<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

         [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                  SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD 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 No. 1-8815
                           --------------------------

                             EQK REALTY INVESTORS I
                             ----------------------
             (Exact name of Registrant as specified in its Charter)

                 Massachusetts                                   23-2320360
         -------------------------------                     -------------------
        (State or other jurisdiction                         (I.R.S.Employer 
        of incorporation or organization)                    Identification No.)

        3424 Peachtree Road NE, Suite 800, Atlanta, GA             30326   
        ----------------------------------------------           ----------
          (Address of principal executive offices)               (Zip Code)

                                 (404) 848-8600
                                 --------------
              (Registrant's telephone number, including area code)


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 file such filing
requirements for the past 90 days. [ X ] Yes [ ] No


       APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDING DURING
                           THE PRECEDING FIVE YEARS:

Indicate by check mark whether the Registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. [ ] Yes [ ]No

                      APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of the issuer's classes of common
stock, as of the latest practicable date: 9,632,212 as of May 14, 1999.
                                          -----------------------------
<PAGE>   2


                             EQK REALTY INVESTORS I

                          QUARTERLY REPORT ON FORM 10-Q
                        FOR QUARTER ENDED MARCH 31, 1999

                                      INDEX

<TABLE>
<CAPTION>

                                                                                Page
                                                                                ----
         PART I - FINANCIAL INFORMATION
         <S>                                                                    <C> 
         Item 1.  Balance Sheets as of March 31, 1999
                  and December 31, 1998                                         3

                  Statements of Operations for the three
                  months ended March 31, 1999 and
                  March 31, 1998                                                4

                  Statements of Cash Flows for the three
                  months ended March 31, 1999 and
                  March 31, 1998                                                5

                  Notes to the Financial Statements                             6

         Item 2.  Management's Discussion and Analysis
                  of Financial Condition and Results
                  of Operations                                                12

         PART II - OTHER INFORMATION

         Items 1 through 6.                                                    19

         SIGNATURES                                                            20



                                                                                
</TABLE>



                                       2
<PAGE>   3


                             EQK REALTY INVESTORS I
                                 BALANCE SHEETS
                        (In thousands, except share data)

<TABLE>
<CAPTION>


                                                                                     March 31,          December 31,
                                                                                       1999               1998
                                                                                    -------------     -------------
                                          ASSETS

<S>                                                                                  <C>               <C>   
Real estate held for sale                                                            $  39,390         $  39,360

Cash and cash equivalents:
    Cash Management Agreement                                                            3,587             3,390
    Other                                                                                  417               471


Accounts receivable and other assets (net of allowance of $74                            2,109             1,881
  and $67, respectively)
                                                                                     ---------         ---------


TOTAL ASSETS                                                                         $  45,503         $  45,102
                                                                                     =========         =========


                 LIABILITIES AND DEFICIT IN SHAREHOLDERS' EQUITY

Liabilities:

         Mortgage note payable                                                       $  43,794         $  43,794

         Term loan payable to bank                                                       1,576             1,580

         Accounts payable and other liabilities (including amounts
               due affiliates of $3,120 and $3,107, respectively)                        4,618             4,560
                                                                                     ---------         ---------


                                                                                        49,988            49,934

Commitments and Contingencies (Note 1and 5)


Deficit in Shareholders' Equity:

         Shares of beneficial interest, without par value:  10,055,555 shares
               authorized, 9,632,212 shares issued and outstanding                     135,875           135,875

         Accumulated deficit                                                          (140,360)         (140,707)
                                                                                     ---------         ---------

                                                                                        (4,485)           (4,832)
                                                                                     ---------         ---------

TOTAL LIABILITIES AND DEFICIT IN SHAREHOLDERS' EQUITY                                $  45,503         $  45,102
                                                                                     =========         =========
</TABLE>

                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS



                                        3

<PAGE>   4
                             EQK REALTY INVESTORS I
                            STATEMENTS OF OPERATIONS
                    (in thousands, except per share amounts)


<TABLE>
<CAPTION>

             -----------------------------------------------------------------------------------------------

                                                                                Three months ended March 31,
                                                                                   1999              1998
             ------------------------------------------------------------------------------------------------

             <S>                                                                 <C>                <C> 
             Revenues from rental operations                                     $ 1,612            $ 1,553
            
             Operating expenses, net of tenant
                reimbursements (including property
                management fees earned by an affiliate of $0
                and $74, respectively)                                               133                158

             Depreciation and amortization                                             0                547
             ----------------------------------------------------------------------------------------------

             Income from rental operations                                         1,479                848

             Interest expense                                                      1,019              1,100

             Other expenses, net of interest income
              (including portfolio management fees
               earned by an affiliate of $51 and $63, respectively )                 113                 83
             ----------------------------------------------------------------------------------------------

             Net income (loss)                                                   $   347            $  (335)
             ==============================================================================================

             Net income (loss) per share                                         $  0.04            ($ 0.04)
             ==============================================================================================
</TABLE>


