SECURITIES AND EXCHANGE COMMISSION

                            WASHINGTON, D.C. 20549

                                  FORM 10-Q

(Mark One)

(x)   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

For the quarterly period ended               SEPTEMBER 30, 1998
                              --------------------------------------------------

OR

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

For the transition period from                      TO
                              --------------------------------------------------

Commission file number                            0-15880
                      ----------------------------------------------------------


                        PROPERTY RESOURCES EQUITY TRUST
--------------------------------------------------------------------------------
            (Exact name of registrant as specified in its charter)



CALIFORNIA                                               95-3959770
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(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization) 
                         


    P. O. BOX 7777, SAN MATEO, CALIFORNIA           94403-7777
--------------------------------------------------------------------------------
(Address of principal executive offices)             (Zip Code)


Registrant's telephone number, including area code      (650) 312-2000
                                                  ------------------------------



                                      N/A
--------------------------------------------------------------------------------
   Former name, former address and former fiscal year, if changed since last
                                    report

   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 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

Shares of Series A Common Stock Outstanding as of  September 30, 1998: 1,090,051
Shares of Series B Common Stock Outstanding as of  September 30, 1998:     1,000



                        PART I - FINANCIAL INFORMATION

                         ITEM 1. FINANCIAL STATEMENTS

                       PROPERTY RESOURCES EQUITY TRUST

                                BALANCE SHEETS
                   SEPTEMBER 30, 1998 AND DECEMBER 31, 1997
                                 (Unaudited)


(Dollars in thousands, except per share amounts)            1998          1997
                                                  -----------------------------
ASSETS:
Real estate:
  Land                                                    $1,702        $1,702
  Buildings and improvements                               4,132         4,132
  Tenant improvements                                        160           157
                                                  -----------------------------
                                                           5,994         5,991

  Less: accumulated depreciation                           1,516         1,409
                                                  -----------------------------
Real estate, net                                           4,478         4,582

Cash and cash equivalents                                    314           461
Deferred rent receivable                                      72            57
Note receivable                                                -           717
Other assets, net                                            304           268
                                                  -----------------------------
   Total assets                                           $5,168        $6,085
                                                  =============================

LIABILITIES AND STOCKHOLDERS' EQUITY:
Note payable                                               2,804         2,827
Tenants' deposits and other liabilities                       37            24
                                                  -----------------------------
   Total liabilities                                       2,841         2,851
                                                  -----------------------------

Stockholders' equity:
Common stock, Series A, without par value, stated
  value $10 per share; 10,000,000 shares
authorized;                                                9,384         9,384
  1,090,051  shares issued and outstanding  in
1998 and 1997
Common stock, Series B, without par value, stated
  Value $10 per share; 1,000 shares authorized,
  issued and outstanding in 1998and 1997                      10            10
Accumulated distributions in excess of net income        (7,067)       (6,160)
                                                  -----------------------------

   Total stockholders' equity                              2,327         3,234
                                                  -----------------------------

   Total liabilities and stockholders' equity             $5,168        $6,085
                                                  ============================= 



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



                       PROPERTY RESOURCES EQUITY TRUST

          CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
                                  (Unaudited)



                                      THREE MONTHS ENDED     NINE MONTHS ENDED
                                    SEPTEMBER   SEPTEMBER  SEPTEMBER   SEPTEMBER
                                       30,         30,         30,         30,
(Dollars in thousands, except         1998        1997        1998        1997
per share amounts)
                                   --------------------------------------------

REVENUE:

  Rent                                $171        $160        $529        $531
  Interest                               -          19          28          66
  Dividends                              4           -          14          39
                                   --------------------------------------------
    Total revenue                      175         179         571         636
                                   --------------------------------------------

EXPENSES:

  Interest                              40          70         176         199
  Depreciation  and amortization        40          39         118         138
  Operating                             24          31          79         111
  Related party                         16          19          52          88
  General and administrative             5           5          50          39
                                   --------------------------------------------
    Total expenses                     125         164         475         575
                                   --------------------------------------------

Operating income before gain on         50          15          96          61
sale of property

Gain on sale of property                 -           -           -         370

                                   ============================================
NET INCOME                             $50         $15         $96        $431
                                   ============================================



Net income per share of Series A      $.05        $.02        $.09        $.40
common stock
                                   ============================================

Dividends per share of Series A       $.06        $.06        $.92       $2.53
common stock
                                   ============================================




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



                       PROPERTY RESOURCES EQUITY TRUST

                           STATEMENTS OF CASH FLOWS
            FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
                                 (Unaudited)




(Dollars in thousands)                                      1998          1997
                                                   ----------------------------
Cash flows from operating activities:

