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 September 30, 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) (I.R.S. 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


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 _____

Number of shares  outstanding of the  Registrant's  Common Stock, par value $.01
per share, as of November 10, 1999: 7,966,621



<PAGE> 2

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




                                                    Sep. 30, 1999  Dec. 31, 1998
ASSETS                                              -------------  -------------
Real estate - income producing, net of
  accumulated depreciation ...........................   $173,743       $142,408
Real estate mortgage notes receivable ................     63,915         64,988
Investments in unconsolidated affiliates .............      3,448          3,323
Cash and cash equivalents (includes $886
 and $930 restricted) ................................      4,473          4,775
Other real estate (net of allowance for
 losses of $2,401) ...................................      5,500          5,463
Receivables and accrued income .......................      2,632          1,713
Prepaid expenses and other ...........................      4,701          2,752
                                                         --------       --------
                                                         $258,412       $225,422
                                                         ========       --------
         LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
  Borrowings .........................................   $157,248       $121,933
  Accounts payable and other liabilities .............      6,444          6,282
                                                         --------       --------
      Total liabilities ..............................    163,692        128,215
                                                         --------        -------

Minority interests in Operating Partnership ..........     16,894         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 ..................................     59,256         60,987
                                                         --------       --------
      Total stockholders' equity .....................     77,826         79,557
                                                         --------       --------
                                                         $258,412       $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       Nine Months Ended
                                      September 30,             September 30,
                                  ----------------------  ---------------------
                                     1999         1998       1999        1998
                                  ---------    ---------  ---------   ---------
Revenues:
  Rent ........................   $   6,572    $   5,104  $  18,621   $  11,641
  Interest, principally
   from mortgage notes ........       2,003        2,122      6,024       6,826
                                  ---------    ---------  ---------   ---------
                                      8,575        7,226     24,645      18,467
                                  ---------    ---------  ---------   ---------
Expenses:
  Interest ....................       3,074        2,507      8,498       5,825
  Operating ...................       1,950        1,597      5,531       3,571
  General and administrative ..         431          404      1,306       1,122
  Depreciation and
    amortization ..............       1,067          820      2,980       1,849
                                  ---------    ---------  ---------   ---------
                                      6,522        5,328     18,315      12,367
                                  ---------    ---------  ---------   ---------
                                      2,053        1,898      6,330       6,100

Equity in income of
  unconsolidated affiliates ...         108          150        123         403
Gain on sale of real estate ...          --           --         --       2,347
Non-recurring items:
  professional fees and
  settlement of litigation ....          --         (200)      (285)       (200)
Minority interests in income of
  Operating Partnership .......        (335)        (292)      (968)     (1,537)
                                  ---------    ---------  ---------   ---------
Net income ....................   $   1,826    $   1,556  $   5,200   $   7,113
                                  =========    =========  =========   =========
Per common share:
  Net income, basic and diluted   $     .23    $    .20   $     .65   $     .89
                                  =========    =========  =========   =========
  Dividends declared ..........   $     .29    $    .29   $     .87   $     .87
                                  =========    =========  =========   =========
  Average common shares
    outstanding, basic
    and diluted ...............   7,966,621    7,966,621  7,966,621   7,966,621
                                  =========    =========  =========   =========




          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 nine months
  ended September 30, 1999 .................................              5,200
Dividends declared .........................................             (6,931)
                                                                       --------
Balance at September 30, 1999 ..............................           $ 59,256
                                                                       ========





          See accompanying notes to consolidated financial statements.


<PAGE> 5

                         CV REIT, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)