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS



                                       4
<PAGE>   5
                             EQK REALTY INVESTORS I
                            STATEMENTS OF CASH FLOWS
                                 (in thousands)
<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------
                                                                               Three months ended March 31,
                                                                              1999                  1998
--------------------------------------------------------------------------------------------------------------
<S>                                                                         <C>                  <C> 
Cash flows from operating activities:
  Net income (loss)                                                         $   347              $  (335)
  Adjustments to reconcile net income (loss) to net
    cash provided by operating activities:
      Depreciation and amortization                                               0                  547
      Changes in assets and liabilities:
      Increase (decrease) in accounts payable and
         other liabilities                                                       58                  (30)
      (Increase) decrease in accounts receivable
         and other assets                                                      (228)                 378
-------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities                                       177                  560
-------------------------------------------------------------------------------------------------------------
Cash flows from investing activities:
  Additions to real estate investments                                          (30)                (170)
-------------------------------------------------------------------------------------------------------------
Net cash used in investing activities                                           (30)                (170)
-------------------------------------------------------------------------------------------------------------
Cash flows from financing activities:
   Scheduled repayments of debt                                                  (4)                  (1)
-------------------------------------------------------------------------------------------------------------
Net cash used in financing activities                                            (4)                  (1)
-------------------------------------------------------------------------------------------------------------
Increase in cash and cash equivalents                                           143                  389
Cash and cash equivalents
  beginning of period                                                         3,861                3,323
-------------------------------------------------------------------------------------------------------------
Cash and cash equivalents
  end of period                                                             $ 4,004              $ 3,712
=============================================================================================================

Supplemental disclosure of cash flow information:
Interest paid                                                               $   679              $ 1,012
=============================================================================================================
</TABLE>

                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS


                                       5
<PAGE>   6

                             EQK REALTY INVESTORS I

                         NOTES TO FINANCIAL STATEMENTS

NOTE 1:  DESCRIPTION OF BUSINESS

         EQK Realty Investors I, a Massachusetts business trust ("EQK" or the
         "Trust"), was formed pursuant to an Amended and Restated Declaration of
         Trust dated February 27, 1985, as amended on March 5, 1986, to acquire
         certain income-producing real estate investments. Commencing with the
         period beginning April 1, 1985, the Trust qualified for and elected
         real estate investment trust ("REIT") status under the provisions of
         the Internal Revenue Code. Lend Lease Portfolio Management, Inc. serves
         as the "Advisor" to the Trust.

         At March 31, 1999, the Trust's remaining real estate investment is
         Harrisburg East Mall (the "Mall"), a regional shopping center in
         Harrisburg, Pennsylvania, which is currently held for sale. On December
         8, 1995, the Trust sold its remaining interest in Castleton Park, an
         office park in Indianapolis, Indiana. The Trust sold office buildings
         comprising an office complex located in Atlanta, Georgia, formerly
         known as Peachtree-Dunwoody Pavilion, during 1992 and 1993. In 1991,
         the Trust completed the sale of two office buildings at Castleton.

         The Declaration of Trust provides for the Trust's existence and a
         maximum holding period for its real estate investments of 14 years. The
         Declaration of Trust further provides that this 14-year term may be
         extended by up to two years upon the recommendation of the Trustees and
         the affirmative vote of a majority of its shareholders. Recognizing
         that the disposition of the Mall would not be completed prior to the
         initial maturity date of the Trust's term (March 5, 1999), the Board of
         Trustees recommended a two-year extension of the Trust's life (through
         March 5, 2001). This recommendation was approved by the shareholders at
         a Special Meeting of Shareholders held on February 23, 1999.

         Effective December 23, 1997, the Trust entered into an Agreement and
         Plan of Merger (the "Merger Agreement"), pursuant to which an affiliate
         of American Realty Trust, Inc. ("ART") is to merge with and into the
         Trust (the "Merger"), with the Trust being the surviving entity. The
         Merger contemplates, among other things, an extension of the life of
         the Trust through December 31, 2018.

         The Merger Agreement was amended on August 25, 1998 (as further amended
         on April 22, 1999, the "Revised Merger Agreement") to provide for,
         among other matters, the right of the Trust to sell the Mall and
         distribute proceeds of such sale to the Trust's shareholders prior to
         completing the Merger and a corresponding reduction in the Merger
         consideration to be paid to the Trust's shareholders.

         The Merger consideration will be comprised entirely of ART Series F
         Cumulative Convertible Preferred Stock with a par value of $2.00 per
         share and a liquidation value of $10.00 per share. ("ART Preferred
         Shares"). The merger will be effected by (i) ART's acquisition of up to
         4,376,056 shares currently held by four EQK shareholders (the "Selling
         Shareholders") and (ii) ART's receipt of 673,976 shares newly issued by
         the Trust (which, together with Shares currently outstanding,
         constitutes "EQK Shares"), the combined effect of which will give