Net income                                                   $96          $431
                                                   ----------------------------

Adjustments to reconcile net income to net cash
 provided by operating activities:
   Depreciation and amortization                             106           151
   (Increase) decrease in deferred rent                     (15)            24
receivable
  Increase in other assets                                  (28)         (138)
   Increase (decrease) in tenants' deposits and               13          (12)
other liabilities
   Gain on sale of rental property                             -         (370)
                                                   ----------------------------
                                                              76         (345)
                                                   ----------------------------

Net cash provided by operating activities                    172            86
                                                   ----------------------------

Cash flow from investing activities:
   Principal received on note receivable                     717            14
   Improvements to rental property                           (3)           (5)
   Leasing Commissions Paid                                  (7)             -
   Proceeds from sale of rental property                       -         2,093
   Disposition of mortgage-backed securities                   -            38
                                                   ----------------------------
Net cash provided by investing activities                    707         2,140
                                                   ----------------------------

Cash flow from financing activities:
   Origination of note payable                                 -         2,850
   Principal payments on note payable                       (23)       (2,763)
   Distributions paid                                    (1,003)       (2,758)
                                                   ----------------------------
Net cash used in financing activities                    (1,026)       (2,671)
                                                   ----------------------------

Net  decrease in cash and cash equivalents                 (147)         (445)

Cash and cash equivalents, beginning of period               461           772

                                                   ============================
Cash and cash equivalents, end of period                    $314          $327
                                                   ============================






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


                       PROPERTY RESOURCES EQUITY TRUST
                        NOTES TO FINANCIAL STATEMENTS
                              SEPTEMBER 30, 1998

NOTE 1- BASIS OF PRESENTATION

The accompanying unaudited interim financial statements of Property Resources
Equity Trust (the "Fund") have been prepared in accordance with the
instructions to Form 10-Q pursuant to the rules and regulations of the
Securities and Exchange Commission.  Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations.  In the opinion of management, all
appropriate adjustments necessary to a fair presentation of the results of
operations have been made for the periods shown.  All adjustments are of a
normal recurring nature.  Certain prior year amounts have been reclassified
to conform to current year presentations.

These financial statements have been prepared on a going concern basis, which
contemplates the realization of assets and the satisfaction of liabilities in
the normal course of business. Management have decided to sell the Fund's
remaining property, Good Guys Shopping Center, and liquidate the Fund. A form
8-K statement announcing this intention was filed on April 22 1998. No sale
of the remaining Property had occurred at September 30, 1998, however
management is currently actively seeking a buyer of the Property (see Note 5
below). Accordingly it is possible that the Fund will not continue as a going
concern for a reasonable period of time.

The financial statements do not include any adjustments relating to the
recoverability and classification of liabilities that might be necessary if
the Fund will not continue as a going concern. Management believes that the
market value of the Partnership's remaining property is at least equal to its
book value. Accordingly management does not expect any material losses to be
undertaken in the event of the liquidation of the Fund. However, there can be
no assurance that the eventual sales price of the property will not result in
a loss or that a sale will be consummated.

These financial statements should be read in conjunction with the Fund's
audited financial statements for the year ended December 31, 1997.

NOTE 2 - NOTE PAYABLE

On March 3, 1997, the note payable collateralized by the Good Guys Plaza
Shopping Center was repaid from the proceeds of a new note payable.  The new
note payable, which is also collateralized by the property and matures in
2022, requires monthly payments of principal and interest at 8.8% until 2007,
at which time the interest rate increases to at least 13.8% under an
adjustment formula defined in the note agreement.

NOTE 3 - SALE OF RENTAL PROPERTY

On March 4, 1997, the Fund sold the Graham Court Business Park to an
unaffiliated buyer for a total sales price of $2,200,000 resulting in net
cash proceeds to the Fund of $2,093,000.  In connection with the sale, the
Fund recognized a gain of $370,000.


NOTE 4 - SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

For the nine-month period ended September 30, 1998, interest paid amounted to
$188,276.

NOTE 5 - SUBSEQUENT EVENT: SALE OF PROPERTY

On October 21, 1998, pursuant to a contract entered into on July 10, 1998,
Management entered sold Good Guys Plaza Shopping Center to an unaffiliated
third party for a cash sales price of $5,108,000.   A gain on sale of
approximately $192,000 was recorded on the sale.

                       PROPERTY RESOURCES EQUITY TRUST


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

INTRODUCTION

Management's discussion and analysis of financial condition and results of
operations should be read in conjunction with the Financial Statements and
Notes thereto.

