfolio and manager of Belmar Realty.
The portfolio manager of the Fund and the co-portfolio manager of the Portfolio
is Duncan W. Richardson. Additional information about Mr. Richardson
appears below. A majority of Mr. Richardsons time is spent managing the
Portfolio and related entities. Lewis R. Piantedosi, a Vice President of Eaton Vance
and Boston Management, is co-portfolio manager of the Portfolio. Mr. Piantedosi
became co-portfolio manager of the Portfolio on May 1, 2006, has been
employed by the Eaton Vance organization for more than five years and manages
other Eaton Vance portfolios. Boston Management has an experienced team of
analysts that provides Messrs. Richardson and Piantedosi with research and
recommendations on investments. As of March 1, 2008, Yana S. Barton and
Michael A. Allison will join Messrs. Richardson and Piantedosi as
co-portfolio managers of both the Fund and Portfolio. Ms. Barton and Mr. Allison
are both Vice Presidents of Eaton Vance and Boston Management, have been
employed by the Eaton Vance organization for more than five years and manage
other Eaton Vance portfolios.  The directors of Belmar
Realty are Mr. Faust and William R. Cross, each of whom is described
below. Mr. Cross is the President and portfolio manager of Belmar Realty
and the head of Boston Managements real estate investment group, which has
primary responsibility for providing research and analysis relating to the Funds
real estate investments held through Belmar Realty. Mr. Cross is a Vice
President of Eaton Vance and Boston Management and has been employed by the
Eaton Vance organization since 1996. A majority of Mr. Cross time is
spent managing the real estate investments of Belmar Realty and the real estate
subsidiaries of other investment funds advised by Boston Management. Mr. Cross
serves as Chairman of the Board and President of Brazos. Other officers of
Eaton Vance and Boston Management also serve as officers and/or directors of
Brazos.  As disclosed under The
Eaton Vance Organization in Item 1, Eaton Vance and Boston Management are
wholly owned subsidiaries of Eaton Vance Corp. The non-voting common stock of
Eaton Vance Corp. is listed and traded on the NYSE. All shares of the voting
common stock of Eaton Vance Corp. are held in a voting trust, the voting
trustees of which are senior officers of the Eaton Vance organization. Eaton
Vance, Inc., a wholly owned subsidiary of Eaton Vance Corp., is the sole
trustee of Eaton Vance and of Boston Management, each of which is a
Massachusetts business trust. The names of the executive officers and the
directors of Eaton Vance, Inc. and their ages and principal occupations
(in addition to their responsibilities described above) are set forth below.  Thomas E. Faust Jr. (49)
is Chief Executive Officer and President of Eaton Vance Corp., President and
Director of Eaton Vance, Inc., Chief Executive Officer and President of
Eaton Vance Management and Boston Management, and Director of  36


EV Distributors. He is
also Chief Executive Officer of Belair Capital Fund LLC, Belcrest Capital Fund
LLC, Belport Capital Fund LLC and Belrose Capital Fund LLC and is an officer of
various other investment companies managed by Eaton Vance or Boston Management.
Mr. Faust has been employed by Eaton Vance since 1985.  John E. Pelletier (43) is
Vice President and Chief Legal Officer of Eaton Vance, Boston Management, Eaton
Vance Corp., EV Distributors and Eaton Vance, Inc. He is also an officer
of various investment companies managed by Eaton Vance or Boston Management and
has been employed by Eaton Vance since October 29, 2007. Prior to joining
Eaton Vance, Mr. Pelletier was Chief Operating Officer and Executive Vice
President for Natixis Global Associates. He was General Counsel of Natixis
Global Associates from 1997 to 2004.  Duncan W. Richardson,
(50), is Executive Vice President and Chief Equity Investment Officer of Eaton
Vance, Boston Management, Eaton Vance Corp. and Eaton Vance, Inc. He is
also an officer of various investment companies managed by Eaton Vance or
Boston Management and has been employed by Eaton Vance since 1987.  Robert J. Whelan (46) is
Vice President and Chief Financial Officer of Eaton Vance, Boston Management,
Eaton Vance Corp. and Eaton Vance, Inc. and a Director of Eaton Vance, Inc.
He is also Vice President and Director of EV Distributors. He has been employed
by Eaton Vance since April 1, 2007. Prior to joining Eaton Vance, Mr. Whelan
was Executive Vice President and Chief Financial Officer for Boston Private
Wealth Management Group from December 2004 to April 2007. Before
joining Boston Private Wealth Management Group, he was Senior Vice President
and Chief Financial Officer of MFS Investment Management from May 1996 to September 2004.  (b) Compliance
with Section 16(a) of the Act.  Section 16(a) of
the 1934 Act requires the Funds officers and directors and persons who own
more than ten percent of the Funds Shares to file forms reporting their
affiliation with the Fund and reports of ownership and changes in ownership of
the Funds Shares with the SEC. Eaton Vance, as manager of the Fund, and the
Directors and executive officers of Eaton Vance, Inc., the sole trustee of
Eaton Vance, also comply with Section 16(a). These persons and entities
are required by SEC regulations to furnish the Fund with copies of all Section 16(a) forms
they file. To the best of the Funds knowledge, during the year ended December 31,
2007 no Section 16(a) filings were required by such persons or
entities.  (c) Code
of Ethics.  The Fund has adopted a
Code of Ethics that applies to the principal executive officer and principal
financial officer (who is also the Funds principal accounting officer). A copy
of the Code of Ethics is available at no cost by request to the Funds Chief
Financial Officer, 255 State Street, Boston, MA 02109 or by calling (800)
225-6265. If the Fund makes any substantive amendments to the Code of Ethics or
grants any waiver, including an implicit waiver, from a provision of the Code
of Ethics as applicable to the principal executive officer or principal
financial officer, the Fund will disclose the nature of such amendment or
waiver in a report on Form 8-K.  Item
11. Executive Compensation.  As noted in Item 10, the
officers of the Fund receive no compensation from the Fund (nor does any other
officer of Belmar Realty or a Subsidiary Real Estate Investment of the Fund
performing policy making functions for the Fund). The Funds manager, Eaton
Vance, and its affiliates receive certain fees from the Fund for services
provided to the Fund, which are described in Item 13 below.  Item
12. Security Ownership of Certain Beneficial Owners and Management and Related
Shareholder Matters.  Security
Ownership of Certain Beneficial Owners.As of December 31, 2007, the following
Shareholder owned the percentage of Fund Shares indicated:  Name and Address of
  Beneficial Owner
  
  Percent of classThe Adelman Family Revocable Trust
  Corralitos, CA
  
  5.2
  %
  To the knowledge
of the Fund, no other person beneficially owned more than 5% of the Shares of
the Fund as of December 31, 2007.  Security
Ownership of Management.As of February 15, 2008,
Eaton Vance, the manager of the Fund, beneficially owned 1,153 Shares of the
Fund. The Shares owned by Eaton Vance represent less than 1% of the outstanding
Shares of the Fund as of February 15, 2008. None of the other entities or
individuals named in response to Item 10 above beneficially owned Shares of the
Fund as of such date.  Changes
in Control.Not applicable.  37


Item
13. Certain Relationships and Related Transactions, and Director Independence.  Messrs. Faust and
Frenette are currently the only related persons of the Fund (as that term is
defined in Regulation S-K under the Securities Act and the Act). The Fund has
instituted written policies and procedures to determine the existence of a
reportable transaction under Item 404(a) of Regulation S-K. In accordance
with such policies and procedures, Eaton Vance circulates an Executive Officer
Questionnaire to each related person annually to determine the existence of a
potential reportable transaction. Any transaction, or proposed transaction, in
which the Fund was or is to be a participant and the amount of which exceeds
$120,000 (and in which a related person had or will have a direct or indirect
material interest) is required to be reviewed by the Audit Committee of the
Board of Directors of Eaton Vance, Inc. The Fund did not have any
reportable transactions under Item 404(a) of Regulation S-K during the
year ended December 31, 2007.  The table below sets
forth the fees paid or payable by, or allocable to, the Fund and Belmar Realty
for the years ended December 31, 2007 and 2006 in connection with services
rendered by Eaton Vance and its affiliates. Each fee is described following the
table.  Year ended
  
  Year endedDecember
  
  December31, 2007
  
  31, 2006Fund Advisory and Administrative Fees*
  
  $
  1,595,340
  
  $
  1,584,480Belmar Realty Management Fees
  
  $
  4,128,568
  
  $
  3,514,113Funds Allocable Portion of the Portfolios
  Advisory Fees**
  
  $
  8,191,590
  
  $
  8,451,162Fund Servicing Fees
  
  $
  1,632,457
  
  $
  1,685,252Funds Allocable Portion of Belvedere
  Companys Servicing Fees
  
  $
  2,882,960
  
  $
  2,944,524Fund Distribution Fees
  
  $
  1,807,217
  
  $
  1,851,776Aggregate Compensation Paid by the Fund to
  Eaton Vance and its Affiliates
  
  $
  7,531,125
  
  $
  6,950,369
  
 *
  
  Boston Management has agreed to waive the portion of
  the investment advisory and administrative fee payable by the Fund to the
  extent that such fee, together with the distribution fee payable by the Fund
  and the Funds attributable share of the investment advisory and management
  fees payable by the Portfolio and Belmar Realty, respectively, exceeds 0.60%
  of the average daily gross assets of the Fund. If the Fund invests in Cash
  Management Portfolio, the advisory and administrative fee paid to Boston
  Management by Cash Management Portfolio in respect of the Funds investment
  therein will be credited towards the Funds advisory and administrative fee
  payments, reducing the amount of such fees otherwise payable. The amounts
  shown are net of reductions and amounts waived by Boston Management.**
  
  For the years ended
  December 31, 2007 and 2006, advisory fees paid or payable by the
  Portfolio totaled $87,681,000 and $83,323,602, respectively. For the year ended
  December 31, 2007, Belvedere Companys allocable portion of that fee was
  $64,755,126 of which $8,191,590 was allocable to the Fund. For the year ended
  December 31, 2006, Belvedere Companys allocable portion of that fee was
  $59,955,794, of which $8,451,162 was allocable to the Fund. The advisory fee
  payable by the Portfolio is reduced by the Portfolios allocable portion of
  the advisory fee paid by Cash Management Portfolio.  The
Funds Investment Advisory and Administrative Fee.Under
the terms of the Funds investment advisory and administrative agreement,
Boston Management is entitled to receive, subject to the fee waiver described
in the next sentence, a monthly advisory and administrative fee at the rate of
1/20 of 1% (equivalent to 0.60% annually) of the average daily gross assets of
the Fund, reduced by the portion of the monthly advisory or management fees for
such months payable by the Portfolio and Belmar Realty that is attributable to
the Funds direct or indirect investments therein (but no such reduction shall
be made to the extent that any such fee or portion thereof has been waived by
Boston Management). Boston Management has agreed to waive that portion of the
monthly investment advisory and administrative fee payable by the Fund to the extent
that such fee, together with the distribution fees payable by the Fund (see Distribution
Fees Paid to EV Distributors below) and that portion of the monthly advisory
or management fees for such month payable by the Portfolio and Belmar Realty
that is attributable to the value of the Funds direct or indirect investments
therein exceeds 1/20 of 1% of the average daily gross assets of the Fund. The
term gross assets as used in the agreement means the value of all the Funds
assets, including the Funds interest in the Company and the Funds ratable
share of the assets of its direct and indirect subsidiaries, Real Estate Joint
Ventures and Co-owned Property investments, without reduction by any
liabilities. The Funds investment advisory and administrative agreement was
amended in June 2007 to reflect, among other things, Belmar Realtys
ability to invest in Co-owned Property.  38


Belmar
Realtys Management Fee.Under the terms of Belmar Realtys
management agreement with Boston Management, Boston Management receives a
monthly management fee at the rate of 1/20 of 1% (equivalent to 0.60% annually)
of the average daily gross assets of Belmar Realty. The term gross assets as
used in the agreement means the value of all assets of Belmar Realty, including
Belmar Realtys ratable share of the assets of its direct and indirect
subsidiaries, Real Estate Joint Ventures and Co-owned Property investments,
without reduction by any liabilities. Belmar Realtys management agreement was
amended in June 2007 to reflect, among other things, its ability to invest
in Co-owned Property.  The
Portfolios Investment Advisory Fee.Under the terms of
the Portfolios investment advisory agreement with Boston Management, Boston
Management receives a monthly advisory fee as follows:  Annual Fee RateAverage Daily Net Assets for the Month
  
  (for each level)Up to $500 million
  
  0.6250
  %$500 million but less than $1 billion
  
  0.5625
  %$1 billion but less than $1.5 billion
  
  0.5000
  %$1.5 billion but less than $7 billion
  
  0.4375
  %$7 billion but less than $10 billion
  
  0.4250
  %$10 billion but less than $15 billion
  
  0.4125
  %$15 billion but less than $20 billion
  
  0.4000
  %$20 billion but less than $25 billion
  
  0.3900
  %$25 billion and over*
  
  0.3800
  %
  
 *
  Effective April 23,
  2007.
  In accordance with the
terms of the 1940 Act, the Portfolios Board of Trustees considers the
continuation of the Portfolios investment advisory agreement annually.  Servicing
Fees Paid by the Fund.Pursuant to a servicing agreement
between the Fund and EV Distributors, the Fund pays a servicing fee to EV
Distributors for providing certain services and information to the Shareholders
of the Fund. The servicing fee is paid on a quarterly basis at an annual rate
of 0.25% of the Funds average daily net assets. With respect to Shareholders
who subscribed through a subagent, EV Distributors has assigned servicing
responsibilities and fees to the applicable subagent, beginning twelve months
after the issuance of Shares of the Fund to such persons. The Funds allocated
share of the servicing fee paid by Belvedere Company is credited toward the
Funds servicing fee payment, thereby reducing the amount of the servicing fee
payable by the Fund.  Servicing
Fees Paid by Belvedere Company.Pursuant to a servicing
agreement between Belvedere Company and EV Distributors, Belvedere Company pays
a servicing fee to EV Distributors for providing certain services and
information to direct and indirect investors in Belvedere Company. The
servicing fee is paid on a quarterly basis, at an annual rate of 0.15% of
Belvedere Companys average daily net assets. With respect to investors in
Belvedere Company and Shareholders of the Fund who subscribed through a
subagent, EV Distributors has assigned servicing responsibilities and fees to
the applicable subagent, beginning twelve months after the issuance of shares
of Belvedere Company or Shares of the Fund to such persons. The Fund assumes
its allocated share of Belvedere Companys servicing fee. The servicing fee
payable in respect of the Funds investment in Belvedere Company is credited
toward the Fund servicing fee described above.  39


Distribution
Fees Paid to EV Distributors.Under the terms of the Funds
placement agreement with EV Distributors, EV Distributors receives a
distribution fee at an annual rate of 0.10% of the average daily net assets of
the Fund as compensation for its services as placement agent. The distribution
fee accrued from the Funds initial closing and will continue for a period of
ten years (subject to the annual approval of Eaton Vance, Inc.).  Certain
Real Estate Investment Transactions.During the year
ended December 31, 2007, Belmar Realty entered into the following real
estate investment transactions with real estate investment affiliates of other
investment funds managed by Eaton Vance and advised by Boston Management or an
entity owned by a real estate investment affiliate:  ·Belmar
Realty purchased Partnership Preference Units from Belair Real Estate
Corporation, which realized a loss of approximately $0.2 million on the
transaction.  ·Belmar
Realty purchased Partnership Preference Units from Belcrest Realty Corporation,
which realized a gain of approximately $1.0 million on the transactions.  ·Belmar
Investment sold a Co-owned Property to Belterra Realty Corporation, no gain or
loss was recognized on the transaction.  ·Belmar
Investment sold a Co-owned Property to Clearfork Realty Corporation, no gain or
loss was recognized on the transaction.  ·Belmar
Investment sold a Co-owned Property to Beldore Realty Corporation, no gain or
loss was recognized on the transaction.  Item
14. Principal Accountant Fees and Services.  The following table
presents fees for the professional audit services rendered by Deloitte &
Touche LLP for the audit of the Funds annual financial statements for the
years ended December 31, 2007 and 2006 and fees billed for other services
rendered by Deloitte & Touche LLP during those periods, including fees
charged by Deloitte & Touche LLP to the Funds consolidated
subsidiaries.  Year ended December 31,2007
  
  2006Audit fees
  
  $
  109,025
  
  $
  108,635Tax fees (1)
  
  159,801
  
  198,127Total
  
  $
  268,826
  
  $
  306,762  
 (1)
  
  Tax fees consist of the aggregate fees billed for
  professional services rendered by Deloitte Tax LLP for tax compliance, tax
  advice and tax planning.  The Audit Committee of
the Board of Directors of Eaton Vance, Inc. reviews all audit,
audit-related, tax and other fees at least annually. The Audit Committee of the
Board of Directos of Eaton Vance, Inc., and prior to the creation of the
Audit Committee of the Board of Directors of Eaton Vance, Inc., the
directors of Eaton Vance, Inc., pre-approved all audit and tax services
for the years ended December 31, 2007 and 2006. The Audit Committee of the
Board of Directors of Eaton Vance, Inc. has concluded that the provision
of the tax services listed above is compatible with maintaining the
independence of Deloitte & Touche LLP.  40


PART IV  Item
15. Exhibits and Financial Statement Schedules.  (a)
  
  Please see the Funds consolidated financial
  statements on pages 43 to 61 of this Annual Report on Form 10-K.
  Please see the Portfolios financial statements on pages 62 to 78 of
  this Annual Report on Form 10-K.(b)
  
  Reports on Form 8-K:The Fund filed a report
  on Form 8-K on January 26, 2007, regarding the appointment of
  Mr. Frenette as Chief Financial Officer of the Fund, replacing
  Ms. Green.The Fund filed a report
  on Form 8-K on June 5, 2007, regarding its previously issued
  financial statements.(c)
  
  A list of the exhibits filed as a part of this Form 10-K
  is included in the Exhibit Index appearing on page 80 hereof.  41


Appendix A  Belmar Capital Fund LLCs (The Fund)
Investment Structure as of December 31, 2007    (A)
  
  Eaton Vance Management is the manager of the Fund;
  Boston Management and Research (Boston Management) is the Funds investment
  adviser.(B)
  
  Boston Management is the manager of Belvedere
  Capital Fund Company LLC.(C)
  
  Boston Management is the investment adviser of
  Tax-Managed Growth Portfolio.(D)
  
  Boston Management is the manager of Belmar Realty
  Corporation (Belmar Realty). Belmar Realty also holds direct investments in
  partnership preference units.(E)
  
  Belmar Realty owns a majority economic interest in
  this real estate joint venture.(F)
  
  Bel
  Stam ford Investors LLC is a wholly owned subsidiary of Belmar Realty.(G)
  
  Bel SMLI, LLC owns a tenancy-in-common interest in
  co-owned property.(H)
  
  Bel Marquette I, LLC owns a tenancy-in-common
  interest in co-owned property.(I)
  
  Belmar Realty owns a minority interest in Belvorn
  Holdings LLC, which owns partnership preference units issued by Vornado
  Realty L.P.  42


