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

                                    Form 10-K

           ANNUAL REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES
                          EXCHANGE ACT OF 1934 For the
                      Fiscal Year Ended September 30, 1998
                          Commission File Number 1-8893

                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
             (Exact name of registrant as specified in its charter)

         Delaware                                       59-2501059
--------------------------------------------------------------------------------
(State or other jurisdiction of                      (I.R.S. Employer 
incorporation or organization)                    Identification Number)

                  2501 S. Ocean Drive Hollywood, Florida 33019
                  --------------------------------------------
               (Address of principal executive offices) (Zip Code)

        Registrant's telephone number, including area code (305) 927-3080

                           
          Securities registered pursuant to Section 12(b) of the Act:
                           Limited Partnership Units

                Name of Each Exchange on which Registered - None

        Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant:

(1) has filed all  reports  required  to be filed by Section 13 or 15 (d) of the
Securities  Exchange  Act of 1934  during the  preceding  12 months (or for such
shorter period that the  registrant was required to file such reports),  and
YES [ X ] NO [  ]

(2) has been subject to such filing requirements for the past 90 days. 
YES [ X ] NO [  ]

Indicate by checkmark if disclosure of delinquent filers pursuant to item 405 of
Regulation S-K (ss. 229.405 of this chapter) is not contained  herein,  and will
not be contained,  to the best of registrant's knowledge, in definitive proxy or
information statement incorporated by reference in Part III of this Form 10-K or
any amendment to this Form 10-K. [XX]

The  aggregate   market  value  of  the  limited   partnership   units  held  by
non-affiliates  of  Registrant  computed by reference to the last  reported sale
price of the Units  over-the-counter  on  December  30,  1998 was  approximately
$1,600,000.
<PAGE>
Item 1. Business

 (a) General Development Of Business

Royal  Palm  Beach  Colony,   Limited  Partnership  (the  "Partnership"  or  the
"Registrant")   was  organized  under  the  Delaware   Revised  Uniform  Limited
Partnership  Act. The  Partnership  is a successor  to Royal Palm Beach  Colony,
Inc.,  (the  "Predecessor  Company") a Florida  corporation  organized  in 1963.
Pursuant to a Plan of Complete Liquidation (the "Plan"), the Predecessor Company
transferred  all of its  assets,  subject  to  all  of its  liabilities,  to the
Partnership  in exchange for a number of  partnership  units  ("Units")  exactly
equal to the  number  of  shares  of  common  stock of the  Predecessor  Company
outstanding on July 11, 1985 (the "Effective Date").

On the  Effective  Date,  the Units were  distributed  to the former  holders of
common  stock of the  Predecessor  Company on the basis of one (1) Unit for each
share  of  common  stock  of the  Predecessor  Company.  The  Partnership,  as a
successor to the Predecessor  Company, has registered its Units under Section 12
(b) of the  Securities  Exchange  Act of 1934.  Under the Amended  Agreement  of
Limited  Partnership  of the  Registrant,  the term of the  Partnership  expires
December  31,  2005,  unless  extended by vote of a majority of the  partnership
units.   Trading  in   Partnership   Units  The  Units  are  currently   trading
over-the-counter under the symbol "RPAMZ."

Results of Liquidation Activities

The Partnership's  principal business has been to operate, manage and dispose of
the assets which were transferred to it on the Effective Date by the Predecessor
Company. Since the Effective Date of the Predecessor Company's liquidation,  the
Partnership has engaged in a program of asset disposition  resulting in the sale
of assets for an aggregate gross consideration of $69,878,241.

         As of September 30, 1998, the  Partnership had distributed an aggregate
of $29,156,000, or $6.50 per Unit, to the general and limited partners. See Item
5 - Market for the Registrant's  Common Equity and Related  Stockholder  Matters
"Prior  Distributions."  As of September 30, 1998, the  Partnership's  remaining
assets  consisted  principally  of; (1) 99  residential  lots (all of which were
under contract for sale) plus commercial property and multifamily-zoned  land in
the "Crestwood"  tract in the Village of Royal Palm Beach (the "Village"),  (see
Item  2 --  Properties  --  "Village  of  Royal  Palm  Beach"  - this  tract  is
hereinafter referred to as the "Crestwood" tract), (2) unsold land in Palm Beach
County,  Florida  which is included  in the  balance  sheet at its book value of
$734,584 (3) a tract of land in the Village  reacquired by  foreclosure  in 1993
and  included in the  balance  sheet at  $288,724,  (4)  contingent  receivables
relating to a prior sale of utility  assets with a maximum  future  undiscounted
value of $5,247,000  (which amount,  other than $438,573  earned as of September
30, 1998 but not payable to the  Partnership  until January,  1999, has not been
included in the balance sheet due to its contingent  nature -- see Note 8 to the
Financial Statements), and (5) cash in the amount of $6,553. Since September 30.
1998,  there have been  substantial  additional real estate sales.  See Item 2 -
"Residential Lots Within the Crestwood Tract."
<PAGE>
Factors Affecting Future Operations and Distributions

The  availability  of cash for  distribution  in the future  will  depend upon a
variety of factors not currently determinable.

(1) Current Activities

In early 1992, a large portion of the Partnership's  remaining land consisted of
the undeveloped 165 acre "Crestwood" Tract described above,  which had been sold
during the  process  of the  Partnership's  liquidation  but  reacquired  by the
Partnership  in 1992 when the  purchaser  was unable to service the interest and
amortization  payments  to  the  Partnership  on  a  $5,039,952  purchase  money
mortgage. Thereafter, management commenced the development of one portion of the
Crestwood  Tract,  consisting  originally  of 170 lots zoned for  single  family
housing  (increased in a revised site-plan to 198 lots), in order to enhance its
sale value. See Item 2 --Properties -"Village of Royal Palm Beach."

(2) Cash Available for Distribution

Management has now  substantially  completed the  development of portions of the
Partnership's  remaining  land in Palm Beach  County as a means of  achieving  a
higher return upon sale. Because of a substantial reduction in sales revenues in
1993 and 1994, and the cash requirements for such land development activities in
1995,   together  with  cash   expenditures  in  connection  with  the  proposed
transaction with Regency Homes, Inc. and normal operating expenses,  no cash has
been available for  distribution  since December 1992. In addition,  portions of
the  sales  proceeds  from the  sale of  residential  lots  must be  applied  to
repayment of bank financing  aggregating  $1,321,750.  Distributions may be made
during fiscal 1999, however, if the sales described herein under Item 2 close as
scheduled.  See Item 2 - "Development and Sale of Residential  Lots;" and Item 7
-- "Management  Discussion and Analysis of Financial  Condition -- Liquidity and
Capital Resources." Future collections of contingent  receivables  relating to a
prior sale of a utility plant would also affect future distributions. See Item 2
--Properties, for a discussion of other sources of and anticipated timing of the
receipt of revenue which will affect future distributions.

(b) Financial Information About Industry Segments

 Not applicable.

(c) Narrative Description Of The Business

Regulation

Development and sales  operations of the Partnership or by potential  purchasers
of real estate from the Partnership  have been subject to regulation by a number
of local,  state and  federal  agencies  concerning  the  nature  and  extent of
improvements,  and compliance with zoning  regulations,  building codes,  health
requirements and environmental protection.  The Partnership believes that it has
been in substantial  compliance with all such laws and regulations  which affect
its properties  and that it has developed the properties to the extent  required
by contract or law. If such laws or regulations are amended, in particular those
concerning environmental protection,  the cost of compliance could be increased.
Reference is made to the discussion concerning the impact of land use regulatory
issues affecting salability of certain properties remaining in Palm Beach County
in Item 2 -- Properties -- "Acreage in the Vicinity of the Village."
<PAGE>
Competition

The real estate business conducted by the Partnership is highly competitive. The
Partnership's  sales  of  its  remaining  land  will  compete  with  surrounding
developments,  and  with  owners  of  tracts  of  land  in the  area  of all its
properties.  There  are  substantial  tracts  of  vacant  land  and  land  under
development  in the general  area of most of the  Partnership's  remaining  real
estate. These competitive considerations could affect the decisions of potential
purchasers  of the  Partnership's  remaining  properties.  The  Partnership  has
historically  marketed its properties  through direct mail  advertising to major
brokers and developers,  advertisements in major regional  newspapers and direct
contacts  between  officers  of the  Managing  General  Partner  and real estate
developers and brokers.  The  Partnership  is currently  marketing its remaining
properties  through local real estate  brokers,  including RTL Realty,  of which
Randy Rieger is a partner. Mr. Rieger served as interim Vice President and Chief
Operating  Officer  of  the  Partnership's   managing  general  partner  between
September 1995 and February 1996. Mr. Rieger currently  provides  services as an
independent consultant to the Partnership for management services in addition to
ongoing brokerage  services.  See Item 13 -- "Certain  Relationships and Related
Transactions."

Impact of General Economic Conditions

The  development  and sale of real estate occurs within a historically  cyclical
market, and is significantly influenced by general economic conditions. Sales of
housing units and sales of tracts to builders are  particularly  affected by the
costs and  availability of mortgage  financing and the rise and fall of interest
rates in general.  Interest  rates moved in a narrow  range during 1996 and 1997
and declined  during the past six months as the result of federal  interest rate
cuts. If significant increases occur in the future, the real estate market could
suffer as a result.

Personnel:

As of December 30, 1998, Stein Management Company, Inc.  ("Steinco")the Managing
General Partner, employed 1 person, who acts as an adminstrator of its books and
records. The balance of the Partnership's affairs are carried out by independent
brokers,  contractors and other  consultants under the direction of the Board of
Directors of Steinco. See Item 10.

Office Facilities:

The  Partnership's  executive  headquarters  are located at 2501 S. Ocean Drive,
Hollywood, Florida 33019. The premises are owned by an affiliate of Hasam Realty
Limited  Partnership  ("Hasam L.P."), a general partner of the Partnership,  and
are being made available to the Partnership as an accommodation without charge.

Item 2. Properties

Palm Beach County, Florida

The Company originally owned approximately 26,000 acres in Palm Beach County, in
southeastern  Florida,  approximately  4,200 of which  were  located  within the
Village.   The  Village  of  Royal  Palm  Beach  The  Village,  an  incorporated
municipality,  is  approximately  eight miles from the Palm Beach  International
Airport and eleven miles west of Palm Beach.  Two major area highways,  Southern
<PAGE>
Boulevard and Okeechobee  Road,  lead directly from Palm Beach through West Palm
Beach to the Village.  The Village has a population of approximately  16,000 and
is primarily  residential.  The Village has been developed in accordance  with a
master plan and includes  schools,  shopping  facilities,  community  recreation
areas, and its own police and fire departments.

