UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    Form 10-Q

                   QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


                         For Quarter Ended June 30, 1998

                          Commission File Number 1-8893


                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)


          DELAWARE                                      59-2501059
---------------------------------        ---------------------------------------
(State of other jurisdiction             (I.R.S. Employer Identification Number)
of incorporation or organization)



     2501 S. Ocean Drive
     Hollywood, Florida                                           33019
----------------------------------------                        ----------
(Address of principal executive offices)                        (Zip Code)


Registrant's telephone number, including area code (954) 927-3080
                                                   --------------

                                      NONE
--------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report


Indicate by checkmark  whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                        YES   [ X ]     NO [   ]


Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.

           CLASS                          Outstanding at June 30, 1998
 Limited Partnership Units                     4,485,504 units

<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP

                                      INDEX


                                                                     Page Number
                                                                     -----------

PART I.   Financial information

            Balance sheets -
              June 30, 1998 and
              September 30, 1997                                         2

            Statements of income -
              Three months and nine months ended
              June 30, 1998 and 1997                                     3

            Statements of cash flows -
              Three months and nine months ended
              June 30, 1998 and 1997                                    4-5

            Notes to financial statements                                6

            Management's discussion and analysis
            of financial condition                                      7-10


Part II.  Other information and signatures                             11-12



<PAGE>
<TABLE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
                                 BALANCE SHEETS

<CAPTION>
                                                      June 30,       September 30,
                                                        1998             1997
                                                     ----------       ----------
                                                     (unaudited)
<S>                                                  <C>              <C>       
                    ASSETS

Cash .........................................       $   30,128       $   48,738
Mortgage notes and other receivables:
  Mortgage receivable ........................             --            101,250
  Other receivables ..........................            1,241          275,303
Property held for sale .......................        4,153,845        4,739,939
Other assets .................................           79,373           62,944
                                                     ----------       ----------
                                                     $4,264,587       $5,228,174
                                                     ==========       ==========

           LIABILITIES AND EQUITY


Liabilities:
  Mortgage payable, bank .....................       $1,038,152       $1,675,972
  Accounts payable and accrued
    liabilities ..............................          843,855          761,325
  Estimated cost of development
    of land and property sold ................             --             30,142
                                                     ----------       ----------
                                                      1,882,007        2,467,439

Equity:
  Partners' equity, 4,485,504 units
    outstanding ..............................        2,382,580        2,760,735
                                                     ----------       ----------
                                                     $4,264,587       $5,228,174
                                                     ==========       ==========
</TABLE>


                        See notes to financial statements



                                      -2-
<PAGE>
<TABLE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
                            STATEMENTS OF OPERATIONS
                       THREE MONTHS AND NINE MONTHS ENDED
                             JUNE 30, 1998 AND 1997
                                   (UNAUDITED)
<CAPTION>
                                  Three Months Ended      Nine Months Ended
                                       June 30,                June 30,
                                ---------------------   ----------------------
                                   1998        1997        1998        1997
                                ---------   ---------   ----------  ----------
<S>                             <C>         <C>         <C>         <C>       
Revenues                        $ 618,981   $ 327,224   $1,728,506  $2,307,755
                                ---------   ---------   ----------  ----------

Cost and expenses:

  Cost of sales                   499,621     305,115    1,370,755   1,198,078
  Selling, general and
    administrative expenses       185,998     152,308      499,861     569,107
  Interest                         31,282        -          54,617      33,434
  Depreciation and
    property taxes                 70,094       2,209      181,428      97,352
                                ---------   ---------   ----------  ----------
      Total costs and expenses    786,995     459,632    2,106,661   1,897,971
                                ---------   ---------   ----------  ----------

Net income (loss)               $(168,014)  $(132,408)  $ (378,155) $  409,784
                                =========   =========   ==========  ==========

Net income (loss) per unit      $   (0.04)  $   (0.03)  $    (0.08) $     0.09
                                =========   =========   ==========  ==========

Weighted average number of
  units outstanding             4,485,504   4,485,504    4,485,504   4,485,504
                                =========   =========   ==========  ==========

