UNITED STATES 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     March 31, 1999                      


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

         For the transition period from          to                             


                         Commission file number 1-10641


                           MILESTONE PROPERTIES, INC.
             (Exact name of registrant as specified in its charter)


           Delaware                                      65-0158204             
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
    incorporation or organization)

150 E. Palmetto Park Rd. 4th Floor, Boca Raton, FL           33432              
(Address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code     (561) 394 - 9533         
                                                       -----------------


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 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

         As of May 12, 1999,  4,943,633 shares of the Registrant's Common Stock,
par value $.01 per share, were outstanding and 16,423 shares of the Registrant's
$.78 Convertible Series A Preferred Stock were outstanding.


<PAGE>


Part I: Financial Information
Item 1. Financial Statements

                   MILESTONE PROPERTIES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                March 31, 1999 (Unaudited) and December 31, 1998
<TABLE>
<CAPTION>

                                                                        March 31, 1999           December 31, 1998
                                                                        --------------           -----------------
ASSETS
Current Assets:
<S>                                                                     <C>                    <C>             
    Cash and cash equivalents                                           $   2,478,826          $     11,826,301
    Restricted cash                                                         9,171,036                   222,000
    Loans receivable                                                        1,426,499                 1,444,442
    Accounts receivable                                                       608,388                   812,555
    Accrued interest receivable                                             1,143,071                 5,185,432
    Due from related party                                                    878,120                   837,400
    Prepaid expenses and other                                                864,728                 1,231,663 
                                                                       ---------------                --------- 
         Total current assets                                              16,570,668                21,559,793

    Property, improvements and equipment, net                              21,557,747                21,517,884
    Wraparound notes, net                                                  35,747,024                39,529,787
    Deferred income tax asset, net                                          3,293,176                 2,994,070
    Investments in preferred stock                                                  0                   445,500
    Management contract rights, net                                           174,666                   193,600
    Goodwill and other, net                                                   647,088                   681,562
                                                                       ---------------                  -------

         Total assets                                                    $ 77,990,369          $     86,922,196
                                                                         ============            ==============

LIABILITIES AND STOCKHOLDERS' EQUITY
 Current Liabilities:
    Accounts payable and accrued expenses                               $   1,203,474          $      2,436,964
    Accrued litigation payable                                              9,692,454                 9,692,454
    Accrued interest payable                                                  409,660                   306,846
    Master lease payable                                                    1,890,813                 8,962,828
    Current portion of mortgages and notes payable                          5,812,003                 5,782,950
    Income taxes payable                                                    2,836,496                 2,836,496
                                                                       --------------                 ---------
         Total current liabilities                                         21,844,900                30,018,538

    Mortgages and notes payable                                            41,669,047                42,194,179
                                                                           ----------                ----------

         Total liabilities                                                 63,513,947                72,212,717
                                                                           ----------                ----------

Commitments and Contingencies
Stockholders' equity:
   Common stock ($.01 par value, 10,000,000 shares authorized,
     4,943,633 issued
     and outstanding at March 31, 1999 and
     December 31, 1998; 692,591 shares in treasury)                             49,436                  49,436
   Preferred stock (Series A $.01 par value, $10 liquidation
     preference, 10,000,000 shares authorized, 16,423 and
     2,999,707 shares issued and outstanding at March 31, 1999
     and December 31, 1998, respectively)                                          164                  29,997
   Additional paid in surplus                                               45,527,013              45,497,180
   Accumulated deficit                                                     (27,659,773)            (27,426,716)
   Shares held in treasury - at cost                                        (3,440,418)             (3,440,418)
                                                                            -----------         ---------------
     Total stockholders' equity                                              14,476,422             14,709,479
                                                                             ----------         --------------

     Total liabilities and stockholders' equity                            $ 77,990,369           $ 86,922,196
                                                                            ============         =============

</TABLE>

           See Accompanying Notes to Consolidated Financial Statements

                                        2

<PAGE>

                   MILESTONE PROPERTIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF REVENUES AND EXPENSES
                                  (Unaudited)
               For the Three Months Ended March 31, 1999 and 1998

<TABLE>
<CAPTION>
                                                                     March 31, 1999            March 31, 1998
                                                                     --------------            --------------

REVENUES
<S>                                                                  <C>                       <C>          
   Rent                                                              $   2,042,097             $   2,745,805
   Interest income                                                       1,507,034                 2,240,556
   Revenue from management company operations                              169,680                   195,842
   Tenant reimbursements                                                   277,554                   257,384
   Management and reimbursement income                                      19,442                    29,051
   Percentage rent                                                          55,197                   109,248
   Gain on sale of real estate and real estate related assets                    0                    81,890
                                                                    --------------               -----------