RESULTS OF OPERATIONS

COMPARISON OF THE THREE AND NINE-MONTH PERIODS ENDED SEPTEMBER 30, 1998 AND
1997

Total revenue for the three and nine-month period ended September 30, 1998
decreased $4,000, or 2%, and $65,000, or 10%, respectively, when compared to
the same periods in 1997. The decrease in dividend and interest income was
attributable to lower average investment balances in the current periods.
Rental income decreased during the nine- month period because of the sale of
Graham Court in March 1997 and also a tenant reimbursement made in 1997 was
not repeated in the second quarter of 1998. Rental income increased during
the three-month period due to various rent increases as provided in the
rental agreements.

Total expenses for the three and nine-month period ended September 30, 1998
decreased $39,000, or 24%, and $100,000, or 17%, respectively, when compared
to the same periods in 1997. The Fund sold the Graham Court property in March
1997. Operating expense, related party, depreciation and general and
administrative expenses decreased as a result of the sale. The decreased
expenses in the three-month period were principally caused by an adjustment
to loan fees amortized which caused a reduction in interest expense of
approximately $29,000.

Net income for the three and nine-month period ended September 30, 1998
increased $35,000, or 233%, and decreased $335,000, or 78%, respectively,
when compared to the same periods in 1997. This was due to changes in revenue
and expenses as discussed above and the gain on sale of the Graham Court
property in March 1997 as discussed in note 4 to the financial statements.

LIQUIDITY AND CAPITAL RESOURCES

At September 30, 1998, cash and cash equivalents aggregated $314,000, which
the Fund believes is adequate to meet its short-term operating cash
requirements.

Net cash provided by operating activities increased $86,000 when compared to
the same period in 1997. This was primarily due to the results of operations
as discussed above.

Cash flows provided by investing activities decreased $1,433,000 in 1998 as a
result of proceeds received from the sale of Graham Court that occurred in
1997 as reduced by amount received on a note receivable in 1998.


                       PROPERTY RESOURCES EQUITY TRUST


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES (Continued)

Cash flows used in financing activities decreased $1,645,000 primarily due to
a decrease in the distribution paid.

As of September 30, 1998, the Fund had one remaining property in its
portfolio. As discussed in note 1 to the financial statements management is
currently marketing the property for sale, and a sale may occur in 1998.

The Fund's principal sources of capital for the acquisition and renovation of
property and for working capital reserves have been proceeds from the initial
offering of its common stock and from cash flow after payment of
distributions.

On March 3, 1997, the note payable collateralized by the Good Guys Plaza
Shopping Center was repaid from the proceeds of a new note payable.  The new
note payable, which is also collateralized by the property and matures in
2022, requires monthly payments of principal and interest at 8.8% until 2007,
at which time the interest rate increases to at least 13.8% under an
adjustment formula defined in the note agreement.

In the short-term and in the long-term, management believes that the Fund's
current sources of capital will continue to be adequate to meet both its
operating requirements and the payment of distributions.

IMPACT OF INFLATION
The Fund's policy of negotiating leases which incorporate operating expense
"pass-through" provisions is intended to protect the Fund against increased
operating costs resulting from inflation.

CASH DISTRIBUTION POLICY
Distributions are declared quarterly at the discretion of the Board of
Directors. The Fund's present distribution policy is to at least annually
evaluate the current distribution rate in light of anticipated tenant
turnover over the next two or three years,  the estimated level of associated
improvements and leasing commissions, planned capital expenditures, any debt
service requirements and the Fund's other working capital requirements.
After balancing these considerations, and considering the Fund's earnings and
cash flow, the level of its liquid reserves and other relevant factors, the
Fund seeks to establish a distribution rate which:

      i)    provides a stable distribution which is sustainable
            despite short term fluctuations in  property cash
            flows;
      ii)   maximizes the amount of cash flow paid out as
            distributions consistent with the above listed
            objective; and
      iii)  complies with the Internal Revenue Code requirement
            that a REIT annually pay out as distributions not less
            than 95% of its taxable income.

During the three-month period ended September 30, 1998, the Fund declared
distributions totaling $65,403.

YEAR 2000
Management is in the process of assessing the impact of Year 2000 issues on
its computer systems and applications. At this time, management believes that
the costs associated with resolving these issues will not have a material
effect on the Fund's financial statements.




                       PROPERTY RESOURCES EQUITY TRUST

                         PART II - OTHER INFORMATION


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)   Not applicable

(b)   Reports on Form 8-K

The Fund filed no forms 8-K during the quarter ended September 30, 1998.






                                  SIGNATURE


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.




                                    PROPERTY RESOURCES EQUITY TRUST


                                    By: /s/ David P. Goss
                                            David P. Goss
                                            Chief Executive Officer


                                    Date:  NOVEMBER 16, 1998