<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
                                       OR
           [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the Quarterly Period Ended September 30, 1997

                         Commission File Number 0-13647*


              GRUBB & ELLIS REALTY INCOME TRUST, LIQUIDATING TRUST
             (Exact name of registrant as specified in its charter)

               California                               (94-6649376)
      (State or Other Jurisdiction          (I.R.S. Employer Identification No.)
    of Incorporation or Organization)
                              433 California Street
                                    Suite 610
                         San Francisco, California 94104
               (Address of Principal Executive Offices) (Zip Code)
                                 (415) 391-9800
               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 such filing
requirements for the past 90 days.
               Yes [X] No [ ] 

The number of units outstanding of the registrant's units of beneficial interest
August 1, 1995 was 2,803,169 units.

GRUBB & ELLIS REALTY COMPANY TRUST LIQUIDATING TRUST IS THE DISTRIBUTEE OF THE
ASSETS OF GRUBB & ELLIS REALTY INCOME TRUST, AND FILES REPORTS UNDER GRUBB &
ELLIS REALTY INCOME TRUST'S FORMER COMMISSION FILE NUMBER


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              GRUBB & ELLIS REALTY INCOME TRUST, LIQUIDATING TRUST

                                    FORM 10-Q
                                    ---------


                                    I N D E X


<TABLE>
<CAPTION>
                                                                                              Page
                                                                                              ----
<S>                                                                                            <C>
PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements (unaudited):

   Condensed Statements of Assets and Liabilities as of September 30, 1997
        and June 30, 1997                                                                        3

   Statements of Income and Expense for the quarters ended September 30, 1997 and
        1996                                                                                     4

   Statements of Cash Flows for the three-month periods ended
        September 30, 1997 and 1996                                                              5

   Notes to Financial Statements                                                               6-8


Item 2.  Management's Discussion and Analysis of Financial Condition and
      Results of Operations                                                                      9


PART II - OTHER INFORMATION
      Item 1: Legal Proceedings                                                                 10
      Item 2: Change of Securities                                                              10
      Item 3: Defaults Upon Senior Securities                                                   10
      Item 4: Submission of Matters to a Vote of Security Holders                               10
      Item 5: Exhibits and Reports on Form 8-K                                                  10

      Signatures                                                                                11
</TABLE>


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              GRUBB & ELLIS REALTY INCOME TRUST, LIQUIDATING TRUST
                 CONDENSED STATEMENTS OF ASSETS AND LIABILITIES


<TABLE>
<CAPTION>
                                                             September 30,        June 30,
                                                                 1997               1997
                                                             ------------       ------------
                                                                (unaudited)
<S>                                                          <C>                <C>    
                     ASSETS
Cash and cash equivalents                                          11,000            727,000
Restricted Cash                                                    32,000            242,000
Prepaid expense and other assets                                   43,000                  0
                                                             ------------       ------------
           Total assets                                      $     86,000       $    969,000
                                                             ============       ============



                 LIABILITIES AND
              BENEFICIARIES' EQUITY

Liabilities:
          Other liabilities                                        68,000             26,000
                                                             ------------       ------------
          Total liabilities                                        68,000             26,000
                                                             ------------       ------------



Beneficiaries' equity:
  Units of beneficial interest                                 12,737,000         12,737,000
  Notes receivable from beneficiaries                            (204,000)
                                                                                    (251,000)
  Reserve for beneficiaries notes receivable                      186,000            186,000
  Distributions in excess of accumulated earnings             (12,701,000)       (11,729,000)
                                                             ------------       ------------
          Total beneficiaries' equity                              18,000            943,000
                                                             ------------       ------------
            Total liabilities and beneficiaries' equity      $     86,000       $    969,000
                                                             ============       ============
</TABLE>


                 The accompanying notes are an integral part of
                           these financial statements.


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<PAGE>   4
              GRUBB & ELLIS REALTY INCOME TRUST, LIQUIDATING TRUST
                        STATEMENTS OF INCOME AND EXPENSE

                                   (UNAUDITED)
                                    _________


<TABLE>
<CAPTION>
                                                   Quarter Ended                     Nine Months Ended   
                                            -----------------------------       -----------------------------
                                           September 30,     September 30,     September 30,     September 30,
                                               1997              1996              1997              1996 
                                            -----------       -----------       -----------       -----------
<S>                                        <C>               <C>               <C>               <C>        
Income:
   Other Income                             $    25,000       $         0       $    25,000       $         0
   Rental income                                    ---           318,000               ---           712,000
   Gain (Loss) on Sale of Investment            (35,000)          491,000          (180,000)          491,000
   Short-term investment interest
       and other income                           4,000                 0            11,000                 0
                                            -----------       -----------       -----------       -----------
                                                 (6,000)          809,000          (144,000)        1,203,000
                                            -----------       -----------       -----------       -----------

