SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                   ----------

   FORM 10-Q (Mark One)
   X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
         THE SECURITIES EXCHANGE ACT OF 1934

                      For the quarter ended March 31, 1999

                                       OR

     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
        SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________ to _______________

                                Commission File Number: 1-8073


                                  CV REIT, INC.
             (Exact name of registrant as specified in its charter)


        Delaware                                  59-0950354
(State of Incorporation)            (IRS Employer Identification No.)

100 Century Boulevard, West Palm Beach, Florida           33417
  (Address of principal executive offices)             (Zip Code)

Registrant's telephone number, including area code: 561-640-3155


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

        Title of each class         Name of each exchange on
                                       which registered

Common stock, par value             New York Stock Exchange
         $.01 per share



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  (2)  has  been  subject  to such  filing
requirements for the past 90 days.
                                   Yes   X    No      


<PAGE> 2


                         CV REIT, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (dollars in thousands)



                                                           Mar.31,      Dec.31,
                        ASSETS                              1999          1998
                                                          --------      --------

Real estate - income producing,
  net of accumulated depreciation ..................      $166,622      $142,408
Real estate mortgage notes
  receivable .......................................        64,696        64,988
Investments in unconsolidated affiliates ...........         3,203         3,323
Cash and cash equivalents (includes
  $878 and $930 restricted) ........................         5,143         4,775
Other real estate (net of allowance
  for losses of $2,401) ............................         5,483         5,463
Other ..............................................         6,365         4,465
                                                          --------      --------
                                                          $251,512      $225,422
                                                          ========      ========

     LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:
  Borrowings .......................................      $148,648      $121,933
  Accounts payable and other
    liabilities ....................................         6,126         6,282
                                                          --------      --------
      Total liabilities ............................       154,774       128,215
                                                          --------      --------
Minority interests in Operating
  Partnership ......................................        17,663        17,650
                                                          --------      --------

Stockholders' equity:
  Common stock, $.01 par-shares authorized
    20,000,000; outstanding 7,966,621 ..............            80            80
  Additional paid-in capital .......................        18,490        18,490
  Retained earnings ................................        60,505        60,987
                                                          --------      --------
      Total stockholders' equity ...................        79,075        79,557
                                                          --------      --------
                                                          $251,512      $225,422
                                                          ========      ========




          See accompanying notes to consolidated financial statements.


<PAGE> 3

                         CV REIT, INC. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                  (dollars in thousands, except per share data)


                                                        Three Months Ended
                                                             March 31,
                                                   ----------------------------
                                                       1999             1998
                                                   -----------      -----------
Revenues:
  Rent .......................................     $     5,569      $     2,794
  Interest, principally from
    mortgage notes ...........................           2,013            2,454
                                                   -----------      -----------
                                                         7,582            5,248
                                                   -----------      -----------
Expenses:
  Interest ...................................           2,466            1,435
  Operating ..................................           1,708              854
  General and administrative .................             380              349
  Depreciation and amortization ..............             873              444
                                                   -----------      -----------
                                                         5,427            3,082
                                                   -----------      -----------
                                                         2,155            2,166
Equity in income of unconsolidated
  affiliates .................................              17              131
Minority interests in income of
  Operating Partnership ......................            (343)            (420)
                                                   -----------      -----------
Net income ...................................     $     1,829      $     1,877
                                                   ===========      ===========
Per common share:
  Net income, basic and diluted ..............     $       .23      $       .24
                                                   ===========      ===========
  Dividend declared ..........................     $       .29      $       .29
                                                   ===========      ===========
  Average common shares outstanding:
    Basic ....................................       7,966,621        7,966,621
                                                   ===========      ===========
    Diluted ..................................       7,966,621        7,973,533
                                                   ===========      ===========




          See accompanying notes to consolidated financial statements.



<PAGE> 4

                         CV REIT, INC. AND SUBSIDIARIES
                   CONSOLIDATED STATEMENT OF RETAINED EARNINGS
                                 (in thousands)









Balance at December 31, 1998 ..............................            $ 60,987

Net income for the three months
  ended March 31 1999 .....................................               1,829

Dividends declared ........................................              (2,311)
                                                                       --------

Balance at March 31, 1999 .................................            $ 60,505
                                                                       ========




          See accompanying notes to consolidated financial statements.