       Total revenues                                                    4,071,004                 5,659,776
                                                                         ---------                 ---------

EXPENSES
   Master lease expense                                                  1,955,054                 3,445,833
   Interest expense                                                      1,069,973                 1,519,598
   Depreciation and amortization                                           191,795                   208,073
   Salaries, general and administrative                                    552,636                   576,328
   Property expenses                                                       449,770                   443,666
   Expenses for management company operations                              176,930                   268,265
   Professional fees                                                       194,019                   219,345
                                                                         ---------                ----------

       Total expenses                                                    4,590,177                 6,681,108 
                                                                         ----------                ----------

Loss before income taxes                                                  (519,173)               (1,021,332)

Benefit for income taxes                                                  (286,116)                 (487,038)
                                                                          ---------                 ---------

Net loss attributable to common stockholders                        $     (233,057)             $   (534,294)
                                                                       ============              ============

Loss per common share, basic and diluted                         $           (0.05)          $         (0.13)
                                                                    ===============           ===============

Weighted average common shares outstanding                               4,244,664                 4,213,368
                                                                       ===========               ===========

</TABLE>

           See Accompanying Notes to Consolidated Financial Statements


                                        3

<PAGE>

                   MILESTONE PROPERTIES, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                   (Unaudited)
                    For the Three Months Ended March 31, 1999

<TABLE>
<CAPTION>
                                                                                                                                    
                                                        Common Stock              Preferred Stock           Treasury Stock          
                                                                                                                                  
                                                    Shares        Cost         Shares          Cost      Shares          Cost       
===============================================   =========== ===========  ==============  =========== ===========  ==============
<S>                                                 <C>        <C>              <C>         <C>          <C>        <C>           
Balance, January 1, 1999                            4,943,633  $   49,436       2,999,707   $   29,997   (692,591)  $  (3,440,418)
Cancellation of Series A Preferred Stock                                      (2,983,284)     (29,833)                            
Net loss for the three months ended March 31, 1999                                                                                
                                                  ----------- -----------  --------------  -----------  ----------  --------------
Balance, March 31, 1999                             4,943,633    $ 49,436          16,423        $ 164   (692,591)   $ (3,440,418)
                                                  =========== ===========  ==============  =========== ===========  ==============



                                                           Additional                                    
                                                            paid in       Accumulated     Stockholders'  
                                                            surplus         deficit          equity      
===============================================         =============== ===============  =============== 
<S>                                                        <C>          <C>                 <C>          
Balance, January 1, 1999                                   $ 45,497,180 $  (27,426,716)     $ 14,709,479 
Cancellation of Series A Preferred Stock                         29,833                                0 
Net loss for the three months ended March 31, 1999                            (233,057)        (233,057) 
                                                        --------------- ---------------  --------------- 
Balance, March 31, 1999                                    $ 45,527,014  $ (27,659,773)     $ 14,476,422 
                                                        =============== ===============  =============== 
                                                       
</TABLE>


           See Accompanying Notes to Consolidated Financial Statements


                                        4

<PAGE>

                   MILESTONE PROPERTIES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
               For the Three Months Ended March 31, 1999 and 1998

<TABLE>
<CAPTION>

                                                                           March 31, 1999            March 31, 1998
                                                                           --------------            --------------
CASH FLOW FROM OPERATING ACTIVITIES
<S>                                                                         <C>                         <C>        
   Net loss                                                                 $   (233,057)               $ (534,294)
   Adjustments to reconcile net loss to net cash used in
        operating activities:
   Depreciation and amortization                                                 191,795                   208,073
   Deferred benefit taxes                                                       (299,106)                 (527,851)
   Gain on sale of real estate related assets                                          0                    81,890
   Changes in operating assets and liabilities
         Decrease in accounts receivable                                         204,167                   111,319
         Increase in due from related party                                      (40,720)                  (77,954)
         Decrease in accrued interest receivable                               4,042,361                 6,595,014
         Decrease (increase) in prepaid expenses                                 366,935                  (400,786)
         Decrease in accrued expenses                                         (1,233,489)               (1,400,525)
         Increase in accrued interest payable                                    102,814                    96,265
         Decrease in master lease payable                                     (7,072,016)              (10,198,183)
         Decrease in due to related party                                              0                   100,680 
                                                                              ----------              -------------

         Net cash used in operating activities                                (3,970,316)               (5,946,352)
                                                                              -----------               -----------

