1

                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, 2001

                          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:
                                      None

Name of Each Exchange on which Registered -
                                      None

Title of Each Class: Limited Partnership Units

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

Indicate by checkmark 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 [   ]

                                       1

<PAGE>


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 31, 2001 was approximately
$1,507,000.

                                       2

<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 $79,909,000.

     The partnership has declared aggregate distributions of $32,520,128 ($7.45)
per unit since inception through December 31, 2001, including $897,101 ($0.20
per Unit) during the fiscal year ended September 30, 2001. See Item 5 - Market
for the Registrant's Common Equity and Related Stockholder Matters "Prior
Distributions."

     As of December 31, 2001, the Partnership retained and was holding for sale:

                                       3

<PAGE>

     (1) a 50% interest in 1.6 acres of commercial property in the "Crestwood"
tract in the Village of Royal Palm Beach under option for sale for a price which
would generate gross proceeds to the Partnership of approximately $375,000.

     (2) a tract of approximately 20 acres in the Crestwood multi-family tract
in the Village of Royal Palm Beach, which is under contract for sale for
$1,462,000.

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. Management has now substantially
completed the development and sale of most of the Partnership's remaining land
in Palm Beach County, and its last three parcels are currently under contract.
However, there can be no assurance that all or any of such contracts will close,
and although the Partnership expects to receive future collections of contingent
receivables relating to a prior sale of a utility plant, it is currently
uncertain when additional cash will become available for distribution. See Item
2 - "Properties," for a discussion of potential 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

                                       4
<PAGE>


issues affecting salability of certain properties remaining in Palm Beach County
in Item 2 -- Properties -- "Acreage in the Vicinity of the Village."

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 it is possible that competitive forces could result in one or
more purchasers under the remaining contracts for sale of the Partnership's
properties determining not to close.

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. Recent
reductions in interests rates could have a favorable impact on the decision of
purchasers for the Partnership's remaining properties to close on contracts
previously executed and on the number of new utility connections installed in
the Village of Royal Palm Beach, which in turn will have an impact on the
contingent receivables payable under the Utilities contract. See "Utility
Contingent Receivable" below. If significant interest rate increases occur in
the future, the real estate market could suffer as a result.

Personnel:

As of December 31, 2001, Stein Management Company, Inc. ("Steinco")the Managing
General Partner, employed 1 person, who acts as an administrator 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 have been located at 2501 S. Ocean
Drive, Hollywood, Florida 33019 but will be re-located to 3225 Aviation Avenue,
Suite 700, Coconut Groves, Florida 33133 on or about February 28, 2002. The
previous are owned by an affiliate of Hasam Realty Limited Partnership ("Hasam
L.P."), a general partner of the Partnership, which made available to the
Partnership as an accommodation without charge. The new premises will be located
in a portion of premises occupied by Randy Reiger, who has been the broker for


                                       5
<PAGE>

numerous real estate sales by the Partnership, and who is making such space
available without cost to the Partnership.

Item 2. Properties

Palm Beach County, Florida

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 was otherwise
undeveloped with the exception of the existence of portions of a drainage
system. Through December 31, 2001, all of the Crestwood Tract had been sold with
the exception of the 1.6 acres of commercial property under option and the 20
acre tract intended for multi-family residential construction described in Item
1 above.

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, and 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, 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. The purchaser
is seeking the appropriate approvals from the Village. The first such parcel was
sold during the year for a gross sale price of $500,000. Subject to receipt of
such approvals, the Partnership anticipates closing on the remaining parcel in
May 2002 for gross proceeds of approximately $375,000 but the timing of closing
on the second parcel is currently uncertain.

                                       6
<PAGE>

Residential Lots Within the Crestwood Tract

     As a result of management's decision to develop portions of the Crestwood
Tract, the Partnership re-planned 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.

     Between 1995 and 1997, the Partnership completed the off-site and on-site
improvements required for the development of 198 lots in the Residential Tract.
Through December 31, 2001, the Partnership had sold all of the 198 lots in the
Residential Tract but had reacquired 45 such lots upon foreclosure in October,
1999. During the quarter ended March 31, 2000, the Company resold such lots for
gross proceeds or $1,316,250 and net proceeds after real estate taxes and
brokerage commissions of $1,092,000.