The Crestwood Tract

Although  the  Partnership  had  previously  sold  nearly all of its land in the
Village,  it reacquired in 1992,  through  foreclosure  of a defaulted  purchase
money mortgage, the 165 acre Crestwood Tract of undeveloped land in the Village.
When reacquired, the Crestwood Tract was zoned and preliminary approval had been
obtained for the development of 172 single-family  homesites (the "Single Family
Tract")  and 625  multi-family  units.  The  Crestwood  Tract is  bisected  by a
principal  Village  road  and has  access  to all  utilities,  but is  otherwise
undeveloped  with the  exception  of the  existence  of  portions  of a drainage
system.

Commercial Land within the Crestwood Tract

In order to enhance the market value of the  Crestwood  Tract,  the  Partnership
obtained the rezoning of an approximately 14 acre portion of the Crestwood Tract
previously zoned for multi-family housing to permit the Partnership to develop a
14 acre shopping center site. The  Partnership  received  site-plan  approval in
mid-1996.  The  Partnership has executed an agreement to sell the entire 14 acre
portion  to an  unaffiliated  shopping  center  developer  ("Purchaser")  in two
phases.

The closing on the first phase of the Commercial Site, consisting of a 11.8-acre
shopping center site, occurred in February, 1997, resulting in gross proceeds of
approximately $1,538,757.

The second  phase  consists  of two  additional  parcels in the 14 acre  portion
rezoned as described  above,  which adjoin the shopping  center site,  but as to
which building permits are not expected to be available until January,  2000. As
to such parcels, the Partnership has agreed to accord an option to the Purchaser
to acquire the  parcels,  with the price to be paid  dependent on the terms upon
which the Purchaser leases or sells such parcels to an unaffiliated third party.
In such event the Purchaser will pay to the  Partnership,  (i) in the event of a
lease,  a sum equal to the five times the average annual rental under the lease,
and (ii) in the event of a sale,  50% of the net proceeds of the sale;  provided
that the  Partnership is not required to accept less than $3.50 per square foot.
The  Partnership  and the  Purchaser  have  entered  into a contract  to sell an
additional 1.6 acres adjoining the  above-described 14 acre shopping center site
for a gross purchase price of approximately $250,000. The purchaser is presently
preparing to seek the  appropriate  approvals  from the Village and  anticipates
approvals by June, 1999.


Residential Lots within the Crestwood Tract

         As a  result  of  management's  decision  to  develop  portions  of the
Crestwood  Tract,  the  Partnership  replanned the  configuration  of the entire
tract.  The project  included a redesign  of the Single  Family  Tract,  and the
Partnership  received  final  plat  approval  to  increase  to 198 the number of
residential  lots  for  development  for  single  family  use  (hereinafter  the
"Residential  Tract").  "Development,"  as such term is applied to single-family
lots,  entails the completion of all necessary zoning,  land use,  environmental
and  other  regulatory  procedures,   the  installation  of  roads  and  utility
connections to each lot and the provision of drainage facilities.
<PAGE>
         Between  1995 and 1997,  the  Partnership  completed  the  off-site and
on-site  improvements  required  for  the  development  of the  198  lots in the
Residential  Tract. The total  construction cost was financed  partially through
the issuance of bonds and partially  with  development  financing  obtained from
Union  Bank of  Florida.  (See  Item 13 -  "Certain  Relationships  and  related
Transactions").  "). A total of  $3,201,749  was  borrowed  from  Union  Bank of
Florida (including  $293,152 for working capital purposes),  of which $1,321,750
was  outstanding as of September 30, 1998. The loan,  which bears interest at 1%
above the bank's prime lending rate,  matures on September 17, 1999. As closings
of lot sales are held, the  Partnership is obligated to pay down the bank at the
rate of $20,000 per lot.  The  remaining  cost of the  development  was financed
utilizing  the net  proceeds  ($1,074,000)  of bonds  issued by the Indian Trail
Water  Control  District,  a  governmental  authority.  The  bonds  are a direct
obligation of the District (and not of the  Partnership) and are repayable as to
principal and interest from taxes levied on the lots in the  Residential  Tract.
The  issuance  of the bonds  increased  the annual real estate tax on the entire
subdivision  by  approximately  $117,000 or $600 per lot. As lots are sold,  the
responsibility  for payment of the taxes passed from the  Partnership to the lot
purchasers.

         In the aggregate,  and through  December 30, 1998, the  Partnership has
sold and conveyed  178 of the 198 lots in the  Residential  Tract,  resulting in
gross  proceeds to the  Partnership  of  approximately  $5,285,000  and net cash
proceeds,  after mandatory loan  reductions and brokerage  commissions and other
closing costs, of approximately $930,000. (The gross proceeds include $1,298,500
owed to the  Partnership  by  Morrison  Homes of  Florida,  Inc.,  which debt is
secured  by a first  mortgage  on 45 of the  lots it  purchased,  requiring  the
payment of $687,000 on June 29, 1999 and the balance on September  29, 1999.) Of
the  foregoing,  during the 1998 fiscal year only,  the  Partnership  conveyed a
total of 59 lots (including 37 lots sold to Lennar Homes of Florida,  Inc. - see
below)  for  aggregate  gross  proceeds  of  $1,684,000.  After  mandatory  loan
reductions of $20,000 per lot and brokerage commissions and other closing costs,
net cash proceeds to the Company were $324,000

         The remaining 20 lots in the Residential  Tract are the last of a total
of 86 lots contracted for sale to Lennar Homes of Florida, Inc. The sale of such
20 lots is scheduled to be completed by June 30, 1999,  and will result in gross
proceeds of $570,000 and  estimated  net cash  proceeds,  after  mandatory  loan
reduction and brokerage  commissions and other closing costs,  of  approximately
$130,000.

         During November 1998 the  Partnership  completed the sale of a 7.7 acre
parcel in the multi-family zoned land in Crestwood to a church for $350,000.

         In March 1998 the Partnership entered into a sale contract with TCR SFA
Apartments,  Inc.,  an  affiliate  of  Trammell  Crow  Residential  (a  national
residential  builder)  covering  a  substantial  part  of the  remainder  of the
multi-family zoned land (comprising land zoned for approximately 290 residential
units).   The   affiliate   has  assigned  the  sale  contract  to  Gables  East
Construction,  Inc. which has acquired Trammell Crow Residential. The completion
of the sale,  which is  subject to the buyer  obtaining  necessary  permits  and
approvals,  is scheduled  for March 19, 1999 with the buyer having the option to
extend  the  closing  for up to 60  days.  The  sale  price  being  paid  to the
Partnership  for the  land  will  generate  approximately  $2,175,000  in  gross
proceeds,  and approximately  $1,800,000 in net proceeds after costs of sale and
brokerage fees.
<PAGE>
Other Acreage Within the Village

In March, 1993 the Partnership  reacquired a separate tract of 4.54 acres in the
Village  by  accepting  a deed in  lieu  of  foreclosure  on a  mortgage  with a
principal  balance of $300,000 (See Item 7 --"Foreclosure  Transactions").  This
parcel is bordered by a golf course and a principal  Village  road, is zoned for
approximately 80 multi-family residential units and is being offered for sale in
its present state without further development. An agreement to sell this acreage
for $350,000 was  terminated  by the  purchaser in June 1997 and the property is
currently being remarketed.

Utility Contingent Receivable

In 1983 the Partnership's  Predecessor Company sold to the Village of Royal Palm
Beach a water and sewage treatment system servicing the Village. Pursuant to the
agreement  of  sale  ("Utility  Contract"),  the  Predecessor  company  received
$2,510,000  on  closing,  and was  entitled  to future  payments to a maximum of
$10,900,000 as future connections,  measured by consumption increases, were made
to the system over a period  ending  August,  2001.  As of  September  30, 1998,
$5,050,000 had not been received or earned.  The Utility  Contract also provided
for contingent  extension  periods  aggregating  not more than three  additional
years to compensate for possible  future  governmental  building  moratoriums or
water use restrictions.  The Partnership's  consultants have advised it that the
term has been  extended  through  2003 as a result of water  usage  restrictions
imposed by the South  Florida  Water  Management  District  in 1990 and 1991 and
moratorium  actions  taken by the  Village of Royal Palm Beach in 1985 and 1986.
The Utility Contract also calls for payments to the Partnership  equal to 25% of
any  "Guaranteed   Revenues"   (payment  by  developers  to  secure   guaranteed
allocations of plant capacity)  collected by the Village to a maximum payment of
$500,000, of which $303,000 has already been received.

To date, the Partnership has received the following Utility Contract payments:

                                             Amount Received Based On
Fiscal Year Ended                   --------------------------------------------
September 30                        Consumption               Guaranteed Amounts
------------                        -----------               ------------------
1984                                $ 919,000
1985                                  830,000
1986                                  637,000
1987                                  859,000
1988                                  240,000                        $ 30,000
1989                                  761,000                          45,000
1990                                       -0-                         35,000
1991                                  293,000                          21,000
1992                                  357,000                          37,000
1993                                  168,000                          47,000
1994                                   58,000                          27,000
1995                                  413,000                          20,000
1996                                  108,000                          19,000
1997                                  207,000                          22,000
Total                              $5,850,000                       $ 303,000
--------------
* The Partnership is also entitled to receive approximately $438,000 in January,
1999.
<PAGE>
The  Utility   Contract  with  extensions   management   believes  have  already
accumulated  will expire in 2003,  subject to extensions of up to one additional
year.  The ability of the  Partnership to realize the maximum price is dependent
upon the rate at which the population in the Village grows,  and levels of water
consumption  which in turn depends upon  economic,  social and climatic  factors
which cannot be predicted.  Historically,  water  consumption  tends to increase
based upon increases in population.  During most of fiscal 1990, however, due to
drought  conditions  existing in most Southern Florida,  the South Florida Water
Management District imposed mandatory water usage  restrictions.  The imposition
of these  restrictions  resulted in a decrease in aggregate water consumption in
the area from which the  Partnership's  receipts are projected while  population
was increasing.  Management believes that there is sufficient capacity presently
available in the area served by the utility to enable the Partnership to realize
the  maximum  remaining  $5,050,000  in  contingent  payments  under the Utility
Contract.  Although the amount to be received by the  Partnership  in respect of
1998 represents a substantial increase from receipts in the two preceding years,
it is  nevertheless  considered  unlikely that the rate of new  construction  or
water  consumption in such area will be sufficient to enable the  Partnership to
receive  the  full  amount  of such  payments  prior  to the  expiration  of the
contingent payment term.

Acreage in the Vicinity of the Village

Substantially all of the property previously owned by the Predecessor Company in
Palm  Beach  County  outside  of  the  Village  limits,  originally  aggregating
approximately  23,800 acres,  was sold under the  Predecessor  Company's  retail
installment  sales  program,  which  terminated  prior to the  inception  of the
Partnership.  The Partnership  currently retains three tracts in the vicinity of
the Village.