                                       6
<PAGE>   7

                             EQK REALTY INVESTORS I

                         NOTES TO FINANCIAL STATEMENTS



         ART up to an approximate 49% interest in EQK. The number of EQK Shares
         acquired by ART and the number of EQK Shares issued to ART may be
         adjusted if, due to certain circumstances, less than all of the Selling
         Shareholders complete their transaction with ART. The Selling
         Shareholders will receive for each EQK Share sold 0.030 of an ART
         Preferred Share with corresponding liquidation value of $0.30 per EQK
         Share sold. The remaining shareholders will be entitled to retain their
         Shares at the time of the Merger, but will be compensated for the
         dilution in their percentage ownership interest through the receipt of
         0.014 of an ART Preferred Share with a corresponding liquidation value
         of $0.14 per EQK Share held. In addition, ART currently intends (but is
         not legally obligated) to acquire the remaining EQK Shares from such
         other shareholders at some time after the third anniversary of the
         consummation of the Merger for not less than 0.0486 of an ART Preferred
         Share with a liquidation value of $0.486 for each EQK Share tendered.

         According to the terms of the Revised Merger Agreement, upon completion
         of the sale of the Mall and receipt of shareholder approval, the Merger
         would be completed. Immediately prior to the closing of the Merger, ART
         will convey one of its properties to the Trust. The total consideration
         paid by the Trust to ART for this property will be a $1,250,000
         non-recourse five-year promissory note. The Trust will also assume
         approximately $1,500,000 of existing debt.

         ART has agreed to permit the Trust to continue to solicit, or respond
         to, offers from third parties for the Trust. In the event the Trust
         accepts an offer from a party other than ART and elects not to proceed
         with the Merger, the Trust generally will be obligated to pay ART a
         break-up fee of $200,000 plus its share of transaction expenses
         (collectively, the "Break-Up Consideration").

         The Revised Merger Agreement is terminable by either ART or the Trust
         if the Merger has not been accomplished by July 30, 1999. The Revised
         Merger Agreement also may be terminated by the Trust if (i) the Trust
         secures a more favorable offer from another party subject to the
         payment of the Break-Up Consideration; or (ii) the Revised Merger
         Agreement in any way impairs or delays the sale of the Mall, or is
         likely to result in a material reduction in proceeds.

         Proceeds from the sale of the Mall and, if applicable, the completion
         of the Merger, will be distributed to the shareholders of the Trust in
         one or more payments once the Trust's liabilities have been settled
         (including retirements of its Mortgage Note and Term Loan) and related
         transaction costs have been paid.

         The Merger is contingent upon, among other things, ART's registration
         statement relating to the ART Preferred Shares to be issued pursuant to
         the Revised Merger Agreement being declared effective by the Securities
         Exchange Commission, and the affirmative vote of the holders of 75% of
         the outstanding Shares.


                                       7
<PAGE>   8

                             EQK REALTY INVESTORS I

                         NOTES TO FINANCIAL STATEMENTS



         The Trust, its trustees, and its Advisor have been named as defendants
         in a purported class action complaint filed in Massachusetts State
         court, which seeks to enjoin the Merger. The complaint also seeks other
         relief including unspecified damages. The Management of the Trust is
         pursuing its legal defenses and believes that the disposition of this
         matter will not have a material adverse effect on the financial
         position of the Trust.

         As previously announced, on March 5, 1999, the Trust entered into a
         non-binding letter of intent to sell the Mall to a private real estate
         group (the "Prospective Purchaser") for $51 million. Closing was
         subject to a number of conditions, including the satisfactory
         completion of due diligence, the Prospective Purchaser's obtaining
         financing and the execution of a definitive purchase and sale
         agreement. The letter of intent provided for an exclusive period, which
         expired May 15, 1999, during which time the Trust could not solicit,
         negotiate, or execute other offers for the sale of the Mall.

         Based on the current status of negotiations, substantial doubt exists
         as to the Trust's ability to close this transaction prior to the
         expiration dates of its forbearance and loan extension arrangements as
         described in Note 5, or at all. Accordingly, Management will propose to
         its lenders that further forbearance and extension arrangements be
         granted. However, no assurances can be given that the lenders will
         grant such relief. Depending upon the status of the negotiations with
         the Prospective Purchaser, Management may consider additional marketing
         activities relating to the Mall.

NOTE 2:  BASIS OF PRESENTATION

         The financial statements have been prepared by the Trust, without
         audit, pursuant to the rules and regulations of the Securities and
         Exchange Commission. Certain information and footnote disclosures
         normally included in the financial statements prepared in accordance
         with generally accepted accounting principles have been condensed or
         omitted pursuant to such rules and regulations, although the Trust
         believes that the disclosures are adequate to make the information
         presented not misleading. The financial statements should be read in
         conjunction with the audited financial statements and related notes
         thereto included in the Annual Report on Form 10-K for the year ended
         December 31, 1998.

         Certain prior year amounts have been reclassified to conform to the
         current year presentation.

         The Trust is actively attempting to sell the Mall and, therefore, has
         classified its investment in real estate on the balance sheet as held
         for sale beginning April 1, 1998. Accordingly, all real estate assets,
         including deferred leasing costs, are recorded at the lower of cost or
         estimated fair market value, less estimated costs to sell. Depreciation
         is not recorded for real estate assets held for sale. Therefore, the
         Trust discontinued recording depreciation and amortization of real
         estate assets on April 1, 1998.