                                                           Nine Months Ended
                                                             September 30,
                                                         ----------------------
                                                           1999          1998
                                                         ---------    ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income .........................................    $  5,200     $  7,113
  Adjustments to reconcile net income to net cash
    provided by operating activities:
      Depreciation and amortization ..................       2,980        1,849
      Equity in depreciation and amortization of
        unconsolidated affiliates ....................         131          128
      Minority interests in income of
        Operating Partnership ........................         968        1,537
      Gain on sale of real estate ....................          --       (2,347)
      Changes in assets and liabilities,
        net of effects from acquisitions:
        Increase in receivables, accrued
          income, prepaid expenses and other .........      (1,671)      (2,962)
        (Decrease) increase in accounts
          payable and other liabilities ..............         (14)         675
                                                          --------     --------
Net cash provided by operating activities ............       7,594        5,993
                                                          --------     --------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Acquisitions of real estate ........................      (1,161)     (21,126)
  Capital improvements ...............................      (1,259)        (920)
  Fundings on real estate mortgage notes .............        --         (5,190)
  Collections on real estate mortgage notes ..........       1,073       17,268
  Proceeds from the sale of real estate ..............        --          4,151
  Other ..............................................        (249)        (164)
                                                          --------     --------
Net cash used in investing activities ................      (1,596)      (5,981)
                                                          --------     --------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from borrowings ...........................      24,858        7,650
  Repayments of borrowings ...........................     (22,380)      (4,286)
  Cash dividends paid ................................      (6,893)      (6,934)
  Distributions to minority interests ................      (1,295)      (1,036)
  Redemption of Operating Partnership units ..........        (546)      (3,631)
                                                          --------     --------
Net cash used in financing activities ................      (6,256)      (8,237)
                                                          --------     --------
Net increase in unrestricted cash and
  cash equivalents ...................................        (258)      (8,225)
Unrestricted cash and cash equivalents
  at the beginning of the period .....................       3,845       11,954
                                                          --------     --------
Unrestricted cash and cash equivalents
  at the end of the period ...........................    $  3,587     $  3,729
                                                          ========     ========
Supplemental disclosure of cash flow
  information:
  Cash paid for interest .............................    $  7,997     $  5,367
                                                          ========     ========
Acquisitions of real estate:
  Fair value of assets acquired ......................    $(34,253)    $(74,325)
  Liabilities assumed or incurred ....................      33,092       53,049
  Operating Partnership units issued .................        --            150
                                                          --------     --------
  Cash paid for acquisitions, net of
   cash acquired .....................................    $ (1,161)    $(21,126)
                                                          ========     ========

          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  84.5% of the OP,  is the OP's  sole  general  partner  and is a
self-administered,  self-managed  equity REIT. As of September 30, 1999,  the OP
owned 20 shopping centers and two office buildings,  located in the Mid-Atlantic
region and Florida aggregating approximately 1.9 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 a
95% economic  interest in Drexel but none of the voting stock,  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  be 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.

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.  Accounts  Receivable  and


<PAGE> 7

Accrued Income

Accounts  receivable  primarily  represent  amounts due from tenants and accrued
interest  receivable  on  mortgage  notes  receivable.  In  addition,   accounts
receivable included $975,000 and $583,000 at September 30, 1999 and December 31,
1998,   respectively,   representing   minimum   rental  income   accrued  on  a
straight-line  basis  to be paid by  tenants  over the  terms of the  respective
leases.


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

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

                                                           Sept. 30,   Dec. 31,
                                                              1999       1998
                                                           ---------  ---------
Land ..................................................... $  18,302  $  14,980
Shopping centers .........................................   156,570    125,670
Office buildings .........................................     4,925      4,900
                                                           ---------  ---------

Totals ...................................................   179,797    145,550
Less accumulated depreciation ............................    (6,054)    (3,142)
                                                           ---------  ---------

Net Real Estate .......................................... $ 173,743  $ 142,408
                                                           =========  =========

(b) On March 31, 1999,  the OP purchased an  approximately  202,499  square foot
shopping center,  located in New Jersey,  for a purchase price of $24.7 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.

On May 18, 1999, the OP purchased an  approximately  75,000 square foot shopping
center, located in Pennsylvania,  for a purchase price of $6.9 million including
transaction costs, substantially all of which was financed by mortgage debt.

On September  17, 1999,  the OP purchased an  approximately  46,000  square foot
shopping center,  located in Pennsylvania,  for a purchase price of $1.6 million
including  transaction  costs,  which  consisted  of $.8 million in cash and the
incurrence of $.8 million in mortgage debt.

The  acquisitions  were accounted for as purchases;  accordingly,  the operating
results of the net assets  acquired are included in the  consolidated  financial
statements from their respective purchase dates.

In addition,  the OP has several pending acquisitions of shopping centers for an
aggregate  purchase  price  of $21  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 $166.7 million,  at September 30, 1999,
is pledged as collateral for borrowings (Note 4).



(3) Real Estate Mortgage Notes Receivable

At September  30, 1999,  the Company's  real estate  mortgage  notes  receivable
consisted of $24.8 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  community
in southeast  Florida,  and $39.1 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).