The first tract originally consisted of 208 one-acre lots located  approximately
eight miles northwest of the Village.  These lots have been improved with graded
unpaved access roads and drainage  facilities.  One lot from this tract was sold
during  1996 for  $12,000,  and 36 were  sold in 1997 for  $190,188,  leaving  a
balance of 171 lots. There were no sales of these lots in 1998.

All of such lots are subject to numerous  governmental  regulations  under which
new development may not be permitted unless adequate public  facilities (such as
roads and  drainage)  must be in place  concurrently  with the  impacts  of such
development.  The Indian Trail Water Control  District  prepared a drainage plan
which would result in an exemption  for such lots from further  compliance  with
such  concurrency  requirements and would allow the issuance of building permits
for  single-family  residences  on such  lots.  Such plan was  opposed  by other
governmental  agencies,  however,  and the Palm Beach County  Health  Department
originally  denied an  application  for septic tank  permits,  due to inadequate
drainage.  Following the institution of administrative proceedings to compel the
issuance of septic tank permits,  the  Partnership  was  successful in obtaining
approval  for such permits for 3 of the 4 lots for which  application  was made;
the 4th lot was wetland and required additional  mitigation.  However, the South
Florida Water Management  District has refused to permit development to proceed,
and the Partnership is currently  engaged in  administrative  proceedings to set
aside such refusal. Numerous additional permits are required before building can
be  commenced,  and  there  is no  assurance  that  all of such  permits  can be
obtained.  The  Partnership  believes  that  should  it  eventually  succeed  in
obtaining septic permits for at least some of the lots, this would substantially
increase the value of such lots and that the aggregate  realizable  value of all
such lots will  substantially  exceed their book value of  $379,560.  Should the
Partnership be unsuccessful in overturning the  administrative  denial of septic
tank  permits,  the  Partnership  may  elect to  pursue  other  legal  remedies,
including a possible claim for "inverse condemnation." There can be no assurance
that any such litigation would be successful.
<PAGE>
The Partnership is presently  evaluating possible alternative uses of the second
tract,  consisting  of  approximately  470 acres,  which  contains a significant
amount of wetlands.  This property is presently zoned for agricultural  use. The
use of this land is  dependent  on  rezoning  and the  extension  of roads,  and
development  activity on this tract may meet with opposition  from  governmental
agencies  concerned  with  wildlife  and  wetlands  preservation.  In  1997  the
Partnership  received  an offer of  $1,385,000  for this  tract  from the Nature
Conservancy on behalf of Palm Beach County.  Negotiations  have been  protracted
and is no assurance that this transaction will be completed. However, management
is of the opinion that the realizable value of this property is in excess of its
current book value of $213,421.

The timing of future sales of the land discussed  above, the manner in which the
land may be developed and therefore the ultimate realizable prices for this land
are dependent upon a complex and  interrelated  number of factors arising out of
governmental regulations concerning permissible land use.

The third tract in the vicinity of the Village the Partnership previously held a
disputed claim to approximately 24 acres of undeveloped land. This claim had not
originally  been  accorded  value on the  Partnership's  balance  sheet  and was
considered  to have little or no value.  During  1994,  in  connection  with the
resolution of this claim with adjoining land owners,  and in order to give value
to such claim,  the  Partnership  relinquished a portion of its claim,  acquired
five adjoining acres for $141,879,  and executed a joint  development  agreement
with one of such adjoining landowners relating to the Partnership's  acreage and
such landowner's acreage (comprising  approximately 22 acres in the aggregate of
which the Partnership now owns approximately 12 acres).

The  Partnership  and the joint developer have entered into an agreement to sell
the entire  combined  parcel for a price of $1.90 per  square  foot,  subject to
survey, which would result in a gross selling price of approximately  $1,986,000
(less  selling   commissions)  of  which  the   Partnership's   share  would  be
approximately  $993,000.  The parcel has been  rezoned by Palm Beach  County for
commercial  use,  but the sale is subject to approval of the  premises as a site
for a  supermarket  by a major  supermarket  chain,  the  provision of necessary
utilities,  and the issuance of all necessary  building and other  permits.  The
closing date  (subject to all of the  foregoing)  was  originally to be no later
than June 30, 1997. The closing date has been extended  until April 1999.  There
is no assurance that such permits and approvals will be obtained,  which involve
proceedings  before  several  governmental  bodies,  or  could be  completed  or
obtained within the required time frame.

Item 3. Pending Legal Proceedings.

There are no pending  legal  proceedings,  other  than  routine  and  immaterial
litigation incidental to its business, to which the Partnership is a party or to
which its property is subject.

Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
<PAGE>
PART II

Item 5.  Market  for the  Registrant's  Common  Equity and  Related  Stockholder
         Matters

The Partnership's  units were formerly listed on the American Stock Exchange but
were   delisted  on  March  28,  1996.   The  Units   currently   trade  on  the
over-the-counter market (Symbol RPAMZ).

The  following  table  sets  forth,  for the fiscal  periods of the  Partnership
indicated,  the reported high and low closing prices for the Partnership's Units
in  over-the-counter  trading during the fiscal years ended September 30 of 1997
and 1998. The Partnership's  Units were held by approximately 600 record holders
of as of December  31,  1998.  Based on its tax  records,  including  beneficial
owners,  the Partnership  believes that there were a total of approximately  950
unit holders as of such date.


Fiscal Year Ended: September 30, 1998

Quarter           High              Low
-------           ----              ---
First              7/8              11/16
Second            13/16             5/8
Third             57/64             21/32
Fourth            55/64             3/4

Fiscal Year Ended: September 30, 1997

Quarter           High              Low
-------           ----              ---
First             1                 3/4
Second            1 1/8             3/4
Third             7/8               25/32
Fourth            7/8               11/16

Prior Distributions

The  Partnership  Agreement  requires the Managing  General  Partner to consider
quarterly whether the Partnership has Cash Available for Distribution in respect
of the  Partnership  Units,  and to make  distributions  unless the costs of the
distribution would be disproportionately  high in relation to the Cash Available
for Distribution.  "Cash Available for Distribution" in general means the excess
cash held by the  Partnership  over  anticipated  expenditures  and reserves for
anticipated  or contingent  liabilities.  The  Partnership is not a party to any
agreements  which would  restrict its ability to make future  distributions.  No
distributions  were  made  since  December  of 1992,  in  light of  management's
judgment  that   Partnership  cash  should  be  conserved  and  applied  to  the
development activities discussed in Item 2, and, during 1994, and 1996, in light
of the fact  that the  Partnership  was  considering  the  resumption  of active
business  operations  as a means to maximize  the values of its  remaining  real
estate.  Distributions  were  not  feasible  in  1997  or  1998  because  of the
Partnership's  obligations to reduce  indebtedness with substantial  portions of
the proceeds of sales. Distributions may be made during fiscal 1999, however, if
the sales described herein close as scheduled.  See Item 1 -- "Factors Affecting
Future Operations and Distributions."
<PAGE>
At the inception of the Partnership, its assets were assigned a tax basis in the
hands of the  Partnership  based  upon the net fair  market  value of the assets
transferred  from the  Predecessor  Company as  determined  by  reference to the
aggregate  market  value of the  Units at the time of  original  issuance.  Each
Unit's  pro rata  share of such net fair  market  value  resulted  in a  capital
account of $6.31 per Unit, which also became the original tax basis of each Unit
in the hands of the original Unitholders. As a result of taxable income and loss
and   distributions   since  inception,   the  capital  account  and  tax  basis
attributable  to each  Unit  which  has  remained  in the  hands of an  original
Unitholder  has been  reduced to $1.65 as of  September  30,  1998.  Each person
acquiring a Unit after  inception  has a tax basis in such Unit equal to the net
price paid therefor. Such basis is thereafter increased by such Unit's allocable
share of the  Partnership's  income  and  decreased  by the  allocable  share of
taxable loss and by any cash distributions made.

A  distribution  itself is not a taxable  event  except to the  extent  that the
distribution reduces the Unitholder's basis below zero. Section 17-607(a) of the
Delaware  Revised  Uniform  Limited  Partnership  Act provides  generally that a
limited  partnership shall not make a distribution to a partner if, after giving
effect to the distribution,  all liabilities of the partnership  exceed the fair
value of its assets.  A limited  partner who  receives  such a  distribution  is
liable to the  limited  partnership  for the  amount  thereof,  but only if such
limited partner knew at the time of the distribution that distribution  violated
said Section 17-607(a).  No claim based on any such wrongful distribution may be
made more than three  years  after such  distribution.  In the normal  course of
events,  however,  the Managing  General  Partner does not  anticipate  that the
liabilities of the  Partnership  immediately  following any future  distribution
will ever exceed the fair value of its net assets.  See also "Factors  Affecting
Future Operations and Distributions" under Item 1.

The Partnership has declared and paid the following liquidating distributions:

Payment Date               Amount Per Unit
------------               ---------------
April 15, 1986                $ .25
August 15, 1986                 .35
December 15, 1986               .40
January 15, 1988                .50
July 15, 1988                   .50
January 15, 1989                .50
July 17, 1989                  1.00
September 29, 1989              .75
March 30, 1990                  .75
July 31, 1990                   .50
August 30, 1991                 .50
December 15, 1991               .25
December 16, 1992               .25
                              -----
                               6.50


<PAGE>
Item 6. Selected Financial Data The following is a summary of selected financial
data (in  thousands of dollars  except as to per unit amounts) as of and for the
periods ended on the dates indicated:
<TABLE>
<CAPTION>
                                         Fiscal Years Ended September 30,
-------------------------------------------------------------------------------------
                              1998         1997        1996         1995         1994
Selected Income
  Statement Data
<S>                        <C>            <C>       <C>          <C>          <C>    
Revenues .............     $ 2,170        3,107     $   397      $   497      $   832
Net income (loss) ....        (215)         391        (690)        (787)        (554)
Income (loss)
         per unit ....        (.05)         .09        (.15)        (.18)        (.12)

Selected Balance
Sheet Data

Total assets .........       4,786        5,228       5,486        5,425        4,650
Mortgage Notes Payable       1,322        1,676       2,065        1,511          -0-

Partners' equity .....       2,546        2,761       2,370        3,060        3,847
 Cash distributions
per unit .............         -0-          -0-         -0-          .25          .25
</TABLE>

Since the Partnership's sole business has been the disposition of its assets and
the distribution of proceeds to its  Unitholders,  results in any period are not
comparable with any other period and are not indicative of the results which may
be anticipated in any future period. See Item 5 -- Prior Distributions (relating
to prior returns of capital).