                                       8
<PAGE>   9

                             EQK REALTY INVESTORS I

                         NOTES TO FINANCIAL STATEMENTS



         In the opinion of the Trust, all adjustments, which include only normal
         recurring adjustments necessary to present fairly its financial
         position as of March 31, 1999, its results of operations for the three
         months ended March 31, 1999 and 1998 and its cash flows for the three
         months ended March 31, 1999 and 1998, have been included in the
         accompanying unaudited financial statements.

NOTE 3:  CASH MANAGEMENT AGREEMENT

         In connection with the Trust's Mortgage Debt agreement (as amended and
         extended), the Trust entered into a Cash Management Agreement with
         Prudential (the "Mortgage Note Lender") and assigned all lease and rent
         receipts to the Mortgage Note Lender as additional collateral. Pursuant
         to this agreement, a third-party escrow agent has been appointed to
         receive all rental payments from tenants and to fund monthly operating
         expenses in accordance with a budget approved by the Mortgage Note
         Lender. As of March 31,1999, a balance of $2,115,000 was held by the
         third-party escrow agent in accordance with the Cash Management
         Agreement. The agreement also provides for the establishment of a
         capital reserve account, which is maintained by the escrow agent.
         Disbursements from this account, which are funded each month with any
         excess operating cash flow, are limited to capital expenditures
         approved by the Mortgage Note Lender. As of March 31, 1999 the balance
         of the capital reserve account was $1,472,000.

         Cash paid for interest for the three months ended March 31, 1999,
         represents three months of interest payments for the Term Loan, but
         only two months of interest payments for the Mortgage Note. The March
         1999 monthly interest payment for the Mortgage Note was deferred until
         April 1999 due to a bank error.

NOTE 4:  ADVISORY AND MANAGEMENT AGREEMENTS

         The Advisor is a wholly owned subsidiary of Lend Lease Real Estate
         Investments, Inc. The Advisor makes recommendations to the Trust
         concerning investments, administration and day-to-day operations.

         Under the terms of the advisory agreement, as amended in December 1989,
         the Advisor receives a management fee that is based upon the average
         daily per share price of the Trust's shares plus the average daily
         balance of outstanding mortgage indebtedness. Such fee is calculated
         using a factor of 42.5 basis points (0.425%) and generally has been
         payable monthly without subordination. However, given the Shares of the
         Trust are no longer traded on a market with readily available market
         values, the Trustees agreed on a stipulated rate of $0.75 per share to
         be used for purposes of calculating the management fee for the period
         of May 4, 1998 through December 31, 1998 and $0.37 per share for the
         period of January 1, 1999 through June 30, 1999.

                                       9

<PAGE>   10

                             EQK REALTY INVESTORS I

                         NOTES TO FINANCIAL STATEMENTS



         Commencing with the December 1995 extension of debt and continuing with
         the December 1996 debt extension, the Mortgage Note Lender has
         requested, and the Advisor has agreed to, a partial deferral of payment
         of its fee. Whereas the fee continues to be computed as described
         above, payments to the Advisor are limited to $37,500 per quarter.
         Accrued but unpaid amounts will be eligible for payment upon the
         repayment of the Mortgage Note. For the three months ended March 31,
         1999 and 1998, portfolio management fees were $51,000 and $63,000,
         respectively. The balance of deferred portfolio management fees at
         March 31, 1999 was $313,000.

         As of December 31, 1989, portfolio management fees of $5,440,000
         payable to the Advisor were deferred in accordance with subordination
         provisions contained in the original advisory agreement. Pursuant to
         the amended advisory agreement, the Advisor forgave one-half, or
         $2,720,000, of the deferred balance. The remaining deferred fees are to
         be paid upon the disposition of the Trust's properties. As of March 31,
         1999, the liability for deferred management fees was $2,720,000.

         Upon the sale of all or any portion of any real estate investment of
         the Trust, the Advisor will receive a disposition fee equal to 2% of
         the gross sale price (including outstanding indebtedness taken subject
         to or assumed by the buyer and any purchase money indebtedness taken
         back by the Trust). The disposition fee will be reduced by the amount
         of any brokerage commissions and legal expenses incurred by the Trust
         in connection with such sales. The Trust incurred no disposition fees
         as of March 31, 1999.

         In connection with the December 15, 1996 extension of debt, the Advisor
         earned a refinancing fee of $50,000, which will be paid upon the
         retirement of the debt.

         The Trust entered into an agreement with ERE Yarmouth Retail, Inc. (the
         "Manager"), for the on-site management of the Mall. ERE Yarmouth
         Retail, Inc. was a wholly owned subsidiary of Lend Lease Real Estate
         Investments, Inc. On September 30, 1998, Lend Lease Real Estate
         Investments, Inc. sold the Manager to LaSalle Partners, Incorporated
         ("LaSalle"), which is not affiliated with the Trust or the Advisor. An
         affiliate of LaSalle continues to manage the Mall pursuant to the terms
         of the original management agreement.

