Item 1. Business

 (a) General Development Of Business

Royal  Palm  Beach  Colony,   Limited  Partnership  (the  "Partnership"  or  the
"Registrant")   was  organized  under  the  Delaware   Revised  Uniform  Limited
Partnership  Act. The  Partnership  is a successor  to Royal Palm Beach  Colony,
Inc.,  (the  "Predecessor  Company") a Florida  corporation  organized  in 1963.
Pursuant to a Plan of Complete Liquidation (the "Plan"), the Predecessor Company
transferred  all of its  assets,  subject  to  all  of its  liabilities,  to the
Partnership  in exchange for a number of  partnership  units  ("Units")  exactly
equal to the  number  of  shares  of  common  stock of the  Predecessor  Company
outstanding on July 11, 1985 (the "Effective Date").

On the  Effective  Date,  the Units were  distributed  to the former  holders of
common  stock of the  Predecessor  Company on the basis of one (1) Unit for each
share  of  common  stock  of the  Predecessor  Company.  The  Partnership,  as a
successor to the Predecessor  Company, has registered its Units under Section 12
(b) of the  Securities  Exchange  Act of 1934.  Under the Amended  Agreement  of
Limited  Partnership  of the  Registrant,  the term of the  Partnership  expires
December  31,  2005,  unless  extended by vote of a majority of the  partnership
units.   Trading  in   Partnership   Units  The  Units  are  currently   trading
over-the-counter under the symbol "RPAMZ."

Results of Liquidation Activities

The Partnership's  principal business has been to operate, manage and dispose of
the assets which were transferred to it on the Effective Date by the Predecessor
Company. Since the Effective Date of the Predecessor Company's liquidation,  the
Partnership has engaged in a program of asset disposition  resulting in the sale
of assets for an aggregate gross consideration of $77,878,215.

As of December  30,  1999,  the  Partnership  had  distributed  an  aggregate of
$31,398,752,  or $7.00 per Unit, to the general and limited partners,  including
$2,242,752,  or $0.50 per Unit which was distributed in October 1999. See Item 5
- Market for the  Registrant's  Common  Equity and Related  Stockholder  Matters
"Prior  Distributions."  As of December 30, 1999,  the  Partnership's  remaining
assets consisted principally of:

         (1) a  50%  interest  in  3.2  acres  of  commercial  property  in  the
"Crestwood" tract in the Village of Royal Palm Beach under option for sale for a
price which would generate gross  proceeds to the  Partnership of  approximately
$250,000;

         (2) 45 residential lots in the Crestwood single family tract reacquired
in  1999  as a  result  of  the  Partnership's  acceptance  of a  deed  in  lieu
offoreclosure,  and  currently  under  contract  for sale  (subject  to  certain
contingencies) for gross proceeds of $1,316,250;

         (3) a tract of 4.54 acres in the  Village  zoned for  approximately  84
multi-family  residential  units,  currently  under a contract of sale for gross
proceeds of $350,000,  the closing of which is subject to several contingencies;

         (4) 162 lots in the  vicinity  of the Village of Royal Palm Beach zoned
for  residential  use  but  presently  the  subject  of  litigation  as  to  the
availability of building permits; and

         (5) a tract of  approximately  22 acres in the  Crestwood  multi-family
tract currently  under contract of sale for $1,870,000,  the closing of which is
subject to numerous contingencies.
<PAGE>
Factors Affecting Future Operations and Distributions

The  availability  of cash for  distribution  in the future  will  depend upon a
variety of factors not currently determinable.

Management has now  substantially  completed the development and sale of most of
the Partnership's  remaining land in Palm Beach County.  After a number of years
in which  cash was not  available  for  distribution  as a result of the need to
expend  substantial  sums to develop its properties in order to enhance ultimate
sale  values,  a  distribution  of  $2,242,752,  or $0.50 per Unit,  was made in
October, 1999. See Item 2 - "Development and Sale of Residential Lots;" and Item
7 -- "Management Discussion and Analysis of Financial Condition -- Liquidity and
Capital Resources." Although additional portions of the Partnership's  remaining
properties are under contract of sale,  and the  Partnership  expects to receive
future  collections  of  contingent  receivables  relating  to a prior sale of a
utility  plant,  it is  currently  uncertain  when  additional  cash will become
available for distribution.  See Item 2 -- Properties, for a discussion of other
sources of and  anticipated  timing of the receipt of revenue  which will affect
future distributions.