Item 7. Management`s  Discussion And Analysis Of Financial Condition And Results
        of Operations

During the fiscal year, the Partnership  continued to incur substantial expenses
in the planning and  development of its properties in addition to normal ongoing
administrative  costs.  The  Partnership  had withheld its properties  from sale
during the fiscal year ended  September 30, 1995, and during most of the quarter
ended December 31, 1995, in  anticipation  of a business  combination  which was
being  negotiated  throughout  most of that year,  but which  negotiations  were
terminated in December, 1995. The only revenues for the year ended September 30,
1996, were the proceeds of $182,000  received upon the sale of five  residential
lots  and one  undeveloped  lot,  offset  in part by  approximately  $71,000  of
terminated  merger expense.  In addition,  the Partnership  received $433,000 in
payment of an installment  on a contingent  note held in respect of a prior sale
of the utility system (recognized in the 1995 fiscal year).

As a  result  of  the  recommencement  of  active  marketing  activities,  sales
increased  substantially  in the fiscal year ended September 30, 1997.  Sales of
real  estate  during  such  year  produced  gross   proceeds  of   approximately
$2,873,000;  and the Partnership also received $127,000  (recognized in the 1996
fiscal year) in payment of an installment  on a contingent  note held in respect
of the prior sale of the utility system. Sales of additional real estate in 1998
produced gross proceeds of  approximately  $1,706,000,  and the Partnership also
received  $229,000  (recognized  in the  1997  fiscal  year)  in  payment  of an
installment  on a  contingent  note held in  respect  of the  prior  sale of the
utility system.
<PAGE>
On February 28, 1997 the Partnership repaid a working capital loan in the amount
of $527,000 due to Hasam Realty Limited  Partnership,  a general  partner of the
Partnership,. See Item 13 -- "Certain Relationships and Related Transactions."

In June 13, 1996 the Partnership  obtained an additional working capital loan in
the amount of $300,000 from an affiliate of Jack  Friedland and $25,000 from Mr.
Friedland  directly.  Mr.  Friedland is  affiliated  with Hasam  Realty  Limited
Partnership, a general partner of the Partnership. The loan was originally for a
term ending  October 31, 1996,  at an interest rate of 2% over the prime rate of
Union  Bank..  As a result of the  deferral  of closing on several  transactions
which had been anticipated to produce  substantial  cash proceeds,  the maturity
date of the note was extended and the loan was paid in full in January, 1997.

The Partnership's  cash balances at any particular point depend primarily on the
timing of sales of its real  estate,  which  timing can be  affected by numerous
factors. See Item 2. Cash declined from $ 48,738 at September 30, 1997 to $6,553
at September  30, 1998 but had increased to  approximately  $213,000 at December
30, 1998. See Financial Information - Statements of Cash Flows.

During the  current  fiscal  year,  and based upon  management's  judgment  that
ordinary operating expenses will not increase, the Partnership  anticipates that
cash  flow and  liquidity  requirements  will be  satisfied  by the  Union  Bank
financing  described above, land sales,  contingent  utility receipts  described
"Utility Contingent Receipts", below and other bank financing. Sales of land are
subject to conditions which might not be satisfied, although the Partnership has
no  present   knowledge  of   circumstances   which  would  render   likely  the
non-satisfaction of such conditions.

Affect of Land Sales on Future Cash Flow

The Partnership's future revenues will depend solely upon its ability to develop
and/or sell its remaining real estate,  and upon receipts from a prior sale of a
utility plant. At September 30, 1998, the  Partnership  retained and was holding
for sale (1) 99  residential  lots and  commercial  property in the  "Crestwood"
tract  in the  Village,  (2)  multi-family  zoned  land in the  Crestwood  tract
presently  zoned for a total of  approximately  394  units,  (3) a tract of 4.54
acres in the Village zoned for approximately 100 multi-family  residential units
(4) 171 lots in the  vicinity of the Village  zoned for single  family homes but
presently the subject of litigation as to the availability of building permits ,
(5) a 470-acre  tract in the  vicinity of the  Village,  and (6) 12 acres in the
vicinity of the Village being jointly  developed  with an unrelated  party - see
"Acreage in the Vicinity of the Village. The development and marketing status of
these properties is described in Item 2.

Total  net  cash  flow  which  might  become   available  for   distribution  is
unpredictable  due to  uncertain  conditions  in the South  Florida  real estate
market  in which  the  Partnership's  remaining  real  estate  is  located,  and
competition from other owners and developers of real estate in the South Florida
market.  These  conditions  will continue to affect the realizable  value of the
Partnership's  remaining land, including decisions by parties holding options on
the Partnership's land to exercise such options in whole or in part. The rate of
construction in the Village of Royal Palm Beach could also significantly  affect
future  payments  to the  Partnership  under the  contract  described  under the
caption "Utilities Contingent Receivable" under Item 2 above. As indicated under
such caption,  although the amount to be received by the  Partnership in respect
of 1998  represents a  substantial  increase  from receipts in the two preceding
years, it is nevertheless  considered unlikely that the rate of new construction
or water  consumption in such area will be sufficient to enable the  Partnership
to receive  the full  amount of such  payments  prior to the  expiration  of the
contingent payment term.
<PAGE>
Environmental Matters

 There are no  environmental  contingencies in respect of the Partnership or its
properties.  Use of all of the Partnership's properties is subject to compliance
with state and county land use regulations  relating to  environmental  matters,
which the  Partnership  takes  into  account  in  considering  the values of its
properties.
<TABLE>
<CAPTION>
Results of Operations

                                             Fiscal Years Ended September 30
                                      ------------------------------------------
                                         1998            1997             1996
                                      ----------      ----------      ----------
<S>                                   <C>             <C>             <C>       
Sales of land, net .............      $1,706,000      $2,874,000      $  182,000
Recognized profit on
installment and cost
recovery sales .................             -0-             -0-           1,000
Interest income ................           7,000           5,000           5,000
Sale of utility system (a) .....         439,000         227,000         129,000
Other (b) ......................          18,000           1,000          80,000
                                      ----------      ----------      ----------

Total revenues .................       2,170,000       3,107,000      $  397,000
                                      ==========      ==========      ==========

</TABLE>


(a) As discussed in Note 8 to the financial statements, income recognized on the
sale of the utility system varies with water consumption and other factors.

(b) Other income in 1996 included $74,000 received as a foreclosure  settlement,
net of related expenses.

Cost of Sales

Cost of sales relates to the sales of land as discussed above.  This item varies
as a result of dissimilar profit margins and income  recognition  methods on the
various sales of land and buildings as discussed above.

Selling, Administrative and Other Expenses

Selling,  general and administrative expenses were 680,239 in 1996. In addition,
$70,720  was  incurred  in  costs  related  to a  proposed  merger  as to  which
negotiations were terminated.)  Costs increased to $768,537 in 1997 primarily as
the result of an increase in brokerage  commissions on higher real estate sales,
and  declined  to  $646,467  in 1998  primarily  as the result of a decrease  in
brokerage commissions on lower real estate sales.

         Interest  expense  increased  from  $33,434 in 1997 to $89,147 in 1998,
primarily  because the Partnership had completed  development  activities in the
residential  lots in 1998 and  therefor  ceased the  capitalization  of interest
expense.
<PAGE>
Depreciation and Property Taxes

Property tax expense  increased from 1996 to 1997 because of higher  assessments
on the Partnership's  properties due in part from higher valuations  ascribed to
certain of the Partnership's properties.  Property tax expense further increased
from 1997 to 1998 primarily  because  development  activities were completed and
such taxes could no longer be capitalized.

Income Taxes

The Partnership,  pursuant to the transitional grandfather rules of the Internal
Revenue Code dealing with publicly traded partnerships, reported its income as a
Partnership for taxable years through  December 31, 1997. The application of the
grandfather  rules  terminated for taxable years  commencing  after December 31,
1997. Under the Taxpayer Relief Act of 1997, a publicly traded  partnership that
is currently  governed by this  provision may elect to continue its  Partnership
tax status  beyond  December  31, 1997 by agreeing to pay an annual 3.5% Federal
Tax on its gross income for federal  income tax purposes  (principally  revenues
less tax cost of land  sold).  The  Partnership  has  elected  to  continue  its
Partnership status beyond December 31, 1997, and estimates that federal tax due,
if any,  on gross  income  for  federal  tax  purposes  for the tax year  ending
December 31, 1998 will not be material.  See Note 6 to the Financial  Statements
included with this report.


Item 8. Financial Statements and Supplementary Data

Financial Statements and supplementary data are listed under Item 14 herein.

Item 9. Disagreements with Accountants on Accounting and Financial Disclosure

None
<PAGE>
PART III

Item 10. Directors and Executive Officers of the Registrant
The following information is provided with respect to the directors and officers
of each general partner of the Registrant.(l)

                                                              Other Positions
Name                 Age and Present Position               With the Registrant
----                -------------------------               -------------------
Irving Cowan        66;   President of Steinco              Private Investor

David B. Simpson    60;   Vice President and                Attorney currently
                          Director of Steinco               in private pracftice
                                                            and counsel to the
                                                            Partnership

Jack Friedland      73;   Member of Friedco,                Private Investor
L.C.(1)

Leonard Friedland   76;   Member of Friedco,                Private Investor
L.C.(1)

Herbert Tobin       58;   Director of Steinco
                          Director, Secretary
                          And Treasurer(*)of
                          Steinco

Marjorie Cowan      58;   Member of Friedco,                Private Investor
L.C.(l);

Harold Friedland    68;   Member of Friedco,                Private Investor
                          L.C.(1)


(1) The general partners of the Partnership are Stein Management  Company,  Inc.
("Steinco")  and Hasam Realty L.P. The general partner of Hasam L.P. is Friedco,
L.C., ("Friedco") a Florida limited liability company. Friedco is managed by its
four members,  Jack,  Harold and Leonard  Friedland and Marjorie Cowan,  who are
brothers and sister. Irving Cowan is the husband of Marjorie Cowan.
<PAGE>
Compliance with Section 16(a) of the Securities Exchange Act of 1934

Section 16(a) of the  Securities  Exchange Act of 1934 requires the officers and
directors of the general partners of the  Partnership,  and persons who own more
than ten percent of the  Partnership's  Units,  to file reports of ownership and
changes in ownership with the Securities and Exchange Commission. Such officers,
directors  and  greater  than  ten-percent   Unitholders  are  required  by  SEC
regulations  to furnish the  Partnership  with copies of all Section 16(a) forms
they file. No such forms were furnished to the  Partnership  during fiscal 1997.
Based solely on the foregoing the Partnership  believes that during fiscal 1997,
no purchases or sales of units were made requiring  compliance  with  applicable
Section 16(a) filing requirements.

Item 11. Executive Compensation

During fiscal 1998 no executive officer of the Managing General Partner received
compensation exceeding $60,000.

All officers and directors of Steinco,  as a group (4 persons) earned $52,500 in
cash compensation.