<PAGE> 5


                         CV REIT, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                               Three Months Ended
                                                               March 31,
                                                          ---------------------
                                                             1999         1998
                                                          --------     --------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income .........................................    $  1,829     $  1,877
  Adjustments to reconcile net income to
    net cash provided by operating activities:
      Depreciation and amortization ..................         873          444
      Equity in depreciation and amortization of
        unconsolidated affiliates ....................          46           43
      Minority interests in income of
        Operating Partnership ........................         343          420
      Changes in assets and liabilities, net
         of effects from acquisitions:
           (Increase) in other assets ................        (778)      (1,241)
           (Decrease) increase in accounts
              payable and other liabilities ..........        (189)         431
                                                          --------     --------
Net cash provided by operating activities ............       2,124        1,974
                                                          --------     --------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Acquisitions of real estate ........................         (77)      (7,500)
  Capital improvements ...............................        (708)        --
  Fundings on real estate mortgage notes .............        --         (4,350)
  Collections on real estate mortgage notes ..........         292        6,614
  Other ..............................................         106         (119)
                                                          --------     --------
Net cash used in investing activities ................        (387)      (5,355)
                                                          --------     --------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from borrowings ...........................       2,358         --
  Repayments of borrowings ...........................        (930)        (700)
  Cash dividends paid ................................      (2,311)      (2,311)
  Distributions to minority interests ................        (434)        --
                                                          --------     --------
Net cash used in financing activities ................      (1,317)      (3,011)
                                                          --------     --------
Net increase (decrease) in unrestricted
  cash and cash equivalents ..........................         420       (6,392)
Unrestricted cash and cash equivalents at
  beginning of the period ............................       3,845       11,954
                                                          --------     --------
Unrestricted cash and cash equivalents at
  end of the period ..................................    $  4,265     $  5,562
                                                          ========     ========
Supplemental disclosure of cash flow information:
  Cash paid for interest .............................    $  2,375     $  1,261
                                                          ========     ========
Acquisitions:
  Fair value of assets acquired ......................    $(25,500)    $(27,739)
  Liabilities assumed ................................      25,423       30,239
                                                          --------     --------
  Cash paid for acquisitions, net of cash acquired ...    $    (77)    $ (7,500)
                                                          ========     ========


          See accompanying notes to consolidated financial statements.



<PAGE> 6


                         CV REIT, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



(1) Organization, Business and Basis of Presentation


Organization and Business


CV Reit, Inc. ("CV Reit") is a real estate investment trust ("REIT") which until
December 31, 1997, was principally  engaged in investing in real estate mortgage
notes. Effective December 31, 1997, CV Reit and its subsidiaries converted to an
Umbrella Partnership REIT (UPREIT) structure as part of a series of transactions
which closed on that date and which included the following:  (1) a newly created
Operating Partnership, Montgomery CV Realty L.P. (together with its wholly-owned
subsidiaries hereinafter collectively referred to as the "OP"), acquired 100% of
the ownership interests in ten commercial  properties,  and an approximately 95%
economic interest in Drexel Realty,  Inc.  ("Drexel"),  a real estate management
and  leasing  company  and  (2)  CV  Reit  and  its   subsidiaries   transferred
substantially  all of their net assets (or the economic  benefit thereof) to the
OP.  As a  result,  CV  Reit,  through  a  wholly-owned  subsidiary,  indirectly
currently  owns  84.1% of the OP,  is the OP's  sole  general  partner  and is a
self-administered,  self-managed equity REIT. As of March 31, 1999, the OP owned
18 shopping centers and two office buildings, located in the Mid-Atlantic region
and Florida aggregating over 1.8 million square feet.


Basis of Presentation


The accompanying  consolidated  financial  statements include the accounts of CV
Reit and all subsidiaries  ("the  Company"),  including the OP. The Company owns
99% of the non-voting  common stock and a 95% economic  interest in Drexel,  and
owns 45%-50% interests in certain real estate partnerships,  which are accounted
for on the equity method.  Significant  intercompany  accounts and  transactions
have been eliminated in consolidation.