Expenses:
   Rental operating expenses                          0           126,000            27,000           279,000
   Interest on mortgage loan                        ---         1,709,000                 0         1,998,000
   Depreciation                                     ---            39,000                 0           133,000
   Directors' fees and expenses                     ---             4,000                 0            12,000
   General and administrative expenses           39,000            26,000            70,000            55,000
                                            -----------       -----------       -----------       -----------
          Total expenses                         39,000         1,904,000            97,000         2,477,000
                                            -----------       -----------       -----------       -----------
          Net income (loss) before     
              extraordinary items               (45,000)       (1,905,000)         (241,000)       (1,274,000)
                                            -----------       -----------       -----------       -----------
          Extraordinary Items                         0           (12,000)                0           (12,000)
                                            -----------       -----------       -----------       -----------
            Net income (loss)                   (45,000)       (1,107,000)         (241,000)       (1,286,000)
                                            ===========       ===========       ===========       ===========

Net income (loss) per unit                  $      (.01)      $      (.39)      $      (.09)      $      (.46)
                                            ===========       ===========       ===========       ===========

Average number of units utilized in
     net income (loss) per unit             $ 2,803,169       $ 2,803,169       $ 2,803,169       $ 2,803,169
                                            ===========       ===========       ===========       ===========
</TABLE>

                 The accompanying notes are an integral part of
                           these financial statements.


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<PAGE>   5
              GRUBB & ELLIS REALTY INCOME TRUST, LIQUIDATING TRUST
                            STATEMENTS OF CASH FLOWS
 
                                  (UNAUDITED)
                                   _________   


<TABLE>
<CAPTION>
                                                                       For the Nine Months
                                                                              Ending
                                                                   ------------------------------
                                                                  September 30,     September 30,
                                                                       1997             1996
                                                                   -----------       ------------
<S>                                                               <C>               <C>          
Cash flows from operating activities:
   Net income (Loss):                                              $  (241,000)      $ (1,286,000)

Adjustments to reconcile net income (Loss):
   Depreciation and amortization                                             0            133,000
   Increase (decrease) in other liabilities                           (973,000)         1,448,000
   Decrease (increase) in prepaid expenses and other assets            (16,000)           (17,000)
                                                                   -----------       ------------
          Net cash provided by operating activities                 (1,230,000)           278,000

Cash flows from investing activities:
   Proceeds from sale                                                        0        (12,697,000)
   Property development costs                                                0         (4,389,000)
                                                                   -----------       ------------
          Net cash provided by (used in) investing activities                0          8,308,000

Cash flows from financing activities:
   Dividends paid                                                     (880,000)                 0
   Decrease (increase) in restricted cash                            1,813,000         (1,841,000)
   Principal payments on mortgage loan payable                               0         (7,770,000)
   Construction loan proceeds                                              ---          3,598,000
                                                                   -----------       ------------
       Net cash used in financing activities                                 0         (6,013,000)
                                                                   -----------       ------------
            Net decrease in cash and cash equivalents                 (933,000)         2,573,000

Cash and cash equivalents, beginning of period                         308,000             64,000
                                                                   -----------       ------------
Cash and cash equivalents, end of period                           $    11,000       $  2,637,000
                                                                   ===========       ============

Supplementary information:
   Cash paid for interest                                          $         0       $  1,992,000
                                                                   ===========       ============
</TABLE>


                 The accompanying notes are an integral part of
                           these financial statements.


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              GRUBB & ELLIS REALTY INCOME TRUST, LIQUIDATING TRUST
                     NOTES TO CONDENSED FINANCIAL STATEMENTS


1.   Organization of the Trust:

     Grubb & Ellis Realty Income Trust, Liquidating Trust (the Trust), a
     California trust, was organized under an agreement dated May 14, 1992,
     between the Trustees and Grubb & Ellis Realty Income Trust (the Company)
     whereby the trustees received all of the assets and assumed all of the
     liabilities of the Company, which was subsequently dissolved. The purpose
     of the Trust was to liquidate the remaining Trust property in a manner to
     conserve and protect the liquidating trust estate, and to collect and
     distribute the income and proceeds to the beneficiaries of the Trust by May
     15, 1995, the date of intended termination. As further explained in Note 3,
     although the purpose of the Trust remains the same, the disposition plans
     for the Trust's remaining property, the Vintner Square Shopping Center
     (formerly the Livermore Arcade Shopping Center), are such that the Trust's
     liquidation period has extended beyond May 1995.


2.   Basis of Presentation:

     The financial statements included herein have been prepared by the Trust,
     without audit, pursuant to the rules and regulation of the Securities and
     Exchange Commission for reporting on Form 10-Q. Certain information and
     footnote disclosures normally included in financial statements prepared in
     accordance with generally accepted accounting principles have been
     condensed or omitted pursuant to such rules and regulations. In addition,
     certain reclassifications have been made to the prior year financial
     statements to conform to the current year's presentation. The statements
     should be read in conjunction with the Company's report on Form 10-K for
     the year ended December 31, 1996 and the audited financial statements
     included therein.