</TABLE>


                        See notes to financial statements

                                      -3-
<PAGE>
<TABLE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
                            STATEMENTS OF CASH FLOWS
                       THREE MONTHS AND NINE MONTHS ENDED
                             JUNE 30, 1998 AND 1997
                                   (UNAUDITED)

<CAPTION>
                                               Three Months Ended                Nine Months Ended
                                                     June 30,                         June 30,
                                          ----------------------------      ----------------------------
                                              1998             1997            1998              1997
                                          -----------      -----------      -----------      -----------
<S>                                       <C>              <C>              <C>              <C>        
Cash flows from operating activities:

  Cash was received from:
    Collections on sales
     and receivables                      $   687,577      $   192,000      $ 1,850,032      $ 2,170,945
    Interest income                               702              224            6,821              810
    Sale of utility system                       --               --            228,660          127,393
    Other                                         399             --             18,305            1,000
                                          -----------      -----------      -----------      -----------
                                              688,678          192,224        2,103,818        2,300,148
                                          -----------      -----------      -----------      -----------

  Cash was expended for:
    Selling, administrative
      and property taxes                      159,487          114,879          566,444        1,052,643
    Interest paid (net of
      amounts capitalized)                     31,282             --             54,617           79,307
    Improvements to property                   59,244          377,934          863,547          902,291
                                          -----------      -----------      -----------      -----------
                                              250,013          492,813        1,484,608        2,034,241
                                          -----------      -----------      -----------      -----------

Net cash provided by (used
  in) operating activities                    438,665         (300,589)         619,210          265,907
                                          -----------      -----------      -----------      -----------

Cash flow from financing activities:
  Proceeds from mortgage
    notes payable: Bank                          --            363,820          662,180          731,046
  Payments on mortgage
    payable: Bank                            (500,000)        (100,000)      (1,300,000)        (180,000)
             General partner                     --               --               --           (527,248)
             Related party                       --               --               --           (325,000)
                                          -----------      -----------      -----------      -----------

     Net cash provided by
      (used in) financing
      activities                             (500,000)         263,820         (637,820)        (301,202)
                                          -----------      -----------      -----------      -----------

Net increase (decrease)
 in cash                                      (61,335)         (36,769)         (18,610)         (35,295)

Cash, beginning of period                      91,463           42,925           48,738           41,451
                                          -----------      -----------      -----------      -----------

Cash, end of period                       $    30,128      $     6,156      $    30,128      $     6,156
                                          ===========      ===========      ===========      ===========

</TABLE>
                        See notes to financial statements

                                      -4-
<PAGE>
<TABLE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
                            STATEMENTS OF CASH FLOWS
                     RECONCILIATION OF NET LOSS TO NET CASH
                          USED IN OPERATING ACTIVITIES
            THREE MONTHS AND NINE MONTHS ENDED JUNE 30, 1998 AND 1997
                                   (UNAUDITED)
<CAPTION>

                                     Three Months Ended           Nine Months Ended
                                          June 30,                     June 30,
                                 ------------------------      ------------------------
                                    1998           1997           1998          1997
                                 ---------      ---------      ---------      ---------
<S>                              <C>            <C>            <C>            <C>      
Net income (loss)                $(168,014)     $(132,408)     $(378,155)     $ 409,784
                                 ---------      ---------      ---------      ---------

Adjustments to reconcile net
  income (loss) to net cash
  provided by (used in)
  operating activities:

  Depreciation                         472            688          1,534          2,066
Change in assets and
  liabilities:

    Increase in:
      Mortgage notes and
        other receivables             --         (143,717)          --          (14,971)
      Property held for sale          --         (143,469)          --             --
      Other assets                 (40,171)       (58,129)       (17,963)       (14,366)
      Accounts payable and
        accrued liabilities        151,481        176,446         82,530           --
    Decrease in:
      Mortgage notes and
        other receivables           69,697           --          375,312           --
      Property held for sale       425,200           --          586,094        356,466
      Accounts payable and
        accrued liabilities           --             --             --         (473,072)
      Estimated costs of
        development of land
        and property sold             --             --          (30,142)          --
                                 ---------      ---------      ---------      ---------
Total Adjustments                  606,679       (168,181)       997,365       (143,877)
                                 ---------      ---------      ---------      ---------

Net cash flow provided by
  (used in) operating
  activities                     $ 438,665      $(300,589)     $ 619,210      $ 265,907
                                 =========      =========      =========      =========
</TABLE>

                       See notes to financial statements.