Belmar Capital Fund LLC

CONSOLIDATED PORTFOLIOS OF INVESTMENTS

As of December 31, 2007

|Investment in Belvedere Capital FundCompany LLC  76.0%                                                                                                                                                   | 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|Security                                                                                                                                                                                                  | 
|Investment in Belvedere Capital Fund Company LLC(Belvedere Company)                                                                                                                                       | 
|Total Investment in Belvedere Company(identified cost, $1,543,805,050)                                                                                                                                    | 
|Partnership Preference Units  5.3%                                                                                                                                                                       | 
|Security                                                                                                                                                                                                  | 
|Belvorn Holdings LLC(1)(2)                                                                                                                                                                               | 
|Colonial Realty Limited Partnership (DelawareLimited Partnership affiliate of ColonialProperties Trust), 7.25% Series B CumulativeRedeemable Perpetual Preferred Units,Callable from 8/24/09(2)          | 
|Essex Portfolio, L.P. (California LimitedPartnership affiliate of Essex propertyTrust, Inc.) 7.875% Series B CumulativeRedeemable Preferred Units, Callablefrom 12/31/09(2)                              | 
|Essex Portfolio, L.P. (California LimitedPartnership affiliate of Essex PropertyTrust, Inc.), 7.875% Series D CumulativeRedeemable Preferred Units, Callablefrom 7/28/10(2)                              | 
|Liberty Property Limited Partnership(Pennsylvania Limited Partnership affiliateof Liberty Property Trust), 7.40% Series HCumulative Redeemable Preferred Units,Callable from 8/21/12(2)                  | 
|MHC Operating Limited Partnership (IllinoisLimited Partnership affiliate of Equity LifestyleProperties, Inc.), 8.0625% Series D CumulativeRedeemable Perpetual Preference Units,Callable from 3/24/10(2) | 
|PSA Institutional Partners, L.P. (CaliforniaLimited Partnership affiliate of PublicStorage, Inc.), 6.4% Series NN CumulativeRedeemable Perpetual Preferred Units,Callable from 3/17/10(2)                | 
|Total Partnership Preference Units(identified cost, $129,592,405)                                                                                                                                         | 



|Real Estate Joint Venture  4.2%                                                                                                                                                                                               | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | 
|Description                                                                                                                                                                                                                    | 
|Investment in Brazos Property Trust (a majority economicinterest of 82.1% in Brazos Property Trust which investsin twenty-three industrial distribution properties located ineight states, net of associated mortgage debt)(2) | 
|Total Real Estate Joint Venture(identified cost, $132,448,908)                                                                                                                                                                 | 
|Wholly Owned and Co-ownedProperties  14.4%                                                                                                                                                                                    | 
|Description                                                                                                                                                                                                                    | 
|Bel Marquette I, LLC (a single member LLC with a 40.0%tenancy-in-common interest in an office building located inWisconsin, net of associated mortgage debt)(2)                                                                | 
|Bel SML I, LLC (a single member LLC with a 40.0%tenancy-in-common interest in two office buildings locatedin two states, net of associated mortgage debt)(2)                                                                   | 
|Bel Stamford Investors LLC (a single member LLC investingin an interest in leasehold improvements of one officebuilding and attached facilities located in Connecticut)(2)                                                     | 



|Total Wholly Owned and Co-ownedProperties(identified cost, $266,113,054) |  | $                      | 322,338,520   |       | 
|------------------------------------------------------------------------ |  | ---------------------- | ------------- | ----- | 
|Short-Term Investment  0.1%                                             | 
|Description                                                              |  | Interest(000'somitted) |               | Value | 
|Investment in Cash Management Portfolio, 4.58%(3)                        |  |                        | 1,281         |       | 
|Total Short-Term Investment(identified cost, $1,280,926)                 |  | $                      | 1,280,926     |       | 
|Total Investments  100.0%(identified cost, $2,073,240,343)              |  | $                      | 2,234,081,678 |       | 



See notes to consolidated financial statements

43

---

Belmar Capital Fund LLC

CONSOLIDATED PORTFOLIOS OF INVESTMENTSCONT'D

As of December 31, 2006

|Investment in Belvedere Company  82.0%                                                                                                                                                                         | 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|Security                                                                                                                                                                                                        | 
|Investment in Belvedere Company                                                                                                                                                                                 | 
|Total Investment in Belvedere Company(identified cost, $1,868,850,084)                                                                                                                                          | 
|Partnership Preference Units  1.3%                                                                                                                                                                             | 
|Security                                                                                                                                                                                                        | 
|Belvorn Holdings LLC(1)(2)                                                                                                                                                                                     | 
|MHC Operating Limited Partnership, L.P. (IllinoisLimited Partnership affiliate of Equity LifestyleProperties, Inc.), 8.0625% Series D CumulativeRedeemable Perpetual Preference Units, Callablefrom 3/24/10(2) | 
|PSA Institutional Partners, L.P. (California LimitedPartnership affiliate of Public Storage, Inc.), 6.4%Series NN Cumulative Redeemable Perpetual PreferredUnits, Callable from 3/17/10(2)                     | 



|Total Partnership Preference Units(identified cost, $32,960,091)                                                                                                                                                               |  | $     | 32,479,513  |  | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ----- | ----------- |  | 
|Real Estate Joint Venture  3.3%                                                                                                                                                                                               | 
|Description                                                                                                                                                                                                                    |  | Value |            
|Investment in Brazos Property Trust (a majority economicinterest of 80.7% in Brazos Property Trust which investsin twenty-three industrial distribution properties located ineight states, net of associated mortgage debt)(2) |  | $     | 81,314,079  |  | 
|Total Real Estate Joint Venture(identified cost, $131,072,697)                                                                                                                                                                 |  | $     | 81,314,079  |  | 
|Wholly Owned Property  13.3%                                                                                                                                                                                                  | 
|Description                                                                                                                                                                                                                    |  | Value |            
|Bel Stamford Investors LLC (a single member LLC investingin an interest in leasehold improvements of one officebuilding and attached facilities located in Connecticut)(2)                                                     |  | $     | 330,000,000 |  | 
|Total Wholly Owned Property(identified cost, $245,732,974)                                                                                                                                                                     |  | $     | 330,000,000 |  | 



|Short-Term Investment  0.1%                                | 
|----------------------------------------------------------- | 
|Description                                                 | 
|Investment in Cash Management Portfolio, 4.87%(3)           | 
|Total Short-Term Investment(identified cost, $1,808,885)    | 
|Total Investments  100.0%(identified cost, $2,280,424,731) | 



The following footnotes are for the years ending December 31, 2007 and December 31, 2006:

Security exempt from registration under the Securities Act of 1933. At December 31, 2007 and 2006, the value of these securities totaled $119,411,262 and $32,479,513 or 7.5% and 1.7% of net assets, respectively.

(1)The sole investment of Belvorn Holdings LLC is as follows: Vornado Realty L.P. (Delaware limited partnership affiliate of Vornado Realty Trust), 6.75% Series D-14 Cumulative Redeemable Preferred Units, callable from 9/9/10. This security is exempt from the Securities Act of 1933.

(2)Investment valued at estimated fair value using methods determined in good faith by or at the direction of the manager of Belmar Realty Corporation.

(3)Affiliated investment company available to Eaton Vance portfolios and funds, which invests in high quality, U.S. dollar denominated money market instruments. The rate shown is the annualized seven-day yield as of December 31, 2007 and 2006, respectively.

See notes to consolidated financial statements

44

---

Belmar Capital Fund LLC

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statements of Assets and Liabilities

|Assets                                                                                                       |  | December 31, 2007 |               | December 31, 2006 | 
|------------------------------------------------------------------------------------------------------------ |  | ----------------- | ------------- | ----------------- | 
|Investment in Belvedere Company, at value (identified cost, $1,543,805,050 and $1,868,850,084, respectively) |  | $                 | 1,697,387,202 |                   | 
|Unaffiliated investments, at value (identified cost, $528,154,367 and $409,765,762, respectively)            |  |                   | 535,413,550   |                   | 
|Affiliated investment, at value (identified cost, $1,280,926 and $1,808,885, respectively)                   |  |                   | 1,280,926     |                   | 
|Cash                                                                                                         |  |                   | 1,143,960     |                   | 
|Distributions and interest receivable                                                                        |  |                   | 371,676       |                   | 
|Interest receivable from affiliated investment                                                               |  |                   | 11,842        |                   | 
|Swap interest receivable                                                                                     |  |                   | 28,765        |                   | 
|Open interest rate swap agreements, at value                                                                 |  |                   | 1,006,924     |                   | 
|Other assets                                                                                                 |  |                   | 1,148,642     |                   | 
|Total assets                                                                                                 |  | $                 | 2,237,793,487 |                   | 
|Liabilities                                                                                                  | 
|Loan payable  Credit Facility                                                                               |  | $                 | 420,400,000   |                   | 
|Mortgage note payable                                                                                        |  |                   | 211,217,114   |                   | 
|Payable for Fund Shares redeemed                                                                             |  |                   | 9,563,231     |                   | 
|Payable to affiliate for investment advisory and administrative fees                                         |  |                   | 494,963       |                   | 
|Payable to affiliate for distribution and servicing fees                                                     |  |                   | 512,735       |                   | 
|Other accrued expenses:                                                                                      | 
|Interest expense                                                                                             |  |                   | 1,056,048     |                   | 
|Other expenses and liabilities                                                                               |  |                   | 536,232       |                   | 
|Total liabilities                                                                                            |  | $                 | 643,780,323   |                   | 
|Net Assets                                                                                                   |  | $                 | 1,594,013,164 |                   | 
|Shareholders' Capital                                                                                        |  | $                 | 1,594,013,164 |                   | 
|Shares Outstanding (unlimited number of shares authorized)                                                   |  |                   | 14,204,446    |                   | 
|Net Asset Value and Redemption Price Per Share                                                               |  | $                 | 112.22        |                   | 



See notes to consolidated financial statements

45

---

Belmar Capital Fund LLC

CONSOLIDATED FINANCIAL STATEMENTSCONT'D

Consolidated Statements of Operations

|                                                                                                                                 |  | Year Ended        |            
|-------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | -----------
|Investment Income                                                                                                                |  | December 31, 2007 |            
|Dividends allocated from Belvedere Company (net of foreign taxes, $622,037, $584,965 and $500,815, respectively)                 |  | $                 | 37,208,124 
|Interest allocated from Belvedere Company                                                                                        |  |                   | 483,591    
|Security lending income allocated from Belvedere Company, net                                                                    |  |                   | 138,320    
|Expenses allocated from Belvedere Company                                                                                        |  |                   | (11,475,812
|Net investment income allocated from Belvedere Company                                                                           |  | $                 | 26,354,223 
|Rental income from Wholly Owned Property                                                                                         |  |                   | 18,161,031 
|Net investment income from Real Estate Joint Venture                                                                             |  |                   | 5,657,677  
|Distributions from Partnership Preference Units                                                                                  |  |                   | 5,072,542  
|Net investment income from Co-owned Properties                                                                                   |  |                   | 1,344,850  
|Interest                                                                                                                         |  |                   | 25,087     
|Interest allocated from affiliated investment                                                                                    |  |                   | 295,429    
|Expenses allocated from affiliated investment                                                                                    |  |                   | (28,354    
|Other income                                                                                                                     |  |                   | 328,964    
|Total investment income                                                                                                          |  | $                 | 57,211,449 
|Expenses                                                                                                                         | 
|Investment advisory and administrative fees                                                                                      |  | $                 | 7,531,125  
|Distribution and servicing fees                                                                                                  |  |                   | 3,439,674  
|Interest expense on Credit Facility                                                                                              |  |                   | 22,601,000 
|Interest expense on mortgage note                                                                                                |  |                   | 13,001,386 
|Custodian and transfer agent fee                                                                                                 |  |                   | 91,628     
|Miscellaneous                                                                                                                    |  |                   | 844,969    
|Total expenses                                                                                                                   |  | $                 | 47,509,782 
|Deduct Reduction of investment advisory and administrative fees                                                                 |  | $                 | 1,807,217  
|Net expenses                                                                                                                     |  | $                 | 45,702,565 
|Net investment income                                                                                                            |  | $                 | 11,508,884 
|Realized and Unrealized Gain (Loss)                                                                                              | 
|Net realized gain (loss)                                                                                                        | 
|Investment transactions in Belvedere Company (investments, securities sold short and foreign currency)(identified cost basis)(1) |  | $                 | 74,199,895 
|Investment transactions in Partnership Preference Units (identified cost basis)                                                  |  |                   | 10,562     
|Investment transaction in Real Estate Joint Venture                                                                              |  |                   |           
|Interest rate swap agreements(2)                                                                                                 |  |                   | 3,538,475  
|Net realized gain                                                                                                                |  | $                 | 77,748,932 
|Change in unrealized appreciation (depreciation)                                                                                | 
|Investments in Belvedere Company (investments, securities sold short and foreign currency)(identified cost basis)                |  | $                 | (6,404,394 
|Investments in Partnership Preference Units (identified cost basis)                                                              |  |                   | (9,700,565 
|Investment in Real Estate Joint Venture                                                                                          |  |                   | 10,973,477 
|Investment in Wholly Owned Property                                                                                              |  |                   | (28,000,000
|Investment in Co-owned Properties                                                                                                |  |                   | (41,560    
|Interest rate swap agreements                                                                                                    |  |                   | (8,935,645 
|Net change in unrealized appreciation (depreciation)                                                                             |  | $                 | (42,108,687
|Net realized and unrealized gain                                                                                                 |  | $                 | 35,640,245 
|Net increase in net assets from operations                                                                                       |  | $                 | 47,149,129 



(1)Amounts include net realized gain from redemptions in-kind of $50,205,672, $30,982,484 and $11,702,725, respectively.

(2)Amounts represent net interest earned (incurred) in connection with interest rate swap agreements (Note 2F).

See notes to consolidated financial statements

46

---

Belmar Capital Fund LLC

CONSOLIDATED FINANCIAL STATEMENTSCONT'D

Consolidated Statements of Changes in Net Assets

|                                                                                                                                              |  | Year Ended        |              
|--------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | -------------
|Increase (Decrease) in Net Assets                                                                                                             |  | December 31, 2007 |              
|From operations                                                                                                                              | 
|Net investment income                                                                                                                         |  | $                 | 11,508,884   
|Net realized gain from investment transactions, securities sold short,foreign currency transactions and interest rate swap agreements         |  |                   | 77,748,932   
|Net change in unrealized appreciation (depreciation) of investments, securitiessold short, foreign currency and interest rate swap agreements |  |                   | (42,108,687  
|Net increase in net assets from operations                                                                                                    |  | $                 | 47,149,129   
|Transactions in Fund Shares                                                                                                                  | 
|Net asset value of Fund Shares issued to Shareholders in payment ofdistributions declared                                                     |  | $                 | 8,735,995    
|Net asset value of Fund Shares redeemed                                                                                                       |  |                   | (395,888,501 
|Net decrease in net assets from Fund Share transactions                                                                                       |  | $                 | (387,152,506 
|Distributions                                                                                                                                | 
|Distributions to Shareholders                                                                                                                 |  | $                 | (22,004,052  
|Total distributions                                                                                                                           |  | $                 | (22,004,052  
|Net increase (decrease) in net assets                                                                                                         |  | $                 | (362,007,429 
|Net Assets                                                                                                                                    | 
|At beginning of year                                                                                                                          |  | $                 | 1,956,020,593
|At end of year                                                                                                                                |  | $                 | 1,594,013,164



See notes to consolidated financial statements

47

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Belmar Capital Fund LLC

CONSOLIDATED FINANCIAL STATEMENTSCONT'D

Consolidated Statements of Cash Flows

|                                                                                                                                              |  | Year Ended        |             
|--------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ------------
|Increase (Decrease) in Cash                                                                                                                   |  | December 31, 2007 |             
|Cash Flows From Operating Activities                                                                                                         | 
|Net increase in net assets from operations                                                                                                    |  | $                 | 47,149,129  
|Adjustments to reconcile net increase in net assets from operations to net cash flows provided by(used in) operating activities              | 
|Net investment income allocated from Belvedere Company                                                                                        |  |                   | (26,354,223 
|Net investment income from Real Estate Joint Venture                                                                                          |  |                   | (5,657,677  
|Return of capital from Real Estate Joint Venture                                                                                              |  |                   | 468,380     
|Distributions of earnings from Real Estate Joint Venture                                                                                      |  |                   | 3,813,085   
|Net investment income from Co-owned Properties                                                                                                |  |                   | (1,344,850  
|Capital contributions to Co-owned Properties                                                                                                  |  |                   | (756,857    
|Return of capital from Co-owned Properties                                                                                                    |  |                   | 46,297,948  
|Distributions of earnings from Co-owned Properties                                                                                            |  |                   | 1,142,241   
|(Increase) decrease in short-term investments                                                                                                 |  |                   |            
|(Increase) decrease in affiliated investment                                                                                                  |  |                   | 527,959     
|(Increase) decrease in distributions and interest receivable                                                                                  |  |                   | (371,520    
|Decrease in interest receivable from affiliated investment                                                                                    |  |                   | 246         
|(Increase) decrease in interest receivable for open swap agreements                                                                           |  |                   | 26,182      
|(Increase) decrease in other assets                                                                                                           |  |                   | (67,603     
|Increase in payable to affiliate for investment advisory and administrative fees                                                              |  |                   | 62,830      
|Increase (decrease) in payable to affiliate for distribution and servicing fees                                                               |  |                   | (82,650     
|Decrease in interest payable for open swap agreements                                                                                         |  |                   |            
|Increase (decrease) in accrued interest and other accrued expenses and liabilities                                                            |  |                   | (333        
|Purchases of Partnership Preference Units                                                                                                     |  |                   | (97,633,376 
|Proceeds from sales of Partnership Preference Units                                                                                           |  |                   | 1,011,624   
|Decrease in investment in Belvedere Company                                                                                                   |  |                   | 45,000,000  
|Purchase of investment in real property                                                                                                       |  |                   | (30,058,790 
|Proceeds from sale of real property                                                                                                           |  |                   | 17,745,462  
|Purchases of Co-owned Properties                                                                                                              |  |                   | (82,900,593 
|Proceeds from sale of Co-owned Properties                                                                                                     |  |                   | 29,495,359  
|Net interest earned (incurred) on interest rate swap agreements                                                                               |  |                   | 3,538,475   
|Minority interest in net income of subsidiary                                                                                                 |  |                   | 17,816      
|Net realized gain from investment transactions, securities sold short, foreign curency transactions and interestrate swap agreements          |  |                   | (77,748,932 
|Net change in unrealized (appreciation) depreciation of investments, securities sold short, foreign currency andinterest rate swap agreements |  |                   | 42,108,687  
|Net cash flows provided by (used in) operating activities                                                                                     |  | $                 | (84,571,981 
|Cash Flows From Financing Activities                                                                                                         | 
|Proceeds from Credit Facility                                                                                                                 |  | $                 | 398,400,000 
|Repayments of Credit Facility                                                                                                                 |  |                   | (287,000,000
|Repayments of mortgage note                                                                                                                   |  |                   | (5,141,649  
|Payments for Fund Shares redeemed                                                                                                             |  |                   | (7,673,726  
|Distributions paid to Shareholders                                                                                                            |  |                   | (13,268,057 
|Distributions paid to minority investors                                                                                                      |  |                   | (17,816     
|Net cash flows provided by (used in) financing activities                                                                                     |  | $                 | 85,298,752  
|Net increase (decrease) in cash                                                                                                               |  | $                 | 726,771     
|Cash at beginning of year                                                                                                                     |  | $                 | 417,189     
|Cash at end of year                                                                                                                           |  | $                 | 1,143,960   
|Supplemental Disclosure and Non-cash Operating and Financing Activities                                                                       | 
|Interest paid on loan  Credit Facility                                                                                                       |  | $                 | 22,545,143  
|Interest paid on mortgage note                                                                                                                |  | $                 | 13,019,382  
|Interest paid (received) on swap agreements, net                                                                                              |  | $                 | (3,564,657  
|Reinvestment of distributions paid to Shareholders                                                                                            |  | $                 | 8,735,995   
|Market value of securities distributed in payment of redemptions                                                                              |  | $                 | 380,599,152 
|Market value of real property and other assets, net of current liabilities, assumedin conjunction with the acquisition of real property       |  | $                 | 30,058,790  
|Market value of real property and other assets, net of current liabilities,disposed of in conjunction with the sale of real property          |  | $                 | 17,745,462  



See notes to consolidated financial statements

48

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Belmar Capital Fund LLC

CONSOLIDATED FINANCIAL STATEMENTSCONT'D

Financial Highlights

|                                                                                                                |  | Year Ended        |          
|--------------------------------------------------------------------------------------------------------------- |  | ----------------- | ---------
|                                                                                                                |  | December 31, 2007 |          
|Net asset value  Beginning of year                                                                             |  | $                 | 110.890  
|Income (loss) from operations                                                                                   | 
|Net investment income(1)                                                                                        |  | $                 | 0.718    
|Net realized and unrealized gain                                                                                |  |                   | 1.862    
|Total income from operations                                                                                    |  | $                 | 2.580    
|Distributions                                                                                                   | 
|Distributions to Shareholders                                                                                   |  | $                 | (1.250   
|Total distributions                                                                                             |  | $                 | (1.250   
|Net asset value  End of year                                                                                   |  | $                 | 112.220  
|Total Return(2)                                                                                                 |  |                   | 2.34     
|Ratios as a percentage of average net assets                                                                    | 
|Investment advisory and administrative fees, distribution and servicing fees and other operating expenses(3)(4) |  |                   | 1.20     
|Interest and other borrowing costs(3)(5)                                                                        |  |                   | 1.25     
|Expenses of Wholly Owned Property(6)                                                                            |  |                   | 0.72     
|Total expenses                                                                                                  |  |                   | 3.17     
|Net investment income(5)                                                                                        |  |                   | 0.64     
|Ratios as a percentage of average gross assets(7)                                                               | 
|Investment advisory and administrative fees, distribution and servicing fees and other operating expenses(3)(4) |  |                   | 0.82     
|Interest and other borrowing costs(3)(5)                                                                        |  |                   | 0.86     
|Expenses of Wholly Owned Property(6)                                                                            |  |                   | 0.49     
|Total expenses                                                                                                  |  |                   | 2.17     
|Net investment income(5)                                                                                        |  |                   | 0.44     
|Supplemental Data                                                                                               | 
|Net assets, end of year (000's omitted)                                                                         |  | $                 | 1,594,013
|Portfolio turnover of Tax-Managed Growth Portfolio(8)                                                           |  |                   | 2        



(1)Calculated using average shares outstanding.