     In August 1999 the Partnership sold a substantial part of the remainder of
the multi-family zoned land (comprising approximately 26 acres) for $2,225,000
in gross proceeds, and approximately $1,886,000 in net proceeds after costs of
sale. Previously, in November 1998, the Partnership sold 7.7 acres for net
proceeds of $288,000.

     The Partnership also holds a tract of approximately 20 acres of
multi-family zoned property in the Crestwood multi-family tract in the Village
of Royal Palm Beach. This property is under contract of sale for a gross selling
price of $1,462,000. The closing of this transaction is subject, as were the
prior contracts, to due diligence review by the purchaser and, thereafter, to
numerous land use and other contingencies and the closing is therefore not
expected to occur until approximately April 2002.

     Proceeds previously received for various sales within the Crestwood tract,
and proposed sale prices under previously canceled contracts, do not necessarily
constitute a reliable predictor of the proceeds which may be anticipated for
sales of the balance of the Partnership's land within the Crestwood area.

                                       7
<PAGE>

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, 2001,
$3,742,000 had not been received. 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 $361,000 has been received through September 30,2001.

     Through December 31, 2001 the Partnership had received total payments of
$7,158,000 in "consumption" payments and $361,000 in Guaranteed payments under
the Utility Contract, and was entitled to receive approximately $442,000 in
January, 2002 in respect of the year 2001. The Utility Contract will expire in
2003. Since the highest annual payment in the ten years ending September 30,
2000 was only $519,000, it is a virtual certainty that the rate of new
construction or water consumption in such area will not be sufficient to enable
the Partnership to receive the maximum remaining in contingent payments under
the Utility Contract prior to the expiration of the contingent payment term.

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.


                                       8
<PAGE>

                                     PART II

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

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, 2000 and
2001. As of December 31, 2000, based on its records, the Partnership believes
that there were a total of approximately 970 holders of Units, including holders
acting as nominee for securities brokerage firms and athers.

Fiscal Year Ended: September 30, 2000

Quarter              High               Low
-------              ----               ---
First                1 1/2              1/2
Second               1 1/64            9/16
Third                1 3/8              3/8
Fourth                11/16             1/2

Fiscal Year Ended: September 30, 2001

Quarter              High               Low
-------              ----               ---
First                $.65               $.20
Second               $.30               $.20
Third                $.80               $.35
Fourth               $.85               $.10

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. See
Item 1 -- "Factors Affecting Future Operations and Distributions."


                                       9
<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 $0.71 as of September 30, 2001. 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
October 27, 1999               .50
February 17,2000               .25
June, 2001                     .20
                             -----
                              7.45

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<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,
                           --------------------------------------------------------
                             2001         2000       1999        1998         1997
<S>                        <C>         <C>         <C>         <C>          <C>
Selected Income
       Statement Data

Revenues                   $ 1,074     $ 2,058     $ 8,412     $ 2,170      $ 3,107
Net income (loss)          $   172     $   281       3,107        (215)         391
Income (loss)
       per unit            $  0.04        0.06        0.69        (.05)         .09

Selected Balance
Sheet Data

Total assets               $ 2,048     $ 2,785     $ 5,936     $ 4,786      $ 5,228
Mortgage Notes Payable        $-0-         -0-         -0-       1,322        1,676
Partners' equity             1,845       2,569       5,652       2,546        2,761
Cash distributions
per unit                   $  0.20     $  0.75     $  0.00     $  0.00      $  0.00
</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).


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<PAGE>

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

During the fiscal year, the Partnership had gross revenues of $1,074,495 most of
which resulted from land sales, as compared with $2,058,211 in 2000 and
$8,411,560 in 1999. Net income was $172,422 in 2001, as compared with $280,524
in 2000 and $3,106,905 in 1999.