(b) Financial Information About Industry Segments

 Not applicable.

(c) Narrative Description Of The Business

Regulation

Development and sales  operations of the Partnership or by potential  purchasers
of real estate from the Partnership  have been subject to regulation by a number
of local,  state and  federal  agencies  concerning  the  nature  and  extent of
improvements,  and compliance with zoning  regulations,  building codes,  health
requirements and environmental protection.  The Partnership believes that it has
been in substantial  compliance with all such laws and regulations  which affect
its properties  and that it has developed the properties to the extent  required
by contract or law. If such laws or regulations are amended, in particular those
concerning environmental protection,  the cost of compliance could be increased.
Reference is made to the discussion concerning the impact of land use regulatory
issues affecting salability of certain properties remaining in Palm Beach County
in Item 2 -- Properties -- "Acreage in the Vicinity of the Village."
<PAGE>

Competition

The real estate business conducted by the Partnership is highly competitive. The
Partnership's  sales  of  its  remaining  land  will  compete  with  surrounding
developments,  and  with  owners  of  tracts  of  land  in the  area  of all its
properties.  There  are  substantial  tracts  of  vacant  land  and  land  under
development  in the general  area of most of the  Partnership's  remaining  real
estate. These competitive considerations could affect the decisions of potential
purchasers  of the  Partnership's  remaining  properties.  The  Partnership  has
historically  marketed its properties  through direct mail  advertising to major
brokers and developers,  advertisements in major regional  newspapers and direct
contacts  between  officers  of the  Managing  General  Partner  and real estate
developers and brokers.  The  Partnership  is currently  marketing its remaining
properties  through local real estate  brokers,  including RTL Realty,  of which
Randy Rieger is a partner. Mr. Rieger served as interim Vice President and Chief
Operating  Officer  of  the  Partnership's   managing  general  partner  between
September 1995 and February 1996. Mr. Rieger currently  provides  services as an
independent consultant to the Partnership for management services in addition to
ongoing brokerage services.

See Item 13 -- "Certain Relationships and Related Transactions."

Impact of General Economic Conditions

The  development  and sale of real estate occurs within a historically  cyclical
market, and is significantly influenced by general economic conditions. Sales of
housing units and sales of tracts to builders are  particularly  affected by the
costs and  availability of mortgage  financing and the rise and fall of interest
rates in general..  If significant  interest rate increases occur in the future,
the real estate market could suffer as a result.

Personnel:

As of December 30, 1999, Stein Management Company, Inc.  ("Steinco")the Managing
General  Partner,  employed 1 person,  who acts as an administrator of its books
and  records.  The  balance of the  Partnership's  affairs  are  carried  out by
independent  brokers,  contractors and other  consultants under the direction of
the Board of Directors of Steinco. See Item 10.

Office Facilities:

The  Partnership's  executive  headquarters  are located at 2501 S. Ocean Drive,
Hollywood, Florida 33019. The premises are owned by an affiliate of Hasam Realty
Limited  Partnership  ("Hasam L.P."), a general partner of the Partnership,  and
are being made available to the Partnership as an accommodation without charge.

Item 2. Properties

Palm Beach County, Florida

The Company originally owned approximately 26,000 acres in Palm Beach County, in
southeastern  Florida,  approximately  4,200 of which  were  located  within the
Village.   The  Village  of  Royal  Palm  Beach  The  Village,  an  incorporated
municipality,  is  approximately  eight miles from the Palm Beach  International
Airport and eleven miles west of Palm Beach.  Two major area highways,  Southern
Boulevard and Okeechobee  Road,  lead directly from Palm Beach through West Palm
Beach to the Village.  The Village has a population of approximately  16,000 and
is primarily  residential.  The Village has been developed in accordance  with a
master plan and includes  schools,  shopping  facilities,  community  recreation
areas, and its own police and fire departments.
<PAGE>