<PAGE> 8

(4) Borrowings

Borrowings consist of (in thousands):

                                                      Sep.30, 1999  Dec.31, 1998
                                                      ------------  ------------
Mortgage notes payable through
  September 2008, interest ranging
  from 6.09% to 10.28%, collateralized
  by Real Estate (Note 2) .............................. $ 78,960       $ 74,528
Mortgage notes payable through April
  2001 under $100 million credit facility,
  interest at one month LIBOR (5.40% at
  September 30, 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 .......................   49,036         16,950

Collateralized Mortgage Obligations,
  net of unamortized discount of
  $468,000 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
  payment required through March 2007 ..................   28,502         30,455

$1 million revolving credit facility,
  interest at one month LIBOR plus
  1.8%, maturing June 2000, collateralized
  by Real Estate .......................................      750           --
                                                         --------       --------
Totals ................................................. $157,248       $121,933
                                                         ========       ========

In March and May  1999,  the  Company  entered  into  three  interest  rate swap
contracts with an aggregate  notional  amount of $28.7 million,  which expire in
2004. The interest rate swaps have an effective interest rate of 6.63%.



(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 and a reconciliation of FFO to net income). 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):


<PAGE> 9

                                   Income
                                   Producing
                                   Real Estate,   Real
                                   Principally    Estate
                                   Shopping       Mortgage
                                   Centers        Notes     Other  Consolidated
                                   ----------    --------  ------  ------------
Quarter Ended September 30, 1999:
Rent revenues                      $ 6,554       $    -    $   18       $ 6,572
                                   =======       =======   ======       =======
Real estate net operating income   $ 4,644       $    -    $  (22)      $ 4,622
Net interest income (expense)       (2,209         1,099       39        (1,071)
                                   -------       -------   ------       -------
Net operating income after net
 interest                          $ 2,435       $ 1,099   $   17       $ 3,551
                                   =======       =======   ======       =======
FFO - OP                                                                $ 3,264
                                                                        =======
Quarter Ended September 30, 1998:
Rent revenues                      $ 5,084       $   -     $   20       $ 5,104
                                   =======       =======   ======       =======
Real estate net operating income   $ 3,489       $   -     $   18       $ 3,507
Net interest income (expense)       (1,735)        1,257       93         (385)
                                   -------       -------   ------       -------
Net operating income after net
  interest                         $ 1,754       $ 1,257   $  111       $ 3,122
                                   =======       =======   ======       =======
FFO - OP                                                                $ 2,910
                                                                        =======
Nine Months Ended September 30, 1999:
Rent revenues                      $18,564       $   -     $   57       $18,621
                                   =======       =======   ======       ========
Real estate net operating income   $13,151       $   -     $  (61)      $13,090
Net interest income (expense)      (6,056)         3,485       97        (2,474)
                                   -------       -------   ------       --------
Net operating income after net
  interest                         $ 7,095       $ 3,485   $   36      $ 10,616
                                   =======       =======   ======      ========
FFO - OP                                                                $ 9,554
                                                                        =======
Nine Months Ended September 30, 1998:
Rent revenues                      $11,358       $    -    $  283       $11,641
                                   =======       =======   ======       =======
Real estate net operating income   $ 7,930       $    -    $  140       $ 8,070
Net interest income (expense)       (3,553)        4,218      336         1,001
                                   -------       -------   ------       -------
Net operating income after net
  interest                         $ 4,377       $ 4,218   $  476       $ 9,071
                                   =======       =======   ======       =======
FFO - OP                                                                $ 8,477
                                                                        =======
At September 30, 1999:
  Investment in real estate and real
    estate mortgage notes         $173,743(a)    $63,915   $ 8,948     $246,606
                                  ========       =======   =======     ========
  Borrowings                      $120,510       $36,738   $    -      $157,248
                                  ========       =======   =======     ========
At September 30, 1998:
  Investment in real estate and real
    estate mortgage notes         $141,958(a)    $65,574   $ 8,760     $216,292
                                  ========       =======   =======     ========
  Borrowings                      $ 91,050       $31,077   $    -      $122,127
                                  ========       =======   =======     ========

(a)  Includes  $34,244 and  $74,575 of  additions  during the nine months  ended
September 30, 1999 and 1998.

<PAGE> 10


(6) Redemption of Certain Minority Interests

During the quarter  ended June 30,  1999,  the OP  redeemed  43,018 OP units for
approximately $546,000, resulting in an increase in CV Reit's indirect ownership
of the OP from 84.2% to 84.5%.


(7) Non-Recurring Items

During the  quarter  ended June 30,  1999,  the  Company  expensed  $285,000  of
professional  fees as a result of the termination of  negotiations  related to a
proposed merger.  During the quarter ended June 30, 1998, the Company recognized
a $2.3  million  gain from the sale of real estate and during the quarter  ended
September 30, 1998, the Company  incurred a $200,000  charge from the settlement
of litigation.



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

                              Results of Operations

Net Income

         Three Months Ended September 30, 1999 and 1998

For the quarter ended  September 30, 1999, net income was $1,826,000 or $.23 per
share compared to $1,556,000 or $.20 per share for the same period of 1998.