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 was $3,113,800 at September 30, 1999 as a result of
the closing of material land sales and decreased to $812,520 as of September 30,
2001 principally as a result of a distributions to Unitholders aggregating
$3,364,128 during the year. Cash declined to $515,952 at September 30, 2001
partially as the result of distributions to Unitholders aggregating $897,101
during the year and reduced revenues from land sales. 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 existing cash, land
sale closings and contingent utility receipts described under the caption
"Utility Contingent Receivable" under Item 2 above.

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. 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

                                       12
<PAGE>

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 "Utility Contingent Receivable" under Item 2 above.

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.

Results of Operations

<TABLE>
<CAPTION>

                               Fiscal Years Ended September 30
                               --------------------------------

                               2001           2000          1999
                               ----           ----          ----
<S>                        <C>            <C>            <C>
Sales of land, net         $  595,000     $1,436,000     $8,000,000
Interest income                37,000         53,000         29,000

Sale of utility system        442,000        548,000        379,000

Other                              --         21,000          3,000
                           ----------     ----------     ----------

Total revenues             $1,074,000     $2,058,000     $8,411,000
                           ==========     ==========     ==========
</TABLE>


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.


                                       13
<PAGE>

Selling, Administrative and Other Expenses

Selling, general and administrative expenses were $1,334,174 in 1999, decreasing
to $585,085 in 2000 and $492,046 in 2001, primarily due to declining sales
commission levels resulting from reductions in the volume of real estate sales.

Property Taxes

Property tax expense decreased materially from 1999 to 2001 because of
substantial sales of the Partnership's properties.

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. Selling, general and administrative
expenses include federal tax of $9,238, $19,908 and $70,000 for the years ended
September 30, 2001, 2000 and 1999, respectively. See Note 6 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


                                       14
<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)

<TABLE>
<CAPTION>

------------------------------- ----------------------------------------- -------------------------------------------
<S>                              <C>                                       <C>
Name and Age                     Present Position With the Registrant      Other Positions With the Registrant

------------------------------- ----------------------------------------- -------------------------------------------
Irving Cowan       69            President of Steinco                      Private Investor

------------------------------- ----------------------------------------- -------------------------------------------
David B. Simpson   62            Vice President and Director of Steinco    Attorney currently in private practice
                                                                           and counsel to the Partnership

------------------------------- ----------------------------------------- -------------------------------------------
Jack Friedland     76            Member of Friedco,LLC (1)                 Private Investor

------------------------------- ----------------------------------------- -------------------------------------------
Leonard Friedland  77            Member of Friedco,LLC (1)                 Private Investor

------------------------------- ----------------------------------------- -------------------------------------------
Herbert Tobin      61            Director of Steinco                       Private Investor
                                 Director, Secretary
                                 And Treasurer(*)of
                                 Steinco

------------------------------- ----------------------------------------- -------------------------------------------
Marjorie Cowan     61            Member of Friedco,LLC (1)                 Private Investor

------------------------------- ----------------------------------------- -------------------------------------------
Harold Friedland   71            Member of Friedco                         Private Investor

------------------------------- ----------------------------------------- -------------------------------------------
</TABLE>


(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.

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 2001.
Based solely on the foregoing the Partnership believes that during fiscal 2001,

                                       15
<PAGE>

no purchases or sales of units were made requiring compliance with applicable
Section 16(a) filing requirements.

Item 11. Executive Compensation

During fiscal 2001 officers and directors of Steinco, the managing partner, as a
group (3 persons), earned $22,500 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.

Item 12. Security Ownership of Certain Beneficial Owners and Management

The following table sets forth as of December 30, 2000 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.

Amount Beneficially               Percent of
Name and Address                  Owned (a)                       Class
------------------                -----------                     -----
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



                                       16
<PAGE>

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)

(a) Includes all units as to which owner holds sole or shared voting or
investment power.

(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.


                                       17
<PAGE>

(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.

Item 13. Certain Relationships and Related Transactions

None

                                     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, 2001 and 2000.

Statements of income for the years ended September 30, 2001, 2000, and 1999.

Statements of partners' equity for the years ended September 30, 2001, 2000, and
1999.

Statements of cash flows for the years ended September 30, 2001, 2000, and 1999.