(2)Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested.

(3)Includes the expenses of Belmar Capital Fund LLC (Belmar Capital) and Belmar Realty Corporation (Belmar Realty). Does not include expenses of Belmar Realty's Wholly Owned Property.

(4)Includes Belmar Capital's share of Belvedere Capital Fund Company LLC's (Belvedere Company) allocated expenses, including those expenses allocated from Tax-Managed Growth Portfolio.

(5)Ratios do not include net interest earned or incurred in connection with interest rate swap agreements. Had such amounts been included, ratios would be lower or higher.

(6)Represents expenses incurred by Belmar Realty's Wholly Owned Property.

(7)Average gross assets means the average daily amount of the value of all assets of Belmar Capital (including Belmar Capital's interest in Belvedere Company and Belmar Capital's ratable share of the assets of its direct and indirect subsidiaries, real estate joint ventures and co-owned real property investments), without reduction by any liabilities.

(8)Excludes the value of portfolio securities contributed or distributed as a result of in-kind shareholder transactions. The total turnover rate of Tax-Managed Growth Portfolio including in-kind contributions and distributions was 6%, 7% and 6% for the years ended December 31, 2007, 2006 and 2005, respectively.

(9)Amounts to less than 1%.

See notes to consolidated financial statements

49

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1Organization

Belmar Capital Fund LLC (Belmar Capital) is a Delaware limited liability company established to offer diversification and tax-sensitive investment management to investors holding large and concentrated positions in equity securities of selected publicly traded companies. The investment objective of Belmar Capital is to achieve long-term, after-tax returns for Belmar Capital shareholders (Shareholders). Belmar Capital pursues this objective primarily by investing indirectly in Tax-Managed Growth Portfolio (the Portfolio), a diversified, open-end management investment company registered under the Investment Company Act of 1940, as amended (the 1940 Act). The Portfolio is organized as a trust under the laws of the state of New York. Belmar Capital maintains its investment in the Portfolio by investing in Belvedere Capital Fund Company LLC (Belvedere Company), a separate Massachusetts limited liability company that invests exclusively in the Portfolio. The performance of Belmar Capital and Belvedere Company is directly and substantially affected by the performance of the Portfolio. The audited financial statements of the Portfolio, including the Portfolio of Investments, are included elsewhere in this report and should be read in conjunction with these financial statements.

Separate from its investment in the Portfolio through Belvedere Company, Belmar Capital invests in real estate investments through its controlled subsidiary, Belmar Realty Corporation (Belmar Realty). Such investments include income-producing preferred equity interests in real estate operating partnerships (Partnership Preference Units) affiliated with publicly traded real estate investment trusts (REITs), an investment in a real estate joint venture (Real Estate Joint Venture), interests in leasehold improvements (Wholly Owned Property) held through Bel Stamford Investors LLC (Bel Stamford) and tenancy-in-common interests in real properties (Co-owned Properties) held through Bel SML I, LLC (Bel SML I) and Bel Marquette I, LLC (Bel Marquette I).

2Significant Accounting Policies

The following is a summary of significant accounting policies consistently followed in the preparation of the consolidated financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).

APrinciples of Consolidation The consolidated financial statements include the accounts of Belmar Capital and its subsidiaries (collectively, the Fund). All material intercompany accounts and transactions have been eliminated.Investments in which the Fund cannot exercise a majority voting interest but over which the Fund has the ability to exercise significant influence over operating and financial policies are presented under the equity method and stated at estimated fair value (Note 2E). The Real Estate Joint Venture and Co-owned Properties are presented under the equity method. Under the equity method, the Real Estate Joint Venture and Co-owned Properties are initially recognized on the Consolidated Statements of Assets and Liabilities at cost (provided such cost is indicative of estimated fair value) and are subsequently adjusted to reflect the Fund's proportionate share of the net increase (decrease) in net assets from operations of the Real Estate Joint Venture and Co-owned Properties. The Real Estate Joint Venture and Co-owned Properties are also adjusted to reflect distributions, contributions and advances in the form of loans, interest earned on advances and certain other adjustments, as appropriate.

BBasis of Presentation Belmar Capital is an investment company and, as such, presents its assets at fair value. Fixed liabilities are generally stated at their principalvalue.

CCash The Fund considers deposits in banks that can be liquidated without prior notice or penalty to be cash.

DInvestment Costs The Fund's investment assets were principally acquired through contributions of common stock by Shareholders in exchange for Fund Shares and through purchases of Partnership Preference Units, a Real Estate Joint Venture, Wholly Owned Property and Co-owned Properties. Upon receipt of common stock from Shareholders, Belmar Capital immediately exchanged the contributed securities into Belvedere Company for shares thereof, and Belvedere Company, in turn, immediately thereafter exchanged the contributed securities into the Portfolio for an interest in the Portfolio. The initial financial reporting cost basis of the Fund's investments in contributed securities is the value of the contributed securities as of the close of business on the day prior to their contribution to the Fund. The initial tax basis of the Fund's investment in the Portfolio through Belvedere Company is the same as the contributing Shareholders' basis in securities contributed to the Fund. The initial tax and financial reporting cost basis of the Fund's investments in Partnership Preference Units, the Real Estate Joint Venture, Wholly Owned Property and Co-owned Properties purchased by the Fund is the purchase cost, which includes the capitalization of certain transaction costs incurred with the acquisition.

50

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

EInvestment and Other Valuations The Fund's investments consist of shares of Belvedere Company, Partnership Preference Units, a Real Estate Joint Venture, Wholly Owned Property and Co-owned Properties. The Fund may also invest in short-term debt securities and Cash Management Portfolio (Cash Management), an affiliated investment company managed by Boston Management, a subsidiary of Eaton Vance Management. Belvedere Company's only investment is an interest in the Portfolio, the value of which is derived from a proportional interest therein. Valuation of securities by the Portfolio is discussed in Note 1A of the Portfolio's Notes to Financial Statements, which are included elsewhere in this report. Additionally, Belmar Capital has entered into interest rate swap agreements (Note 9). The valuation policies followed by the Fund are as follows:

Market prices for the Fund's real estate investments (including Partnership Preference Units, the Real Estate Joint Venture, Wholly Owned Property and Co-owned Properties) are not readily available and therefore such investments are stated in the Fund's consolidated financial statements at estimated fair value. The estimated fair value of an investment represents the amount at which Boston Management, as manager of Belmar Realty, believes the investment could be sold in a current transaction between willing parties in an orderly disposition, that is, other than in a forced or liquidation sale. In valuing these investments, Boston Management considers relevant factors, data and information. With respect to investments in Partnership Preference Units, Boston Management considers information from dealers and similar firms with knowledge of such issues and/or the prices of comparable preferred equity securities and other fixed or adjustable rate instruments having similar investment characteristics. Wholly Owned Property, Co-owned Properties and real property held by the Real Estate Joint Venture are primarily valued based upon independent valuations (i.e.,appraisals). Detailed real property valuations are performed at least annually and reviewed periodically. When a property has not been appraised (such as when a property has been recently acquired), Boston Management determines the estimated fair value of the property based on the transaction value of the property, which equals the total acquisition cost of the property, exclusive of certain legal and transaction costs, provided such amount is deemed indicative of fair value.

Appraisals of newly acquired properties, whether held by a wholly owned subsidiary of Belmar Realty or a Real Estate Joint Venture, are generally conducted in the year following the acquisition or when there has been a significant change in economic circumstances. Interimvaluations of properties may be adjusted to reflect significant changes in economic circumstances or recent independent valuations of similar properties, and the results of operations and distributions.

The fair value of Belmar Realty's equity interest in the Real Estate Joint Venture is estimated quarterly using a financial model that considers (i) the terms of the Real Estate Joint Venture agreements relating to the allocation of distributable cash flow, (ii) the expected duration of the Real Estate Joint Venture, and (iii) the projected property values and cash flows from the properties based on estimates used in the independent valuations. If detailed independent real property valuations have not been performed on property within a recently established Real Estate Joint Venture, Boston Management allocates equity interest in the Real Estate Joint Venture based on the contractual ownership interests of the parties. Interim valuations may be adjusted to reflect significant changes in economic circumstances or recent independent valuations of similar properties, and the results of operations and distributions.

The valuation of real estate investments is based on many assumptions, including, but not limited to, a current transaction between willing parties and an orderly disposition of assets, that is, other than in a forced or liquidation sale. If the assumptions used to value a real estate investment change, it may materially impact the estimated fair value of that investment.

If real property securing a mortgage note payable has an estimated fair value that is less than the outstanding principal balance, the mortgage note payable may be adjusted to the estimated fair value of the property securing the mortgage note. No such adjustment has been made to the mortgage note payable at December 31, 2007 and 2006.

Short-term debt securities with a remaining maturity of 60days or less are valued at amortized cost. If short-term debt securities are acquired with a remaining maturity of more than 60 days, they will be valued by a pricing service.

Cash Management values its investment securities utilizing the amortized cost valuation technique permitted by Rule 2a-7 under the 1940 Act. This technique involves initially valuing a portfolio security at its cost and thereafter assuming a constant amortization to maturity of any discount or premium.

Interest rate swap agreements are normally valued on the basis of valuations furnished by an independent pricing service.

51

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

Changes in the fair value of the Fund's investments are recorded as unrealized appreciation or depreciation in the Consolidated Statements of Operations.

FInterest Rate Swaps Belmar Capital has entered into interest rate swap agreements with respect to its borrowings. Pursuant to these agreements, Belmar Capital makes periodic payments to the counterparty at predetermined fixed rates in exchange for floating-rate payments from the counterparty at a predetermined spread to one-month London Interbank Offered Rate (LIBOR). Net interest paid and accrued or received and earned is recorded as realized gains or losses and changes in the underlying values of the swaps are recorded as unrealized appreciation (depreciation), each in the Consolidated Statements of Operations. Belmar Capital is exposed to a risk of loss in the event of non-performance by the swap counterparty. Risks may arise from unanticipated movements in interest rates.

GRental Income Wholly Owned Property is leased to a single tenant under a net lease pursuant to a non-cancelable, fixed long-term operating lease expiring in 2017, with options to extend. Net leases require the lessee to pay all costs associated with the operations and maintenance of the property. During the initial lease term the rental income from the office building and attached facilities, together with any related payments received, are expected to equal the payments due under the mortgage. Bel Stamford is 100% leased at December 31, 2007.

At December 31, 2007, the minimum lease payments expected to be received from leases with lease periods greater than one year are as follows:

|Year Ending December 31, |            | Amount | 
|------------------------ | ---------- | ------ | 
|                         | 2008       |        | 
|                         | 2009       |        | 
|                         | 2010       |        | 
|                         | 2011       |        | 
|                         | 2012       |        | 
|                         | Thereafter |        | 
|                         |            |        | 



HIncome Belvedere Company's net investment income or loss consists of Belvedere Company's pro rata share of the net investment income or loss of the Portfolio, less all expenses of Belvedere Company, determined in accordance with GAAP.

The Fund's net investment income or loss consists of the Fund's pro rata share of the net investment income or loss of Belvedere Company, the Fund's pro rata share of the net investment income or loss of Cash Management, plus all net investment income earned on the Fund's real estate investments, less all expenses of the Fund, determined in accordance with GAAP.

Dividend income and distributions from Partnership Preference Units are recorded on the ex-dividend date or on the date the Fund is informed of the distribution. Income from the Real Estate Joint Venture and Co-owned Properties is recorded based on the Fund's proportional interest in the net investment income earned by the Real Estate Joint Venture and Co-owned Properties. Rental income from Wholly Owned Property is recorded on the accrual basis based upon the terms of the lease agreements.

Interest income is recorded on the accrual basis.

IIncome Taxes Belmar Capital, Belvedere Company and the Portfolio are treated as partnerships for federal income tax purposes. As a result, Belmar Capital, Belvedere Company and the Portfolio do not incur federal income tax liability, and the shareholders and partners thereof are individually responsible for taxes on items of partnership income, gain, loss and deduction. The policy of Belmar Realty is to comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to REITs. Belmar Realty will generally not be subject to federal income tax to the extent that it distributes its taxable income to its stockholders each year and maintains its qualification as a REIT. Wholly owned subsidiaries of Belmar Realty are generally treated as pass-through entities for federal income tax purposes.

The Fund recognizes interest expense and penalties related to uncertain tax positions as tax expense when incurred.

Net investment income and capital gains determined in accordance with income tax regulations may differ from such amounts determined in accordance with GAAP. Such differences could be significant and are primarily due to differences in the cost basis of securities and other contributed investments, depreciation of real estate assets, periodic payments made or received in connection with interest rate swap agreements and the character of distributions received from Belmar Realty, Partnership Preference Units, the Real Estate Joint Venture, Wholly Owned Property and Co-owned Properties.

JOther Investment transactions are accounted for on the date the investments are purchased or sold.

52

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

KUse of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates.

LIndemnifications and Guarantees Under Belmar Capital's Limited Liability Company Agreement, Belmar Capital's officers, its manager, investment adviser, and any affiliate, associate, officer, employee or trustee thereof, and any manager, director, officer or employee of Belmar Realty or any other subsidiary may be indemnified against certain liabilities and expenses arising out of their duties to the Fund. Shareholders also may be indemnified against personal liability for the liabilities of Belmar Capital. Additionally, in the normal course of business, the Fund enters into agreements with service providers, lenders and counterparties that may contain indemnification or guarantee clauses. The Fund's maximum exposure under these arrangements is unknown, as this would involve possible future claims that may be made against the Fund that have not yet occurred.

MRecently Issued Accounting Pronouncements In February 2007, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities  including an amendment of FASB Statement No. 115." SFAS No. 159 permits entities to elect to measure certain financial assets and liabilities at fair value. SFAS No. 159 is effective as of the beginning of the first fiscal year that begins after November 15, 2007. SFAS No. 159 will not have a material impact on the Fund's net asset value, financial condition or results of operations.

In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements." SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosure about fair value measurements. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. SFAS No. 157 will require additional financial statement disclosures and will not have a material effect on the net asset value, financial condition or results of operations of the Fund.

In June 2006, the FASB issued FASB Interpretation No. 48 (FIN 48), "Accounting for Uncertainty in Income Taxes  an interpretation of SFAS No. 109." FIN 48 clarifies the accounting for uncertainty in income taxes recognized in accordance with SFAS No. 109, "Accounting for IncomeTaxes." FIN 48 is effective during the first required financial reporting period for fiscal years beginning after December 15, 2006.

The Fund adopted the provisions of FIN 48 on March 30, 2007, as required. The adoption of FIN 48 did not have a material effect on the net asset value, financial condition or results of operations of the Fund. In accordance with the requirements of FIN 48, the Fund evaluated all tax years still subject to potential audit under state and federal income tax law in reaching its accounting conclusions. The Fund files numerous U.S. federal, state and local income and franchise tax returns. With few exceptions, the Fund is no longer subject to U.S. federal, state or local tax examinations by taxing authorities for years prior to 2004.

3Distributions to Shareholders

Belmar Capital intends to distribute at the end of each year, or shortly thereafter, all of its net investment income for the year, if any, and approximately 18% of its net realized capital gains for such year, if any, other than precontribution gains allocated to a Shareholder in connection with a taxable tender offer or other taxable corporate event with respect to a security contributed by that Shareholder or such Shareholder's predecessor in interest. In addition, whenever a distribution in respect of a precontribution gain is made, Belmar Capital intends to make a supplemental distribution to compensate Shareholders receiving such distributions for taxes that may be due on income specially allocated in connection with the precontribution gain and supplemental distributions. Capital gain distributions that are made with respect to realized precontribution gains and the associated supplemental distributions (collectively, Special Distributions) are made solely to the Shareholders to whom such realized precontribution gain is allocated. There were no Special Distributions paid or accrued for the years ended December 31, 2007, 2006 and 2005.

The Fund's distributions generally are based on determinations of net investment income and net realized capital gains for federal income tax purposes. Such amounts may differ from net investment income or loss and net realized gain or loss as set forth in the Fund's consolidated financial statements due to differences in the treatment of various income, gain, loss, expense and other items for federal income tax purposes and under GAAP.

In addition, Belmar Realty intends to distribute substantially all of its taxable income earned during the year.

Distributions made to Shareholders electing the Fund's Estate Freeze feature will be paid, first, to holders of

53

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

Preferred Shares to the extent of the unpaid cumulative annual priority return of the Preferred Shares and, second, to the holders of the associated Common Shares. Distributions made in respect of any realized precontribution gains and associated supplemental distributions will be apportioned between Preferred Shares and Common Shares consistent with the allocation to the Preferred Shares and Common Shares of such realized precontribution gains. It is expected that substantially all Belmar Capital distributions in respect of Estate Freeze Shares will be paid to holders of Preferred Shares rather than holders of Common Shares. Distributions on Estate Freeze Shares may be reinvested in Belmar Capital to purchase undivided Fund Shares at the Fund's net asset value per share on the date of reinvestment.