NOTE 5:  DEBT MATURITIES

         The Trust's debt instruments (aggregate principal outstanding of
         $45,370,000) had original maturity dates of December 15, 1995. The
         Trust's Mortgage Note Lender and Term Loan Lender have agreed to extend
         the maturity date of the loans twice, first for a period of one year
         through December 15, 1996, and second for a period of 18 months through
         June 15, 1998. Following the June 15, 1998 maturity date, the Mortgage
         Note Lender granted two six-month forbearance arrangements (through
         December 15, 1998 and June 15, 1999) wherein it agreed not to exercise
         remedies for non-repayment of the outstanding principal


                                       10
<PAGE>   11

                             EQK REALTY INVESTORS I

                         NOTES TO FINANCIAL STATEMENTS



         balance. The Term Loan Lender has granted two six-month extensions of
         its maturity date so as to coincide with such forbearance periods.
         These forbearance arrangements are conditioned upon, among other
         things, the Trust continuing to make timely debt service payments in
         monthly amounts equal to those amounts stipulated in the December 1996
         debt extension agreements.

         As discussed above, the Trust's expiration date of its forbearance and
         extension arrangements is June 15, 1999. The potential inability of the
         Trust to refinance this debt or to generate sufficient proceeds from
         the sale of the Mall to repay the debt raises substantial doubt about
         the Trust's ability to continue as a going concern. Given the
         uncertainty surrounding the timing of the disposition of the Mall as
         described in Note 1, Management will propose to its lenders that
         further forbearance and extension arrangements be granted. However, no
         assurances can be given that the lenders will grant such relief. The
         financial statements do not include any adjustments that might result
         from the outcome of this uncertainty.











                                       11
<PAGE>   12
                             EQK REALTY INVESTORS I

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS


This discussion should be read in conjunction with the financial statements and
notes that appear on pages 3-11.

FINANCIAL CONDITION

CAPITAL RESOURCES

Trust Background

As of March 31, 1999, the Trust's remaining real estate investment is Harrisburg
East Mall (the "Mall"), a regional shopping center located in Harrisburg,
Pennsylvania. During the period 1992 to 1995, the Trust completed the
disposition of its two other real estate investments. Castleton Park, an office
park in Indianapolis, Indiana was sold in 1995, and Peachtree Dunwoody Pavilion,
an office park in Atlanta, Georgia, was sold in three separate transactions
during 1992 and 1993.

Management intends to dispose of its remaining real estate investment, the Mall,
as soon as commercially practicable. Management is attempting to complete such
disposition prior to the June 15, 1999 expiration dates if its forbearance and
extension arrangements with its lenders. However, substantial doubt exists as
to the Trust's ability to complete such disposition prior to this date.
Accordingly, Management will propose to its lenders that further forbearance
and extension arrangements be granted. However, no assurances can be given that
the lenders will grant such relief.

The Declaration of Trust provides for the Trust's existence and a maximum
holding period for its real estate investments of 14 years. The Declaration of
Trust further provides that this 14 year term may be extended by up to two years
upon the recommendation of the Trustees and the affirmative vote of a majority
of its shareholders. Recognizing that the disposition of the Mall would not be
completed prior to the initial maturity date of the Trust's term (March 5,
1999), the Board of Trustees recommended a two year extension of the Trust's
life (through March 5, 2001). This recommendation was approved by the
shareholders at a Special Meeting of Shareholders held on February 23, 1999.

Proposed Merger with American Realty Trust

Effective December 23, 1997, the Trust entered into an Agreement and Plan of
Merger (the "Merger Agreement"), pursuant to which an affiliate of American
Realty Trust, Inc. ("ART") is to merge with and into the Trust (the "Merger"),
with the Trust being the surviving entity. The Merger contemplates, among other
things, an extension of the life of the Trust through December 31, 2018.


                                       12

<PAGE>   13

                             EQK REALTY INVESTORS I

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS


The Merger Agreement was amended on August 25, 1998 (as further amended on
April 22, 1999, the "Revised Merger Agreement") to provide for, among other
matters, for the right of the Trust to sell the Mall and distribute proceeds of
such sale to the Trust's shareholders prior to completing the Merger and a
corresponding reduction in the Merger consideration to be paid to the Trust's
shareholders.

The Merger consideration will be comprised entirely of ART Series F Cumulative
Convertible Preferred Stock with a par value of $2.00 per share and a
liquidation value of $10.00 per share. ("ART Preferred Shares"). The merger will
be effected by (i) ART's acquisition of up to 4,376,056 shares currently held by
four EQK shareholders (the "Selling Shareholders") and (ii) ART's receipt of
673,976 shares newly issued by the Trust (which, together with shares currently
outstanding, constitutes "EQK Shares"), the combined effect of which will give
ART up to an approximate 49% interest in EQK. The number of existing EQK Shares
acquired by ART and the number of EQK Shares issued to ART may be adjusted if,
due to certain circumstances, less than all of the Selling Shareholders complete
their transaction with ART. The Selling Shareholders will receive for each EQK
Share sold 0.030 of an ART Preferred Share with corresponding liquidation value
of $0.30 per EQK Share sold. The remaining shareholders will be entitled to
retain their Shares at the time of the Merger, but will be compensated for the
dilution in their percentage ownership interest through the receipt of 0.014 of
an ART Preferred Share with a corresponding liquidation value of $0.14 per EQK
Share held. In addition, ART currently intends (but is not legally obligated) to
acquire the remaining EQK Shares from such other shareholders at some time after
the third anniversary of the consummation of the Merger for not less than 0.0486
of an ART Preferred Share with a liquidation value of $0.486 for each EQK Share
tendered.