3. Financial Statement Schedules:


Schedule X - Supplementary Income Statement Information


                                       18
<PAGE>


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.

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.


                                       19
<PAGE>

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.


                                       20
<PAGE>

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.

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 as Exhibit 4(m) to the
Report of the Registrant on Form 10-K for the fiscal year ended September 30,
1998 and incorporated herein by reference.


                                       21
<PAGE>

4(n) Agreement dated January ____, 2001 for Purchase and Sale between the
Registrant and Stewart Marcus, Trustee, relating to the sale of approximately
21.82 acres in the Crestwood Tract, filed herewith. Filed as Exhibit 4(n) to the
report of the Registrant on Form 10-12 for the fiscal year ended September 30,
2000 and incorporated herein by reference.


                                       22
<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/ Irving Cowan
    --------------------
    Irving Cowan, President


Date: February 26, 2002

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 and Title


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


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


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


Dated: February 26, 2002




                                       23


<PAGE>


                            Royal Palm Beach Colony,

                               Limited Partnership

                              FINANCIAL STATEMENTS

                                   YEARS ENDED

                        SEPTEMBER 30, 2001, 2000 AND 1999




<PAGE>




                  Royal Palm Beach Colony, Limited Partnership

                              FINANCIAL STATEMENTS

                  YEARS ENDED SEPTEMBER 30, 2001, 2000 AND 1999



                                    CONTENTS

                                                        Page

Independent auditors' report                              1

Financial statements:

    Balance sheets                                        2

    Statements of operations                              3

    Statements of partners' equity                        4

    Statements of cash flows                             5-6

    Notes to financial statements                        7-12


<PAGE>








                          Independent Auditor's 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,  2001,  and  2000,  and the  related
statements of operations, partners' equity, and cash flows for each of the three
years in the period ended September 30, 2001. 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 auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain  reasonable  assurance  about  whether the financial
statements are free of material misstatement.  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, 2001 and 2000,  and the results of its
operations  and its cash flows for each of the three  years in the period  ended
September 30, 2001 in conformity with accounting  principles  generally accepted
in the United States of America.





LEFCOURT, BILLIG, TIKTIN & YESNER, P.A.



Coral Gables, Florida
November 28, 2001



<PAGE>


<TABLE>
<CAPTION>

                  Royal Palm Beach Colony, Limited Partnership

                                 BALANCE SHEETS

                           SEPTEMBER 30, 2001 AND 2000



                                     ASSETS



                                                                 2001            2000
                                                              ----------      ----------
<S>                                                           <C>             <C>

Cash                                                          $  515,952      $  812,520
Utility and other receivables (Note 2)                           444,558         549,482
Property held for sale (Note 3)                                1,024,834       1,366,915
Other assets (Note 4)                                             62,570          55,994
                                                              ----------      ----------

                                                              $2,047,914      $2,784,911
                                                              ==========      ==========



                        LIABILITIES AND PARTNERS' EQUITY



Liabilities:
      Accounts payable and other liabilities (Note 5)         $  203,233      $  215,551
                                                              ----------      ----------

Partners' equity:
      4,485,504 units authorized and outstanding
           General partners                                      107,217         122,580
           Limited partners                                    1,737,464       2,446,780
                                                              ----------      ----------

                                                               1,844,681       2,569,360
                                                              ----------      ----------

                                                              $2,047,914      $2,784,911
                                                              ==========      ==========
</TABLE>


                       See notes to financial statements.


                                                                               2

<PAGE>


<TABLE>
<CAPTION>


                  Royal Palm Beach Colony, Limited Partnership

                            STATEMENTS OF OPERATIONS



                                                     Years ended September 30,
                                             ------------------------------------------
                                                2001            2000            1999
                                             ----------      ----------      ----------
<S>                                          <C>             <C>             <C>
Revenues (Note 9)                            $1,074,495      $2,058,221      $8,411,560
                                             ----------      ----------      ----------

Costs and expenses:
    Cost of sales                               361,355       1,105,191       3,729,906
    Selling, general and administrative
       expenses (Notes 6 and 7)                 492,046         585,058       1,334,174
    Interest                                        714                          47,212
    Property taxes                               47,958          87,448         193,363
                                             ----------      ----------      ----------

                                                902,073       1,777,697       5,304,655
                                             ----------      ----------      ----------

Net income                                   $  172,422      $  280,524      $3,106,905
                                             ==========      ==========      ==========

Net income per unit                          $     0.04      $     0.06      $     0.69
                                             ==========      ==========      ==========

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


                       See notes to financial statements.