The Partnership Agreement provides that the Partnership will provide and pay for
all  payroll  and other  costs of Steinco (to the extent such costs are not paid
directly by the Partnership) in connection with the employment of personnel, and
the  costs of  office  space,  outside  clerical  and  professional  assistance,
equipment,  and other facilities which are ordinary and necessary to the conduct
and  management  of  the  Partnership's   affairs.   Since  1994,  however,  for
administrative  convenience,  all such  reimburseable  expenses  have  been paid
directly by the Partnership. Steinco's sole function is to serve as the Managing
General Partner and it does not conduct any other operations.

Other than the foregoing,  the Managing  General  Partner is not entitled to any
compensation  in  respect  of  the  discharge  of  its  obligations   under  the
Partnership Agreement. Hasam L.P., the other General Partner, is not entitled to
compensation  of any nature under the  Partnership  Agreement but is entitled to
reimbursement  for such expenses as it may reasonably  incur in the discharge of
its ordinary and necessary obligations as a General Partner.
<PAGE>
Item 12. Security Ownership of Certain Beneficial Owners and Management

The following  table sets forth as of December 30, 1998  information  concerning
(i) all persons who are known to the  Registrant to be the  beneficial  owner of
more  than 5% of the  Units  and  (ii)  the  beneficial  ownership  of  Units of
directors and officers of each General Partner of the Registrant.
<TABLE>
<CAPTION>
                                       Amount Beneficially         Percent of
Name and Address                              Owned (a)              Class
------------------                     -------------------         ----------
<S>                                         <C>                    <C>  
Harold Friedland                            712,417 (1)              15.8%
636 Old York Road #210
Jenkintown, PA 19046

Jack Friedland                            1,155,834 (1)(2)           25.8%
111 Regatta Drive
Jupiter, FL 33477

Leonard Friedland                         1,170,196 (1)(3)           26.1%
6530 Allison Road
Miami Beach, FL 33131

Marjorie Cowan                            1,057,929 (1)(4)           23.6%
3725 S. Ocean Dr.
Hollywood, FL 33019

Samuel Friedland
Family Foundation                           637,417                  14.2%
2501 S. Ocean Dr.
Hollywood, FL 33019

Hasam Realty Limited
Partnership                                  75,000                   1.7%
2501 S. Ocean Dr.
Hollywood, FL 33019

Stein Management Company                     20,093                Less than 1%
2501 S. Ocean Drive
Hollywood, FL 33019

David B. Simpson                              1,460 (5)            Less than 1%
2 University Plaza #109
Hackensack, N. J. 07601

All officers and                          2,361,822                  52.7%
directors as a group
(See footnotes) (6)
</TABLE>
------------
(a)  Includes  all  units as to which  owner  holds  sole or  shared  voting  or
investment power.
<PAGE>
(1) Includes 637,417 units owned by the Samuel  Friedland Family  Foundation and
75,000 units owned by Hasam Realty Limited Partnership, of which this individual
may be deemed a controlling  person.  In the case of Harold  Friedland  does not
include  316,144  Units owned by an adult child and 65,000 Units owned by trusts
for other adult  children of which Jack Friedland is one of three  trustees.  In
the case of Leonard Friedland,  includes Units held for benefit of Mr. Friedland
and adult children of Mr. Friedland.

(2) Does not include 2,500 units owned Jack Friedland's wife.

(3) Does not include 2,500 units owned by Leonard Friedland's ex-wife.

(4) Does not include 96,900 units owned by Mrs. Cowan's  husband,  Irving Cowan.
Includes  16,993  units owned by a trust for a minor child of which Mr. and Mrs.
Cowan are trustees; Includes 21,708 Units owned jointly with Mr. Cowan

(5) Does not include 20,000 Units owned by Stein  Management  Company,  of which
Mr. Simpson's wife owns 50% of the common stock.

(6) Dr. Ernest Safie,  a director of Steinco who owned 150 Units,  died in early
1998.


Item 13. Certain Relationships and Related Transactions

Borrowing from Related Parties

In June, 1995, the Company borrowed $500,000 from Hasam Realty, L.P. for general
working  capital  purposes,  secured  by  a  first  mortgage  on  the  Crestwood
commercial  property  referred to in Item 2. In February,  1996, Hasam agreed to
add to  principal  $27,249 of  interest  accrued  through  January  31, 1996 and
unpaid.  The loan  (including  said amount added to  principal)  was  originally
payable in full on June 29, 1996 but was  extended  through and paid on February
28, 1997.  The loan bore  interest at a rate equal to two percent over the Prime
Rate, defined as the highest fluctuating rate of interest per annum as published
by the Wall Street Journal. Management believes that the terms of this borrowing
were fair and  reasonable,  and at least as  favorable  as the terms which could
have been obtained from an unaffiliated institutional lender.

On June 13, 1996, the  Partnership  borrowed  $300,000 from an affiliate of Jack
Friedland and $25,000 directly from Mr. Friedland,  who is an affiliate of Hasam
Realty Limited Partnership,  a general partner of the Partnership.  These loans,
originally  due on October 1, 1996,  were extended  through and paid in January,
1997.

Indian Trail Water Control District

The Indian Trail Improvement  District,  a public entity whose seven supervisors
included  Martin J. Katz  (President  and Director of Steinco until his death in
September,  1995) and to which Jack Friedland was recently  elected in 1996, has
prepared a drainage and  reclamation  plan  covering a portion of the  Company's
acreage in the vicinity of the Village of Royal Palm Beach.  In November,  1996,
the District  issued bonds to finance a portion of the development of certain of
the  Partnership's  acreage  in the  Village.  Reference  is  made  to  Item 2 -
Properties  --Palm Beach County -"The  Village of Royal Palm Beach" and "Acreage
<PAGE>
in the  Vicinity of the  Village."  Herbert  Tobin,  a Director  of Steinco,  is
Chairman of the Board and Director, of Union Bank of Florida,  which made a land
development  loan to the  Partnership  in 1994.  See Item 2.  Randy  Rieger  was
elected on an interim basis as a Vice President and Chief  Operating  Officer of
Stein Management Company,  Inc., the Partnership's  managing general partner, in
September 1995,  shortly  following Mr. Katz's death. Mr. Rieger had been active
as a real estate broker, directly and through affiliated companies, in the south
Florida real estate market for many years.

Prior to his election in 1995,  Mr.  Rieger had been serving as a consultant  to
the  Partnership  under an arrangement  pursuant to which he was paid consulting
fees, and additional  amounts  applicable to future  brokerage  commissions were
being paid to RTL Realty Corp.  (50% owned by Mr. Rieger) which had been engaged
as the Partnership's exclusive broker in respect of a substantial portion of its
real estate assets.  Under such prior arrangement,  RTL Realty Corp. is entitled
to substantial brokerage commissions in the event that certain real estate sales
currently under contract relating to a shopping center site are consummated. See
Item 2  Properties  -- "The Village of Royal Palm  Beach." Mr.  Rieger  resigned
following the election of new officers on February 14, 1996; however, Mr. Rieger
has continued to serve the  Partnership  as a consultant  under a consulting and
brokerage  agreement  with Mr.  Rieger and RTL Realty Corp,  dated May 23, 1996,
which was  originally  scheduled  to expire on  December  31,  1996 and has been
extended  through  December  31,  1998  (the  "RTL  Agreement").  Under  the RTL
Agreement,  RTL  receives  $6,000  per month in  consideration  of Mr.  Rieger's
services  to  the  Partnership,  in  addition  to  brokerage  on  sales  of  the
Partnership's  properties at a varying  schedule of rates and  reimbursement  of
approved  expenses.  The Partnership  also reimburses RTL for certain  expenses,
including  office  expenses,  at the  rate of  $2,500  per  month.  RTL may earn
additional commissions on other transactions on a negotiated basis.
<PAGE>
PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)       The following documents are filed as a part of this report:

1.    Financial Statements:
2.    Independent Auditor's Report


Royal Palm Beach Colony, Limited Partnership Financial Statements:

         Balance sheets as of September 30, 1998 and 1997.

         Statements of operations for the years ended September 30, 1998,  1997,
         and 1996.

         Statements of partners'  equity for the years ended September 30, 1998,
         1997, and 1996.

         Statements of cash flows for the years ended September 30, 1998,  1997,
         and 1996.

3.    Financial Statement Schedules:

Schedule IX -  Valuation  and  qualifying  accounts  Schedule X -  Supplementary
Income Statement Information

Schedules  other than those listed above have been omitted  because they are not
applicable or the required  information is shown in the financial  statements or
notes thereto.

(b) Reports on Form 8-K

         None.

(c) Exhibits NOTE:

All references in this table of exhibits to "Registration  Statement"  relate to
the Registration  Statement of the Registrant on Form S-14 (file Number 2-96374)
as originally  filed with the  Securities  and Exchange  commission on March 12,
1985, as  supplemented by Amendment No. 1 filed May 23, 1985 and as effective on
June 10, 1985.

3(a)  Certificate  and  Agreement  of  Limited  Partnership  of Royal Palm Beach
Colony,   L.P.  filed  as  Exhibit  3(d)  to  the  Registration   Statement  and
incorporated herein by reference.

3(b) Restated  certificate  and Agreement of Limited  Partnership  of Royal Palm
Beach  Colony,  L.P.  included as Appendix B to the  Registration  Statement and
incorporated herein by reference.

3(c) Amended  Certificate  and  Agreement of Limited  Partnership  of Royal Palm
Beach Colony,  L.P. (filed May 21, 1985 with the Secretary of State of Delaware)
changing name to Royal Palm Beach Colony, Limited Partnership.  Filed as Exhibit
3(g) to Amendment  Number One to the  Registration  Statement  and  incorporated
herein by reference.
<PAGE>
3(d)  Restated  Certificate  and  Agreement  of  Limited  Partnership  (revised)
included as Appendix B to  Amendment  No. 1 to the  Registration  Statement  and
filed July 11, 1985 with the  Secretary  of State of Delaware  and  incorporated
herein by reference.

3(e) Restated  Certificate of Limited Partnership dated December 16, 1986. Filed
as Exhibit 3(e) to Report on Form 10-K for the fiscal year ended  September  30,
1986 and incorporated herein by reference.

3(f) Amended and Restated  Agreement of Limited  Partnership  dated December 16,
1986.  Filed as Exhibit  3(f) to Report on Form 10-K for the  fiscal  year ended
September 30, 1986 and incorporated herein by reference.

3(g)  Amendment No. 1 to Amended and Restated  Agreement of Limited  Partnership
dated  December 30,  1986.  Filed as Exhibit 3(g) to Report on Form 10-K for the
fiscal year ended September 30, 1986 and incorporated herein by reference.