                                      -5-
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
                          NOTES TO FINANCIAL STATEMENTS
                       THREE MONTHS AND NINE MONTHS ENDED
                             JUNE 30, 1998 AND 1997

1. Interim financial statements:

         The accompanying  unaudited financial  statements have been prepared in
         accordance with the instructions to Form 10-Q and do not include all of
         the information and footnotes required by generally accepted accounting
         principles  for  complete  financial  statements.  In  the  opinion  of
         management,  all adjustments  (consisting of normal recurring accruals)
         considered  necessary  for a  fair  presentation  have  been  included.
         Operating  results  for the nine  months  ended  June 30,  1998 are not
         necessarily  indicative  of the results  that may be  expected  for the
         fiscal year ending September 30, 1998. These statements  should be read
         in conjunction with the financial statements and notes thereto included
         in the  Company's  Annual Report on Form 10-K for the fiscal year ended
         September 30, 1997.


2. Income tax:

         The  Partnership has made no provision for income taxes since it is not
         subject to income taxes.  Instead, the partners are required to include
         in their income tax returns  their share of the  Partnership's  taxable
         income or loss.




                                      -6-
<PAGE>
                  ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                CONDITION AND RESULTS OF OPERATIONS THREE MONTHS
                  AND NINE MONTHS ENDED JUNE 30, 1998 AND 1997
                                   (UNAUDITED)

         Results of Operations

         During  the three  month  periods  ended  June 30,  1998 and 1997,  the
Partnership had revenues totaling $618,981 and $327,224,  respectively,  and net
losses,  respectively,  of ($168,014)  or ($0.04) per unit,  compared with a net
loss of  ($132,408)  or ($0.03) per unit.  During the three month  periods ended
June  30,  1998,  revenues  derived  almost  entirely  from  from the sale of 21
residential  lots from Phase II of the  Crestwood  tract for gross  proceeds  of
$598,500.

                  During the nine month  periods  ended June 30,  1998 and 1997,
the Partnership had revenues totaling  $1,728,506 and $2,307,755,  respectively,
and a net loss of  ($378,155)  or ($0.08 per unit),  compared with net income of
$409,784,  or $0.09 per unit in the prior  year.  During the nine  month  period
ending June 30,  1998,  revenues  derived  almost  entirely  from the sale of 59
residential losts from Phase II of the Crestwood tract.

         Since the Partnership's  activities consist  principally of the sale of
its  remaining  properties,  and the timing of  closing  dates for such sales is
usually subject to  contingencies  which often result in changes to such closing
dates,  a  comparison  of sales and income  results from  comparable  periods in
different years or successive quarters is not considered meaningful.

         Liquidity and Capital Resources

         Proceeds from collections on sales and receivables for the three months
ended June 30, 1998 totalled $687,577,  and after cash expenditures for selling,
administrative  expenses and property taxes,  interest paid and  improvements to
property held for sale the net cash provided by operating  activities amounts to
$438,665.  The Company made payments on mortgages  payable  during the period of
$500,000.  As a result, the Partnership's  cash balances,  which were $91,463 at
March 31, 1998 decreased to $30,128 at June 30, 1998. See Financial  Information
Statements of Cash Flows.

         The  Partnership's  future revenues will depend solely upon its ability
to develop and/or sell its remaining real estate, and upon receipts from a prior
sale of a utility plant. The Partnership's properties are described in Item 2 of
its report on Form 10-K for the year ended September 30, 1997 (the "Incorporated
1997 10K"). An extract from the  Incorporated  1997 10K containing Items 1 and 2
thereof is annexed to this  report as an Exhibit and is  incorporated  herein by
reference. The development and marketing status of these properties is described
in Item 2 of the Incorporated 1997 10-K.