The consolidated  financial statements included herein have been prepared by the
Company,  without audit, pursuant to the rules and regulations of the Securities
and Exchange  Commission.  Certain information and footnote disclosures normally
included in financial  statements prepared in accordance with generally accepted
accounting  principles have been  consolidated or omitted pursuant to such rules
and regulations; however, the Company believes that the disclosures are adequate
to make the  information  presented not  misleading.  It is suggested that these
consolidated  financial  statements are read in  conjunction  with the financial
statements and the notes thereto included in the Company's annual report on Form
10-K for the fiscal year ended December 31, 1998.


<PAGE> 7

The consolidated  financial  statements for the interim periods included herein,
which are  unaudited,  include,  in the opinion of management,  all  adjustments
(consisting only of normal recurring  accruals)  necessary to present fairly the
financial  position  and  results of  operations  of the Company for the periods
presented.  The  results  of  operations  for  interim  periods  should  not  be
considered indicative of results to be expected for the full year.


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  statements  of assets and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual revenues could differ from those estimates.



(2) Real Estate - Income Producing ("Real Estate")


(a) Real Estate is located in the  Mid-Atlantic  region and Florida and consists
of (in thousands):

                                                     Mar. 31,           Dec.31,
                                                       1999              1998
                                                    ---------         ---------

 Shopping centers ..........................        $ 165,281         $ 140,212
Office buildings ...........................            5,338             5,338
                                                    ---------         ---------
 Totals ....................................          170,619           145,550

 Less accumulated depreciation .............           (3,997)           (3,142)
                                                    ---------         ---------
 Net Real Estate ...........................        $ 166,622         $ 142,408
                                                    =========         =========

(b) On March 31, 1999, the OP purchased a 202,499  square foot shopping  center,
located  in New  Jersey,  for a  purchase  price  of  $24.4  million,  including
transaction costs, substantially all of which was financed by mortgage debt. The
OP was  required  to  deposit  an  additional  $1  million  with the  lender  in
connection with future capital improvements.


<PAGE> 8

The acquisition was accounted for as a purchase;  accordingly, the net assets of
the shopping center acquired are included in the Consolidated  Balance Sheets as
of the date of  acquisition  and the  Consolidated  Statements  of  Income  will
include the operating results beginning with the second quarter of 1999.

In addition,  the OP has several pending acquisitions of shopping centers for an
aggregate  purchase  price  of $19  million.  See  Management's  Discussion  and
Analysis of Results of Operations and Financial  Condition Liquidity and Capital
Resources - Acquisitions for a discussion of these potential acquisitions.


(c) Real Estate with a net book value of $161.2  million,  at March 31, 1999, is
pledged as collateral for borrowings (Note 4).



(3) Real Estate Mortgage Notes Receivable


At March 31, 1999, the Company's real estate mortgage notes receivable consisted
of $24.9 million due from Hilcoast  Development Corp. (the "Hilcoast  Recreation
Note"),  collateralized  by first mortgages on the recreation  facilities at the
Century  Village at  Pembroke  Pines  adult  condominium  project  in  southeast
Florida, and $39.8 million,  collateralized by first mortgages on the recreation
facilities at the three  previously  completed  Century  Village  communities in
southeast  Florida   (collectively,   the  "Recreation   Notes").  The  Hilcoast
Recreation  Note  provides  for  self-amortizing  equal  monthly  principal  and
interest  payments due through July 31, 2023,  bears  interest at 11% per annum,
and may not be prepaid by Hilcoast without a prepayment  penalty.  The remaining
Recreation Notes principally provide for self-amortizing equal monthly principal
and interest  payments due through 2012,  with interest rates  averaging 13% per
annum,  and contain certain  prepayment  prohibitions.  The Recreation Notes are
pledged as collateral for borrowings (Note 4).



(4) Borrowings


Borrowings consist of (in thousands):

                                                            Mar. 31,    Dec. 31,
                                                              1999        1998
Mortgage notes payable through .........................    --------    --------
  September 2008, interest ranging
  from 6.09% to 10.28%, collateralized
  by Real Estate (Note 2) ..............................    $ 76,593    $ 74,528

Mortgage  notes  payable in November
  2000 under $100 million credit facility,
  interest at one month LIBOR (4.96% at
  March 31, 1999) plus 1.75%, collateralized
  by Real Estate (Note 2) and the
  Hilcoast Recreation Note (Note 3) 
  See Management's Discussion and Analysis
  of Results of Operations and Financial
  Condition - Liquidity and Capital
  Resources - Borrowings for a description
  of the terms .........................................      42,237      16,950