3(h) Second  Amended  and  Restated  Certificate  of Limited  Partnership  dated
December 30, 1986.  Filed as Exhibit 3 (h) to Report on Form 10-K for the fiscal
year ended September 30, 1986 and incorporated herein by reference.

4(a) Form of Unit  Certificate  issued to Limited  Partners and Assignees of the
Partnership.   Filed  as  Exhibit  4  (a)  to  the  Registration  Statement  and
incorporated herein by reference.

4(b) Loan Agreement  between Royal Palm Beach Colony,  Limited  Partnership  and
Union Bank of Florida dated October 6, 1994, pertaining to loan in the amount of
$975,000. Filed as Exhibit 4(b) to the Report of the Registrant on Form 10-K for
the fiscal year ended September 30, 1995 and incorporated herein by reference.

4(c)  Correction to  description of Exhibit 4(c) filed with Report of Registrant
on Form 10-K for fiscal year ended  September 30, 1995.  Said Exhibit relates to
is a promissory  note for $27,247.83 of accrued  interest on Promissory  Note in
the amount of $500,000 filed as Exhibit 4(d) to said report on Form 10-K.  Filed
as Exhibit 4(c) to the Report of the Registrant on Form 10-K for the fiscal year
ended September 30, 1996 and incorporated herein by reference.

4(d)  Correction to  description of Exhibit 4(d) filed with Report of Registrant
on Form 10-K for  fiscal  year  ended  September  30,  1995.  Said  Exhibit is a
Promissory  note from  Registrant  to Hasam Realty  Limited  Partnership  in the
amount of  $500,000.  Filed as Exhibit 4(d) to the Report of the  Registrant  on
Form 10-K for the fiscal year ended September 30, 1996 and  incorporated  herein
by reference.

4(e)  Agreement  between  Registrant and Gerald M. Higier dated December 1, 1995
relating to purchase of 10.8 acre commercial tract. Filed as Exhibit 4(e) to the
Report of the  Registrant  on Form 10-K for the fiscal year ended  September 30,
1995 and incorporated herein by reference.

4(f) Agreement between Registrant and Gerald M. Higier dated in 1995 relating to
purchase of 24 acres.  Filed as Exhibit 4(f) to the Report of the  Registrant on
Form 10-K for the fiscal year ended September 30, 1995 and  incorporated  herein
by reference.

4(g) Agreement executed August 12, 1996 between the Registrant and Lennar Homes,
Inc. relating to sale of 86 single family lots in Crestwood Unit 3 - Plat Three.
Filed as  Exhibit  4(g) to the  Report  of the  Registrant  on Form 10-K for the
fiscal year ended September 30, 1996 and incorporated herein by reference.
<PAGE>
4(h) First Mortgage Modification Amendment dated June 26, 1995 to Loan Agreement
referred  to in  Exhibit  4(b).  Filed  as  Exhibit  4(h) to the  Report  of the
Registrant  on Form  10-K for the  fiscal  year  ended  September  30,  1996 and
incorporated herein by reference.

4(i)  Second  Mortgage  Modification  Amendment  dated  October 21, 1996 to Loan
Agreement  referred to in Exhibit  4(b).  Filed as Exhibit 4(i) to the Report of
the  Registrant  on Form 10-K for the fiscal year ended  September  30, 1996 and
incorporated herein by reference.

4 (j) Mortgage dated June 13, 1996 between Crossroads  Associates,  Ltd. and the
Registrant  pertaining to secured loan of $300,000 to the  Registrant.  Filed as
Exhibit  4(j) to the Report of the  Registrant  on Form 10-K for the fiscal year
ended September 30, 1996 and incorporated herein by reference.

4 (k)  Promissory  Note  dated  June 13,  1996 in the  amount of  $300,000  from
Registrant to Crossroads  Associates,  Ltd.  relating to Mortgage referred to in
Exhibit 4(j). Filed as Exhibit 4(k) to the Report of the Registrant on Form 10-K
for the  fiscal  year  ended  September  30,  1996 and  incorporated  herein  by
reference.

4(l) Letter Agreement dated May 23, 1996 between Randy Rieger and the Registrant
relating to  brokerage  and  consulting  services.  Filed as Exhibit 4(l) to the
Report of the  Registrant  on Form 10-K for the fiscal year ended  September 30,
1996 and incorporated herein by reference.

4(m)  Agreement  for  Purchase  and  Sale  between  the  Registrant  and TCR SFA
Apartments,  Inc. dated March 18, 1998 and First and Second  Amendments  thereto
dated  in June  and  December  of 1998,  respectively,  relating  to the sale of
approximately 21.8 acres in the Crestwood Tract, filed herewith.
<PAGE>

                                   SIGNATURES

Pursuant  to the  requirements  of  Section 13 and 15(d) of the  Securities  and
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.


                                      ROYAL PALM BEACH COLONY,
                                      LIMITED PARTNERSHIP
                                      By: Stein Management Company, Inc. 
                                          Managing General Partner

                                      By: /s/ David B. Simpson
                                          --------------------
                                          David B. Simpson, Vice President



Date: December 30, 1998



<PAGE>


                  Royal Palm Beach Colony, Limited Partnership
                                    Form 10-K
                          Year Ended September 30, 1998

                           Continuation of Signatures


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.

Name                                   Title

/s/David B. Simpson                    Director,  Vice President,Stein
-------------------                    Management Company,  Inc.
David B. Simpson                       


/s/Herbert Tobin                       Director,  Stein  Management
----------------                       Company,  Inc.
Herbert Tobin                          

/s/Irving Cowan                        Director,  President,Stein Management
---------------                        Company, Inc.                        
Irving Cowan                           
                                       

Dated:

December 30, 1998
<PAGE>


                            ROYAL PALM BEACH COLONY,

                               LIMITED PARTNERSHIP

                              FINANCIAL STATEMENTS

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996




              Independent auditors' report

              Financial statements:

                 Balance sheets

                 Statements of operations

                 Statements of partners' equity

                 Statements of cash flows

                 Notes to financial statements

              Schedule IX - Valuation and Qualifying Accounts

              Schedule X - Supplemental Income Statement Information





<PAGE>

                          Independent Auditors' Report


              Partners
              Royal Palm Beach Colony, Limited Partnership
              Hollywood, Florida

              We have  audited  the  accompanying  balance  sheets of Royal Palm
              Beach Colony,  Limited  Partnership  as of September 30, 1998, and
              1997, and the related statements of operations,  partners' equity,
              and cash  flows for each of the three  years in the  period  ended
              September   30,  1998.   These   financial   statements   are  the
              responsibility of the Partnership's management. Our responsibility
              is to express an opinion on these  financial  statements  based on
              our audits.

              We conducted  our audits in  accordance  with  generally  accepted
              auditing  standards.  Those  standards  require  that we plan  and
              perform the audit to obtain reasonable assurance about whether the
              financial statements are free of material misstatements.  An audit
              includes  examining,  on a test  basis,  evidence  supporting  the
              amounts and disclosures in the financial statements. 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 financial statements referred to above present
              fairly, in all material respects,  the financial position of Royal
              Palm Beach Colony,  Limited  Partnership  as of September 30, 1998
              and 1997, and the results of its operations and its cash flows for
              the years in the period  ended  September  30, 1998 in  conformity
              with generally accepted accounting principles.

              Our audits  were made for the purpose of forming an opinion on the
              basic financial  statements taken as a whole. The schedules listed
              in item 14(a)3 are presented  for purposes  of complying  with the
              Securities and Exchange Commission's rules and are not part of the
              basic financial statements. These schedules have been subjected to
              the  auditing  procedures  applied  in  the  audit  of  the  basic
              financial  statements  and, in our  opinion,  fairly  state in all
              material  respects  the  financial  data  required to be set forth
              therein in relation to the basic financial  statements  taken as a
              whole.



              /s/LEFCOURT, BILLIG, SARBEY, TIKTIN & YESNER, P.A.
              --------------------------------------------------
              LEFCOURT, BILLIG, SARBEY, TIKTIN & YESNER, P.A.
              Coral Gables, Florida

              November 11, 1998


<PAGE>
<TABLE>
<CAPTION>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                                 BALANCE SHEETS

                           SEPTEMBER 30, 1998 AND 1997


                        ASSETS

                                                             1998           1997
                                                        ----------    ----------- 
<S>                                                     <C>            <C>       
Cash ..............................................     $    6,553     $   48,738
Mortgage note and other receivables (Note 2):
    Mortgage note receivable ......................                       101,250
    Other .........................................        439,825        275,303
Property held for sale (Note 4) ...................      4,279,599      4,739,939
Other assets (Note 3) .............................         59,627         62,944
                                                        ----------     ----------

                                                        $4,785,604     $5,228,174
                                                        ==========     ==========


          LIABILITIES AND PARTNERS' EQUITY


Liabilities:
    Mortgage notes payable, bank (Note 4) .........     $1,321,750     $1,675,972
    Accounts payable and other liabilities (Note 5)        917,795        761,325
    Estimated cost of development of land sold ....                        30,142
                                                        ----------     ----------

                                                         2,239,545      2,467,439

Partners' equity:
    4,485,504 units authorized and outstanding ....      2,546,059      2,760,735
                                                        ----------     ----------

                                                        $4,785,604     $5,228,174
                                                        ==========     ==========


</TABLE>
                       See notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
                       ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                                 STATEMENTS OF OPERATIONS




                                                       Years ended September 30,
                                            -------------------------------------------- 
                                                1998             1997            1996
                                            -----------      -----------     ----------- 
<S>                                         <C>              <C>             <C>        
Revenues (Note 10) ....................     $ 2,170,116      $ 3,106,552     $   396,924
                                            -----------      -----------     -----------

Costs and expenses:
    Cost of sales .....................       1,394,684        1,747,627         135,533
    Selling, general and administrative
       expenses (Note 7) ..............         646,467          768,537         680,239
    Interest (Note 4) .................          89,147           33,434          72,696
    Terminated merger costs ...........                                           70,720
    Depreciation and property taxes ...         254,494          166,110         127,979
                                            -----------      -----------     -----------

                                              2,384,792        2,715,708       1,087,167
                                            -----------      -----------     -----------

Net income (loss) .....................     $  (214,676)     $   390,844     $  (690,243)
                                            ===========      ===========     ===========

Net income (loss) per unit ............     $     (0.05)     $      0.09     $     (0.15)
                                            ===========      ===========     ===========

Weighted average number of units                                  
    outstanding .......................       4,485,504        4,485,504       4,485,504 
                                            ===========      ===========     =========== 
                                            
</TABLE>

                       See notes to financial statements.