The Crestwood Tract

 Although  the  Partnership  had  previously  sold nearly all of its land in the
 Village,  it reacquired in 1992,  through  foreclosure of a defaulted  purchase
 money  mortgage,  the 165  acre  Crestwood  Tract  of  undeveloped  land in the
 Village.  When  reacquired,  the  Crestwood  Tract was  zoned  and  preliminary
 approval had been obtained for the development of 172  single-family  homesites
 (the "Single Family Tract") and 625 multi-family  units. The Crestwood Tract is
 bisected by a principal  Village road and has access to all utilities,  but was
 otherwise  undeveloped  with the  exception  of the  existence of portions of a
 drainage system. Through December 30, 1999, all of the Crestwood Tract had been
 sold with the exception of the  commercial  land described  below,  and a tract
 intended  for  mutli-family   residential  construction  described  in  item  I
 (5)above.   However,   during  1999,  a  mortgage  obligor  defaulted  under  a
 non-recourse purchase money mortgage securing a remaining principal balance due
 of $1,298,500  secured by 45  residential  lots in the Crestwood  single family
 tract.  The  Partnership  accepted a deed in lieu of  foreclosure in respect of
 this  property in  October,  1999 and has  contracted  for its resale for gross
 proceeds of  $1,316,250.  This sale,  which is subject to the  satisfaction  of
 certain conditions, is expected to close in February, 2000.
Commercial Land within the Crestwood Tract

In order to enhance the market value of the  Crestwood  Tract,  the  Partnership
obtained the rezoning of an approximately 14 acre portion of the Crestwood Tract
previously zoned for multi-family housing to permit the Partnership to develop a
14 acre shopping center site. The  Partnership  received  site-plan  approval in
mid-1996.  The  Partnership has executed an agreement to sell the entire 14 acre
portion  to an  unaffiliated  shopping  center  developer  ("Purchaser")  in two
phases.

The closing on the first phase of the Commercial Site, consisting of a 11.8-acre
shopping center site, occurred in February, 1997, resulting in gross proceeds of
approximately $1,538,757.

The second  phase  consists  of two  additional  parcels in the 14 acre  portion
rezoned as described  above,  which adjoin the shopping  center site. As to such
parcels,  the  Partnership  has agreed to accord an option to the  Purchaser  to
acquire the parcels, with the price to be paid dependent on the terms upon which
the Purchaser  leases or sells such parcels to an  unaffiliated  third party. In
such  event the  Purchaser  will pay to the  Partnership,  (i) in the event of a
lease,  a sum equal to the five times the average annual rental under the lease,
and (ii) in the event of a sale,  50% of the net proceeds of the sale;  provided
that the  Partnership is not required to accept less than $3.50 per square foot.
The  Partnership  and the  Purchaser  have  entered  into a contract  to sell an
additional 1.6 acres adjoining the  above-described 14 acre shopping center site
for a gross purchase price to the  Partnership of  approximately  $120,000.  The
purchaser is  presently  preparing to seek the  appropriate  approvals  from the
Village and anticipates approvals by June of 2000.
<PAGE>

Residential Lots Within the Crestwood Tract

         As a  result  of  management's  decision  to  develop  portions  of the
Crestwood  Tract,  the  Partnership  replanned the  configuration  of the entire
tract.  The project  included a redesign  of the Single  Family  Tract,  and the
Partnership  received  final  plat  approval  to  increase  to 198 the number of
residential  lots  for  development  for  single  family  use  (hereinafter  the
"Residential  Tract").  "Development,"  as such term is applied to single-family
lots,  entails the completion of all necessary zoning,  land use,  environmental
and  other  regulatory  procedures,   the  installation  of  roads  and  utility
connections to each lot and the provision of drainage facilities.

         Between  1995 and 1997,  the  Partnership  completed  the  off-site and
on-site  improvements  required  for  the  development  of the  198  lots in the
Residential  Tract.  Through  December 30, 1999, the Partnership had sold all of
the 198 lots in the  Residential  Tract  but had  reacquired  45 such  lots upon
foreclosure in October,1 999.Such dispositions (including forfeited deposits and
payments  under such  foreclosed  mortgage)  resulted  in gross  proceeds to the
Partnership  of  approximately  $5,855,000  and net cash  proceeds of $1,016,000
after  mandatory  loan  reduction  and brokerage  commissions  and other closing
costs.  Of the  foregoing,  during the 1999  fiscal year only,  the  Partnership
conveyed a total of 54 lots for aggregate  gross  proceeds of $1,688,000 and net
cash proceeds,  after mandatory loan reductions of $20,000 per lot and brokerage
commissions and other closing costs, of $734,000.