Collateralized Mortgage Obligations, net of
  unamortized discount of $525,000 and
  $584,000 based on an  effective  interest
  rate of 8.84%,  collateralized  by
  certain of the Recreation Notes (Note 3),
  quarterly  self-amortizing principal
  and interest payments required through March 2007 ....      29,818      30,455
                                                            --------    --------
          Totals .......................................    $148,648    $121,933
                                                            ========    ========

<PAGE> 9


(5) Segment Reporting


Statement of Financial Accounting Standards No.131,  "Disclosures about Segments
of an Enterprise and Related Information",  requires disclosure of financial and
descriptive  information about the Company's reportable operating segments.  The
operating  segments presented are the segments of the Company for which separate
financial  information  is  available  and  operating  performance  is evaluated
regularly  by senior  management  in deciding how to allocate  resources  and in
assessing  performance.  The Company  evaluates the performance of its operating
segments  generally  based on net operating  income  (before and after  interest
expense) and Funds From  Operations  ("FFO" - see  Management's  Discussion  and
Analysis of Results of Operations  and  Financial  Condition for a definition of
FFO).

Effective  December 31, 1997,  the Company  became an equity REIT engaged in the
acquisition,  leasing and  management  of  neighborhood  or  community  shopping
centers,  located in  Pennsylvania,  New Jersey and Florida.  Prior to 1998, the
Company's  only  principal  business  segment  consisted of  investments in real
estate mortgage notes. Although the Company no longer invests in new real estate
mortgage  notes,  it continues to hold its  Recreation  Notes (Note 3) and, as a
result,  the  following  segment  disclosure   includes   information  on  those
investments (in thousands):


                                Income
                               Producing
                              Real Estate,    Real
                              Principally    Estate
                                Shopping    Mortgage
Quarter Ended                   Centers       Notes     Other   Consolidated
   March 31, 1999:             ---------    --------   ------   ------------

Rent revenues                   $  5,550    $    -     $   19     $  5,569
Operating expenses                (1,670)        -        (38)      (1,708)
                                --------    -------    ------     --------
Real estate net operating
  income                           3,880         -        (19)       3,861
                                --------    -------    ------     --------
Interest income                       -       1,995        18        2,013
Interest expense                  (1,726)      (740)        -       (2,466)
                                --------    -------    ------     --------
Net interest income (expense)     (1,726)     1,255        18         (453)
                                --------    -------    ------     --------
Net operating income after
  interest expense                 2,154      1,255        (1)       3,408
General, administrative
  and other                         (129)         -      (192)        (321)
                                --------    -------    ------     --------
FFO - OP                           2,025      1,255      (193)       3,087

Reconciliation of FFO to
  net income:
  Depreciation and amortization
    of real property                (855)        -        (60)        (915)
                                --------    -------    ------     --------
Net income - OP                 $  1,170    $ 1,255    $ (253)       2,172
                                ========    =======    ======
Less minority interests in OP                                         (343)
                                                                  --------
Net income - consolidated                                         $  1,829
                                                                  ========
At March 31, 1999:
  Investment in real estate
    and real estate mortgage
    notes                       $166,622(a) $64,696    $8,686     $240,004
                                ========    =======    ======     ========

  Borrowings                    $112,293    $36,355    $   -      $148,648
                                ========    =======    ======     ========

--------
(a) Includes $25,068 of additions during the quarter.



<PAGE> 10


                                Income
                               Producing
                              Real Estate,    Real
                              Principally    Estate
                                Shopping    Mortgage
Quarter Ended                   Centers       Notes     Other   Consolidated
   March 31, 1998:             ---------    --------   ------   ------------

Rent revenues                   $  2,590    $    -    $   204     $  2,794
Operating expenses                  (788)        -        (66)        (854)
                                --------    -------   -------     --------
Real estate net operating
  income                           1,802         -        138        1,940
                                --------    -------   -------     --------
Interest income                       -       2,312       142        2,454
Interest expense                    (711)      (724)       -        (1,435)
                                --------    -------   -------     --------
Net interest income (expense)       (711)     1,588       142        1,019
                                --------    -------   -------     --------
Net operating income after
  interest expense                 1,091      1,588       280        2,959
General, administrative
  and other                            3         -       (180)        (177)
                                --------    -------   -------     --------
FFO - OP                           1,094      1,588       100        2,782