         At June 30, 1998, the Partnership retained and was holding for sale (1)
99 residential  lots and  commercial  property in the  "Crestwood"  tract in the
Village,  (2) multi-family zoned land in the Crestwood tract presently zoned for
a total of  approximately  394 units,  (3) a tract of 4.54 acres in the  Village
zoned for  approximately 84 multi-family  residential  units (4) 171 lots in the
vicinity of the Village  zoned for single family homes but presently the subject


                                      -7-
<PAGE>
of litigation as to the availability of building  permits,  (5) a 470-acre tract
in the vicinity of the Village,  and (6) 12 acres in the vicinity of the Village
being jointly  developed with an unrelated  party - see "Acreage in the Vicinity
of the Village.

         As described in Item 2 of the Incorporated 1997 10K, the Partnership is
committed to the continuing  development of phases II and III of the "Crestwood"
single-family  tract  as  the  most  efficacious  manner  in  which  to  enhance
liquidation  values.  Between  1995  and  1997,  the  Partnership  substantially
completed the off-site and on-site improvements  required for the development of
the  198  lots  in the  Crestwood  single-family  residential  subdivision.  The
construction  cost was  financed  partially  through  the  issuance of bonds and
partially  with  development  financing  obtained from Union Bank of Florida.  A
total of $2,918,152 was borrowed from Union Bank of Florida, of which $1,038,152
was outstanding as of June 30, 1998. The loan,  which bears interest at 2% above
the bank's prime lending rate,  was originally to mature on January 31, 1998 but
has been extended  until  September 17, 1999. As closings of lot sales are held,
the  Partnership  is  obligated  to pay down the bank at the rate of $20,000 per
lot.  The  remaining  cost of the  development  was financed  utilizing  the net
proceeds  ($1,074,000)  of  bonds  issued  by the  Indian  Trail  Water  Control
District,  a governmental  authority.  The bonds are a direct  obligation of the
District  (and not of the  Partnership)  and are  repayable as to principal  and
interest  from  taxes  levied  on the  lots in the  Crestwood  subdivision.  The
issuance  of the bonds  increased  the  annual  real  estate  tax on the  entire
subdivision by  approximately  $117,000,  or $600 per lot. As lots are sold, the
responsibility  for payment of the taxes passed from the  Partnership to the lot
purchasers.

     Under the  Partnership's  agreement  with Lennar  Homes,  Inc.  ("Lennar"),
executed in August,  1996,  (as described in the  Incorporated  1997 10K) Lennar
contracted  to  purchase  86 lots  over a two  year  period  in  Phase II of the
Residential  Tract for an aggregate of $2,451,000.  A closing on 8 lots occurred
prior to September 30, 1997,  resulting in gross proceeds to the  Partnership of
approximately  $225,500 and net proceeds,  after  mandatory  loan  reductions of
$20,000  per lot and  brokerage  commissions  and other and  closing  costs,  of
approximately  $43,000. An additional 16 lots were sold to Lennar and one lot to
another  builder during the quarter ended December 31, 1997 for aggregate  gross
proceeds of $484,500  and net  proceeds,  after  mandatory  loan  reductions  of
$20,000 per lot and brokerage  commissions  and other selling and closing costs,
of approximately  $96,000. There were no sales pursuant to this agreement in the
quarters  ended March 31 1998.  During the  quarter  ended June 30, 1998 21 lots
were sold pursuant to this  agreement for aggregate  gross  proceeds of $598,500
and  net  proceeds  (after  manadatory  loans  reductions,   closing  costs  and
commissions of $469,000) were approximately $129,500.

         During the current  fiscal year, and based upon  management's  judgment
that ordinary operating expenses will not increase, the Partnership  anticipates
that cash flow and  liquidity  requirements  will be satisfied by the Union Bank
financing  described above, land sales,  contingent  utility receipts  described
"Utility Contingent  Receipts" in the Incorporated 1997 10K, and bank financing.
As above indicated, however, sales of land are subject to conditions which might
not  be  satisfied,  although  the  Partnership  has  no  present  knowledge  of
circumstances which would render likely the non-satisfaction of such conditions.