     In the opinion of the Trustees, the financial statements reflect all
     adjustments necessary for a fair presentation of financial position,
     results of operations, and cash flows for the interim period presented. The
     results of operations for the nine-month period ended September 30, 1997
     are not necessarily indicative of the results to be expected for the full
     year.


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              GRUBB & ELLIS REALTY INCOME TRUST, LIQUIDATING TRUST
                     NOTES CONDENSED TO FINANCIAL STATEMENTS

3.   Net Real Estate Investment:

     Prior to the inception of the Trust, the Vintner Square Shopping Center
     property became subject to an environmental clean-up and remediation
     program to remedy soil contamination caused by a former tenant. As of May
     15, 1992 (date of inception) $241,000 had been paid in connection with the
     testing and remediation program. During 1993, the procedures required to
     complete the remediation were approved by the Regional Water Quality
     Control Board (RWCB). The Trust had taken legal action against the former
     tenant, previous owners and other related parties of the property in order
     to recover all costs of the clean-up program. A settlement agreement and
     general release was executed on January 18, 1994 which shifted the
     liability for the clean-up to a separate entity and incorporated the RWCB's
     plan approval. On April 30, 1996 the Trust received a No Further Action
     Letter from the Regional Water Quality Control Board indicating that the
     clean-up requirements imposed by the RWCB have been satisfied and that a
     monitoring program will be required for a period of approximately 24
     months.

     Due to the environmental clean-up program, plans to expand and ultimately
     sell the Vintner Square Shopping Center were delayed. However, on July 7,
     1995, the Trust executed a loan agreement which provided funds for
     financing the rehabilitation and expansion of the shopping center. In
     addition, the Trust finalized lease renewals with the three major tenants
     in the center, Orchard Supply Hardware, Long's Drugs and Safeway Stores.
     The renewed leases result in increased annual rental income and expire in
     the years 2011 and 2016.

     The Orchard Supply lease involved a build-to-suit agreement for a new
     building. Construction activities started in July, 1995 and include the
     demolition of a portion of the shopping center. The Trust recorded a
     reserve approximating $1,300,000 in the quarter ended June 30, 1995, to
     reflect a reduction in the net book value of buildings and improvements for
     those assets being demolished. The new Orchard Supply building was
     completed on April 1, 1996. The construction schedule called for the
     completion of 20,000 sq. ft of new shop space at various intervals from May
     24, 1996 to August 15, 1996. The rehabilitation of the original
     undemolished shop space and the existing Safeway and Long's stores was
     completed in August, 1996.

     The Trust recorded an additional net realizable value reserve allowance of
     $1,300,000 as of June 30, 1995 and increased the reserve to $1,500,000 as
     of December 31, 1995.


                                    Continued


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              GRUBB & ELLIS REALTY INCOME TRUST, LIQUIDATING TRUST
                     NOTES CONDENSED TO FINANCIAL STATEMENTS

4.    Restricted Cash

The Vintner Square Shopping Center was sold on September 18, 1996. As part of
the Sales Agreement, the Buyer's lender held-back the distribution of $1,234,000
pending completion of tenant improvement construction. The tenant improvements
were substantially completed in February, 1997. Various lender requirements such
as Tenant Estoppel Statements and Certificates of Occupancy from the City of
Livermore have been delivered to the Lender. Distribution of $992,000 of these
funds to the Trust was made in June, 1997 and an additional $166,000 was
distributed in July, 1997. Distributions of the remaining balance of these funds
has been held-up by the buyer of the shopping center as a result of a dispute
involving post-closing adjustments. The Trust has been aggressively attempting
to resolve this dispute since June, 1997. It is currently anticipated that final
resolution should be accomplished prior to December 31, 1997.


                                    Continued


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<PAGE>   9
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS


Changes in Financial Condition:


Cash and cash equivalents decreased from June 30, 1997 to September 30, 1997 by
$716,000 due to a cash distribution to unit holders in the amount of $880,000.


Results of Operations:

     Nine Months Ended September 30, 1997 Compared to the Nine Months Ended
     September 30, 1996:

     A $241,000 loss was recorded in the nine months ended September 30, 1997 as
     compared with a loss of $1,286,000 in the comparable period in 1996. This
     is a result of the shopping center operating expenses, construction loan
     interest and depreciation charges partially offset by rental income and
     gain on sale of the property that were recorded prior to sale in September,
     1996.


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<PAGE>   10
                           PART II - OTHER INFORMATION


Items 1 through 4 are not applicable.


Item 5, Exhibits and Reports on Form 8-K:

None


                                    10 of 11


<PAGE>   11
                                   SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) 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.

                                        GRUBB & ELLIS REALTY INCOME TRUST,
                                        LIQUIDATING TRUST

                                        By:  /s/ Harold A. Ellis Jr.
                                           -------------------------------  
                                           Harold A. Ellis, Jr., Trustee

Dated:  November 13, 1997