Reconciliation of FFO to
  net income:
  Depreciation and amortization
    of real property                (416)        -        (69)        (485)
                                --------    -------   -------     --------
Net income - OP                 $    678    $ 1,588   $    31        2,297
                                ========    =======   =======
Less minority interests in OP                                         (420)
                                                                  --------
Net income - consolidated                                         $  1,877
                                                                  ========
At March 31, 1998:
  Investment in real estate
    and real estate mortgage
    notes                       $ 96,379(a) $75,388   $10,552     $182,319
                                ========    =======   =======     ========

  Borrowings                    $ 53,365    $32,281   $    -      $ 85,646
                                ========    =======   =======     ========

--------
(a) Includes $27,609 of additions during the quarter.




<PAGE> 11


Item 2.  Management's Discussion and Analysis of Results
         of Operations and Financial Condition


                              Results of Operations


Net Income



        Three Months Ended March 31, 1999 and 1998


For the quarter  ended March 31,  1999,  net income was  $1,829,000  or $.23 per
share compared to $1,877,000 or $.24 per share for the same period of 1998.

During the quarter ended March 31, 1999,  rent revenue,  operating  expenses and
interest expense increased by $2,775,000, $854,000, and $1,031,000, respectively
(a net increase of $890,000), primarily due to the acquisition of seven shopping
centers  during  1998 (the "1998  Acquisitions").  The  increase  also  reflects
improved  operating  results from existing centers which  experienced a $145,000
increase in net rental income (rent revenue less operating expenses).  We expect
continued increases in rent revenue, operating costs and interest expense due to
the acquisition of Lakewood Plaza  ("Lakewood"),  a 202,499 square foot shopping
center,  on March 31, 1999,  for a purchase  price of $24.4  million,  including
transaction costs, substantially all of which was financed by mortgage debt, and
in the event  certain  additional  planned  acquisitions  are  consummated  (see
Liquidity and Capital Resources - Acquisitions).

Interest  income  decreased  by  $441,000  during  the  first  quarter  of 1999,
primarily  attributable  to an  approximately  $10.5  million  reduction  in the
average balance of mortgage notes receivable.  These notes principally consisted
of a line of credit and certain other loans to Hilcoast,  which matured and were
repaid during 1998. The average interest rate on these notes  approximated 10.6%
and the repayments were generally  utilized to acquire shopping centers in 1998.
Our   remaining   mortgage   notes   receivable   are  long  term  and   require
self-amortizing   payments  through  2023.   Accordingly,   interest  income  is
anticipated  to  continue  to  decrease  although  to a  lesser  extent,  due to
scheduled repayments.

Depreciation   and   amortization   increased   by  $429,000  due  to  the  1998
Acquisitions. We expect continued increases in depreciation and amortization due
to the Lakewood acquisition.

<PAGE> 12


Funds From Operations

Funds From Operations  ("FFO"),  as defined by the National  Association of Real
Estate  Investment  Trusts  (NAREIT),   consists  of  net  income  (computed  in
accordance with generally accepted  accounting  principles) before  depreciation
and amortization of real property,  certain  non-recurring items,  extraordinary
items, gains and losses on sales of real estate and income taxes.

The following schedule reconciles FFO to net income (in thousands):


                                                            Three Months Ended
                                                                  March 31,
                                                           ---------------------
                                                            1999           1998
                                                           ------         ------
Net income .......................................         $1,829         $1,877
Minority interests in income
  of OP ..........................................            343            420
Depreciation and amortization
  of real property ...............................            869            442
Equity in depreciation and
  amortization of real property
  of unconsolidated affiliates ...................             46             43
                                                           ------         ------
FFO - OP in 1998 .................................         $3,087         $2,782
                                                           ======         ======
FFO - CV Reit (a) ................................         $2,599         $2,273
                                                           ======         ======

-------
(a) CV Reit's  interests  in the OP was 84.2% in the first  quarter  of 1999 and
81.7% in the first quarter of 1998.