During the quarter ended  September 30, 1999, rent revenue,  operating  expenses
and  interest   expense   increased  by   $1,468,000,   $353,000  and  $567,000,
respectively  (a net increase of $548,000),  primarily due to the acquisition of
six shopping  centers  since July 1998.  The  increase  also  reflects  improved
operating results from existing  centers,  which experienced a $136,000 increase
in net rental income (rent revenue less operating expenses). We expect continued
increases in rent revenue,  operating expenses and interest expense in the event
certain  additional  planned  acquisitions  are  consummated  (see Liquidity and
Capital Resources - Acquisitions).

Interest  income  decreased  by  $119,000  during  the  third  quarter  of 1999,
primarily  attributable  to lower  interest  earning  cash  and cash  equivalent
balances.  Our available  cash has generally  been utilized to acquire  shopping
centers.  Our  Recreation  Notes  Receivable  (Note 3) are long term and require
self-amortizing  payments  through 2023.  Accordingly,  interest income on those
notes  is  anticipated  to  decrease  slightly  each  quarter  due to  scheduled
repayments.

Depreciation  and  amortization  increased  by $247,000  due to shopping  center
acquisitions.  We expect continued increases in depreciation and amortization in
the event certain additional planned acquisitions are consummated (see Liquidity
and Capital Resources - Acquisitions).

Net  income  for the  quarter  ended  September  30,  1998  includes  a $200,000
non-recurring charge from the settlement of litigation.


<PAGE> 11

         Nine Months Ended September 30, 1999 and 1998

For the nine months ended  September 30, 1999, net income was $5,200,000 or $.65
per share compared to $7,113,000 or $.89 per share for the same period of 1998.

Net income for the nine months ended  September 30, 1998 includes a $2.3 million
gain from the sale of real estate.

During the nine  months  ended  September  30,  1999,  rent  revenue,  operating
expenses  and  interest  expense  increased  by  $6,980,000,   $1,960,000,   and
$2,673,000,  respectively (a net increase of  $2,347,000),  primarily due to the
acquisition  of ten shopping  centers since the beginning of 1998.  The increase
also  reflects  improved   operating   results  from  existing  centers,   which
experienced  a  $234,000  increase  in net  rental  income  (rent  revenue  less
operating expenses).

Interest  income   decreased  by  $802,000  during  the  nine  months  of  1999,
attributable to a reduction in the average balance of mortgage notes  receivable
and cash and cash equivalent balances.  The mortgage notes principally consisted
of a line of credit and certain other loans to Hilcoast Development Corp., which
matured and were repaid during 1998.  Those repayments as well as available cash
balances have generally been utilized to acquire shopping centers.

General and administrative expenses increased by $184,000 during the nine months
ended  September  30,  1999  primarily  due  to  higher  professional  fees  and
performance related bonuses.

Depreciation  and  amortization  increased by $1,131,000 due to shopping  center
acquisitions.

Equity in income of unconsolidated  affiliates decreased by $280,000 principally
due to the decision by our management  company  (Drexel - Note 1) to concentrate
mainly on management, leasing and renovation of our Real Estate and acquisitions
of additional  shopping  centers.  As a result,  Drexel has  terminated  various
management contracts for properties owned by outside parties.

Net income for the nine months ended  September  30, 1999  includes  $285,000 of
professional  fees  expensed  as a result  of the  termination  of  negotiations
related to a  proposed  merger.  Net  income  for the prior  nine  month  period
includes a $200,000 non-recurring charge from the settlement of litigation.


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.

<PAGE> 12

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


                                           Three Months Ended  Nine Months Ended
                                              September 30,       September 30,
                                               1999    1998      1999     1999
                                            ----------------   -----------------
Net income .................................  $1,826  $1,556    $5,200  $ 7,113
Minority interests in income of OP .........     335     292       968    1,537
Depreciation and amortization of real
  property (including unconsolidated
  affiliates) ..............................   1,103     862     3,101    1,974
Non-recurring items (Note 7) ...............    --       200       285      200
Gain on sale of real estate ................    --      --        --     (2,347)
                                              ------  ------    ------  -------
FFO - OP ...................................  $3,264  $2,910    $9,554  $ 8,477
                                              ======  ======    ======  =======
FFO - CV Reit (a) ..........................  $2,757  $2,448    $8,055  $ 6,999
                                              ======  ======    ======  =======


(a) CV Reit's  interests  in the OP  averaged  84.5% and 84.3% for the three and
nine  months  of 1999,  respectively  and 84.2% and 82.5% for the three and nine
months of 1998, respectively.