4Shareholder Transactions

Belmar Capital may issue an unlimited number of full and fractional Fund Shares. Transactions in Fund Shares were as follows:

|                                                                                 |  | Year Ended       |           
|-------------------------------------------------------------------------------- |  | ---------------- | ----------
|                                                                                 |  | December 31,2007 |           
|Issued to Shareholders electing toreceive payment of distributionsin Fund Shares |  |                  | 79,260    
|Redemptions                                                                      |  |                  | (3,514,114
|Net decrease                                                                     |  |                  | (3,434,854



5Investment Transactions

The following table summarizes the Fund's investment transactions, other than short-term investments, for the years ending December 31, 2007, 2006 and 2005:

|                                                   |  | Year Ended       |            
|-------------------------------------------------- |  | ---------------- | -----------
|Investment Transactions                            |  | December 31,2007 |            
|Decreases in investment inBelvedere Company        |  | $                | 425,599,152
|Increases in PartnershipPreference Units(1)        |  | $                | 97,633,376 
|Decreases in PartnershipPreference Units(2)        |  | $                | 1,011,624  
|Decrease in investment inReal Estate Joint Venture |  | $                | 4,281,465  
|Increase in investment inreal property             |  | $                | 30,058,790 
|Decrease in investment inreal property(3)          |  | $                | 17,745,462 
|Increase in investment inCo-owned Properties       |  | $                | 83,657,450 
|Decrease in investment inCo-owned Properties(4)    |  | $                | 76,935,548 



(1)Increases in Partnership Preference Units for the years ended December 31, 2007 and 2005 include Partnership Preference Units purchased from real estate investment affiliates of other investment funds advised by Boston Management.

(2)Decreases in Partnership Preference Units for the year ended December 31, 2006 represent Partnership Preference Units sold to real estate investment affiliates of other investment funds advised by Boston Management for which a net realized gain of $154,250 was recognized.

(3)Decrease in investment in real property for the year ended December 31, 2007 represents the sale of real property to the real estate investment affiliates of other investment funds advised by Boston Management. No gain or loss was recognized on the transactions.

(4)Decrease in investment in Co-owned Properties for the year ended December 31, 2007 includes the sale of Co-owned Properties to the real estate investment affiliate of another investment fund advised by Boston Management. No gain or loss was recognized on the transaction.

6Indirect Investment in the Portfolio

The following table summarizes the Fund's investment in the Portfolio through Belvedere Company for the years ended December 31, 2007, 2006 and 2005, including allocations of income, expenses and net realized and unrealized gains (losses) for the years then ended:

|                                                                                                                                                    |  | Year Ended       |               
|--------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------- | --------------
|                                                                                                                                                    |  | December 31,2007 |               
|Belvedere Company'sinterest in thePortfolio(1)                                                                                                      |  | $                | 14,763,099,076
|The Fund's investment inBelvedere Company(2)                                                                                                        |  | $                | 1,697,387,202 
|Income allocated toBelvedere Companyfrom the Portfolio                                                                                              |  | $                | 298,751,556   
|Income allocated tothe Fund fromBelvedere Company                                                                                                   |  | $                | 37,830,035    
|Expenses allocated toBelvedere Companyfrom the Portfolio                                                                                            |  | $                | 67,348,884    
|Expenses allocated tothe Fund fromBelvedere Company(3)                                                                                              |  | $                | 11,475,812    
|Net realized gain frominvestment transactions,securities sold shortand foreign currencytransactions allocatedto Belvedere Companyfrom the Portfolio |  | $                | 581,142,259   



54

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

|                                                                                                                                                           |  | Year Ended       |            
|---------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------- | -----------
|                                                                                                                                                           |  | December 31,2007 |            
|Net realized gain frominvestment transactions,securities sold shortand foreign currencytransactions allocatedto the Fund fromBelvedere Company             |  | $                | 74,199,895 
|Net change in unrealizedappreciation(depreciation) ofinvestments, securitiessold short and foreigncurrency allocated toBelvedere Companyfrom the Portfolio |  | $                | (99,671,823
|Net change in unrealizedappreciation(depreciation) ofinvestments, securitiessold short and foreigncurrency allocated tothe Fund fromBelvedere Company      |  | $                | (6,404,394 



(1)As of December 31, 2007, 2006 and 2005, the value of Belvedere Company's interest in the Portfolio represents 74.3%, 73.1% and 70.4% of the Portfolio's net assets,respectively.

(2)As of December 31, 2007, 2006 and 2005, the Fund's investment in Belvedere Company represents 11.5%, 13.6% and 14.8% of Belvedere Company's net assets, respectively.

(3)Expenses allocated to the Fund from Belvedere Companyrepresent:

|                                     |  | Year Ended       |          
|------------------------------------ |  | ---------------- | ---------
|                                     |  | December 31,2007 |          
|Expenses allocatedfrom the Portfolio |  | $                | 8,520,310
|Servicing fee (see Note 11)          |  | $                | 2,882,960
|Operating expenses                   |  | $                | 72,542   



7Investment in Real Estate Joint Venture

At December 31, 2007, 2006 and 2005, Belmar Realty held an investment in one Real Estate Joint Venture, Brazos Property Trust (Brazos). Belmar Realty acquired its investment in Brazos in June 2004.

Belmar Realty owns 100% of the Class A shares of the Real Estate Joint Venture, representing 80% of the initial economic interest in the Real Estate Joint Venture. A party unrelated to Belmar Realty owns 100% of the Class B shares of the Real Estate Joint Venture, representing 20% ofthe initial economic interest. The primary distinction between the two classes of shares is the distribution priority.

Distributable cash flows are allocated per the Real Estate Joint Venture agreement in a manner that provides Belmar Realty 1) a priority with respect to a fixed annual preferred return; and 2) participation on a pro rata or reduced basis in distributable cash flows in excess of the annual preferred return of Belmar Realty and the subordinated preferred return of the Class B shareholder.

Major decisions of the Real Estate Joint Venture are subject to the unanimous approval of the Real Estate Joint Venture's board. The day-to-day operating management is provided by a real estate operating company which is an affiliate of the Class B shareholder.

Upon unanimous consent or from and after August 4, 2014, either Belmar Realty or the Brazos Class B shareholder may cause a liquidation of Brazos. If Belmar Realty or the Brazos Class B shareholder elects to liquidate Brazos, Brazos will retain an independent third party to effectuate the liquidation.

Real property held by Brazos is financed through mortgage notes issued to Brazos. The mortgage notes are secured by the real property held by Brazos and are generally without recourse to Belmar Capital and Belmar Realty.

Condensed summary financial data of the Real Estate Joint Venture is presented below.

|                                           |  | December 31,2007 |             | December 31,2006 | 
|------------------------------------------ |  | ---------------- | ----------- | ---------------- | 
|Assets:                                    | 
|Investment in real estate                  |  | $                | 341,911,481 |                  | 
|Other assets                               |  |                  | 5,762,549   |                  | 
|Total assets                               |  | $                | 347,674,030 |                  | 
|Liabilities and Shareholders' Equity:      | 
|Mortgage notes payable(1)                  |  | $                | 228,745,957 |                  | 
|Other liabilities                          |  |                  | 4,603,094   |                  | 
|Total liabilities                          |  | $                | 233,349,051 |                  | 
|Shareholders' equity                       |  | $                | 114,324,979 |                  | 
|Total liabilities and shareholders' equity |  | $                | 347,674,030 |                  | 



(1)The estimated fair value of the mortgage notes payable is approximately $229,200,000 and $227,400,000 as of December 31, 2007 and 2006, respectively. The mortgage notes payable generally cannot be prepaid or otherwise disposed of without incurring a substantial prepayment penalty unless the rental property financed by the mortgage

55

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

notes payable is sold. Management generally has no current plans to prepay or otherwise dispose of the mortgage notes payable without the sale of the related rental property prior to the maturity date. The fair value of the mortgage notes is based on estimates using discounted cash flow analysis and current prevailing interest rates.

|                                                    |  | Year Ended       |           
|--------------------------------------------------- |  | ---------------- | ----------
|                                                    |  | December 31,2007 |           
|Revenues                                            |  | $                | 28,403,730
|Expenses                                            |  |                  | 21,512,528
|Income before realized andunrealized gain (loss)    |  | $                | 6,891,202 
|Realized gain                                       |  |                  |          
|Change in net unrealizedappreciation (depreciation) |  |                  | 10,845,796
|Net investment income                               |  | $                | 17,736,998



8Investment in Co-owned Properties

Belmar Realty held investments in Co-owned Properties through Bel SML I and Bel Marquette I. The other investors in the Co-owned Properties are real estate subsidiaries of other investment funds advised by Boston Management. The Co-owned Properties are financed through mortgage notes. The mortgage notes are secured by the real property and are generally without recourse to Belmar Capital and Belmar Realty, except that there may be recourse for certain liabilities arising from actions such as fraud, misrepresentation, misappropriation of funds or breach of material covenants and liabilities arising from environmental conditions.

9Interest Rate Swap Agreements

Belmar Capital has entered into interest rate swap agreements with Merrill Lynch Capital Services, Inc. to fix the cost of a substantial portion of its borrowings under the Credit Facility (Note 10B) and to mitigate in part the impact of interest rate changes on Belmar Capital's net asset value. Under such agreements, Belmar Capital has agreed to make periodic payments at fixed rates in exchange for payments at floating rates. The notional or contractual amounts of these instruments may not necessarily represent the amounts potentially subject to risk. The measurement of the risks associated with these investments is meaningful only when considered in conjunction with all related assets, liabilities andagreements. Interest rate swap agreements in place at December 31, 2007 and 2006 are listed below.

|              |  | NotionalAmount |         |           |  |              |       | InitialOptionalTermi- |  | FinalTermi- |              | Unrealized Appreciation at | 
|------------- |  | -------------- | ------- | --------- |  | ------------ | ----- | --------------------- |  | ----------- | ------------ | -------------------------- | 
|EffectiveDate |  | (000'somitted) |         | FixedRate |  | FloatingRate |       | nationDate            |  | nationDate  |              | December 31,2007           | 
|10/03         |  | $              | 55,831  |           |  |              | 4.875 | %                     |  |             | LIBOR +0.20% |                            | 
|10/03         |  |                | 43,010  |           |  |              | 4.755 | %                     |  |             | LIBOR +0.20% |                            | 
|              |  |                |         |           |  | LIBOR +      |       |                       |  |             |              |                            | 
|10/03         |  |                | 56,978  |           |  |              | 4.695 | %                     |  |             | 0.20         | %                          | 
|              |  |                |         |           |  | LIBOR +      |       |                       |  |             |              |                            | 
|10/03         |  |                | 64,418  |           |  |              | 4.565 | %                     |  |             | 0.20         | %                          | 
|10/03         |  |                | 110,068 |           |  |              | 3.973 | %                     |  |             | LIBOR +0.20% |                            | 
|2/04          |  |                | 58,363  |           |  |              | 4.90  | %                     |  |             | LIBOR +0.20% |                            | 
|              |  |                |         |           |  |              |       |                       |  |             |              |                            | 



10Debt

AMortgage Note Real property held by Bel Stamford is financed through a mortgage note secured by the real property held by Bel Stamford. The mortgage note is generally without recourse to Belmar Capital and Belmar Realty, except that there may be recourse for certain liabilities arising from actions such as fraud, misrepresentation, misappropriation of funds or breach of material covenants and liabilities arising from environmental conditions.

The estimated fair value of the real property securing the mortgage note is approximately $302,000,000 and $330,000,000 at December 31, 2007 and 2006, respectively. Terms of the mortgage note payable and the amounts outstanding at December 31, 2007 and 2006 are as follows:

|                 |  |              |      | Monthly         | 
|---------------- |  | ------------ | ---- | --------------- | 
|                 |  | Annual       |      | Principal and   | 
|MaturityDate     |  | InterestRate |      | InterestPayment | 
|October 11, 2016 |  |              | 6.00 | %               | 



56

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

Scheduled principal payments of the mortgage note for the years subsequent to December 31, 2007 are as follows:

|Year Ending December 31, |            | Amount | 
|------------------------ | ---------- | ------ | 
|                         | 2008       |        | 
|                         | 2009       |        | 
|                         | 2010       |        | 
|                         | 2011       |        | 
|                         | 2012       |        | 
|                         | Thereafter |        | 
|                         |            |        | 



The estimated fair value of the mortgage note payable is approximately $213,900,000 and $221,100,000 at December 31, 2007 and 2006, respectively. The mortgage note payable generally cannot be prepaid or otherwise disposed of without incurring a substantial prepayment penalty unless the rental property financed by the mortgage note payable is sold. Management generally has no current plans to prepay or otherwise dispose of the mortgage note payable without the sale of the related rental property prior to the maturity date. The fair value of the mortgage note is based on estimates using discounted cash flow analysis and current prevailing interest rates.

BCredit Facility Belmar Capital has entered into credit arrangements with Dresdner Kleinwort Holdings I, Inc. (DKH) and Merrill Lynch Mortgage Capital, Inc. (Merrill Lynch) (collectively, the Credit Facility). The Credit Facility expires on June 25, 2010. Belmar Capital's obligations under the Credit Facility are secured by a pledge of its assets, excluding the assets of Bel Stamford, the Real Estate Joint Venture and Co-owned Properties.

The credit arrangement with DKH is a term loan facility that accrues interest at a rate of one-month LIBOR plus 0.20% per annum. In August 2007, Belmar Capital amended its credit arrangement with DKH to increase the amount of the term loan by $111,000,000 to an aggregate amount of $401,000,000.

The credit arrangement with Merrill Lynch is a revolving loan facility, including the ability to issue letters of credit up to $10,000,000. On May 9, 2007, Belmar Capital amended its credit arrangement with Merrill Lynch to increase the amount of the revolving loan facility by $60,000,000 to an aggregate amount available for borrowing of $118,500,000. Borrowings under this credit arrangement accrue interest at a rate of one-month LIBOR plus 0.38% per annum. On June 18, 2007, Belmar Capital amended its credit arrangement with Merrill Lynch to increase the amount of the revolving loan facility by $125,000,000 to an aggregateamount available for borrowing of $243,500,000 through a temporary agreement (the Temporary Arrangement). Belmar Capital used the proceeds from these borrowings to finance the Fund's investments in Co-owned Properties. The borrowings under the Temporary Arrangement accrued interest at a rate of one-month LIBOR plus 1.0% per annum. Pursuant to its terms, the Temporary Arrangement expired on September 14, 2007 and all amounts outstanding were repaid. A commitment fee of 0.10% per annum is paid on the unused commitment amount. Belmar Capital pays all fees associated with issuing the letters of credit.

The following table summarizes Belmar Capital's CreditFacility:

|                                                |  | At December 31, 2007 |             | At December 31, 2006 | 
|----------------------------------------------- |  | -------------------- | ----------- | -------------------- | 
|Total amount available under theCredit Facility |  | $                    | 519,500,000 |                      | 
|DKH borrowings outstanding                      |  | $                    | 401,000,000 |                      | 
|Merrill Lynch borrowings outstanding            |  | $                    | 19,400,000  |                      | 
|Outstanding letters of credit                   |  | $                    |            |                      | 



Borrowings under the Credit Facility have been used to purchase the Fund's interests in real estate investments, to pay selling commissions and organizational expenses and to provide for the liquidity needs of the Fund. Additional borrowings under the Credit Facility may be made in the future for these purposes.

CAverage Borrowings and Average Interest Rate During the year ended December 31, 2007, the average balance of borrowings under the Credit Facility and the mortgage note payable was approximately $412,500,000 and $213,800,000 with a weighted average interest rate of 5.48% and 6.00%, respectively.

11Management Fee and Other Transactions withAffiliates

Belmar Capital and the Portfolio have engaged Boston Management as investment adviser. Under the terms of the advisory agreement with the Portfolio, Boston Management receives a monthly advisory fee of 5/96 of 1% (0.625% annually) of the average daily net assets of the Portfolio up to $500,000,000 and at reduced rates as daily net assets exceed that level. For each of the years ended December 31, 2007, 2006 and 2005, the advisory fee applicable to the Portfolio was 0.43% of average daily net assets.

Subject to the fee waiver described below, Boston Management is entitled to receive a monthly advisory and administrative fee of 1/20 of 1% (0.60% annually) of the

57

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

average daily gross assets of Belmar Capital. The term "gross assets" means the value of all of Belmar Capital's assets, including Belmar Capital's interest in Belvedere Company and Belmar Capital's ratable share of the assets of its direct and indirect subsidiaries, real estate joint ventures and co-owned real property investments, without reduction by any liabilities. Belmar Realty pays Boston management a monthly management fee at a rate of 1/20 of 1% (equivalent to 0.60% annually) of the average daily gross assets of Belmar Realty. The term "gross assets" means the value of all assets of Belmar Realty, including Belmar Realty's ratable share of the assets of its direct and indirect subsidiaries, real estate joint ventures and co-owned real property investments, without reduction by any liabilities.

As compensation for its services as placement agent, Belmar Capital pays Eaton Vance Distributors, Inc. (EV Distributors) a monthly distribution fee at a rate of 1/120 of 1% (equivalent to 0.10% annually) of Belmar Capital's average daily net assets.

Eaton Vance Management and Boston Management do not receive separate compensation for serving as manager of Belmar Capital and manager of Belvedere Company,respectively.

Boston Management has agreed to waive that portion of the monthly investment advisory and administrative fee payable by Belmar Capital to the extent that such fee, together with the monthly distribution fee payable by Belmar Capital to EV Distributors and Belmar Capital's attributable share of the monthly investment advisory fee and management fee payable by the Portfolio and Belmar Realty, respectively, exceeds 0.60% of the average daily gross assets of Belmar Capital (as described above). In addition, if Belmar Capital invests in Cash Management, the advisory and administrative fees paid to Boston Management by Cash Management in respect of Belmar Capital's investment therein will be credited towards Belmar Capital's advisory and administrative fee payments, reducing the amount of such fees otherwise payable by Belmar Capital.

Pursuant to a servicing agreement between Belvedere Company and EV Distributors, Belvedere Company pays a servicing fee to EV Distributors for providing certain services and information to direct and indirect investors in Belvedere Company. The servicing fee is paid on a quarterly basis at an annual rate of 0.15% of Belvedere Company's average daily net assets. Pursuant to a servicing agreement between Belmar Capital and EV Distributors, Belmar Capital pays a servicing fee to EV Distributors on a quarterly basis at an annual rate of 0.25% of BelmarCapital's average daily net assets. Belmar Capital's allocated share of the servicing fee payable by Belvedere Company is credited towards Belmar Capital's servicing fee payment, reducing the amount of such fee that would otherwise be payable by Belmar Capital. With respect to Shareholders who subscribe through a subagent, EV Distributors has assigned servicing responsibilities and fees to the applicable subagent.

The table below sets forth the fees paid or payable by, or allocable to, the Fund for the years ended December 31, 2007, 2006 and 2005 in connection with the services rendered by Eaton Vance Management and its affiliates.

|                                                             |  | Year Ended       |           
|------------------------------------------------------------ |  | ---------------- | ----------
|                                                             |  | December 31,2007 |           
|Advisory fee allocated toBelvedere Company fromthe Portfolio |  | $                | 64,755,126
|Advisory fee allocated tothe Fund from BelvedereCompany      |  | $                | 8,191,590 
|Advisory fee allocated tothe Fund from CashManagement        |  | $                | 27,049    
|Advisory and administrativefees incurred directlyby the Fund |  | $                | 7,531,125 
|Distribution fee incurreddirectly by the Fund                |  | $                | 1,807,217 
|Reduction of advisory andadministrative fees                 |  | $                | 1,807,217 
|Servicing fee of BelvedereCompany                            |  | $                | 22,797,451
|Servicing fee allocated tothe Fund fromBelvedere Company     |  | $                | 2,882,960 
|Servicing fee incurreddirectly by the Fund                   |  | $                | 1,632,457 
|Servicing fee paid oraccrued to subagents                    |  | $                | 4,508,739 



58

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

12Segment Information

Belmar Capital pursues its investment objective primarily by investing indirectly in the Portfolio through Belvedere Company. The Portfolio is a diversified investment company that emphasizes investments in common stocks of domestic and foreign growth companies that are considered by its investment adviser to be high in quality and attractive in their long-term investment prospects. The Fund's investment income includes the Fund's pro rata share of Belvedere Company's net investment income. Separate from its investment in Belvedere Company, Belmar Capital invests in real estate investments through its subsidiary, Belmar Realty. Belmar Realty invests directly and indirectly in Partnership Preference Units, a Real Estate Joint Venture (Note 7), Wholly Owned Property and Co-owned Properties. The Fund's investment income from real estate investments primarily consists of rental income from the Wholly Owned Property, net investment income from the Real Estate Joint Venture, distribution income from Partnership Preference Units and net investment income from Co-owned Properties.