We believe that FFO is an appropriate  measure of operating  performance because
real  estate  depreciation  and  amortization  charges  are  not  meaningful  in
evaluating  the  operating  results  of our  properties  and would  distort  the
comparative   measurement  of  performance  and  are  not  relevant  to  ongoing
operations.  However,  FFO does not  represent  cash  generated  from  operating
activities in accordance  with  generally  accepted  accounting  principles  and
should not be considered as an  alternative to either net income as a measure of
our  operating  performance  or to cash flows from  operating  activities  as an
indicator  of  liquidity  or cash  available  to fund all cash  flow  needs.  In
addition,  since  other  REITs may not  calculate  FFO in the same  manner,  FFO
presented herein may not be comparable to that reported by other REITs.


<PAGE> 13

                         Liquidity and Capital Resources



Consolidated Statements of Cash Flows


Net cash  provided by  operating  activities,  as  reported in the  Consolidated
Statements of Cash Flows,  amounted to $2.1 million in the first quarter of 1999
compared  to $2 million  for the same period in 1998.  These  amounts  generally
reflect FFO and net changes in assets and liabilities.

Net cash used in investing  activities decreased to $.4 million during the first
quarter of 1999 from $5.4 million for the same period in 1998.  The 1999 amounts
reflect  $.7  million  of capital  improvements.  The 1998  amounts  principally
consist of $7.5 million of cash required in connection with the acquisition of a
shopping center in the first quarter of 1998,  partially  offset by $2.3 million
of net collections on real estate mortgage notes receivable.

Net cash used in  financing  activities  decreased  to $1.3 million in the first
quarter of 1999 from $3 million during the same period of 1998. The 1999 amounts
consist of cash distributions of $2.3 million to stockholders and $.4 million to
minority  interests and $1.4 million of net proceeds from  borrowings.  The 1998
amounts consist of cash distributions  amounting to $2.3 million to stockholders
and $.7 million of repayments of borrowings.


Borrowings

At March 31,  1999,  our  borrowings  increased  to $148.6  million  from $121.9
million at December 31, 1998. The $26.7 million increase  included $25.3 million
borrowed  under  the  Line  of  Credit  (see  below)  to  finance  the  Lakewood
acquisition.  Scheduled  principal  payments  over the next five years are $94.7
million with $53.9 million due thereafter.

Borrowings  include $118.8 million,  collateralized by a substantial  portion of
our Real Estate,  including  $42.2 million under the Line of Credit (see below).
We expect to  refinance  certain of these  borrowings,  at or prior to maturity,
through new mortgage loans on Real Estate including  refinancing  under the Line
of Credit.  The ability to do so,  however,  is dependent upon various  factors,
including  the  income  level  of the  properties,  interest  rates  and  credit
conditions within the commercial real estate market.  Accordingly,  there can be
no assurance that such  refinancing can be achieved.  As a result of refinancing
three  mortgage  loans in March and May of 1999, we have been able to reduce the
weighted  average  effective  fixed  interest  rate on $23.5 million of mortgage
loans  from  7.48% to 6.63%.  We were also  able to  obtain an  additional  $5.2
million in cash in connection with the refinancings.


<PAGE> 14

The  remaining  $29.8  million of  borrowings  consists  of the CMO's  which are
collateralized   by  $39.8   million  of  the   Recreation   Notes  and  require
self-amortizing  principal and interest  payments through March 2007. During the
term of the CMO's,  the scheduled annual debt service  requirement  approximates
$5.2 million compared to annual principal and interest payments  scheduled to be
received under the related Recreation Notes of $6.5 million.

Effective  March  31,  1998,  we  entered  into a  agreement  with  a  financial
institution which provides us with a three year non-revolving line of credit for
up to $100 million (the "Line of  Credit").  Advances  under the Line of Credit:
(1) must be secured by assets  based on  specified  aggregate  loan to value and
debt service coverage  ratios,  (2) bear interest at an annual rate of one month
LIBOR  plus  1.75% and (3) may be drawn  only  during the first two years of the
credit  facility  and must be repaid by certain  dates  during  the third  year.
Additional  provisions include a 1% commitment fee, a minimum net worth covenant
and cross-default and cross-collateralization  requirements.  Advances under the
Line of Credit are used to fund acquisitions, expansions, renovations, financing
and refinancing of real estate,  including reimbursement of equity advances, and
require certain  performance  covenants.  In March 1999, we pledged the Hilcoast
Recreation  Note as  collateral  for future  borrowings  under an $18.5  million
promissory note (the "Pembroke Note") as part of the Line of Credit. As of March
31, 1999, we had borrowed $42.2 million under the Line of Credit  including $6.5
million under the Pembroke Note.