                                                                               3

<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, 1998           4,485,504      $   122,086      $ 2,423,973      $ 2,546,059


Net income                                                65,866        3,041,039        3,106,905
                                    -----------      -----------      -----------      -----------

Balance, September 30, 1999           4,485,504          187,952        5,465,012        5,652,964


Partnership distributions
    ($0.75 per unit)                                     (71,319)      (3,292,809)      (3,364,128)

Net income                                                 5,947          274,577          280,524
                                    -----------      -----------      -----------      -----------

Balance, September 30, 2000           4,485,504          122,580        2,446,780        2,569,360

Partnership distributions
    ($0.20 per unit)                                     (19,018)        (878,083)        (897,101)

Net income                                                 3,655          168,767          172,422
                                    -----------      -----------      -----------      -----------

Balance, September 30, 2001           4,485,504      $   107,217      $ 1,737,464      $ 1,844,681
                                    ===========      ===========      ===========      ===========

</TABLE>

                       See notes to financial statements.


                                                                               4

<page>
                  Royal Palm Beach Colony, Limited Partnership

                            STATEMENTS OF CASH FLOWS


<TABLE>
<CAPTION>


                                                            Years ended September 30,
                                                  ---------------------------------------------
                                                     2001             2000             1999
                                                  -----------      -----------      -----------

<S>                                                 <C>              <C>              <C>
Cash flows from operating activities:
   Cash received:
    Collections on land sales and
      receivables                                 $   595,000      $ 1,436,250      $ 6,612,133
    Interest income                                    36,730           63,066           18,384
    Sale of utility system                            548,317          379,363          438,572
    Other cash received                                   287           21,110              817
                                                  -----------      -----------      -----------
                                                    1,180,334        1,899,789        7,069,906
                                                  -----------      -----------      -----------

Cash expended:
   Selling, general and administrative, and
    property taxes                                    572,962          705,781        2,169,094
   Interest paid (net of amounts capitalized)             714                            47,212
   Improvements to property held for sale               6,125          121,978          421,531
                                                  -----------      -----------      -----------
                                                      579,801          827,759        2,637,837
                                                  -----------      -----------      -----------

Net cash provided by operating
   activities                                         600,533        1,072,030        4,432,069
                                                  -----------      -----------      -----------

Cash flows from investing activities:
   Purchase of property and equipment                                   (9,182)          (3,072)
                                                  -----------      -----------      -----------

Cash flows from financing activities:
   Proceeds from mortgage notes payable:
    Bank                                                                                 17,800
   Payments on mortgage payable:
    Bank                                                                            (1,339,550)
   Partner distributions                             (897,101)      (3,364,128)
                                                  -----------      -----------      -----------

Net cash used in financing activities                (897,101)      (3,364,128)      (1,321,750)
                                                  -----------      -----------      -----------

Net increase (decrease) in cash                      (296,568)      (2,301,280)       3,107,247

Cash at beginning of year                             812,520        3,113,800            6,553
                                                  -----------      -----------      -----------

Cash at end of year                               $   515,952      $   812,520      $ 3,113,800
                                                  ===========      ===========      ===========


</TABLE>


                                                                     (continued)


                                                                               5

<PAGE>

                  Royal Palm Beach Colony, Limited Partnership

                      STATEMENTS OF CASH FLOWS (CONTINUED)

<TABLE>
<CAPTION>

                                                                             Years ended September 30,
                                                            -------------------------------------------------------------
                                                                  2001                   2000                  1999
                                                            -----------------     -----------------    ------------------
<S>                                                         <C>                   <C>                  <C>

Reconciliation of net income to net cash provided by operating activities:

   Net income                                               $        172,422      $        280,524     $       3,106,905
                                                            -----------------     -----------------    ------------------
   Adjustments to reconcile net income
    to net cash provided by
      operating activities

      Depreciation and amortization                                    2,584                 2,718                 1,302

   Change in assets and liabilities
    Increase in:
      Utility and other receivables                                                       (147,510)
      Other assets                                                    (9,160)               (8,909)
    Decrease in:
      Utility and other receivables                                  104,924                                      37,853
      Property held for sale                                         342,081             1,013,001             1,899,683
      Other assets                                                                                                20,776
      Accounts payable and accrued liabilities                       (12,318)              (67,794)             (634,450)
                                                            -----------------     -----------------    ------------------

   Total adjustments                                                 428,111               791,506             1,325,164
                                                            -----------------     -----------------    ------------------

   Net cash provided by operating activities                $        600,533      $      1,072,030     $       4,432,069
                                                            =================     =================    ==================

</TABLE>

                       See notes to financial statements.


                                                                               6

<PAGE>


                  Royal Palm Beach Colony, Limited Partnership

                          NOTES TO FINANCIAL STATEMENTS

                  YEARS ENDED SEPTEMBER 30, 2001, 2000 AND 1999


Note 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 when  purchased  to be cash
               equivalents.

          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  and   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.

                                   (continued)


                                                                               7
<PAGE>

                  Royal Palm Beach Colony, Limited Partnership

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 2001, 2000 AND 1999


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

          Concentrations of risk and financial instruments:

               Assets 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.

               Financial  instruments which potentially  subject the Partnership
               to  concentrations of credit risk include cash which is deposited
               with a financial  institution in excess of amounts  guaranteed by
               the Federal Deposit Insurance Corporation.


          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 2000 financial  statements have been reclassified
          to conform to the 2001 presentation.


Note 2.   Utility and other receivables:
                                                      September 30,
                                               -------------------------
                                                  2001         2000
                                               ---------    ---------

          Utility receivable (Note 8)          $442,478     $548,317
          Other                                   2,080        1,165
                                               ---------    ---------

                                               $444,558     $549,482
                                              ==========   ==========


Note 3.   Property held for sale:

          In connection  with an August 18, 1999 sale of land,  the  Partnership
          received  mitigation  credits  which  increased the value of two other
          tracts of land, one of which was sold on August 27, 1999 and the other
          tract  remains in  property  held for sale at  September  30, 2000 and
          2001.  The value of the  mitigation  credits  received  ($345,600) was
          included  in 1999  net  sales  of land  and  allocated  to the cost of
          properties which were benefited.


                                                                               8

<PAGE>


Note 4.       Other assets:

              Other assets consist of the following:
                                                              September 30,
                                                       -------------------------
                                                          2001         2000
                                                       ---------    ---------
                 Furniture and equipment,
                    net of accumulated depreciation     $7,011        $9,595

                 Prepaid expenses                       55,559        46,399
                                                       ---------    ---------

                                                       $62,570       $55,994
                                                       ==========   ==========

Note 5.       Accounts payable and other liabilities:

              Accounts payable and other liabilities consist of the following:


                                                              September 30,
                                                       -------------------------
                                                          2001         2000
                                                       ---------    ---------
                 Accounts payable                       $45,250      $67,618
                 Accrued liabilities:
                    Property taxes                      117,443       99,917
                    Other                                40,540       48,016
                                                       ---------    ---------

                                                       $203,233     $215,551
                                                       ==========   ==========

Note 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. Selling, general and
               administrative  expenses  include Federal tax of $9,238,  $19,980
               and $70,000  for the years ended  September  30,  2001,  2000 and
               1999, respectively.



                                   (continued)

                                                                               9
<PAGE>


Note 6.       Income taxes (continued):

               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.
               The  Partnership  is  on 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, 2001.