According to the terms of the Revised Merger Agreement, upon completion of the
sale of the Mall and receipt of shareholder approval, the Merger would be
completed. Immediately prior to the closing of the Merger, ART will convey one
of its properties to the Trust. The total consideration paid by the Trust to ART
for this property will be a $1,250,000 non-recourse five-year promissory note.
The Trust will also assume approximately $1,500,000 of existing debt.

ART has agreed to permit the Trust to continue to solicit, or respond to, offers
from third parties for the Trust. In the event the Trust accepts an offer from a
party other than ART and elects not to proceed with the Merger, the Trust
generally will be obligated to pay ART a break-up fee of $200,000 plus its share
of transaction expenses (collectively, the "Break-Up Consideration").




                                       13


<PAGE>   14

                             EQK REALTY INVESTORS I

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS



The Revised Merger Agreement is currently terminable by either ART or the Trust
if the Merger has not been accomplished by July 30, 1999. The Revised Merger
Agreement also may be terminated by the Trust if (i) the Trust secures a more
favorable offer from another party subject to the payment of the Break-Up
Consideration; or (ii) the Revised Merger Agreement in any way impairs or delays
the sale of the Mall, or is likely to result in a material reduction in
proceeds.

Proceeds from the sale of the Mall and, if applicable, the completion of the
Merger, will be distributed to the shareholders of the Trust in one or more
payments once the Trust's liabilities have been settled (including retirements
of its Mortgage Note and Term Loan) and related transaction costs have been
paid.

The Merger is contingent upon, among other things, ART's registration statement
relating to the ART Preferred Shares to be issued pursuant to the Revised Merger
Agreement being declared effective by the Securities Exchange Commission, and
the affirmative vote of the holders of 75% of the outstanding Shares.

The Trust, its trustees, and its Advisor have been named as defendants in a
purported class action complaint filed in Massachusetts State court, which seeks
to enjoin the Merger. The complaint also seeks other relief including
unspecified damages. Management of the Trust is pursuing its legal defenses and
believes that the disposition of this matter will not have a material adverse
effect on the financial position of the Trust.

Harrisburg East Mall Disposition Plan

Management commenced marketing and sales activities relating to the Mall during
the second quarter of 1998, which included the retention of an outside broker.
Since the commencement of sales activities, changing conditions in the capital
markets have had an adverse effect on the market for real estate, and especially
on the market for regional shopping malls. This unfavorable environment has been
characterized by a reduction in available sources of financing for real estate
transactions and by reduced purchasing interest on the part of many traditional
buyers, including many of the public real estate investment trusts.

As previously announced, on March 5, 1999, the Trust entered into a non-binding
letter of intent to sell the Mall to a private real estate group (the
"Prospective Purchaser") for $51 million. Closing was subject to a number of
conditions, including the satisfactory completion of due diligence, the
Prospective Purchaser's obtaining financing and the execution of a definitive
purchase and sale agreement. The letter of intent provided for an exclusive
period, which expired May 15, 1999, during which time the Trust could not
solicit, negotiate, or execute other offers for the sale of the Mall.


                                       14
<PAGE>   15

                             EQK REALTY INVESTORS I

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS


Based on current status of negotiations, substantial doubt exists as to the
Trust's ability to close this transaction prior to the expiration dates of its
forbearance and loan extension arrangements as described in Note 5, or at all.
Accordingly, Management will propose to its lenders that further forbearance and
extension arrangements be granted. However, no assurances can be given that the
lenders will grant such relief. Depending upon the status of the negotiations
with the Prospective Purchaser, Management may consider additional marketing
activities relating to the Mall.

The Trust understands that two of its former officers are affiliated with a
company that has entered into a relationship with the Prospective Purchaser in
connection with this transaction.

Mortgage Debt Extensions

The Trust's debt instruments (aggregate principal outstanding of $45,370,000)
had original maturity dates of December 15, 1995. The Trust's Mortgage Note
Lender and Term Loan Lender have agreed to extend the maturity date of the loans
twice, first for a period of one year through December 15, 1996, and second for
a period of 18 months through June 15, 1998. Following the June 15, 1998
maturity date, the Mortgage Note Lender granted two six-month forbearance
arrangements (through December 15, 1998 and June 15, 1999) wherein it agreed not
to exercise remedies for non-repayment of the outstanding principal balance. The
Term Loan Lender has granted two six-month extensions of its maturity date so as
to coincide with such forbearance periods. These forbearance arrangements are
conditioned upon, among other things, the Trust continuing to make timely debt
service payments in monthly amounts equal to those amounts stipulated in the
December 1996 debt extension agreements.