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.


                         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 $7.6  million for the nine months  ended
September  30, 1999  compared  to $6 million for the same period in 1998.  These
amounts generally reflect FFO and net changes in assets and liabilities.

Net cash used by investing  activities  for the nine months ended  September 30,
1999  decreased to $1.6 million from $6 million for the same period in 1998. The
1999 amounts  reflect $1.3 million of capital  improvements  and $1.2 million of
cash required in connection with the  acquisitions of three shopping  centers in
1999,  partially  offset by $1.1 million of collections on real estate  mortgage
notes receivable.  The 1998 amounts principally consist of $21.1 million of cash
required in connection  with the  acquisition of seven  shopping  centers in the
first nine  months of 1998 and $.9  million of capital  improvements,  partially
offset  by $12.1  million  of net  collections  on real  estate  mortgage  notes
receivable and $4.2 million received from the sale of real estate.

Net cash used in  financing  activities  decreased  to $6.3 million for the nine
months  ended  September  30, 1999 from $8.2  million  during the same period of
1998. The 1999 amounts principally consist of cash distributions of $6.9 million
to stockholders and $1.3 million to minority interests, partially offset by $2.5
million  of net  proceeds  from  borrowings.  The 1998  amounts  consist of cash
distributions  amounting  to $6.9  million  to  stockholders  and $1  million to
minority interests, and $3.6 million for the redemption of approximately 300,000
OP units, partially offset by $3.4 million of net proceeds from borrowings.

<PAGE> 13

Borrowings

At September 30, 1999,  our  borrowings  increased to $157.2 million from $121.9
million at December 31, 1998. The $35.3 million increase  included $32.8 million
borrowed  principally  under the Line of Credit  (see  below) to  finance  three
shopping center acquisitions in 1999. Scheduled principal payments over the next
five years are $82.6 million (including $22.7 million through December 31, 2000)
with $74.6  million due  thereafter.  Our  borrowings  are  collateralized  by a
substantial  portion of our Real Estate and our Recreation  Notes.  We expect to
refinance  certain of these  borrowings,  at or prior to  maturity,  through new
mortgage loans on Real Estate. 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.

Borrowings consist of $107.4 million of fixed rate indebtedness, with an average
interest rate of 7.71% at September 30, 1999, and $49.8 million of variable rate
indebtedness,  principally  under the Line of Credit (see  below).  The weighted
average  interest rate of the variable rate  indebtedness  at September 30, 1999
was 7.15%. As a result of refinancing three mortgage loans in 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 6.53%.  We were also able to obtain an
additional $5.2 million in cash in connection with the refinancings.

Under our three year  non-revolving line of credit (the "Line of Credit") we can
borrow  up to $100  million.  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  through March 31, 2000 and must be repaid by certain
dates  during the twelve  months  ended March 31,  2001.  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. As of September 30, 1999, the unused facility amounted to
$51  million of which  $10.3  million  was  available  to be  borrowed  based on
collateral  already pledged under the Line of Credit. We have an additional $1.2
million available principally under an unsecured credit facility.


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  refinancing,  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.

Acquisitions

During the nine months ended September 30, 1999, we completed the acquisition of
three shopping centers,  located in Pennsylvania and New Jersey for an aggregate
purchase price of $33.2 million, including transaction costs, which consisted of
$1.2  million  in  cash  and  the  incurrence  of $32  million  in  liabilities,
substantially  all of which was mortgage  debt.  In  connection  with one of the
acquisitions,  we were  required to deposit an  additional  $1 million  with the
lender in connection with future capital improvements.


<PAGE> 14

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 $21 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 September 30, 1999,  there were  1,462,406 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.

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.


<PAGE> 15

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.

As to the second component of the Y2K readiness program,  we have identified our
significant tenants,  vendors and creditors that are believed,  at this time, to
be critical to business  operations  subsequent to January 1, 2000.  Through the
use of questionnaires,  interviews,  on-site visits and other available means we
have  ascertained  that we have no significant  exposure to Y2K problems at this
time.  However,  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  is not  expected  to exceed
$25,000.  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.



<PAGE>16

           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.


                           PART II. Other Information




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

Exhibits:

   27    Financial Data Schedule

         Reports on Form 8-K:

NONE

                                   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, Sr.
November 12, 1999            _____________________________________
                              Louis P. Meshon Sr., President


                                /s/ Elaine Hauff
November 12, 1999            _____________________________________
                              Elaine Hauff, Vice President,
                              Treasurer and Principal Financial
                              and Accounting Officer