Capital Resources

Our operating  funds are expected to be principally  generated from rent revenue
from income producing properties and interest income on the Recreation Notes. We
believe that our operating funds will be sufficient in the foreseeable future to
fund operating and administrative expenses,  interest expense, recurring capital
expenditures   and   distributions  to  stockholders  in  accordance  with  REIT
requirements.  Sources of capital for  non-recurring  capital  expenditures  and
scheduled  principal  payments,   including  balloon  payments,  on  outstanding
borrowings  are expected to be obtained  from property  refinancings,  scheduled
principal  repayments on the Recreation Notes, sales of non-strategic other real
estate,  the Line of Credit  and/or  potential  debt or equity  financing in the
public or private markets.


<PAGE> 15


Acquisitions


During the quarter ended March 31, 1999,  we completed the Lakewood  acquisition
for  a  purchase  price  of  $24.4   million,   including   transaction   costs,
substantially  all of which was financed by mortgage  debt.  We were required to
deposit an  additional  $1 million  with the lender in  connection  with  future
capital improvements.

In addition,  we have  entered  into  conditional  agreements  to acquire  three
shopping centers in Pennsylvania and New Jersey for an aggregate  purchase price
of approximately $19 million.  The acquisitions are subject to due diligence and
certain  other  conditions  and  there  can be no  assurance  that  they will be
consummated.  If  consummated,  we  plan  to  finance  substantially  all of the
purchase prices.

We are also in various stages of negotiating acquisitions of additional shopping
centers.  However,  there is no  assurance  that we will be able to complete any
such acquisition. In the event properties are acquired in the future, the OP may
issue additional OP units, pay cash, or a combination  thereof. If cash payments
are required in excess of funds  available  under the Line of Credit,  we may be
required to seek outside financing which may or may not be available.

Our policy is to acquire additional properties only if they are income producing
and any proposed acquisition requires a resolution by a majority of our Board of
Directors that the  acquisition  will not adversely  affect our ability to pay a
quarterly dividend of at least 29 cents per share.  Under the OP agreement,  all
of the  activities  of the OP must  generally  be  conducted  with a view toward
enabling the OP to make quarterly  distributions  to all partners of at least 29
cents per OP unit and such additional amount, if required,  to enable CV Reit to
pay a  regular  quarterly  dividend  of at  least  29  cents  per  share  to its
stockholders.  As of March 31,  1999,  there  were  1,505,424  OP units  held by
minority interests.




                                    Inflation

During recent  years,  the rate of inflation has remained at a low level and had
minimal impact on our operating results.


<PAGE> 16

Most of the tenant leases  contain  provisions  designed to lessen the impact of
inflation.  These provisions include escalation clauses which generally increase
rental rates annually based on cost of living indexes (or based on stated rental
increases which are currently higher than recent cost of living increases),  and
percentage  rentals based on tenant's gross sales,  which generally  increase as
prices  rise.  Many of the  leases  are for terms of less  than ten years  which
increases  our ability to replace those leases which are below market rates with
new leases at higher base and/or percentage  rentals.  In addition,  most of the
leases  require the tenants to pay their  proportionate  share of  increases  in
operating  expenses,  including common area  maintenance,  real estate taxes and
insurance.

However, in the event of significant  inflation,  our operating results could be
adversely affected if general and  administrative  expenses and interest expense
increase  at a rate higher  than rent  income or if the  increase  in  inflation
exceeds rent  increases for certain  tenant leases which provide for stated rent
increases (rather than based on cost of living indexes).



                                 Year 2000 Issue


As many computer  systems,  software  programs and other equipment with embedded
chips or processors  (collectively,  "Information  Systems") use only two digits
rather than four to define the  applicable  year,  they may be unable to process
accurately  certain data,  during or after the year 2000. As a result,  business
and governmental  entities are at risk for possible  miscalculations  or systems
failures  causing  disruptions  in their business  operations.  This is commonly
known  as the  Year  2000  ("Y2K")  issue.  The  Y2K  issue  concerns  not  only
Information  Systems  used  solely  within a  company  but also  concerns  third
parties,  such as customers,  vendors and creditors,  using Information  Systems
that may interact with or affect a company's operations.