As discussed above, the Trust's expiration date of its forbearance and extension
arrangements is June 15, 1999. The potential inability of the Trust to refinance
this debt or to generate sufficient proceeds from the sale of the Mall to repay
the debt raises substantial doubt about the Trust's ability to continue as a
going concern. Given the uncertainty surrounding the timing of the disposition
of the Mall as described in Note 1, Management will propose to its lenders that
further forbearance and extension arrangements be granted. However, no
assurances can be given that the lenders will grant such relief. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.


                                       15
<PAGE>   16

                             EQK REALTY INVESTORS I

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS


LIQUIDITY

GENERAL

Cash flows provided by operating activities decreased $383,000 for the three
months ended March 31, 1999 as compared to the three months ended March 31,
1998. This decrease is attributable to the timing of payment of real estate
taxes and certain other operating expenses. These current year cash outflows are
offset by the March 1999 Mortgage Note interest payment which was deferred until
April 1999, as well as the receipt of several tenants' prepayment of real estate
tax reimbursements during the first quarter of 1999. In addition, the cash flows
for the first quarter of 1998 includes the receipt of certain reimbursements
from ART in accordance with the Revised Merger Agreement.

Cash flows used in investing activities during the three months ended March 31,
1999, $30,000, were for tenant allowances at the Mall. The Trust anticipates
capital expenditures of approximately $1,660,000 for the remainder of 1999,
which include budgeted tenant allowances of $1,307,000. Certain of these
expenditures are discretionary in nature and may be deferred into future
periods.

For the three months ended March 31, 1999, cash flows used in financing
activities were limited to principal payments on the Trust's Term Loan. The
Mortgage Note requires monthly payments of interest only.

The Trust's liquidity requirements for the remainder of 1999 also will include
principal and interest payments of approximately $1,337,000 through June 15,
1999, pursuant to the existing loan and forbearance agreements. The forbearance
and extension agreements specify that the remaining loan balances of $45,370,000
be paid in full by June 15, 1999. In the event the sale of the Mall is not
completed by June 15, 1999, Management will propose to its lenders that further
forbearance and extensions be granted. However, no assurance can be given that
the lenders will grant such relief.

The Trust's cash management agreement stipulates that all rental payments from
tenants are to be made directly to a third party escrow agent who also funds
monthly operating expenses in accordance with a budget approved by the Mortgage
Note Lender. The Trust believes that its cash flow for 1999 will be sufficient
to fund its various operating requirements, including budgeted capital
expenditures and monthly principal and interest payments, although its
discretion with respect to cash flow management will be limited by the terms of
the cash management agreement. Management believes that the Trust's current cash
reserves, coupled with additional cash flow projected to be generated from
operations, will permit the Trust to meet its operating, capital and monthly
debt service requirements.


                                       16
<PAGE>   17

                             EQK REALTY INVESTORS I

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS


The Trust intends to sell the Mall and, therefore, has classified its real
estate as held for sale at April 1, 1998. Accordingly, the investment in real
estate, including deferred leasing costs, is recorded at the lower of cost or
estimated fair market value, less estimated costs to sell.

Depreciation is not recorded for real estate assets held for sale. Therefore,
the Trust discontinued recording depreciation and amortization of real estate
assets on April 1, 1998.

The Trust has not written up the cost basis of its investment in the Mall to its
substantially higher fair value. Therefore, the Trust does not believe that its
deficit in shareholders' equity of $4,485,000 at March 31, 1999 is indicative of
its current liquidity or the net distribution that its shareholders would
receive upon liquidation.

YEAR 2000 READINESS DISCLOSURE

The inability of computers, software and other equipment to recognize and
properly process data fields containing a two-digit year is commonly referred to
as the Year 2000 compliance issue ("Y2K"). As the year 2000 approaches, such
systems may be unable to accurately process certain date-based information.

Y2K exposures of the Trust and the Mall are currently being assessed. Potential
critical exposures include reliance on third party vendors and building systems
that are not Y2K compliant. The Trust has begun to communicate with its third
party service vendors such as Lend Lease and LaSalle Partners in an effort to
assess their Y2K compliance status and the adequacy of their Y2K efforts.

The Mall has been assessed in an effort to identify Y2K issues. Remediation
efforts are expected to be complete by July 31, 1999. The remediation strategy
has been developed based on the assessment findings.

The Trust and the Mall have incurred costs to date relating to Y2K of
approximately $15,700. The total assessment cost is expected to be approximately
$16,000 and the total cost for quality assurance for third party engineers and
consultants is expected to be approximately $3,400. Estimated remediation costs
of $30,500 are expected to be incurred to remediate and test non-compliant
building systems.