Belmar Capital evaluates performance of the reportable segments based on the net increase (decrease) in net assets from operations of the respective segment, which includes net investment income (loss), net realized gain (loss) and the net change in unrealized appreciation (depreciation).

The Fund's Credit Facility borrowings and related interest expense are centrally managed by the Fund. A portion of the Credit Facility borrowings and related interest expense have been approximated and allocated to the real estate segment for presentation purposes herein. Credit Facility borrowings allocated to the real estate segment primarily represent estimated net amounts borrowed to purchase the Fund's interest in real estate investments. The Fund's interest rate swap agreement balances are presented as part of the real estate segment for presentation purposes herein. The accounting policies of the reportable segments are the same as those for Belmar Capital on a consolidated basis (Note 2). No reportable segments have been aggregated. Reportable information by segment is as follows:

|                                                        |  | Year Ended       |            
|------------------------------------------------------- |  | ---------------- | -----------
|                                                        |  | December 31,2007 |            
|Investment income                                       | 
|The Portfolio*                                          |  | $                | 26,354,223 
|Real Estate                                             |  |                  | 30,565,064 
|Unallocated                                             |  |                  | 292,162    
|Total investment income                                 |  | $                | 57,211,449 
|Interest expense                                        | 
|The Portfolio*                                          |  | $                | 4,520,200  
|Real Estate(1)                                          |  |                  | 27,014,006 
|Unallocated(2)                                          |  |                  | 4,068,180  
|Total interest expense                                  |  | $                | 35,602,386 
|Net realized gain (loss)                                | 
|The Portfolio*                                          |  | $                | 74,199,895 
|Real Estate                                             |  |                  | 3,549,037  
|Unallocated                                             |  |                  |           
|Total net realized gain                                 |  | $                | 77,748,932 
|Net change in unrealizedappreciation (depreciation)     | 
|The Portfolio*                                          |  | $                | (6,404,394 
|Real Estate                                             |  |                  | (35,704,293
|Unallocated                                             |  |                  |           
|Total net change inunrealizedappreciation(depreciation) |  | $                | (42,108,687
|Net increase (decrease) innet assets from operations    | 
|The Portfolio*                                          |  | $                | 88,034,184 
|Real Estate                                             |  |                  | (33,273,244
|Unallocated(3)                                          |  |                  | (7,611,811 
|Net increase in netassets from operations               |  | $                | 47,149,129 



|               |  | At December 31, 2007 |               | At December 31, 2006 | 
|-------------- |  | -------------------- | ------------- | -------------------- | 
|Segment assets | 
|The Portfolio* |  | $                    | 1,697,387,202 |                      | 
|Real Estate    |  |                      | 538,070,578   |                      | 
|Unallocated(4) |  |                      | 2,335,707     |                      | 
|Segment assets |  | $                    | 2,237,793,487 |                      | 
|Net assets     | 
|The Portfolio* |  | $                    | 1,601,648,138 |                      | 
|Real Estate    |  |                      | 63,062,397    |                      | 
|Unallocated(5) |  |                      | (70,697,371   | )                    | 
|Net Assets     |  | $                    | 1,594,013,164 |                      | 



*  Belmar Capital invests indirectly in the Portfolio through Belvedere Company.

(1)Includes interest expense on the mortgage note payable held by Bel Stamford, as well as interest expense incurred on Credit Facility borrowings allocated to the real estate segment for presentation purposes.

59

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Belmar Capital Fund LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCONT'D

(2)Unallocated interest expense represents interest incurred on unallocated Credit Facility borrowings. Such borrowings are used to finance ongoing operations of the Fund and are not allocable to reportable segments.

(3)Unallocated amounts pertain to the overall operation of Belmar Capital and do not pertain to either segment. Included in this amount are primarily distribution and servicing fees and unallocated Credit Facility interest expense as follows:

|                                 |  | Year Ended       |          
|-------------------------------- |  | ---------------- | ---------
|                                 |  | December 31,2007 |          
|Distribution and servicing fees  |  | $                | 3,439,674
|Credit Facility interest expense |  | $                | 4,068,180



(4)Represents direct cash and short-term investments held by the Fund, including the Fund's investment in Cash Management.

(5)Amount includes unallocated liabilities, net of unallocated assets. Unallocated liabilities primarily consist of outstanding unallocated Credit Facility borrowings. Such borrowings are used to finance ongoing operations of the Fund and are not allocable to reportable segments. As of December 31, 2007 and 2006, such borrowings totaled approximately $72,256,000 and $81,905,000, respectively.

13Subsequent Event

On January 30, 2008, the Fund made a distribution of $1.31 per share to Shareholders of record on January 29, 2008.

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Belmar Capital Fund LLC

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders of Belmar Capital Fund LLC and Subsidiaries

We have audited the accompanying consolidated statements of assets and liabilities, including the consolidated portfolios of investments, of Belmar Capital Fund LLC and subsidiaries (collectively, the Fund) as of December 31, 2007 and 2006, and the related consolidated statements of operations, changes in net assets, cash flows, and financial highlights for each of the three years in the period ended December 31, 2007. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (UnitedStates). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2007 and 2006, by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Belmar Capital Fund LLC and subsidiaries as of December 31, 2007 and 2006, and the results of their operations, the changes in their net assets, their cash flows, and the financial highlights for each of the three years in the period ended December 31, 2007, in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 2 to the financial statements, the financial statements include investments whose fair values have been estimated by management in the absence of readily determinable fair values. Management's estimates are based on information provided by the fund managers. As of December 31, 2007 and 2006, these investments were valued at $535,413,550 (34% of net assets) and $443,793,592 (23%of net assets), respectively.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Fund's internal control over financial reporting as of December 31, 2007, based on the criteria established inInternal Control  Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 27, 2008 expressed an unqualified opinion on the Fund's internal control over financial reporting.

DELOITTE & TOUCHE LLPBoston, MassachusettsFebruary 27, 2008

61

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Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTS

|Common Stocks  99.4%                | 
|------------------------------------ | 
|Security                             | 
|Aerospace & Defense  3.9%           | 
|Boeing Co. (The)                     | 
|General Dynamics Corp.               | 
|Honeywell International, Inc.        | 
|Lockheed Martin Corp.                | 
|Northrop Grumman Corp.               | 
|Raytheon Co.                         | 
|Rockwell Collins, Inc.               | 
|United Technologies Corp.            | 
|                                     | 
|Air Freight & Logistics  2.2%       | 
|CH Robinson Worldwide, Inc.          | 
|FedEx Corp.                          | 
|United Parcel Service, Inc., Class B | 
|                                     | 
|Airlines  0.0%                      | 
|Southwest Airlines Co.               | 
|                                     | 
|Auto Components  0.2%               | 
|Delphi Corp.(1)                      | 
|Johnson Controls, Inc.               | 
|WABCO Holdings, Inc.                 | 
|                                     | 
|Automobiles  0.1%                   | 
|DaimlerChrysler AG(2)                | 
|Ford Motor Co.(1)                    | 
|General Motors Corp.                 | 
|Harley-Davidson, Inc.                | 
|                                     | 
|Beverages  5.7%                     | 
|Anheuser-Busch Cos., Inc.            | 
|Brown-Forman Corp., Class A          | 
|Brown-Forman Corp., Class B          | 
|Coca-Cola Co. (The)                  | 
|Coca-Cola Enterprises, Inc.          | 
|PepsiCo, Inc.                        | 
|                                     | 



|Security                                |  | Shares |             | Value | 
|--------------------------------------- |  | ------ | ----------- | ----- | 
|Biotechnology  1.0%                    | 
|Amgen, Inc.(1)                          |  |        | 3,455,994   |       | 
|Biogen Idec, Inc.(1)                    |  |        | 212,421     |       | 
|Genentech, Inc.(1)                      |  |        | 8,609       |       | 
|Genzyme Corp.(1)                        |  |        | 244,608     |       | 
|Gilead Sciences, Inc.(1)                |  |        | 280,364     |       | 
|Vertex Pharmaceuticals, Inc.(1)         |  |        | 13,000      |       | 
|                                        |  | $      | 204,574,928 |       | 
|Building Products  0.5%                | 
|Masco Corp.                             |  |        | 3,187,629   |       | 
|Trane, Inc.                             |  |        | 444,951     |       | 
|                                        |  | $      | 89,668,324  |       | 
|Capital Markets  4.8%                  | 
|Affiliated Managers Group, Inc.(1)      |  |        | 20,520      |       | 
|Ameriprise Financial, Inc.              |  |        | 66,443      |       | 
|Bank of New York Mellon Corp. (The)     |  |        | 903,498     |       | 
|Bear Stearns Companies, (The), Inc.     |  |        | 95,740      |       | 
|Charles Schwab Corp. (The)              |  |        | 797,107     |       | 
|Credit Suisse Group(2)                  |  |        | 155,136     |       | 
|Deutsche Bank AG(2)                     |  |        | 16,000      |       | 
|E*Trade Financial Corp.(1)              |  |        | 45,935      |       | 
|Federated Investors, Inc., Class B      |  |        | 1,599,819   |       | 
|Franklin Resources, Inc.                |  |        | 569,223     |       | 
|Goldman Sachs Group, Inc.               |  |        | 1,115,548   |       | 
|Knight Capital Group, Inc., Class A(1)  |  |        | 1,000,000   |       | 
|Legg Mason, Inc.                        |  |        | 46,784      |       | 
|Lehman Brothers Holdings, Inc.          |  |        | 195,374     |       | 
|Merrill Lynch & Co., Inc.               |  |        | 2,652,883   |       | 
|Morgan Stanley                          |  |        | 3,033,981   |       | 
|Northern Trust Corp.                    |  |        | 701,042     |       | 
|Piper Jaffray Cos., Inc.(1)             |  |        | 12,636      |       | 
|Raymond James Financial, Inc.           |  |        | 221,005     |       | 
|State Street Corp.                      |  |        | 607,860     |       | 
|T. Rowe Price Group, Inc.               |  |        | 341,862     |       | 
|UBS AG(2)                               |  |        | 192,957     |       | 
|Waddell & Reed Financial, Inc., Class A |  |        | 273,635     |       | 
|                                        |  | $      | 945,957,548 |       | 
|Chemicals  0.8%                        | 
|Arch Chemicals, Inc.                    |  |        | 4,950       |       | 
|Ashland, Inc.                           |  |        | 46,969      |       | 
|Dow Chemical Co. (The)                  |  |        | 250,895     |       | 



See notes to financial statements62

---

Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTSCONT'D

|Security                               |  | Shares |               | Value | 
|-------------------------------------- |  | ------ | ------------- | ----- | 
|Chemicals (continued)                  | 
|E.I. du Pont de Nemours & Co.          |  |        | 985,903       |       | 
|Ecolab, Inc.                           |  |        | 414,911       |       | 
|Monsanto Co.                           |  |        | 39,168        |       | 
|Olin Corp.                             |  |        | 9,900         |       | 
|PPG Industries, Inc.                   |  |        | 14,262        |       | 
|Rohm and Haas Co.                      |  |        | 2,380         |       | 
|Sigma-Aldrich Corp.                    |  |        | 1,062,698     |       | 
|Tronox, Inc., Class B                  |  |        | 3,250         |       | 
|Valspar Corp. (The)                    |  |        | 985,379       |       | 
|                                       |  | $      | 162,971,823   |       | 
|Commercial Banks  5.6%                | 
|Associated Banc-Corp.                  |  |        | 512,602       |       | 
|Banco Bilbao Vizcaya Argentaria SA ADR |  |        | 80,438        |       | 
|Bank of Hawaii Corp.                   |  |        | 69,735        |       | 
|Bank of Montreal(2)                    |  |        | 244,144       |       | 
|BB&T Corp.                             |  |        | 1,490,483     |       | 
|City National Corp.                    |  |        | 143,260       |       | 
|Comerica, Inc.                         |  |        | 315,697       |       | 
|Commerce Bancshares, Inc.              |  |        | 179,609       |       | 
|Fifth Third Bancorp                    |  |        | 3,175,840     |       | 
|First Horizon National Corp.           |  |        | 142,230       |       | 
|First Midwest Bancorp, Inc.            |  |        | 241,668       |       | 
|HSBC Holdings PLC(2)                   |  |        | 220,592       |       | 
|HSBC Holdings PLC UK ADR               |  |        | 578,331       |       | 
|Huntington Bancshares, Inc.            |  |        | 583,001       |       | 
|KeyCorp                                |  |        | 545,748       |       | 
|M&T Bank Corp.                         |  |        | 75,512        |       | 
|Marshall & Ilsley Corp.                |  |        | 672,512       |       | 
|National City Corp.                    |  |        | 1,543,156     |       | 
|PNC Financial Services Group, Inc.     |  |        | 86,068        |       | 
|Regions Financial Corp.                |  |        | 2,202,677     |       | 
|Royal Bank of Canada(2)                |  |        | 611,218       |       | 
|Societe Generale(2)                    |  |        | 1,669,583     |       | 
|SunTrust Banks, Inc.                   |  |        | 882,656       |       | 
|Synovus Financial Corp.                |  |        | 842,907       |       | 
|Toronto-Dominion Bank (The)(2)         |  |        | 17,915        |       | 
|Trustmark Corp.                        |  |        | 205,425       |       | 
|U.S. Bancorp                           |  |        | 4,908,006     |       | 
|Valley National Bancorp.               |  |        | 5,229         |       | 
|Wachovia Corp.                         |  |        | 2,843,749     |       | 
|Wells Fargo & Co.                      |  |        | 3,305,187     |       | 
|Westamerica Bancorporation             |  |        | 1,968         |       | 
|Zions Bancorporation                   |  |        | 366,194       |       | 
|                                       |  | $      | 1,115,266,841 |       | 



|Security                                |  | Shares |             | Value | 
|--------------------------------------- |  | ------ | ----------- | ----- | 
|Commercial Services & Supplies  0.3%   | 
|ACCO Brands Corp.(1)                    |  |        | 15,490      |       | 
|Allied Waste Industries, Inc.(1)        |  |        | 656,568     |       | 
|Avery Dennison Corp.                    |  |        | 56,594      |       | 
|Cintas Corp.                            |  |        | 280,640     |       | 
|Herman Miller, Inc.                     |  |        | 541,800     |       | 
|HNI Corp.                               |  |        | 291,437     |       | 
|Manpower, Inc.                          |  |        | 706         |       | 
|PHH Corp.(1)                            |  |        | 20,110      |       | 
|Pitney Bowes, Inc.                      |  |        | 43,177      |       | 
|RR Donnelley & Sons Co.                 |  |        | 18,144      |       | 
|Waste Management, Inc.                  |  |        | 264,230     |       | 
|                                        |  | $      | 59,047,557  |       | 
|Communications Equipment  2.4%         | 
|ADC Telecommunications, Inc.(1)         |  |        | 21,340      |       | 
|Alcatel SA ADR                          |  |        | 89,240      |       | 
|Cisco Systems, Inc.(1)                  |  |        | 8,650,060   |       | 
|Comverse Technology, Inc.(1)            |  |        | 25,350      |       | 
|Corning, Inc.                           |  |        | 3,672,635   |       | 
|Dycom Industries, Inc.(1)               |  |        | 57,599      |       | 
|Juniper Networks, Inc.(1)               |  |        | 137,067     |       | 
|Motorola, Inc.                          |  |        | 1,260,589   |       | 
|Nokia Oyj ADR                           |  |        | 1,994,425   |       | 
|Nortel Networks Corp.(1)(2)             |  |        | 72,544      |       | 
|QUALCOMM, Inc.                          |  |        | 1,355,558   |       | 
|Riverstone Networks, Inc.(3)            |  |        | 28,706      |       | 
|Tellabs, Inc.(1)                        |  |        | 25,118      |       | 
|                                        |  | $      | 481,157,628 |       | 
|Computer Peripherals  2.2%             | 
|Brocade Communications Systems, Inc.(1) |  |        | 5,418       |       | 
|Dell, Inc.(1)                           |  |        | 4,283,879   |       | 
|EMC Corp.(1)                            |  |        | 2,761,909   |       | 
|Hewlett-Packard Co.                     |  |        | 902,900     |       | 
|International Business Machines Corp.   |  |        | 1,713,085   |       | 
|Lexmark International, Inc., Class A(1) |  |        | 1,208,803   |       | 
|Network Appliance, Inc.(1)              |  |        | 369,094     |       | 
|Palm, Inc.                              |  |        | 398         |       | 
|Sun Microsystems, Inc.(1)               |  |        | 79,795      |       | 
|                                        |  | $      | 439,779,361 |       | 