<PAGE>
<TABLE>
<CAPTION>
                          ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                                 STATEMENTS OF PARTNERS' EQUITY





                                 Partnership       General          Limited            Total
                                    Units          Partners         Partners          Equity
                                -----------      -----------      -----------      -----------
<S>                             <C>              <C>              <C>              <C>        
Balance, September 30, 1995       4,485,504      $   132,984      $ 2,927,150      $ 3,060,134


Net loss ..................                          (14,633)        (675,610)        (690,243)
                                -----------      -----------      -----------      -----------

Balance, September 30, 1996       4,485,504          118,351        2,251,540        2,369,891


Net income ................                            8,286          382,558          390,844
                                -----------      -----------      -----------      -----------

Balance, September 30, 1997       4,485,504          126,637        2,634,098        2,760,735


Net loss ..................                           (4,551)        (210,125)        (214,676)
                                -----------      -----------      -----------      -----------

Balance, September 30, 1998       4,485,504      $   122,086      $ 2,423,973      $ 2,546,059
                                ===========      ===========      ===========      ===========

</TABLE>



                       See notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
                             ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                                       STATEMENTS OF CASH FLOWS


                                                                  Years ended September 30,
                                                        ---------------------------------------------
                                                            1998             1997             1996
                                                        -----------      -----------      -----------
<S>                                                     <C>              <C>              <C>  
Cash flows from operating activities:
   Cash received:
      Collections on land sales and receivables ...     $ 1,852,861      $ 2,730,995      $   434,830
      Interest income .............................           7,018            1,154            7,622
      Sale of utility system ......................         228,661          127,393          432,800
      Other cash received .........................          18,304            1,000            6,398
                                                        -----------      -----------      -----------
                                                          2,106,844        2,860,542          881,650
                                                        -----------      -----------      -----------

Cash expended:
   Selling, general and administrative,
      property taxes and other expenses ...........         654,811        1,274,637          528,353
   Interest paid (net of amounts capitalized) .....          89,147           33,434           72,696
   Improvements to property held for sale .........       1,050,849        1,156,495          848,616
                                                        -----------      -----------      -----------
                                                          1,794,807        2,464,566        1,449,665
                                                        -----------      -----------      -----------

Net cash provided by (used in) operating activities         312,037          395,976         (568,015)
                                                        -----------      -----------      -----------
Cash flows from investing activities:
   Purchase of property and equipment .............                                            (1,335)
                                                        -----------      -----------      -----------
Cash flows from financing  activities:
 Proceeds from mortgage notes
   payable:
      Bank ........................................         945,778        1,043,560          301,899
      Other .......................................                                           325,000
   Payments on mortgage payable:
      Bank ........................................      (1,300,000)        (580,000)        (100,000)
      General partner .............................                         (527,249)
      Other .......................................                         (325,000)
                                                        -----------      -----------      -----------

Net cash provided by (used in) financing activities        (354,222)        (388,689)         526,899
                                                        -----------      -----------      -----------

Net increase (decrease) in cash ...................         (42,185)           7,287          (42,451)

Cash at beginning of year .........................          48,738           41,451           83,902
                                                        -----------      -----------      -----------

Cash at end of year ...............................     $     6,553      $    48,738      $    41,451
                                                        ===========      ===========      ===========
</TABLE>
                                   (continued)
<PAGE>
<TABLE>
<CAPTION>
                                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                                      STATEMENTS OF CASH FLOWS (CONTINUED)

                                                                                Years ended September 30,
                                                                       --------------------------------------- 
                                                                          1998           1997          1996
                                                                       ---------      ---------      ---------
<S>                                                                    <C>            <C>            <C>       
Reconciliation of net income (loss) to net cash provided by (used
  in) operating activities:

               Net income (loss) .................................     $(214,676)     $ 390,844      $(690,243)
                                                                       ---------      ---------      ---------
               Adjustments to reconcile net income
                  to net cash provided by (used in)
                     operating activities

                     Depreciation and amortization ...............         1,975          2,754          3,428
                     Sundry (See below) ..........................                                      27,249

               Change in assets and liabilities 
                  Increase in: 
                     Mortgage notes and other receivables ........       (63,272)      (243,235)
                     Property held for sale ......................                                    (642,327)
                     Other assets ................................                       (4,322)        (1,578)
                     Accounts payable and accrued liabilities ....       156,470                       197,037
                     Estimated cost of development of land sold ..                       16,000
                  Decrease in:
                     Mortgage notes and other receivables ........                                     538,718
                     Property held for sale ......................       460,340        510,049
                     Other assets ................................         1,342
                     Accounts payable and accrued liabilities ....                     (276,114)
                     Estimated cost of development of land sold ..       (30,142)                         (299)
                                                                       ---------      ---------      ---------

               Total adjustments .................................       526,713          5,132        122,228
                                                                       ---------      ---------      ---------

               Net cash provided by (used in) operating activities     $ 312,037      $ 395,976      $(568,015)
                                                                       =========      =========      =========
</TABLE>
              Supplemental   information   concerning  investing  and  financing
              activities: 

              In  fiscal  1996  the  Partnership  issued a note  payable  to the
              general partner for unpaid interest in the amount of $27,249.


                       See notes to financial statements.
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996


                1. Organization and summary of significant accounting policies:

                      The primary  business  purpose of the  Partnership  is the
                      operation,  management  and  orderly  disposition  of  its
                      assets and the distributions of the proceeds  therefrom to
                      unitholders.  The general  partners of the Partnership are
                      Hasam  Realty  Limited  Partnership  and Stein  Management
                      Company, Inc. ("Steinco"). Steinco is the Managing General
                      Partner   which  employs  the   management   and  clerical
                      employees  necessary  to carry  out the  operation  of the
                      Partnership.  Steinco is reimbursed by the Partnership for
                      related expenses.

                      A summary of the Partnership's accounting principles is as
                      follows:

                       Land sales:
                          Generally,   land  sales  are   recognized   when  the
                          purchaser has made an adequate  down  payment,  20% to
                          25% of the  purchase  price,  the  Partnership  has no
                          substantial  remaining obligations with respect to the
                          property,   and  the  collectibility  of  the  related
                          receivable  is  reasonably   predictable.   Otherwise,
                          either the  installment or the cost recovery method is
                          used. Under the installment method, portions of profit
                          are  recognized as cash payments are received from the
                          buyer.  Under  the cost  recovery  method no profit is
                          recognized  until  cash  payments  received  from  the
                          buyer,  including  interest and principal,  exceed the
                          seller's cost of the property sold.

                       Sale of Utility System:
                          The Partnership  recognizes profit on the 1983 sale of
                          a utility  system in the years in which  increases  in
                          consumption  generate  amounts due to the Partnership.
                          (See Note 8).

                       Cash:
                          The  Partnership  considers  all  highly  liquid  debt
                          investments with maturities of three months or less to
                          be cash equivalents.

                       Mortgage note receivable:
                          Mortgage  note  receivable  represents  the amount due
                          from the sale of properties. The Partnership evaluates
                          the  carrying  amount  of  delinquent  mortgage  notes
                          receivable  to  determine  that such  amount  does not
                          exceed  the   estimated   fair  market  value  of  the
                          underlying land.

                                  (continued)
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996

            1.  Organization  and  summary of  significant  accounting  policies
                (continued):

                  Property held for sale:
                      Property  held for sale is  stated at the lower of cost or
                      estimated net realizable  value. The cost of property held
                      for sale  includes the original  purchase  price,  cost of
                      land  development,  development  period real estate taxes,
                      and interest.

                  Net income (loss) per unit:
                      Net  income  (loss)  per unit is  calculated  based on the
                      weighted  average number of units  outstanding  during the
                      year.

                  Concentrations of risk:
                      Asset which subject the Partnership to  concentrations  of
                      risk  consist  primarily  of property  held for sale.  The
                      Partnership's   property  held  for  sale  is  located  in
                      Florida. The Partnership's ability to sell its property is
                      substantially  dependent   upon the  Florida  real  estate
                      economic sector.

                  Use of estimates:
                      The preparation of financial statements in conformity with
                      generally   accepted   accounting    principles   requires
                      management to make estimates and  assumptions  that affect
                      the reported amounts and disclosures. Actual results could
                      differ from those estimates.

                  Reclassifications:
                      Certain  items in the 1997 and 1996  financial  statements
                      have   been   reclassified   to   conform   to  the   1998
                      presentation.

            2. Mortgage note and other receivables:

               Mortgage  note  receivable  of  $101,250  at  September  30, 1997
               carried  interest at 10% per annum,  and was paid as of September
               30, 1998.

                                                   September 30,
                                             ----------------------
                                               1998         1997
                                             --------     --------- 

             Utility receivable (Note 8)     $438,572     $228,660
             Accrued interest receivable                     3,900
             Closing proceeds receivable                    41,200
             Other .....................        1,253        1,543
                                             --------     --------

                                             $439,825     $275,303
                                             ========     ========
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996


            3. Other assets:

               Other assets consist of the following:

                                                     September 30,
                                                  -------------------- 
                                                     1998       1997
                                                  -------     -------- 
           Furniture and equipment,
              net of accumulated depreciation     $ 1,361     $ 3,336

           Prepaid expenses .................      58,266      59,608
                                                  -------     -------

                                                  $59,627     $62,944
                                                  =======     =======

            4. Mortgage notes payable, bank:

               Mortgage notes payable, bank consist of the following:

<TABLE>
<CAPTION>
                                                                                                 September 30,
                                                                                         --------------------------- 
                                                                                            1998             1997
                                                                                         ----------      ----------- 
<S>                                                                                      <C>             <C>       
                      Mortgage  notes  payable,  bank:  On July  15,  1998,  the
                      Partnership  combined  certain  construction   development
                      loans under a $2,925,000 Consolidation Promissory Note, at
                      1% over the prime rate (for an effective  rate of 9.50% at
                      September 30, 1998).  Interest is payable  monthly and the
                      note matures on September 17, 1999. Property held for sale
                      with a cost of approximately  $2,259,000 is collateral for
                      this  loan  and the  loan  below.  The  mortgage  requires
                      certain  principal  payments as land is sold. At September
                      30, 1998, $16,402 is available to be drawn on this loan.           $1,028,598      $1,485,820

                      On  September  2, 1997,  the  Partnership  entered in to a
                      Future  Advance for Working  Capital Loan in the amount of
                      $300,000 at 1% over the prime rate (for an effective  rate
                      of 9.50% at  September  |30,  1998).  Interest  is payable
                      monthly and the loan  matures on September  17, 1999.  The
                      collateral   described  above  also   collateralizes  this
                      obligation.                                                           293,152         190,152
                                                                                         ----------      ---------- 

                                                                                         $1,321,750      $1,675,972
                                                                                         ==========      ========== 
</TABLE>
                                  (continued)
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996

            4. Mortgage notes payable, bank: (continued)

               Interest is capitalized for property being developed as follows:
<TABLE>
<CAPTION>
                                                                                                 September 30,
                                                                                         --------------------------- 
                                                                                            1998             1997
                                                                                         ----------      ----------- 
<S>                                                                                      <C>             <C>       
                        Capitalized                                                      $   61,212      $   191,893