         In August 1999 the Partnership sold a substantial part of the remainder
of  the  multi-family  zoned  land  (comprising   approximately  26  acres)  for
$2,225,000 in gross proceeds, and approximately $1,886,000 in net proceeds after
costs of sale. Previously,  in November 1998, the Partnership sold 7.7 acres for
net proceeds of $288,000.

Other Acreage Within the Village

In March, 1993 the Partnership  reacquired a separate tract of 4.54 acres in the
Village  by  accepting  a deed in  lieu  of  foreclosure  on a  mortgage  with a
principal  balance of $300,000 (See Item 7 --"Foreclosure  Transactions").  This
parcel is bordered by a golf course and a principal  Village  road, is zoned for
approximately 80 multi-family residential units and is being offered for sale in
its present state without further development. This land is under a contract for
sale for $350,000 and closing of this sale is expected in June of 2000,  subject
to numerous contingencies and conditions.
<PAGE>

Utility Contingent Receivable

In 1983 the Partnership's  Predecessor Company sold to the Village of Royal Palm
Beach a water and sewage treatment system servicing the Village. Pursuant to the
agreement  of  sale  ("Utility  Contract"),  the  Predecessor  company  received
$2,510,000  on  closing,  and was  entitled  to future  payments to a maximum of
$10,900,000 as future connections,  measured by consumption increases, were made
to the system over a period  ending  August,  2001.  As of  September  30, 1999,
$4,623,000  had not been  received.  The  Utility  Contract  also  provided  for
contingent extension periods aggregating not more than three additional years to
compensate for possible future  governmental  building  moratoriums or water use
restrictions.  The  Partnership's  consultants have advised it that the term has
been extended  through 2003 as a result of water usage  restrictions  imposed by
the South  Florida  Water  Management  District in 1990 and 1991 and  moratorium
actions  taken by the Village of Royal Palm Beach in 1985 and 1986.  The Utility
Contract  also  calls  for  payments  to  the  Partnership  equal  to 25% of any
"Guaranteed Revenues" (payment by developers to secure guaranteed allocations of
plant capacity)  collected by the Village to a maximum  payment of $500,000,  of
which $314,000 was received through September,1999.

To date, the Partnership has received the following Utility Contract payments:

Fiscal Year Ended          Amount Received Based On
September 30               Consumption      Guaranteed Amounts
------------               -----------      ------------------
1984                       $ 919,000
1985                         830,000
1986                         637,000
1987                         859,000
1988                         240,000            $30,000
1989                         761,000             45,000
1990                              -0-            35,000
1991                         293,000             21,000
1992                         357,000             37,000
1993                         168,000             47,000
1994                          58,000             27,000
1995                         413,000             20,000
1996                         108,000             19,000
1997                         207,000             22,000
1998                         427,000             11,000
                             -------             ------
Total                     $6,277,000           $314,000

* The Partnership is also entitled to receive approximately $379,000 in January,
2000 in respect of 1999.
<PAGE>

The  Utility   Contract  with  extensions   management   believes  have  already
accumulated  will expire in 2003,  subject to extensions of up to one additional
year.  The ability of the  Partnership to realize the maximum price is dependent
upon the rate at which the population in the Village grows,  and levels of water
consumption  which in turn depends upon  economic,  social and climatic  factors
which cannot be predicted.  Historically,  water  consumption  tends to increase
based upon increases in population.  During most of fiscal 1990, however, due to
drought  conditions  existing in most Southern Florida,  the South Florida Water
Management District imposed mandatory water usage  restrictions.  The imposition
of these  restrictions  resulted in a decrease in aggregate water consumption in
the area from which the  Partnership's  receipts are projected while  population
was  increasing.  It is  considered  extremely  unlikely  that  the  rate of new
construction or water  consumption in such area will be sufficient to enable the
Partnership to receive the maximum remaining  $4,623,000 in contingent  payments
under the Utility  Contract prior to the  expiration of the  contingent  payment
term.