<TABLE>
<CAPTION>

<S>                                                            <C>             <C>
              Partners' equity, financial reporting basis                      $1,844,681
                 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.                  15,713,736
                                                              -------------
                                                                 1,286,264

                 Add items not presently deductible for tax
                    purposes                                        41,591     1,327,855
                                                               ------------   -----------

                 Partners' equity, income tax basis                          $ 3,172,536
                                                                             ============
</TABLE>

Note 7.       Lease information:

               During the years  ended  September  30,  2001,  2000 and 1999 the
               Partnership  occupied its office  facility in a building owned by
               an entity related by common  ownership.  The  Partnership did not
               incur any rent at this office facility. Other long-term operating
               leases  on  real  and  personal  properties  are  not  considered
               material.


                                                                              10

<PAGE>


                  Royal Palm Beach Colony, Limited Partnership

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 2001, 2000 AND 1999


Note 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 increases in  consumption)  are added
               to the system,  over a period through  September 30, 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   $3,742,000  had  not  yet  been  received  as  of
               September 30, 2001. In addition, the Partnership had the right to
               receive  up to  $500,000,  of which  $361,252  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 and as the
               Village collects  guaranteed  revenues from developers.  Revenues
               related to the sale of utility  system of $442,478,  $548,317 and
               $379,363  were  recognized  for fiscal years 2001,  2000 and 1999
               respectively.


Note 9.       Revenues:
<TABLE>
<CAPTION>

              Revenues consist of the following:
                                                     Years ended September 30,
                                                 ------------------------------
                                                   2001        2000          1999
                                                 ----------   ----------    ----------

<S>                                              <C>          <C>           <C>
              Net sales of land                  $595,000   $1,436,250    $7,999,974
              Interest income                      36,730       52,544        28,906
              Sale of utility system (Note 8)     442,478      548,317       379,363
              Other                                   287       21,110         3,317
                                                -----------  -----------   -----------

                                               $1,074,495   $2,058,221    $8,411,560
                                                -----------  -----------   -----------
</TABLE>


                                                                              11


<PAGE>
                  Royal Palm Beach Colony, Limited Partnership

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                  YEARS ENDED SEPTEMBER 30, 2001, 2000 AND 1999


Note 10.      Comparative quarterly financial information (unaudited):
<TABLE>
<CAPTION>


                                            First            Second           Third            Fourth
                                           quarter           quarter          quarter          quarter       Full year
                                          -----------      -----------      -----------      -----------     -----------

<S>                                       <C>              <C>              <C>              <C>             <C>
2001:
Revenues:                                 $    19,538      $   341,920      $   261,630      $   451,407     $ 1,074,495
Cost and expenses                              86,979          476,599          219,976          118,519         902,073
                                          -----------      -----------      -----------      -----------     -----------

Net income (loss)                         $   (67,441)     $  (134,679)     $    41,654      $   332,888     $   172,422
                                          ===========      ===========      ===========      ===========     ===========

Net income (loss) per unit                $     (0.01)     $     (0.03)     $      0.01      $      0.07     $      0.04
                                          ===========      ===========      ===========      ===========     ===========


2000:
Revenues:                                 $    15,751      $ 1,332,197      $    31,866      $   678,407     $ 2,058,221
Cost and expenses                             137,278        1,299,159          145,564          195,696       1,777,697
                                          -----------      -----------      -----------      -----------     -----------

Net income (loss)                         $  (121,527)     $    33,038      $  (113,698)     $   482,711     $   280,524
                                          ===========      ===========      ===========      ===========     ===========

Net income (loss) per unit                $     (0.03)     $      0.01      $     (0.03)     $      0.11     $      0.06
                                          ===========      ===========      ===========      ===========     ===========


1999:
Revenues:                                 $ 2,514,254      $     4,232      $ 1,593,713      $ 4,299,361     $ 8,411,560
Cost and expenses                           2,400,505          252,326          998,757        1,653,067       5,304,655
                                          -----------      -----------      -----------      -----------     -----------

Net income (loss)                         $   113,749      $  (248,094)     $   594,956      $ 2,646,294     $ 3,106,905
                                          ===========      ===========      ===========      ===========     ===========

Net income (loss) per unit                $      0.03      $     (0.06)     $      0.13      $      0.59     $      0.69
                                          ===========      ===========      ===========      ===========     ===========

</TABLE>

                                                                              12