See notes to financial statements63

---

Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTSCONT'D

|Security                              |  | Shares |             | Value | 
|------------------------------------- |  | ------ | ----------- | ----- | 
|Construction & Engineering  0.1%     | 
|Jacobs Engineering Group, Inc.(1)     |  |        | 108,010     |       | 
|                                      |  | $      | 10,326,836  |       | 
|Construction Materials  0.1%         | 
|Cemex SAB de CV ADR(1)                |  |        | 51,226      |       | 
|CRH PLC(2)                            |  |        | 207,894     |       | 
|Vulcan Materials Co.                  |  |        | 205,352     |       | 
|                                      |  | $      | 24,734,732  |       | 
|Consumer Finance  0.8%               | 
|American Express Co.                  |  |        | 684,621     |       | 
|Capital One Financial Corp.           |  |        | 1,770,321   |       | 
|Discover Financial Services           |  |        | 1,230,162   |       | 
|SLM Corp.                             |  |        | 911,782     |       | 
|                                      |  | $      | 156,193,486 |       | 
|Containers & Packaging  0.1%         | 
|Bemis Co., Inc.                       |  |        | 295,186     |       | 
|Sealed Air Corp.                      |  |        | 3,799       |       | 
|Sonoco Products Co.                   |  |        | 73,373      |       | 
|Temple-Inland, Inc.                   |  |        | 90,660      |       | 
|                                      |  | $      | 12,458,193  |       | 
|Distributors  0.0%                   | 
|Genuine Parts Co.                     |  |        | 190,459     |       | 
|                                      |  | $      | 8,818,252   |       | 
|Diversified Consumer Services  0.2%  | 
|Apollo Group, Inc., Class A(1)        |  |        | 27,070      |       | 
|H&R Block, Inc.                       |  |        | 1,603,312   |       | 
|                                      |  | $      | 31,672,464  |       | 
|Diversified Financial Services  2.2% | 
|Bank of America Corp.                 |  |        | 3,631,286   |       | 
|Citigroup, Inc.                       |  |        | 4,583,304   |       | 
|CME Group, Inc.                       |  |        | 2,908       |       | 
|ING Groep N.V. ADR                    |  |        | 264,281     |       | 
|IntercontinentalExchange, Inc.(1)     |  |        | 11,417      |       | 
|JPMorgan Chase & Co.                  |  |        | 2,698,987   |       | 
|Moody's Corp.                         |  |        | 323,702     |       | 
|                                      |  | $      | 428,602,108 |       | 



|Security                                              |  | Shares |             | Value | 
|----------------------------------------------------- |  | ------ | ----------- | ----- | 
|Diversified Telecommunication Services  1.7%         | 
|AT&T, Inc.                                            |  |        | 1,601,671   |       | 
|BCE, Inc.(2)(4)                                       |  |        | 2,653,500   |       | 
|Bell Aliant Regional Communications, Inc.(1)(2)(3)(5) |  |        | 210,251     |       | 
|Cincinnati Bell, Inc.(1)                              |  |        | 169,013     |       | 
|Citizens Communications Co.                           |  |        | 6,949       |       | 
|Deutsche Telekom AG ADR                               |  |        | 1,845,908   |       | 
|Embarq Corp.                                          |  |        | 10,856      |       | 
|McLeod USA, Inc., Class A(1)(3)                       |  |        | 947         |       | 
|Qwest Communications International, Inc.(1)           |  |        | 888         |       | 
|RSL Communications, Ltd., Class A(1)(2)(3)            |  |        | 247,161     |       | 
|Telefonos de Mexico SAB de CV ADR                     |  |        | 2,519,435   |       | 
|Verizon Communications, Inc.                          |  |        | 523,029     |       | 
|Windstream Corp.                                      |  |        | 906,552     |       | 
|                                                      |  | $      | 347,191,492 |       | 
|Electric Utilities  0.5%                             | 
|Duke Energy Corp.                                     |  |        | 432,532     |       | 
|Exelon Corp.                                          |  |        | 1,011,736   |       | 
|Southern Co. (The)                                    |  |        | 68,451      |       | 
|                                                      |  | $      | 93,974,773  |       | 
|Electrical Equipment  0.8%                           | 
|Emerson Electric Co.                                  |  |        | 2,534,883   |       | 
|Rockwell Automation, Inc.                             |  |        | 112,400     |       | 
|Roper Industries, Inc.                                |  |        | 46,244      |       | 
|Thomas & Betts Corp.(1)                               |  |        | 22,600      |       | 
|                                                      |  | $      | 155,377,979 |       | 
|Electronic Equipment & Instruments  0.3%             | 
|Agilent Technologies, Inc.(1)                         |  |        | 459,803     |       | 
|Arrow Electronics, Inc.(1)                            |  |        | 8,750       |       | 
|Flextronics International, Ltd.(1)(2)                 |  |        | 480,195     |       | 
|Jabil Circuit, Inc.                                   |  |        | 1,651,513   |       | 
|National Instruments Corp.                            |  |        | 88,674      |       | 
|Plexus Corp.(1)                                       |  |        | 140,213     |       | 
|Sanmina-SCI Corp.(1)                                  |  |        | 18,166      |       | 
|Tyco Electronics, Ltd.(2)                             |  |        | 281,877     |       | 
|                                                      |  | $      | 65,383,270  |       | 



See notes to financial statements64

---

Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTSCONT'D

|Security                                |  | Shares |             | Value | 
|--------------------------------------- |  | ------ | ----------- | ----- | 
|Energy Equipment & Services  0.9%      | 
|Baker Hughes, Inc.                      |  |        | 204,980     |       | 
|Halliburton Co.                         |  |        | 900,476     |       | 
|Schlumberger, Ltd.(2)                   |  |        | 1,200,029   |       | 
|Transocean, Inc.(2)                     |  |        | 81,993      |       | 
|                                        |  | $      | 180,545,074 |       | 
|Food & Staples Retailing  2.3%         | 
|Casey's General Stores, Inc.            |  |        | 12,551      |       | 
|Costco Wholesale Corp.                  |  |        | 913,115     |       | 
|CVS Caremark Corp.                      |  |        | 2,392,086   |       | 
|Kroger Co. (The)                        |  |        | 1,368,952   |       | 
|Safeway, Inc.                           |  |        | 1,133,243   |       | 
|Sysco Corp.                             |  |        | 2,322,757   |       | 
|Walgreen Co.                            |  |        | 989,530     |       | 
|Wal-Mart Stores, Inc.                   |  |        | 2,417,231   |       | 
|                                        |  | $      | 459,554,443 |       | 
|Food Products  2.6%                    | 
|Archer-Daniels-Midland Co.(6)           |  |        | 25,859      |       | 
|Archer-Daniels-Midland Co.              |  |        | 1,548,807   |       | 
|Campbell Soup Co.                       |  |        | 1,295,515   |       | 
|ConAgra Foods, Inc.                     |  |        | 438,684     |       | 
|Dean Foods Co.                          |  |        | 286,449     |       | 
|Del Monte Foods Co.                     |  |        | 98,719      |       | 
|General Mills, Inc.                     |  |        | 133,423     |       | 
|H.J. Heinz Co.                          |  |        | 154,799     |       | 
|Hershey Co. (The)                       |  |        | 494,963     |       | 
|J.M. Smucker Co. (The)                  |  |        | 6,121       |       | 
|Kellogg Co.                             |  |        | 9,362       |       | 
|Kraft Foods, Inc., Class A              |  |        | 422,531     |       | 
|Nestle SA(2)                            |  |        | 275,000     |       | 
|Sara Lee Corp.                          |  |        | 4,267,625   |       | 
|Smithfield Foods, Inc.(1)               |  |        | 2,352,196   |       | 
|TreeHouse Foods, Inc.(1)                |  |        | 25,945      |       | 
|Tyson Foods, Inc., Class A              |  |        | 241,647     |       | 
|Unilever PLC ADR                        |  |        | 1,755       |       | 
|William Wrigley Jr. Co.                 |  |        | 999,004     |       | 
|                                        |  | $      | 512,801,186 |       | 
|Health Care Equipment & Supplies  1.3% | 
|Advanced Medical Optics, Inc.(1)        |  |        | 9,834       |       | 
|Baxter International, Inc.              |  |        | 244,163     |       | 



|Security                                     |  | Shares |             | Value | 
|-------------------------------------------- |  | ------ | ----------- | ----- | 
|Health Care Equipment & Supplies (continued) | 
|Becton, Dickinson and Co.                    |  |        | 63,708      |       | 
|Boston Scientific Corp.(1)                   |  |        | 1,124,134   |       | 
|Covidien, Ltd.(2)                            |  |        | 281,877     |       | 
|DENTSPLY International, Inc.                 |  |        | 7,700       |       | 
|Hospira, Inc.(1)                             |  |        | 111,411     |       | 
|Medtronic, Inc.                              |  |        | 3,132,080   |       | 
|St. Jude Medical, Inc.(1)                    |  |        | 154,981     |       | 
|Stryker Corp.                                |  |        | 168,467     |       | 
|Zimmer Holdings, Inc.(1)                     |  |        | 599,639     |       | 
|                                             |  | $      | 266,396,898 |       | 
|Health Care Providers & Services  1.5%      | 
|AmerisourceBergen Corp.                      |  |        | 368,948     |       | 
|Cardinal Health, Inc.                        |  |        | 1,856,066   |       | 
|CIGNA Corp.                                  |  |        | 49,467      |       | 
|Express Scripts, Inc.(1)                     |  |        | 196,994     |       | 
|Health Management Associates, Inc., Class A  |  |        | 124,425     |       | 
|Henry Schein, Inc.(1)                        |  |        | 1,089,990   |       | 
|McKesson Corp.                               |  |        | 6,462       |       | 
|Medco Health Solutions, Inc.(1)              |  |        | 167,770     |       | 
|PharMerica Corp.(1)                          |  |        | 30,682      |       | 
|Sunrise Senior Living, Inc.(1)               |  |        | 8,000       |       | 
|Tenet Healthcare Corp.(1)                    |  |        | 1,548       |       | 
|UnitedHealth Group, Inc.                     |  |        | 441,856     |       | 
|WellPoint, Inc.(1)                           |  |        | 609,715     |       | 
|                                             |  | $      | 305,771,070 |       | 
|Health Care Technology  0.0%                | 
|IMS Health, Inc.                             |  |        | 120,055     |       | 
|                                             |  | $      | 2,766,067   |       | 
|Hotels, Restaurants & Leisure  1.0%         | 
|Bob Evans Farms, Inc.                        |  |        | 1,792       |       | 
|Carnival Corp.(2)                            |  |        | 543,886     |       | 
|Darden Restaurants, Inc.                     |  |        | 184,714     |       | 
|Gaylord Entertainment Co.(1)                 |  |        | 74,918      |       | 
|International Game Technology                |  |        | 409,904     |       | 
|International Speedway Corp., Class A        |  |        | 118,344     |       | 
|Marriott International, Inc., Class A        |  |        | 424,554     |       | 
|McDonald's Corp.                             |  |        | 939,331     |       | 
|MGM MIRAGE(1)                                |  |        | 27,640      |       | 
|Starbucks Corp.(1)                           |  |        | 2,254,271   |       | 



See notes to financial statements65

---

Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTSCONT'D

|Security                                            |  | Shares |             | Value | 
|--------------------------------------------------- |  | ------ | ----------- | ----- | 
|Hotels, Restaurants & Leisure (continued)           | 
|Wyndham Worldwide Corp.                             |  |        | 110,649     |       | 
|Yum! Brands, Inc.                                   |  |        | 363,380     |       | 
|                                                    |  | $      | 190,104,520 |       | 
|Household Durables  0.3%                           | 
|Blyth, Inc.                                         |  |        | 136,371     |       | 
|D.R. Horton, Inc.                                   |  |        | 642,283     |       | 
|Fortune Brands, Inc.                                |  |        | 119,860     |       | 
|Leggett & Platt, Inc.                               |  |        | 1,290,676   |       | 
|Newell Rubbermaid, Inc.                             |  |        | 291,589     |       | 
|                                                    |  | $      | 50,179,629  |       | 
|Household Products  3.4%                           | 
|Clorox Co. (The)                                    |  |        | 14,873      |       | 
|Colgate-Palmolive Co.                               |  |        | 707,241     |       | 
|Energizer Holdings, Inc.(1)                         |  |        | 76,555      |       | 
|Kimberly-Clark Corp.                                |  |        | 639,207     |       | 
|Procter & Gamble Co. (The)                          |  |        | 7,811,071   |       | 
|                                                    |  | $      | 682,501,339 |       | 
|Independent Power Producers & Energy Traders  0.0% | 
|AES Corp. (The)(1)                                  |  |        | 133,519     |       | 
|                                                    |  | $      | 2,855,971   |       | 
|Industrial Conglomerates  3.0%                     | 
|3M Co.                                              |  |        | 1,008,315   |       | 
|General Electric Co.                                |  |        | 13,169,338  |       | 
|Teleflex, Inc.                                      |  |        | 11,386      |       | 
|Textron, Inc.                                       |  |        | 43,912      |       | 
|Tyco International, Ltd.(2)                         |  |        | 281,877     |       | 
|                                                    |  | $      | 588,233,262 |       | 
|Insurance  5.6%                                    | 
|Aegon, N.V. ADR                                     |  |        | 5,224,475   |       | 
|AFLAC, Inc.                                         |  |        | 2,260,033   |       | 
|Allstate Corp. (The)                                |  |        | 191,074     |       | 
|American International Group, Inc.                  |  |        | 6,433,663   |       | 
|AON Corp.                                           |  |        | 386,911     |       | 
|Arthur J. Gallagher & Co.                           |  |        | 557,025     |       | 
|Berkshire Hathaway, Inc., Class A(1)                |  |        | 633         |       | 
|Berkshire Hathaway, Inc., Class B(1)                |  |        | 40,413      |       | 
|Chubb Corp.                                         |  |        | 28,354      |       | 



|Security                                      |  | Shares |               | Value | 
|--------------------------------------------- |  | ------ | ------------- | ----- | 
|Insurance (continued)                         | 
|Hartford Financial Services Group, Inc. (The) |  |        | 58,685        |       | 
|Lincoln National Corp.                        |  |        | 143,261       |       | 
|Manulife Financial Corp.(2)                   |  |        | 246,658       |       | 
|Marsh & McLennan Cos., Inc.                   |  |        | 478,442       |       | 
|MetLife, Inc.                                 |  |        | 81            |       | 
|Old Republic International Corp.              |  |        | 294,458       |       | 
|Progressive Corp. (The)                       |  |        | 3,731,348     |       | 
|SAFECO Corp.                                  |  |        | 161,000       |       | 
|Torchmark Corp.                               |  |        | 318,929       |       | 
|Travelers Cos., Inc. (The)                    |  |        | 348,162       |       | 
|UnumProvident Group                           |  |        | 39,000        |       | 
|XL Capital Ltd., Class A(2)                   |  |        | 187,100       |       | 
|                                              |  | $      | 1,102,245,281 |       | 
|Internet & Catalog Retail  0.1%              | 
|Amazon.com, Inc.(1)                           |  |        | 43,801        |       | 
|Expedia, Inc.(1)                              |  |        | 403,096       |       | 
|IAC/InterActiveCorp(1)                        |  |        | 429,832       |       | 
|                                              |  | $      | 28,374,698    |       | 
|Internet Software & Services  1.2%           | 
|eBay, Inc.(1)                                 |  |        | 1,257,244     |       | 
|Google Inc., Class A(1)                       |  |        | 294,413       |       | 
|                                              |  | $      | 245,308,629   |       | 
|IT Services  1.9%                            | 
|Accenture Ltd., Class A(2)                    |  |        | 2,739,520     |       | 
|Acxiom Corp.                                  |  |        | 74,785        |       | 
|Affiliated Computer Services, Inc.(1)         |  |        | 176,162       |       | 
|Automatic Data Processing, Inc.               |  |        | 1,494,739     |       | 
|Broadridge Financial Solutions, Inc.          |  |        | 223,288       |       | 
|Computer Sciences Corp.(1)                    |  |        | 226,702       |       | 
|DST Systems, Inc.(1)                          |  |        | 22,600        |       | 
|Electronic Data Systems Corp.                 |  |        | 1,252         |       | 
|Fidelity National Information Services, Inc.  |  |        | 37,789        |       | 
|Fiserv, Inc.(1)                               |  |        | 836,355       |       | 
|Gartner, Inc., Class A(1)                     |  |        | 30,575        |       | 
|Metavante Technologies, Inc.(1)               |  |        | 224,170       |       | 
|Paychex, Inc.                                 |  |        | 983,290       |       | 
|Perot Systems Corp.(1)                        |  |        | 625,309       |       | 
|Western Union Co.                             |  |        | 3,488,152     |       | 
|                                              |  | $      | 374,696,941   |       | 



See notes to financial statements66

---

Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTSCONT'D

|Security                                         |  | Shares |               | Value | 
|------------------------------------------------ |  | ------ | ------------- | ----- | 
|Leisure Equipment & Products  0.0%              | 
|Eastman Kodak Co.                                |  |        | 26,739        |       | 
|Mattel, Inc.                                     |  |        | 30,514        |       | 
|                                                 |  | $      | 1,165,769     |       | 
|Life Sciences Tools & Services  0.2%            | 
|Dionex Corp.(1)                                  |  |        | 37,300        |       | 
|Invitrogen Corp.(1)                              |  |        | 429,910       |       | 
|PerkinElmer, Inc.                                |  |        | 139,526       |       | 
|Thermo Fisher Scientific, Inc.(1)                |  |        | 18,700        |       | 
|                                                 |  | $      | 47,957,654    |       | 
|Machinery  5.1%                                 | 
|Caterpillar, Inc.                                |  |        | 217,329       |       | 
|Danaher Corp.                                    |  |        | 3,933,362     |       | 
|Deere & Co.                                      |  |        | 5,563,523     |       | 
|Donaldson Co., Inc.                              |  |        | 77,792        |       | 
|Dover Corp.                                      |  |        | 653,465       |       | 
|Illinois Tool Works, Inc.                        |  |        | 1,708,540     |       | 
|ITT Industries, Inc.                             |  |        | 8,428         |       | 
|Nordson Corp.                                    |  |        | 20,306        |       | 
|Parker Hannifin Corp.                            |  |        | 45,658        |       | 
|                                                 |  | $      | 1,009,331,288 |       | 
|Media  3.8%                                     | 
|CBS Corp., Class A                               |  |        | 10,967        |       | 
|CBS Corp., Class B                               |  |        | 556,629       |       | 
|Citadel Broadcasting Corp.                       |  |        | 16,551        |       | 
|Comcast Corp., Class A(1)                        |  |        | 2,800,692     |       | 
|Comcast Corp., Class A Special(1)                |  |        | 3,545,407     |       | 
|Discovery Holding Co., Class A(1)                |  |        | 16,629        |       | 
|E.W. Scripps Co. (The), Class A                  |  |        | 51,066        |       | 
|EchoStar Communications Corp., Class A(1)        |  |        | 35,150        |       | 
|Entercom Communications Corp.                    |  |        | 220,000       |       | 
|Gannett Co., Inc.                                |  |        | 476,821       |       | 
|Havas Advertising(2)                             |  |        | 3,142,938     |       | 
|Idearc, Inc.                                     |  |        | 22,323        |       | 
|Interpublic Group of Cos., Inc.(1)               |  |        | 932,692       |       | 
|Lamar Advertising Co.                            |  |        | 241,409       |       | 
|Liberty Global, Inc., Class A(1)                 |  |        | 19,414        |       | 
|Liberty Global, Inc., Class C(1)                 |  |        | 3,140         |       | 
|Liberty Media Corp. - Interactive(1)             |  |        | 256,350       |       | 
|Liberty Media Holding Corp.-Capital, Series A(1) |  |        | 8,315         |       | 
|Live Nation, Inc.(1)                             |  |        | 9,085         |       | 



|Security                                      |  | Shares |             | Value | 
|--------------------------------------------- |  | ------ | ----------- | ----- | 
|Media (continued)                             | 
|McClatchy Co., (The), Class A                 |  |        | 3,310       |       | 
|McGraw-Hill Companies, Inc., (The)            |  |        | 472,678     |       | 
|New York Times Co. (The), Class A             |  |        | 22,468      |       | 
|News Corp., Class A                           |  |        | 188,031     |       | 
|Omnicom Group, Inc.                           |  |        | 4,815,503   |       | 
|Publicis Groupe(2)                            |  |        | 329,132     |       | 
|Time Warner, Inc.                             |  |        | 4,062,511   |       | 
|Viacom, Inc., Class A(1)                      |  |        | 4,000       |       | 
|Viacom, Inc., Class B(1)                      |  |        | 524,573     |       | 
|Vivendi SA(2)                                 |  |        | 163,491     |       | 
|Walt Disney Co.                               |  |        | 4,933,939   |       | 
|Washington Post Co. (The), Class B            |  |        | 13,327      |       | 
|WPP Group PLC(2)                              |  |        | 139,450     |       | 
|WPP Group PLC ADR                             |  |        | 252,137     |       | 
|                                              |  | $      | 750,664,952 |       | 
|Metals & Mining  0.0%                        | 
|Alcoa, Inc.                                   |  |        | 85,947      |       | 
|Freeport-McMoRan Copper & Gold, Inc., Class B |  |        | 21,456      |       | 
|Steel Dynamics, Inc.                          |  |        | 51,604      |       | 
|                                              |  | $      | 8,413,366   |       | 
|Multiline Retail  1.1%                       | 
|Dollar Tree Stores, Inc.(1)                   |  |        | 52,534      |       | 
|Family Dollar Stores, Inc.                    |  |        | 1,279,835   |       | 
|JC Penney Co., Inc.                           |  |        | 130,349     |       | 
|Macy's, Inc.                                  |  |        | 230,860     |       | 
|Nordstrom, Inc.                               |  |        | 131,384     |       | 
|Sears Holdings Corp.(1)                       |  |        | 4,107       |       | 
|Target Corp.                                  |  |        | 3,590,237   |       | 
|                                              |  | $      | 222,436,012 |       | 
|Multi-Utilities  0.0%                        | 
|Ameren Corp.                                  |  |        | 5,000       |       | 
|PG&E Corp.                                    |  |        | 3,000       |       | 
|Wisconsin Energy Corp.                        |  |        | 9,576       |       | 
|                                              |  | $      | 866,767     |       | 
|Office Electronics  0.0%                     | 
|Xerox Corp.                                   |  |        | 10,000      |       | 
|Zebra Technologies Corp., Class A(1)          |  |        | 13,500      |       | 
|                                              |  | $      | 630,350     |       | 