     Our State of Readiness

We have implemented a Y2K readiness  program with the objective of having all of
our significant  Information  Systems  functioning  properly with respect to Y2K
before  January 1, 2000.  The first  component of our  readiness  program was to
identify  our  internal  Information  Systems  that are  susceptible  to  system
failures  or  processing  errors as a result of the Y2K  issue.  This  effort is
substantially  complete  and any  issues  that arose  have been  identified  and
corrected where necessary.


<PAGE> 17

As to the second component of the Y2K readiness  program,  we intend to identify
our significant tenants,  vendors and creditors that are believed, at this time,
to be critical to business  operations  subsequent to January 1, 2000. We expect
to reasonably ascertain their respective stages of Y2K readiness through the use
of questionnaires, interviews, on-site visits and other available means. We will
take appropriate action based on those responses,  but there can be no assurance
that the  Information  Systems  provided by or utilized by other companies which
affect their  operations will be timely converted in such a way as to allow them
to continue normal business operations or furnish products,  services or data to
us without disruption.

     Risks

If needed  remediations and conversions to the Information  Systems are not made
on a timely basis by our  materially-significant  customers or vendors, we could
be affected by business disruption,  operational problems, financial loss, legal
liability to third parties and similar risks, any of which could have a material
adverse  effect on our  operations,  liquidity or financial  condition.  Factors
which could cause material differences in results, many of which are outside our
control,  include,  but are not limited to, the accuracy of  representations  by
manufacturers of our Information  Systems that their products are Y2K complaint,
the ability of our tenants  and  vendors to identify  and resolve  their own Y2K
issues and our ability to respond to unforeseen Y2K complications.

     Y2K Costs

Our  total  cost of  these  Y2K  compliance  activities  has not been and is not
anticipated  to be material to our business,  results of operations or financial
condition.  The costs and time  necessary to complete the Y2K  modification  and
testing processes are based on our best estimates,  which were derived utilizing
numerous  assumptions of future events  including the continued  availability of
certain resources,  third party  modification plans and other factors.  However,
there can be no  assurance  that these  estimates  will be  achieved  and actual
results could differ from the estimates. Our Y2K readiness program is an ongoing
process and the estimates of costs and completion  dates for various  components
of the Y2K readiness program described above are subject to change.




           Forward Looking Information: Certain Cautionary Statements


Certain statements contained in "Management's Discussion and Analysis of Results
of Operations and Financial Condition" and elsewhere in this Form 10-Q, that are
not related to  historical  results,  are forward  looking  statements,  such as
anticipated   liquidity   and  capital   resources,   completion   of  potential
acquisitions and  collectibility of real estate mortgage notes  receivable.  The
matters  referred to in forward  looking  statements are based on assumptions of
future  events which may not prove to be accurate and which could be affected by
the  risks and  uncertainties  involved  in our  business;  accordingly,  actual
results may differ  materially  from those  projected and implied in the forward
looking statements.  These risks and uncertainties  include, but are not limited
to,  the effect of  conditions  in the  commercial  real  estate  market and the
economy in general,  the level and volatility of interest  rates,  the impact of
current or pending  legislation and  regulation,  as well as certain other risks
described  in the  Form  10-Q.  Subsequent  written  and  oral  forward  looking
statements  attributable  to our  company  or  persons  acting on its behalf are
expressly qualified in their entirety by cautionary statements in this paragraph
and elsewhere described in this Form 10-Q and in other reports we filed with the
Securities and Exchange Commission.


<PAGE> 18

                           Part II. Other Information



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


        Exhibits:

27      Financial Data Schedule


        Reports on Form 8-K:

         On April 7, 1999,  the  Registrant  filed on Form 8-K reporting  under
         Item 2. and Item 7., the acquisition of Lakewood Plaza Shopping Center.



                                   SIGNATURES

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


                                           CV REIT, INC.
                             -------------------------------------
                                          (Registrant)


                             /s/ Louis P. Meshon
May 13, 1999          _____________________________________
                                 Louis P. Meshon, President


                             /s/ Elaine Hauff
May 13, 1999          _____________________________________
                                Elaine Hauff, Vice President,
                                  Treasurer and Principal
                                  Financial and Accounting
                                  Officer