The failure to adequately address the Year 2000 issue may result in the closure
of the Mall. In order to reduce the potential impact on the operations of the
Trust and the Mall, Trust contingency plans are expected to be developed by July
31, 1999, and the building contingency plan is expected to be developed by June
30, 1999. A contingency plan may involve but not be limited to the engagement of
additional security services, the disconnection of systems that interface (that
does not significantly impact Mall operations) and the identification and
engagement of alternative service vendors.


                                       17
<PAGE>   18


                             EQK REALTY INVESTORS I

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS


RESULTS OF OPERATIONS

For the three months ended March 31, 1999, the Trust reported net income of
$347,000 ($.04 per share) compared to a net loss of $335,000 ($.04 per share)
for the three months ended March 31, 1998. The increase in net income is
primarily attributable to the cessation of recording depreciation and
amortization on the Mall's assets as a result of the Trust's real estate being
classified as "held for sale" as of April 1, 1998. No depreciation and
amortization expense was recorded for the first quarter of 1999 whereas $547,000
of depreciation and amortization expense was recorded for the first quarter of
1998.

The Trust's revenues from rental operations for the three months ended March 31,
1999 and 1998 were $1,612,000 and $1,553,000,respectively. This represents an
increase of $59,000 over the prior year period. This increase is attributable to
the Trust recognizing income from a bankruptcy settlement ($29,000) and income
received from the Pennsylvania Department of Transportation for its purchase of
a 0.8 acre remote land parcel owned by the Trust ($30,000) in the current
period.

Operating expenses net of tenant reimbursements were $133,000 and $158,000 for
the three month periods ended March 31, 1999 and 1998, respectively. This
variance is comprised of several operating expense variances, none of which are
considered significant.

Interest expense decreased $81,000 from the prior year primarily due to
recording the amortization of extension fees associated with the 1996 debt
extension during the three month period ended March 31, 1998 ($88,000). The
majority of the 1996 debt extension costs were fully amortized by June 30, 1998.
Partially offsetting this variance was the amortization of extension 
fees in the first quarter of 1999 related to the extension of the maturity 
date of the Mortgage Loan and Term Loan through June 15, 1999
($16,000).

Other expenses net of interest income were $113,000 and $83,000 for the three
month periods ended March 31, 1999 and 1998, respectively. The increase in these
expenses over the prior year is primarily due to the costs incurred by the Trust
for the administration of the Special Meeting of Shareholders held on February
23, 1999.


                                       18
<PAGE>   19
                             EQK REALTY INVESTORS I
                           PART II - OTHER INFORMATION

              Item 1.      Legal Proceedings

                           On February 3, 1998, the Trust, its trustees, and its
                           Advisor were named as defendants in a purported class
                           action complaint filed by a shareholder in
                           Massachusetts State court. The complaint seeks to
                           enjoin the Merger and also seeks other relief
                           including unspecified damages. Management of the
                           Trust is pursuing its legal defenses and believes
                           that the disposition of this matter will not have a
                           material adverse effect on the financial position of
                           the Trust.

              Item 2.      Changes in Securities
                           None

              Item 3.      Defaults Upon Senior Securities
                           None

              Item 4.      Submission of Matters to a Vote of Security Holders

                          A Special Meeting of Shareholders was held on February
                          23, 1999 to consider and vote upon a proposal to
                          extend the Trust's existence for a maximum period of
                          two years in accordance with the Trust's Amended and
                          Restated Declaration of Trust. An affirmative vote of
                          the majority of the shareholders was received in favor
                          of extending the Trust's existence for a period of two
                          years beyond March 5, 1999.

              Item 5.      Other Information
                           None

              Item 6.      Exhibits and Reports on Form 8-K
                           (a)  Exhibits:
                                    2.  None
                                    4.  None
                                    10. Material Contracts
                                        (1) First Amendment to Amended and 
                                            Restated Agreement and Plan of 
                                            Merger by and among the Registrant, 
                                            American Realty Trust,  Inc., ART 
                                            Newco,  LLC, Basic Capital  
                                            Management, Inc., EQK Realty 
                                            Investors I, and Lend Lease 
                                            Portfolio Management, Inc. (a)
                                    11. See Note 2 to Financial Statements
                                    15. Not Applicable
                                    18. Not Applicable
                                    19. None
                                    22. None
                                    23. Not Applicable
                                    24. None
                                    27. Included in EDGAR transmission only.
                                        (for SEC use only).
                           (b)  Reports on Form 8-K
                                    None
--------------------------------------------------------------------------------
                     (a) Incorporated herein by reference to exhibit 99.8 filed 
                         with Registration Statement on April 23, 1999 on 
                         Amendment #5 to form S-4 filed by American Realty 
                         Trust, Inc. (Registration Statement Number 333-43777)

                                       19




<PAGE>   20

                                   SIGNATURES

Pursuant to 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.

Date:  May 17, 1999           EQK REALTY INVESTORS I


                               By: /s/ Samuel F. Hatcher                       
                                   ---------------------------------------------
                                   Samuel F. Hatcher
                                   President (Principal Executive Officer)
                                   and Trustee

                              By:  /s/ Don Henry                        
                                   ---------------------------------------------
                                   Don Henry
                                   Vice President (Principal Financial Officer)
                                   and Controller






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