                                       -8-
<PAGE>
         Affect of Land Sales on Future Cash Flow

The Partnership's future revenues will depend solely upon its ability to develop
and/or sell its remaining real estate,  and upon receipts from a prior sale of a
utility plant.  At June 30, 1998, the  Partnership  retained and was holding for
sale (1) 99 residential lots and commercial property in the"Crestwood"  tract in
the Village,  (2) multi-family zoned land in the Crestwood tract presently zoned
for a total of approximately 394 units, (3) a tract of 4.54 acres in the Village
zoned for  approximately 84 multi-family  residential  units (4) 171 lots in the
vicinity of the Village with zoning which permits  construction of single family
homes but presently the subject of litigation as to the availability of building
permits,  (5) a 470-acre tract in the vicinity of the Village,  and (6) 12 acres
in the vicinity of the Village being jointly developed with an unrelated party -
see "Acreage in the  Vicinity of the  Village.  The  development  and  marketing
status of these properties is described in the Incorporated 1997 10-K.

         Although the Partnership has contracted to sell substantial portions of
its residential land inventory,  the requirement to repay indebtedness  incurred
to finance  necessary on and off-site  development work required by the terms of
sales  contracts  makes  unlikely  distributions  to partners at least until the
latter part of fiscal 1999, and  distributions in 1999 or thereafter will depend
upon the rate of sales of remaining  land, and the prices  obtainable  therefor,
and  collection  of  Contingent  Utilities  Receipts  described in Item 2 of the
Incorporated 1997 10-K.

         Total net cash flow which might become  available for  distribution  is
also unpredictable due to uncertain  conditions in the South Florida real estate
market  in which  the  Partnership's  remaining  real  estate  is  located,  and
competition from other owners and developers of real estate in the South Florida
market.  These  conditions  will continue to affect the realizable  value of the
Partnership's  remaining land, including decisions by parties holding options on
the Partnership's land to exercise such options in whole or in part. The rate of
construction in the Village of Royal Palm Beach could also significantly  affect
future  payments  to the  Partnership  under the  contract  described  under the
caption "Utilities Contingent  Receivable" under Item 2 of the Incorporated 1997
10-K. As indicated  under such caption,  it is now considered  unlikely that the
rate of new  construction  or water  consumption in such area will increase to a
level which is sufficient to enable the  Partnership to receive the full amount,
or even a substantial  portion of such maximum  payments prior to the expiration
of the contingent payment term.

         Cost of Sales

         Cost of sales  relates to the sales of land as  discussed  above.  This
item varies as a result of  dissimilar  profit  margins  and income  recognition
methods on the various sales of land and buildings as discussed above.  Selling,
Administrative and other expenses Selling,  general and administrative expenses,
have not varied significantly between the periods.

         Interest Expense

         During the nine months  ended June 30, 1998  interest of  approximately
$115,000 was incurred and $61,000 was capitalized.  During the nine months ended
June 30, 1997 interest of  approximately  $169,000 was incurred and $136,000 was
capitalized.


                                      -9-
<PAGE>
         Income Taxes

         The Partnership,  pursuant to the transitional grandfather rules of the
Internal  Revenue Code dealing with publicly traded  partnerships,  has reported
its  income as a  Partnership.  The  application  of the  grandfather  rules was
scheduled to terminate for the taxable year commencing  after December 31, 1997.
Under the  recently  enacted  Taxpayer  Relief Act of 1997,  a  publicly  traded
partnership  that is currently  governed by this provision may elect to continue
its Partnership tax status beyond December 31, 1997 by agreeing to pay an annual
3.5%  Federal  Tax  on  its  gross  income  for  Federal   Income  Tax  purposes
(principally  revenues  less cost of land sold)  from the  conduct of its active
trade or business. The Partnership has made such election. These provisions will
become operativeas to the Partnership for the taxable year commencing October 1,
1998.


                                      -10-
<PAGE>



                           PART II - OTHER INFORMATION




         (a)  Exhibits  - 99- Copy of Items 1 and 2 from  Annual  Report  of the
              Registrant  on Form 10-K for the fiscal year ended  September  30,
              1997.

         (b)  Reports on Form 8-K - None







                                      -11-

<PAGE>


                                   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.


                                                        ROYAL PALM BEACH COLONY,
                                                        LIMITED PARTNERSHIP  
   
                                                  By:   Stein Management    
                                                        Company,Inc.
                                                        Managing General Partner

 DATE: August 17, 1998                            By:   /s/ Irving Cowan
                                                        ---------------------
                                                        Irving Cowan
                                                        President


                                      -12-