Acreage in the Vicinity of the Village

Substantially all of the property previously owned by the Predecessor Company in
Palm  Beach  County  outside  of  the  Village  limits,  originally  aggregating
approximately  23,800 acres,  was sold under the  Predecessor  Company's  retail
installment  sales  program,  which  terminated  prior to the  inception  of the
Partnership.  The Partnership currently retains one tract in the vicinity of the
Village.

The tract originally consisted of 208 one-acre lots located approximately eight
miles  northwest  of the  Village.  These lots have been  improved  with graded
unpaved access roads and drainage facilities.  One lot from this tract was sold
during 1996 for $12,000, 36 were sold in 1997 for $190,188, and 9 were sold in
1999 for $48,155, leaving a balance of 162 lots.

The timing of future sales of the land discussed  above, the manner in which the
land may be developed and therefore the ultimate realizable prices for this land
are dependent upon a complex and  interrelated  number of factors arising out of
governmental regulations concerning permissible land use.

All of such lots are subject to numerous  governmental  regulations  under which
new development may not be permitted unless adequate public  facilities (such as
roads and  drainage)  must be in place  concurrently  with the  impacts  of such
development. The Indian Trail Improvement District (formerly known as the Indian
Trail Water Control District)  prepared a drainage plan which would result in an
exemption  for  such  lots  from  further   compliance  with  such   concurrency
requirements and would allow the issuance of building permits for  single-family
residences on such lots. Such plan was opposed by other  governmental  agencies,
however,  and the Palm  Beach  County  Health  Department  originally  denied an
application for septic tank permits, due to inadequate drainage.

Following the institution of  administrative  proceedings to compel the issuance
of septic tank permits, the Partnership was successful in obtaining approval for
such permits for 3 of the 4 lots for which application was made; the 4th lot was
wetland and required  additional  mitigation.  However,  the South Florida Water
Management  District  has  refused to permit  development  to  proceed,  and the
Partnership is currently engaged in administrative proceedings to set aside such
refusal.  Numerous  additional  permits  are  required  before  building  can be
commenced, and there is no assurance that all of such permits can be obtained.
<PAGE>

The Partnership  believes that should it eventually succeed in obtaining all the
necessary  permits  for at least  some of the  lots,  this  would  substantially
increase the value of such lots and that the aggregate  realizable  value of all
such lots will  substantially  exceed their book value of  $561,374.  Should the
Partnership be unsuccessful in overturning the  administrative  denial of septic
tank  permits,  the  Partnership  may  elect to  pursue  other  legal  remedies,
including a possible claim for "inverse condemnation." There can be no assurance
that any such litigation would be successful.

Another tract,  consisting of  approximately  470 acres,  and which  contained a
significant  amount of  wetlands,  was sold in  August,  1999 for  approximately
$1,350,000  to the  Nature  Conservancy  on behalf  of Palm  Beach  County.  The
aforesaid amount does not include approximately $345,600 of "mitigation credits"
granted to the Partnership in connection which such transaction  which increased
the value of two other tracts of land held by the Partnership,  one of which was
sold in August of 1999.

Another tract in the vicinity of the Village the  Partnership  previously held a
involved a disputed claim to  approximately  24 acres of undeveloped  land. This
claim had not originally been accorded value on the Partnership's  balance sheet
and was considered to have little or no value.  During 1994, in connection  with
the resolution of this claim with  adjoining  land owners,  and in order to give
value to such  claim,  the  Partnership  relinquished  a portion  of its  claim,
acquired five  adjoining  acres for $141,879,  and executed a joint  development
agreement with one of such adjoining  landowners  relating to the  Partnership's
acreage and such landowner's acreage  (comprising  approximately 22 acres in the
aggregate  of which  the  Partnership  now owns  approximately  12  acres).  The
Partnership and the joint developer thereafter entered into an agreement to sell
the entire combined parcel.  After several closing extensions  required in order
to obtain various  governmental agency approvals,  this parcel was sold in April
1999 for gross proceeds of $968,000 and net cash proceeds after  commissions and
expenses of $833,000.