See notes to financial statements67

---

Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTSCONT'D

|Security                            |  | Shares |               | Value | 
|----------------------------------- |  | ------ | ------------- | ----- | 
|Oil, Gas & Consumable Fuels  11.5% | 
|Anadarko Petroleum Corp.            |  |        | 4,388,053     |       | 
|Apache Corp.                        |  |        | 2,147,950     |       | 
|BPPLC ADR                           |  |        | 4,966,126     |       | 
|Chevron Corp.                       |  |        | 701,238       |       | 
|ConocoPhillips                      |  |        | 6,223,305     |       | 
|Devon Energy Corp.                  |  |        | 720,663       |       | 
|El Paso Corp.                       |  |        | 97,665        |       | 
|Exxon Mobil Corp.                   |  |        | 6,940,827     |       | 
|Hess Corp.                          |  |        | 54,286        |       | 
|Marathon Oil Corp.                  |  |        | 177,844       |       | 
|Murphy Oil Corp.                    |  |        | 78,679        |       | 
|Royal Dutch Shell PLC ADR           |  |        | 9,594         |       | 
|Royal Dutch Shell PLC ADR           |  |        | 157,131       |       | 
|Spectra Energy Corp.                |  |        | 263,315       |       | 
|Total SA ADR                        |  |        | 272,750       |       | 
|Williams Cos., Inc.                 |  |        | 223,515       |       | 
|                                    |  | $      | 2,287,947,573 |       | 
|Paper and Forest Products  0.1%    | 
|International Paper Co.             |  |        | 155,490       |       | 
|Neenah Paper, Inc.                  |  |        | 23,874        |       | 
|Weyerhaeuser Co.                    |  |        | 85,055        |       | 
|                                    |  | $      | 12,002,649    |       | 
|Personal Products  0.0%            | 
|Avon Products, Inc.                 |  |        | 173,400       |       | 
|Estee Lauder Cos., Inc., Class A    |  |        | 13,035        |       | 
|                                    |  | $      | 7,422,958     |       | 
|Pharmaceuticals  7.5%              | 
|Abbott Laboratories                 |  |        | 3,728,243     |       | 
|Allergan, Inc.                      |  |        | 276,600       |       | 
|Bristol-Myers Squibb Co.            |  |        | 4,298,950     |       | 
|Eli Lilly & Co.                     |  |        | 4,347,136     |       | 
|Forest Laboratories, Inc.(1)        |  |        | 56,729        |       | 
|GlaxoSmithKline PLC ADR             |  |        | 426,495       |       | 
|Johnson & Johnson                   |  |        | 3,911,737     |       | 
|King Pharmaceuticals, Inc.(1)       |  |        | 152,305       |       | 
|Merck & Co., Inc.                   |  |        | 2,224,896     |       | 
|Mylan, Inc.                         |  |        | 6,832         |       | 
|Novo Nordisk A/S ADR                |  |        | 398,434       |       | 
|Pfizer, Inc.                        |  |        | 12,368,792    |       | 



|Security                                        |  | Shares |               | Value | 
|----------------------------------------------- |  | ------ | ------------- | ----- | 
|Pharmaceuticals (continued)                     | 
|Schering-Plough Corp.                           |  |        | 1,731,023     |       | 
|Shering AG ADR                                  |  |        | 25,000        |       | 
|Teva Pharmaceutical Industries, Ltd. ADR        |  |        | 1,676,674     |       | 
|Watson Pharmaceuticals, Inc.(1)                 |  |        | 558,195       |       | 
|Wyeth                                           |  |        | 996,516       |       | 
|                                                |  | $      | 1,482,611,740 |       | 
|Real Estate Management & Development  0.0%     | 
|Forest City Enterprises, Inc., Class A          |  |        | 56,500        |       | 
|Forestar Real Estate Group, Inc.                |  |        | 30,220        |       | 
|                                                |  | $      | 3,223,750     |       | 
|Road & Rail  0.1%                              | 
|Avis Budget Group, Inc.(1)                      |  |        | 55,324        |       | 
|Burlington Northern Santa Fe Corp.              |  |        | 55,466        |       | 
|CSX Corp.                                       |  |        | 3,276         |       | 
|Kansas City Southern(1)                         |  |        | 6,815         |       | 
|Norfolk Southern Corp.                          |  |        | 3,090         |       | 
|Union Pacific Corp.                             |  |        | 65,519        |       | 
|                                                |  | $      | 14,100,041    |       | 
|Semiconductors & Semiconductor Equipment  2.8% | 
|Analog Devices, Inc.                            |  |        | 586,324       |       | 
|Applied Materials, Inc.                         |  |        | 1,094,431     |       | 
|Broadcom Corp., Class A(1)                      |  |        | 1,034,881     |       | 
|Cypress Semiconductor Corp.(1)                  |  |        | 52,742        |       | 
|Intel Corp.                                     |  |        | 11,610,600    |       | 
|KLA-Tencor Corp.                                |  |        | 148,373       |       | 
|Linear Technology Corp.                         |  |        | 423,388       |       | 
|LSI Corp.(1)                                    |  |        | 141,203       |       | 
|Maxim Integrated Products, Inc.                 |  |        | 263,099       |       | 
|Skyworks Solutions, Inc.(1)                     |  |        | 98,685        |       | 
|Teradyne, Inc.(1)                               |  |        | 6,799         |       | 
|Texas Instruments, Inc.                         |  |        | 4,191,058     |       | 
|Verigy, Ltd.(1)(2)                              |  |        | 4,119         |       | 
|Xilinx, Inc.                                    |  |        | 24,830        |       | 
|                                                |  | $      | 546,398,386   |       | 



See notes to financial statements68

---

Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTSCONT'D

|Security                                |  | Shares |             | Value | 
|--------------------------------------- |  | ------ | ----------- | ----- | 
|Software  2.5%                         | 
|Adobe Systems, Inc.(1)                  |  |        | 490,317     |       | 
|CA, Inc.                                |  |        | 40,728      |       | 
|Compuware Corp.(1)                      |  |        | 150,944     |       | 
|Electronic Arts, Inc.(1)                |  |        | 21,405      |       | 
|Intuit, Inc.(1)                         |  |        | 736,959     |       | 
|Jack Henry & Associates, Inc.           |  |        | 119,142     |       | 
|Microsoft Corp.                         |  |        | 7,280,107   |       | 
|Oracle Corp.(1)                         |  |        | 7,224,372   |       | 
|SAP AG ADR                              |  |        | 400,000     |       | 
|Symantec Corp.(1)                       |  |        | 225,808     |       | 
|Wind River Systems, Inc.(1)             |  |        | 1,304       |       | 
|                                        |  | $      | 497,127,563 |       | 
|Specialty Retail  1.4%                 | 
|Abercrombie & Fitch Co., Class A        |  |        | 4,015       |       | 
|AutoNation, Inc.(1)                     |  |        | 75,966      |       | 
|Best Buy Co., Inc.                      |  |        | 280,415     |       | 
|Collective Brands, Inc.(1)              |  |        | 23,100      |       | 
|Gap, Inc. (The)                         |  |        | 599,138     |       | 
|Home Depot, Inc.                        |  |        | 4,526,827   |       | 
|Limited Brands, Inc.                    |  |        | 503,556     |       | 
|Lowe's Companies, Inc.                  |  |        | 2,734,798   |       | 
|RadioShack Corp.                        |  |        | 74,318      |       | 
|Sherwin-Williams Co. (The)              |  |        | 500         |       | 
|Staples, Inc.                           |  |        | 275,430     |       | 
|TJX Companies, Inc. (The)               |  |        | 1,718,239   |       | 
|                                        |  | $      | 279,773,286 |       | 
|Textiles, Apparel & Luxury Goods  1.2% | 
|Coach, Inc.(1)                          |  |        | 729,407     |       | 
|Hanesbrands, Inc.(1)                    |  |        | 559,410     |       | 
|Nike, Inc., Class B                     |  |        | 3,058,444   |       | 
|                                        |  | $      | 233,978,879 |       | 
|Thrifts & Mortgage Finance  0.1%       | 
|Fannie Mae                              |  |        | 301,173     |       | 
|Freddie Mac                             |  |        | 146,695     |       | 
|Guaranty Financial Group, Inc.          |  |        | 30,220      |       | 
|MGIC Investment Corp.                   |  |        | 95,045      |       | 
|Washington Mutual, Inc.                 |  |        | 643,357     |       | 
|                                        |  | $      | 28,410,264  |       | 



|Security                                                        |  | Shares |                | Value | 
|--------------------------------------------------------------- |  | ------ | -------------- | ----- | 
|Tobacco  0.2%                                                  | 
|Altria Group, Inc.                                              |  |        | 589,531        |       | 
|                                                                |  | $      | 44,556,753     |       | 
|Trading Companies & Distributors  0.0%                         | 
|United Rentals, Inc.(1)                                         |  |        | 266,647        |       | 
|                                                                |  | $      | 4,895,639      |       | 
|Wireless Telecommunication Services  0.2%                      | 
|SprintNextel Corp.                                              |  |        | 1,848,673      |       | 
|Telephone and Data Systems, Inc.                                |  |        | 9,252          |       | 
|Telephone and Data Systems, Inc., Special Shares                |  |        | 24,636         |       | 
|Vodafone Group PLC ADR                                          |  |        | 302,728        |       | 
|                                                                |  | $      | 37,569,094     |       | 
|Total Common Stocks(identified cost $13,619,432,710)            |  | $      | 19,742,377,028 |       | 
|Convertible Preferred Stocks  0.0%                             | 
|Security                                                        |  | Shares |                | Value | 
|Independent Power Producers & EnergyTraders  0.0%              | 
|Enron Corp.(1)(3)                                               |  |        | 11,050         |       | 
|                                                                |  | $      | 0              |       | 
|Total Convertible Preferred Stocks(identified cost $16,626,069) |  | $      | 0              |       | 
|Other Investments  0.0%                                        | 
|Description                                                     |  | Shares |                | Value | 
|Commercial Banks  0.0%                                         | 
|Wachovia Corp. (Dividend Equalization Preferred Shares)         |  |        | 166,518        |       | 
|Software  0.0%                                                 | 
|Seagate Technology, Inc. (Tax Refund Rights)(1)(3)              |  |        | 197,392        |       | 
|Total Other Investments(identified cost $39,407)                |  | $      | 250            |       | 



See notes to financial statements69

---

Tax-Managed Growth Portfolioas of December 31, 2007

PORTFOLIO OF INVESTMENTSCONT'D

|Short-Term Investments  1.0%                               | 
|----------------------------------------------------------- | 
|Description                                                 | 
|Eaton Vance Cash Collateral Fund, LLC, 4.99%(7)(8)          | 
|Investment in Cash Management Portfolio, 4.58%(8)           | 
|Total Short-Term Investments(identified cost $193,886,028)  | 
|Total Investments  100.4%(identified cost $13,829,984,214) | 
|Other Assets, Less Liabilities  (0.4)%                     | 
|Net Assets  100.0%                                         | 



ADR - American Depository Receipt

(1)Non-income producing security.

(2)Foreign security.

(3)Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(4)All or a portion of these securities were on loan at December 31, 2007.

(5)Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At December 31, 2007, the aggregate value of the securities is $6,269,504 or 0.03% of the Portfolio's net assets.

(6)Security subject to restrictions on resale (see Note 5).

(7)The amount invested in Eaton Vance Cash Collateral Fund, LLC represents cash collateral received for securities on loan as of December 31, 2007. Other Assets, Less Liabilities includes an equal and offsetting liability of the Portfolio to repay collateral upon the return of loaned securities.

(8)Affiliated investment company available to Eaton Vance portfolios and funds which invests in high quality, U.S. dollar denominated money market instruments. The rate shown is the annualized seven-day yield as of December 31, 2007.

See notes to financial statements70

---

Tax-Managed Growth Portfolioas of December 31, 2007

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

As of December 31, 2007

|Assets                                                                                                            | 
|----------------------------------------------------------------------------------------------------------------- | 
|Unaffiliated investments, at value including $105,508,702of securities on loan (identified cost, $13,636,098,186) | 
|Affiliated investments, at value (identified cost, $193,886,028)                                                  | 
|Cash                                                                                                              | 
|Receivable for investments sold                                                                                   | 
|Dividends and interest receivable                                                                                 | 
|Interest receivable from affiliated investment                                                                    | 
|Securities lending income receivable                                                                              | 
|Tax reclaims receivable                                                                                           | 
|Total assets                                                                                                      | 
|Liabilities                                                                                                       | 
|Collateral for securities loaned                                                                                  | 
|Payable to affiliate for investment advisory fees                                                                 | 
|Payable to affiliate for Trustees' fees                                                                           | 
|Other accrued expenses                                                                                            | 
|Total liabilities                                                                                                 | 
|Net Assets applicable to investors' interest in Portfolio                                                         | 
|Sources of Net Assets                                                                                             | 
|Net proceeds from capital contributions and withdrawals                                                           | 
|Net unrealized appreciation (computed on the basis of identified cost)                                            | 
|Total                                                                                                             | 



Statement of Operations

For the Year Ended December 31, 2007

|Investment Income                                                                     | 
|------------------------------------------------------------------------------------- | 
|Dividends (net of foreign taxes, $6,224,760)                                          | 
|Interest                                                                              | 
|Security lending income, net                                                          | 
|Interest income allocated from affiliated investment                                  | 
|Expenses allocated from affliated investment                                          | 
|Total investment income                                                               | 
|Expenses                                                                              | 
|Investment adviser fee                                                                | 
|Trustees' fees and expenses                                                           | 
|Custodian fee                                                                         | 
|Legal and accounting services                                                         | 
|Miscellaneous                                                                         | 
|Total expenses                                                                        | 
|Deduct Reduction of custodian fee                                                    | 
|Total expense reductions                                                              | 
|Net expenses                                                                          | 
|Net investment income                                                                 | 
|Realized and Unrealized Gain (Loss)                                                   | 
|Net realized gain (loss) Investment transactions (identified cost basis)(1)          | 
|Foreign currency transactions                                                         | 
|Net realized gain                                                                     | 
|Change in unrealized appreciation (depreciation) Investments (identified cost basis) | 
|Foreign currency                                                                      | 
|Net change in unrealized appreciation (depreciation)                                  | 
|Net realized and unrealized gain                                                      | 
|Net increase in net assets from operations                                            | 



(1)Includes net realized gains of $624,934,809 from redemptions in-kind.

See notes to financial statements71

---

Tax-Managed Growth Portfolioas of December 31, 2007

FINANCIAL STATEMENTSCONT'D

Statements of Changes in Net Assets

|Increase (Decrease)in Net Assets                                                       |  | Year EndedDecember 31, 2007 |                | Year EndedDecember 31, 2006 | 
|-------------------------------------------------------------------------------------- |  | --------------------------- | -------------- | --------------------------- | 
|From operations Net investment income                                                 |  | $                           | 313,617,864    |                             | 
|Net realized gain from investmentand foreign currency transactions                     |  |                             | 891,474,938    |                             | 
|Net change in unrealized appreciation(depreciation) of investments andforeign currency |  |                             | (239,534,188   | )                           | 
|Net increase in net assets from operations                                             |  | $                           | 965,558,614    |                             | 
|Capital transactions Contributions                                                    |  | $                           | 1,526,283,139  |                             | 
|Withdrawals                                                                            |  |                             | (3,014,972,770 | )                           | 
|Net decrease in net assetsfrom capital transactions                                    |  | $                           | (1,488,689,631 | )                           | 
|Net increase (decrease) in net assets                                                  |  | $                           | (523,131,017   | )                           | 
|Net Assets                                                                             | 
|At beginning of year                                                                   |  | $                           | 20,387,292,247 |                             | 
|At end of year                                                                         |  | $                           | 19,864,161,230 |                             | 



See notes to financial statements72

---

Tax-Managed Growth Portfolioas of December 31, 2007

FINANCIAL STATEMENTSCONT'D

Supplementary Data

|                                                      |  | Year Ended December 31, |           
|----------------------------------------------------- |  | ----------------------- | ----------
|                                                      |  | 2007                    |           
|Ratios/Supplemental Data                              | 
|Ratios (As a percentage of average daily net assets): | 
|Expenses before custodian fee reduction               |  |                         | 0.44      
|Expenses after custodian fee reduction                |  |                         | 0.44      
|Net investment income                                 |  |                         | 1.52      
|Portfolio Turnover(2)                                 |  |                         | 2         
|Total Return                                          |  |                         | 4.72      
|Net assets, end of year (000's omitted)               |  | $                       | 19,864,161



(1)The investment adviser waived a portion of its investment advisory fee (equal to less than 0.01% and 0.01% of average daily net assets for 2005 and 2004, respectively).

(2)Excludes the value of the portfolio securities contributed or distributed as a result of in-kind shareholder transactions. The total turnover rate of the Portfolio including in-kind contributions and distributions was 6%, 7%, 6%, 10%, and 21% for 2007, 2006, 2005, 2004, and 2003, respectively.

(3)Amounts to less than 1%.

See notes to financial statements73

---

Tax-Managed Growth Portfolioas of December 31, 2007

NOTES TO FINANCIAL STATEMENTS

1Significant Accounting Policies

Tax-Managed Growth Portfolio (the Portfolio) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as a diversified, open-end management investment company. The Portfolio seeks to achieve long-term, after-tax returns for its interestholders through investing in a diversified portfolio of equity securities. The Declaration of Trust permits the Trustees to issue interests in the Portfolio. The following is a summary of significant accounting policies of the Portfolio. The policies are in conformity with accounting principles generally accepted in the United States of America.

AInvestment Valuations Equity securities listed on a U.S. securities exchange generally are valued at the last sale price on the day of valuation or, if no sales took place on such date, at the mean between the closing bid and asked prices therefore on the exchange where such securities are principally traded. Equity securities listed on the NASDAQ Global or Global Select Market generally are valued at the NASDAQ official closing price. Unlisted or listed securities for which closing sales prices or closing quotations are not available are valued at the mean between the latest available bid and asked prices or, in the case of preferred equity securities that are not listed or traded in the over-the-counter market, by an independent pricing service. The value of preferred equity securities that are valued by a pricing service on a bond basis will be adjusted by an income factor, to be determined by the investment adviser, to reflect the next anticipated regular dividend. Exchange-traded options are valued at the last sale price for the day of valuation as quoted on the principal exchange or board of trade on which the options are traded or, in the absence of sales on such date, at the mean between the latest bid and asked prices therefore. Financial futures contracts listed on commodity exchanges are valued at closing settlement prices. Short-term debt securities with a remaining maturity of sixty days or less are valued at amortized cost, which approximates market value. If short-term debt securities are acquired with a remaining maturity of more than sixty days, they will be valued by a pricing service. Other fixed income and debt securities, including listed securities and securities for which price quotations are available, will normally be valued on the basis of valuations furnished by a pricing service. Foreign securities and currencies are valued in U.S. dollars, based on foreign currency exchange rate quotations supplied by an independent quotation service. The daily valuation of exchange-traded foreign securities generally is determined as of the close of trading on the principal exchange on which such securities trade. Events occurring after the close of trading on foreign exchanges may result in adjustments to the valuation of foreignsecurities to more accurately reflect their fair value as of the close of regular trading on the New York Stock Exchange. When valuing foreign equity securities that meet certain criteria, the Trustees have approved the use of a fair value service that values such securities to reflect market trading that occurs after the close of the applicable foreign markets of comparable securities or other instruments that have a strong correlation to the fair-valued securities. Investments for which valuations or market quotations are not readily available are valued at fair value using methods determined in good faith by or at the direction of the Trustees of the Portfolio considering relevant factors, data and information including the market value of freely tradable securities of the same class in the principal market on which such securities are normally traded.