                        Charged to operations                                                89,147           33,434
                                                                                        -----------      ----------- 

                        Total interest incurred                                         $   150,359      $   225,327
                                                                                        ===========      =========== 

</TABLE>

            5. Accounts payable and other liabilities:

               Accounts payable and other liabilities consist of the following:
<TABLE>
<CAPTION>
                                                                                                 September 30,
                                                                                         --------------------------- 
                                                                                            1998             1997
                                                                                         ----------      ----------- 
<S>                                                                                      <C>             <C>       
                     Accounts payable                                                    $  671,594      $   477,192
                     Accrued liabilities:
                        Current property taxes                                              205,690          244,133
                        Other                                                                40,511           40,000
                                                                                         ----------      ----------- 

                                                                                         $  917,795      $   761,325
                                                                                         ==========      =========== 
</TABLE>


               Property taxes related to 1994, 1995, 1996 and 1997 in the amount
               of $329,160 are delinquent at September 30, 1998 and are included
               in accounts payable.
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996


            6.     Income taxes:

                  The  Partnership,  pursuant  to the  transitional  grandfather
                  rules of the  Internal  Revenue  Code  dealing  with  publicly
                  traded partnerships,  reported its income as a partnership for
                  taxable years through  December 31, 1997.  The  application of
                  the grandfather  rules terminated for taxable years commencing
                  after  December  31, 1997.  Under the  Taxpayer  Relief Act of
                  1997, a publicly traded partnership that is currently governed
                  by this  provision may elect to continue its  partnership  tax
                  status  beyond  December 31, 1997 by agreeing to pay an annual
                  3.5%  Federal tax on its gross  income for Federal  income tax
                  purposes  (principally  revenues less cost of land sold).  The
                  Partnership  has elected to continue  its  Partnership  status
                  beyond  December 31, 1997, and estimates that Federal tax due,
                  if any, on gross  income for Federal tax  purposes for the tax
                  year ending December 31, 1998 will not be material.

                  The  partners  are  required  to include  in their  income tax
                  returns  their share of the  Partnership's  income or loss, as
                  adjusted to reflect the effects of certain  transactions which
                  are accorded different accounting treatment for federal income
                  tax  purposes.  Pursuant  to the Tax Reform  Act of 1986,  the
                  Partnership  changed its fiscal year end,  September  30, to a
                  calendar year end for income tax purposes.

                  The  following  analysis   summarizes  the  major  differences
                  between the  financial  reporting  and income tax basis of the
                  partner's equity account at September 30, 1998.

<TABLE>
<CAPTION>

<S>                                                                   <C>                  <C>         
                  Partners'  equity,  financial  reporting  basis                          $ 2,546,059 
                     Add item recorded for tax purposes only:
                        Step-up in basis of property                   $17,000,000
                     Less: Cost of sales - step-up adjusted
                        for unamortized additional capitalized
                        inventory costs and any adjustments as
                        a result of repossessions.                      12,167,524
                                                                       ----------- 
                                                                         4,832,476

                     Add items not presently deductible for tax
                        purposes                                            39,882           4,872,358
                                                                       -----------         ----------- 

                     Partners' equity, income tax basis                                    $ 7,418,417
                                                                                           =========== 

</TABLE>
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996


            7.    Lease information:

                  The  Partnership  occupies  its office  facility in a building
                  owned  by  an  entity   related  by  common   ownership.   The
                  Partnership  does  not pay any rent at this  office  facility.
                  Other  long-term   operating   leases  on  real  and  personal
                  properties are not considered material.


            8.   Other transactions:

                  A  subsidiary  of the  Company,  Royal  Palm  Beach  Utilities
                  Company ("Utilities"), previously sold to the Village of Royal
                  Palm Beach  ("Village")  all of its  assets,  consisting  of a
                  water treatment and  distribution  system and a sanitary sewer
                  collection,  treatment  and  disposal  system  located  in the
                  Village.   The  sale  requires  payments  to  be  received  by
                  Utilities  as future  connections  (as measured by increase in
                  consumption)  are added to the system,  over a period which is
                  expected to be extended from August, 2001 through 2003. Should
                  consumption not increase  sufficiently,  the Partnership would
                  not receive  the full sale  amount.  The  maximum  proceeds to
                  Utilities approximates $13,410,000,  of which, under the terms
                  of  the  sale,  approximately  $5,050,000  had  not  yet  been
                  received  as  of  September   30,  1998.   In  addition,   the
                  Partnership had the right to receive up to $500,000,  of which
                  $303,000 has already been  received,  as the Village  collects
                  guaranteed revenues from developers. Since future increases in
                  consumption  and  payment  of  guaranteed  revenues  cannot be
                  assured and,  therefore,  the extent of future payments to the
                  Partnership is uncertain,  the  Partnership  accounts for this
                  transaction  utilizing the cost recovery method of accounting.
                  The Partnership  has  previously  fully recovered its cost and
                  recognizes  profit  on the sale as  increases  in  consumption
                  generate amounts due to the  Partnership.  Revenues related to
                  the sale of utility system of $438,573, $227,053, and $129,000
                  were   recognized  for  fiscal  years  1998,   1997  and  1996
                  respectively.

<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996



            9. Comparative quarterly financial information (unaudited):
<TABLE>
<CAPTION>
                                      First           Second            Third           Fourth
                                     quarter          quarter          quarter          quarter        Full year
                                  -----------      -----------      -----------      -----------      -----------
<S>                               <C>              <C>              <C>              <C>              <C>        
1998:
    Revenues: ...............     $   489,037      $   620,488      $   618,981      $   441,610      $ 2,170,116
    Cost and expenses .......         555,056          764,610          786,995          278,131        2,384,792
                                  -----------      -----------      -----------      -----------      -----------

    Net income (loss) .......     $   (66,019)     $  (144,122)     $  (168,014)     $   163,479      $  (214,676)
                                  ===========      ===========      ===========      ===========      ===========

    Net income (loss) per unit    $     (0.01)     $     (0.03)     $     (0.04)     $      0.03      $     (0.05)
                                  ===========      ===========      ===========      ===========      ===========

1997:
    Revenues: ...............     $   320,619      $ 1,659,912      $   327,224      $   798,797      $ 3,106,552
    Cost and expenses .......         291,774        1,146,565          459,632          817,737        2,715,708
                                  -----------      -----------      -----------      -----------      -----------

    Net income (loss) .......     $    28,845      $   513,347      $  (132,408)     $   (18,940)     $   390,844
                                  ===========      ===========      ===========      ===========      ===========

    Net income (loss) per unit    $      0.01      $      0.11      $     (0.03)     $     (0.00)     $      0.09
                                  ===========      ===========      ===========      ===========      ===========


1996:
    Revenues: ...............     $   144,044      $     7,197      $    12,476      $   233,207      $   396,924
    Cost and expenses .......         375,444          283,059          185,668          242,996        1,087,167
                                  -----------      -----------      -----------      -----------      -----------

         Net loss ...........     $  (231,400)     $  (275,862)     $  (173,192)     $    (9,789)     $  (690,243)
                                  ===========      ===========      ===========      ===========      ===========

    Net loss per unit .......     $     (0.05)     $     (0.06)     $     (0.04)     $     (0.00)     $     (0.15)
                                  ===========      ===========      ===========      ===========      ===========

</TABLE>
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996

            10.  Revenues:

                 Revenues consist of the following:
<TABLE>
<CAPTION>

                                               Years ended September 30,
                                        ----------------------------------------
                                           1998           1997           1996
                                        ----------     ----------     ---------- 
<S>                                     <C>            <C>            <C>       
 Land revenues:
    Net sales of land .............     $1,706,221     $2,873,445     $  182,000
    Recognized profit on
      installment and costs
     recovery sales ...............                                          690
Interest income ...................          7,018          5,054          4,789
    Sale of utility system (Note 8)        438,573        227,053        129,000
      Foreclosure settlement, net .                                       74,047
     Other ........................         18,304          1,000          6,398
                                        ----------     ----------     ----------

                                        $2,170,116     $3,106,552     $  396,924
                                        ==========     ==========     ==========
</TABLE>

            11.  Liquidity:

                 During the year  ended  September  30,  1995,  the  Partnership
                 incurred   substantial  expenses  in  the  development  of  its
                 properties in addition to normal ongoing  administrative  costs
                 incurred  in   connection   with  a   terminated   merger.   In
                 anticipation  of adding home  building  operations  through the
                 proposed  merger, management  made a decision  to suspend  land
                 sales  activity  pending  the  outcome  of  the  merger.   This
                 suspension  of  land  sales  resulted  in   insufficient   cash
                 resources available for the Partnership to meet its obligations
                 as they become due.

                 Since the  termination  of the  merger in  December  1995,  the
                 Partnership  has  resumed  land  sales  efforts  and has closed
                 certain sales.  However,  there is no assurance that such sales
                 and closings will continue to occur,  or that their timing will
                 coincide with the Partnership's cash  requirements.  Management
                 believes  that  the  Partnership  will be able to fund  ongoing
                 operations from future land sales or from short-term financing,
                 if  needed.  The  success  of the sales  efforts  or  obtaining
                 additional  borrowing is necessary to enable the Partnership to
                 meet its current obligations.

<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                 SCHEDULE IX - VALUATION AND QUALIFYING ACCOUNTS

                          YEAR ENDED SEPTEMBER 30, 1998


<TABLE>
<CAPTION>


                                                                  Column C
                                                       -------------------------------- 
                                   Column B                (1)                   (2)                                      Column E
                                  Balance at           Charged to            Charged to                                  Balance at
        Column A                  beginning             costs and               other               Column D               end of
      Description                 of period             expenses              accounts             deductions              period
      -----------                 ---------             --------              --------             ----------              ------ 
<S>                              <C>                                         <C>                    <C>                 <C>      
Deferred profit:

  1996                           $   49,648                                                         (A)  $   (690)       $    0.00
                                                                                                    (B)   (48,958)
</TABLE>
(A) Recognized profit on installment and cost recovery sales.

(B) Write-off of deferred  profit in connection with settlement of mortgage note
    receivable.
<PAGE>
                   ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

             SCHEDULE X - SUPPLEMENTAL INCOME STATEMENT INFORMATION

                  YEARS ENDED SEPTEMBER 30, 1998, 1997 AND 1996




                                                     September 30,
                                          --------------------------------------
                                             1998           1997          1996
                                          --------       --------       --------

1. Maintenance and repairs ........       $      0       $    580       $      0
                                          ========       ========       ========



2. Taxes, other than payroll
      and income taxes ............       $254,791       $166,837       $128,589
                                          ========       ========       ========


3. Advertising ....................       $      0       $    168       $      0
                                          ========       ========       ========