The Portfolio may invest in Cash Management Portfolio (Cash Management) and Eaton Vance Cash Collateral Fund, LLC (Cash Collateral Fund), affiliated investment companies managed by Boston Management and Research (BMR) and Eaton Vance Management (EVM), respectively. Cash Management values its investment securities utilizing the amortized cost valuation technique permitted by Rule 2a-7 of the 1940 Act. This technique involves initially valuing a portfolio security at its cost and thereafter assuming a constant amortization to maturity of any discount or premium. Investments in Cash Collateral Fund are valued at the net asset value per share on the valuation date.

BInvestment Transactions Investment transactions for financial statement purposes are accounted for on a trade date basis. Realized gains and losses on investments sold are determined on the basis of identified cost.

CIncome Dividend income is recorded on the ex-dividend date for dividends received in cash and/or securities. However, if the ex-dividend date has passed, certain dividends from foreign securities are recorded as the Fund is informed of the ex-dividend date. Withholding taxes on foreign dividends and capital gains have been provided for in accordance with the Fund's understanding of the applicable countries' tax rules and rates. Interest income is recorded on the basis of interest accrued, adjusted for amortization of premium or accretion of discount.

DFederal Taxes The Portfolio has elected to be treated as a partnership for federal tax purposes. No provision is made by the Portfolio for federal or state taxes on any taxable income of the Portfolio because each investor in the Portfolio is ultimately responsible for the payment of any taxes on its share of taxable income. Since at least one of the Portfolio's investors is a regulated investment company that invests all or substantially all of

74

---

Tax-Managed Growth Portfolioas of December 31, 2007

NOTES TO FINANCIAL STATEMENTSCONT'D

its assets in the Portfolio, the Portfolio normally must satisfy the applicable source of income and diversification requirements (under the Internal Revenue Code) in order for its investors to satisfy them. The Portfolio will allocate, at least annually among its investors, each investor's distributive share of the Portfolio's net investment income, net realized capital gains and any other items of income, gain, loss, deduction or credit.

In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 48 (FIN 48), "Accounting for Uncertainty in Income Taxes  an interpretation of FASB Statement No. 109". FIN 48 clarifies the accounting for uncertainty in income taxes recognized in accordance with FASB Statement No. 109, "Accounting for Income Taxes". This interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. FIN 48 is effective on the last business day of the first required financial reporting period for fiscal years beginning after December 15, 2006. Management has concluded that as of December 31, 2007, there are no uncertain tax positions that would require financial statement recognition, de-recognition, or disclosure. Each of the Portfolio's federal tax returns filed in the 3-year period ended December 31, 2007 remains subject to examination by the Internal Revenue Service.

EExpense Reduction State Street Bank and Trust Company (SSBT) serves as custodian of the Portfolio. Pursuant to the custodian agreement, SSBT receives a fee reduced by credits, which are determined based on the average daily cash balance the Portfolio maintains with SSBT. All credit balances, if any, used to reduce the Portfolio's custodian fees are reported as a reduction of expenses in the Statement of Operations.

FForeign Currency Translation Investment valuations, other assets, and liabilities initially expressed in foreign currencies are translated each business day into U.S. dollars based upon current exchange rates. Purchases and sales of foreign investment securities and income and expenses denominated in foreign currencies are translated into U.S. dollars based upon currency exchange rates in effect on the respective dates of such transactions. Recognized gains or losses on investment transactions attributable to changes in foreign currency exchange rates are recorded for financial statement purposes as net realized gains and losses on investments. That portion of unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed.

GUse of Estimates The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates.

HIndemnifications Under the Portfolio's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Portfolio. Interestholders in the Portfolio are jointly and severally liable for the liabilities and obligations of the Portfolio in the event that the Portfolio fails to satisfy such liabilities and obligations; provided, however, that, to the extent assets are available in the Portfolio, the Portfolio may, under certain circumstances, indemnify interestholders from and against any claim or liability to which such holder may become subject by reason of being or having been an interestholder in the Portfolio. Additionally, in the normal course of business, the Portfolio enters into agreements with service providers that may contain indemnification clauses. The Portfolio's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Portfolio that have not yet occurred.

2Investment Adviser Fee and Other Transactions with Affiliates

The investment adviser fee is earned by BMR, a subsidiary of EVM, as compensation for investment advisory services rendered to the Portfolio. The fee is payable monthly and is computed at an annual rate of 0.625% of the average daily net assets of the Portfolio up to $500 million. The advisory fee on net assets of $500 million or more is reduced asfollows:

|Average Daily Net Assets For the Month |  | Annual Fee Rate(for each level) |       
|-------------------------------------- |  | ------------------------------- | ------
|$500 million but less than $1 billion  |  |                                 | 0.5625
|$1 billion but less than $1.5 billion  |  |                                 | 0.5000
|$1.5 billion but less than $7 billion  |  |                                 | 0.4375
|$7 billion but less than $10 billion   |  |                                 | 0.4250
|$10 billion but less than $15 billion  |  |                                 | 0.4125
|$15 billion but less than $20 billion  |  |                                 | 0.4000
|$20 billion but less than $25 billion  |  |                                 | 0.3900
|$25billion and over                    |  |                                 | 0.3800



*  Effective April 23, 2007.

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Tax-Managed Growth Portfolioas of December 31, 2007

NOTES TO FINANCIAL STATEMENTSCONT'D

The portion of the advisory fee payable by Cash Management on the Portfolio's investment of cash therein is credited against the Portfolio's advisory fees. For the year ended December 31, 2007, the Portfolio's advisory fee totaled $88,148,658 of which $467,658 was allocated from Cash Management and $87,681,000 was paid or accrued directly by the Portfolio. For the year ended December 31, 2007, the Portfolio's advisory fee, including the portion allocated from Cash Management, was 0.43% of the Portfolio's average daily net assets.

Except as to Trustees of the Portfolio who are not members of EVM's or BMR's organizations, officers and Trustees receive remuneration for their services to the Portfolio out of the investment adviser fee. Trustees of the Portfolio who are not affiliated with the investment adviser may elect to defer receipt of all or a percentage of their annual fees in accordance with the terms of the Trustees Deferred Compensation Plan. For the year ended December 31, 2007, no significant amounts have been deferred. Certain officers and Trustees of the Portfolio are officers of the above organizations.

3Purchases and Sales of Investments

For the year ended December 31, 2007, purchases and sales of investments, other than short-term obligations, aggregated $434,592,730 and $569,175,325, respectively. In addition, investments having an aggregate market value of $1,986,256,699 at dates of withdrawal were distributed in payment for capital withdrawals and investors contributed securities with a value of $880,809,267, during the year ended December 31, 2007.

4Federal Income Tax Basis of Investments

The cost and unrealized appreciation (depreciation) of investments of the Portfolio at December 31, 2007 as determined on a federal income tax basis were as follows:

|Aggregate cost                |  | $ | 4,503,281,878  |   | 
|----------------------------- |  | - | -------------- | - | 
|Gross unrealized appreciation |  | $ | 24,767,710,218 |   | 
|Gross unrealized depreciation |  |   | (9,334,728,790 | ) | 
|Net unrealized appreciation   |  | $ | 15,432,981,428 |   | 



The net unrealized appreciation on foreign currency at December 31, 2007 on a federal income tax basis was $191,196.

5Restricted Securities

At December 31, 2007, the Portfolio owned the following securities (representing 0.01% of net assets) which were restricted as to public resale and not registered under the Securities Act of 1933 (excluding Rule 144A securities). The Portfolio has various registration rights (exercisable under a variety of circumstances) with respect to these securities. The fair value of these securities is determined based on valuations provided by brokers when available, or if not available, they are valued at fair value using methods determined in good faith by or at the direction of the Trustees.

|Common Stocks               |  | Date ofAcquisition |           | Eligiblefor Resale |  | Shares |            | Cost |  | Value |       
|--------------------------- |  | ------------------ | --------- | ------------------ |  | ------ | ---------- | ---- |  | ----- | ------
|Archer-Daniels-Midland Co.  |  |                    | 12/13/07  |                    |  |        | 12/13/2008 |      |  |       | 25,859
|Total Restricted Securities |  | $                  | 1,000,017 |                    |  | $      | 1,198,834  |      | 



6Financial Instruments

The Portfolio may trade in financial instruments with off-balance sheet risk in the normal course of its investing activities to assist in managing exposure to various market risks. These financial instruments may include written options, forward foreign currency exchange contracts and financial futures contracts and may involve, to a varying degree, elements of risk in excess of the amounts recognized for financial statement purposes. The notional or contractual amounts of these instruments represent the investment the Portfolio has in particular classes of financial instruments and does not necessarily represent the amounts potentially subject to risk. The measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are considered. The Portfolio did not have any open obligations under these financial instruments at December 31, 2007.

7Line of Credit

The Portfolio participates with other portfolios and funds managed by EVM and its affiliates in a $200 million unsecured line of credit agreement with a group of banks. Borrowings will be made by the Portfolio solely to facilitate the handling of unusual and/or unanticipated short-term cash requirements. Interest is charged to the Portfolio based on its borrowings at an amount above either the Eurodollar rate or Federal Funds rate. In addition, a fee computed at an annual rate of 0.07% on the daily unused portion of the line of credit is allocated among the participating portfolios and funds at the end of each quarter. The Portfolio did not

76

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Tax-Managed Growth Portfolioas of December 31, 2007

NOTES TO FINANCIAL STATEMENTSCONT'D

have any significant borrowings or allocated fees during the year ended December 31, 2007.

8Securities Lending Agreement

The Portfolio has established a securities lending agreement with SSBT as securities lending agent in which the Portfolio lends portfolio securities to qualified borrowers in exchange of either cash or U.S. government securities in an amount at least equal to the market value of the securities on loan. Cash collateral is invested in Cash Collateral Fund. The Portfolio earns interest on the amount invested in Cash Collateral Fund but it must pay the broker a loan rebate fee computed as a varying percentage of the collateral received. The loan rebate fee and lending agent fee paid by the Portfolio amounted to $2,679,685 and $263,837, respectively, for the year ended December 31, 2007. At December 31, 2007, the value of the securities loaned and the value of the collateral amounted to $105,508,702 and $107,661,941, respectively. In the event of counterparty default, the Portfolio is subject to potential loss if it is delayed or prevented from exercising its right to dispose of the collateral. The Portfolio bears risk in the event that invested collateral is not sufficient to meet obligations due on loans.

9Recently Issued Accounting Pronouncement

In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157 (FAS 157), "Fair Value Measurements". FAS 157 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosure about fair value measurements. FAS 157 is effective for fiscal years beginning after November 15, 2007. As of December 31, 2007, management does not believe the adoption of FAS 157 will impact the amounts reported in the financial statements; however, additional disclosures may be required about the inputs used to develop the measurements of fair value and the effect of certain of the measurements on changes in net assets for the period.

77

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Tax-Managed Growth Portfolioas of December 31, 2007

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Trustees and Investors of Tax-Managed Growth Portfolio:

We have audited the accompanying statement of assets and liabilities of Tax-Managed Growth Portfolio (the Portfolio), including the portfolio of investments, as of December 31, 2007, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the supplementary data for each of the five years in the period then ended. These financial statements and supplementary data are the responsibility of the Portfolio's management. Our responsibility is to express an opinion on these financial statements and supplementary data based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and supplementary data are free of material misstatement. The Portfolio is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Portfolio's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of December 31, 2007 by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such financial statements and supplementary data referred to above present fairly, in all material respects, the financial position of Tax-Managed Growth Portfolio as of December 31, 2007, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the supplementary data for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

DELOITTE & TOUCHE LLPBoston, MassachusettsFebruary 15, 2008

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SIGNATURES  Pursuant to the
requirements of Section 13 or 15(d) 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.  BELMAR CAPITAL FUND LLC
  (Registrant)By:
  /s/ Andrew C. FrenetteAndrew C. FrenetteDuly Authorized Officer
  andPrincipal Accounting
  Officer Date: February 29,
2008   Pursuant to the
requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.   By:
  /s/ Thomas E. Faust Jr.Thomas E. Faust Jr.Chief Executive Officer  Date: February 29,
2008   By:
  /s/ Andrew C. FrenetteAndrew C. FrenetteChief Financial Officer  Date: February 29,
2008  79


EXHIBIT INDEX  Exhibit No.
  
  Description3
  
  Copy of Limited
  Liability Company Agreement of the Fund dated March 17, 2000 filed as Exhibit 3
  to the Funds Initial Registration Statement on Form 10 and incorporated
  herein by reference. (Note: the LLC Agreement also defines the rights of the
  holders of Shares of the Fund.)3(a)
  
  Copy of Amendment No. 1
  to the Funds Limited Liability Company Agreement dated December 30,
  2003 filed as Exhibit 3(a) to the Funds Report on Form 10-K
  for the period ended December 31, 2003 and incorporated herein by
  reference.4.1
  
  Copy of Loan and
  Security Agreement between the Fund and DrKW Holdings, Inc., as lender,
  dated June 25, 2003 filed as Exhibit 4.1 to the Funds Report on Form 10-Q
  for the period ended June 30, 2003 and incorporated herein by reference.4.1(a)
  
  Copy of Amendment No. 1
  to the Loan and Security Agreement between the Fund and DrKW Holdings, Inc.
  dated December 15, 2005 filed as Exhibit 4.1(a) to the Funds
  Report on Form 10-K for the period ended December 31, 2005 and
  incorporated herein by reference.4.1(b)
  
  Copy of Amendment No. 2
  to the Loan and Security Agreement between the Fund and Dresdner Kleinwort
  Holdings I, Inc. (formerly DrKW Holdings, Inc.) dated August 8,
  2007 filed as Exhibit 4.1(b) to the Funds Report on Form 10-Q
  for the period ended September 30, 2007 and incorporated herein by
  reference.4.1(c)
  
  Copy of Amendment No. 3
  to the Loan and Security Agreement between the Fund and Dresdner Kleinwort
  Holdings I, Inc. dated August 24, 2007 filed as Exhibit 4.1(c) to
  the Funds Report on Form 10-Q for the period ended September 30,
  2007 and incorporated herein by reference.4.2
  
  Copy of Loan and
  Security Agreement between the Fund and Merrill Lynch Mortgage Capital, Inc.,
  as Agent, and Merrill Lynch Capital Services, Inc. dated June 25,
  2003 filed as Exhibit 4.2 to the Funds Report on Form 10-Q for the
  period ended June 30, 2003 and incorporated herein by reference.4.2(a)
  
  Copy of Amendment No. 1
  dated August 3, 2004 to Loan and Security Agreement among the Fund,
  Merrill Lynch Mortgage Capital, Inc., as Agent, the Lenders referred to
  therein and Merrill Lynch Capital Services, Inc. filed as Exhibit 4.2(a) to
  the Funds Report on Form 10-Q for the period ended September 30,
  2004 and incorporated herein by reference.4.2(b)
  
  Copy of Amendment No. 2
  dated June 30, 2006 to the Loan and Security Agreement among the Fund,
  Merrill Lynch Mortgage Capital, Inc., as Agent, the Lenders referred to
  therein and Merrill Lynch Capital Services, Inc. filed as Exhibit 4.2(b) to
  the Funds Report on Form 10-Q for the period ended June 30, 2006
  and incorporated herein by reference.4.2(c)
  
  Copy of Amendment No. 3
  dated May 9, 2007 to the Loan and Security Agreement among the Fund,
  Merrill Lynch Mortgage Capital, Inc., as Agent, the Lenders referred to
  therein and Merrill Lynch Capital Services, Inc. filed as Exhibit 4.2(c) to
  the Funds Report on Form 10-K for the period ended December 31,
  2006 and incorporated herein by reference.4.2(d)
  
  Copy of Amendment No. 4
  dated June 18, 2007 to the Loan and Security Agreement among the Fund,
  Merrill Lynch Mortgage Capital, Inc., as Agent, the Lenders referred to
  therein and Merrill Lynch Capital Services, Inc. filed as Exhibit 4.2(d) to
  the Funds Report on Form 10-K for the period ended December 31,
  2006 and incorporated herein by reference.10(1)
  
  Copy of Investment
  Advisory and Administrative Agreement between the Fund and Boston Management
  and Research dated March 10, 2000 filed as Exhibit 10(1) to
  the Funds Initial Registration Statement on Form 10 and incorporated
  herein by reference.10(1)(a)
  
  Copy of Amendment No. 1
  to Investment Advisory and Administrative Agreement between the Fund and
  Boston Management and Research dated as of June 5, 2007 filed as Exhibit 10(1)(a) to
  the Funds Report on Form 10-K for the period ended December 31,
  2006 and incorporated herein by reference.10(2)
  
  Copy of Management
  Agreement between Belmar Realty Corporation and Boston Management and
  Research dated March 10, 2000 filed as Exhibit 10(2) to the
  Funds Initial Registration Statement on Form 10 and incorporated herein
  by reference.  80


10(2)(a)
  
  Copy of Amendment No. 1
  to Management Agreement between Belmar Realty Corporation and Boston
  Management and Research dated as of January 2, 2001 filed as Exhibit 10(2)(a) to
  the Funds Report on Form 10-Q for the period ended September 30,
  2001 and incorporated herein by reference.10(2)(b)
  
  Copy of Amendment No. 2
  to Management Agreement between Belmar Realty Corporation and Boston
  Management and Research dated June 5, 2007 filed as Exhibit 10(2)(b) to
  the Funds Report on Form 10-K for the period ended December 31,
  2006 and incorporated herein by reference.10(3)
  
  Copy of Investor
  Servicing Agreement between the Fund and Eaton Vance Distributors, Inc.
  dated December 15, 1999 filed as Exhibit 10(3) to the Funds
  Initial Registration Statement on Form 10 and incorporated herein by
  reference.10(4)
  
  Copy of Custody and
  Transfer Agency Agreement between the Fund and Investors Bank &
  Trust Company dated December 15, 1999 filed as Exhibit 10(4) to
  the Funds Initial Registration Statement on Form 10 and incorporated
  herein by reference.10(4)(a)
  
  Copy of Amendment dated
  March 29, 2005 to Custody and Transfer Agency Agreement between the Fund
  and Investors Bank & Trust Company filed as Exhibit 10(4)(a) to
  the Funds report on Form 10-Q filed for the period ended June 30,
  2005 and incorporated herein by reference.20(a)
  
  Report on Form 8-K
  filed electronically with the Securities and Exchange Commission on January 26,
  2007 and incorporated herein by reference.20(b)
  
  Report on Form 8-K
  filed electronically with the Securities and Exchange Commission on June 5,
  2007 and incorporated herein by reference.21
  
  List of Subsidiaries of
  the Fund filed herewith.31.1
  
  Certification Pursuant
  to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of
  the Sarbanes-Oxley Act of 2002 filed herewith.31.2
  
  Certification Pursuant
  to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of
  the Sarbanes-Oxley Act of 2002 filed herewith.32.1
  
  Certification Pursuant
  to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
  the Sarbanes-Oxley Act of 2002 filed herewith.32.2
  
  Certification Pursuant
  to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
  the Sarbanes-Oxley Act of 2002 filed herewith.99.3
  
  Form N-CSR of
  Eaton Vance Tax-Managed Growth Portfolio (File No. 811-7409) for its
  year ended December 31, 2007 filed electronically with the Securities
  and Exchange Commission under the Investment Company Act of 1940 on February 22,
  2008 incorporated herein by reference pursuant to Rule 12b-32.  81