CASH FLOW FROM INVESTING ACTIVITIES
   Principal repayments on loans receivable                                       17,943                    16,568
   Principal repayments on wraparound notes                                    3,782,763                 5,061,340
   Investment in wraparound notes                                                      0                    15,000
   Purchase of leasehold improvements                                           (178,250)                  (92,456)
   Proceeds from realization of real estate related assets                             0                    75,000
   Proceeds from redemption of investments in preferred stock                    445,500                   445,500
                                                                                 -------                   -------

         Net cash provided by investing activities                             4,067,956                 5,520,952 
                                                                              -----------              ------------

CASH FLOW FROM FINANCING ACTIVITIES
   Principal payments on mortgages and notes payable                            (496,079)                 (779,760)
   Amounts in restricted cash                                                 (8,949,036)                         0 
                                                                              -----------              ------------  

         Net cash used in financing activities                                (9,445,115)                 (779,760)
                                                                              -----------                 ---------

NET DECREASE IN CASH AND CASH EQUIVALENTS                                     (9,347,475)               (1,205,160)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                11,826,301                13,435,237
                                                                              ----------                ----------

CASH AND CASH EQUIVALENTS, END OF PERIOD                                   $   2,478,826            $   12,230,077
                                                                            ============               ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

         Cash paid during the period for interest                          $     967,159            $   1,423,333
                                                                            ============              ============


         Cash paid during the period for income taxes                      $      12,990            $      40,813
                                                                            ============              ============
</TABLE>


           See Accompanying Notes to Consolidated Financial Statements


                                        5

<PAGE>

                   MILESTONE PROPERTIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)

The accompanying consolidated financial statements of Milestone Properties, Inc.
("Milestone") and its wholly owned  subsidiaries  (together,  Milestone with its
subsidiaries is hereinafter  referred to as the "Company") have been prepared in
accordance with generally accepted  accounting  principles for interim financial
information and with the  instructions to Form 10-Q and Rule 10-01 of Regulation
S-X.  Accordingly,  they 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.  The  financial  statements  as of and for the periods ended March 31,
1999 and 1998 are unaudited.  The results of operations for the interim  periods
are not necessarily indicative of the results of operations for the fiscal year.
Certain  information  for 1998  has been  reclassified  to  conform  to the 1999
presentation.   These  consolidated  financial  statements  should  be  read  in
conjunction with the financial  statements and footnotes included thereto in the
Company's Annual Report on Form 10-K for the year ended December 31, 1998.

The  Company  is  engaged  in  the  business  of  owning,  acquiring,  managing,
developing  and  investing  in  commercial  real estate and real estate  related
assets.  The  Company is  primarily  engaged  in the  ownership,  operation  and
management of interests in commercial real estate  properties,  currently (as of
the date of this filing)  consisting of (i) 10 properties owned in fee (the "Fee
Properties"),  (ii) the ownership of wraparound notes (the  "Wraparound  Notes")
and wraparound  mortgages (the  "Wraparound  Mortgages"  and,  together with the
Wraparound  Notes,  the "Wrap  Debt")  which are secured by 23  commercial  real
properties (the "Underlying  Properties" and,  together with the Fee Properties,
the "Properties")  and (iii) the operation and management of the Properties.  At
March 31, 1999,  the Company  possessed  interests in 35 commercial  real estate
properties  consisting of (i) 10 properties  owned in fee and (ii) the ownership
of wraparound  notes and  wraparound  mortgages  secured by 25  commercial  real
properties.  At March 31, 1998, the Company possessed interests in 31 commercial
real  properties  consisting  of (i) four  properties  owned in fee and (ii) the
ownership of wraparound notes and wraparound  mortgages secured by 27 commercial
real properties.

1.       Acquisition and Disposition of Real Estate Related Assets

On April 6, 1999, a wraparound note held by the Company on a 125,803 square foot
shopping center property  located in Pascagoula,  Mississippi  (the  "Pascagoula
Property"),  was paid as a result of the sale of the Pascagoula  Property by its
owner,  an affiliate of the Company (the  partnership  that owned the Pascagoula
Property),  to an unrelated  third  party.  In  connection  with the sale of the
Pascagoula Property,  the Company, as the master lessee on a master lease on the
Pascagoula  Property,  canceled such master lease. As a result of the payment of
the  wraparound  note, the Company  realized net cash proceeds of  approximately
$2,178,000 and a book gain of approximately $607,000.



                                                         6

<PAGE>




On April 27, 1999, a wraparound note held by the Company on a 52,700 square foot
shopping  center  property  located in Baton Rouge,  Louisiana (the "Baton Rouge
Property"),  was paid as a result of the sale of the Baton Rouge Property by its
owner, an affiliate of the Company (the  partnership  that owned the Baton Rouge
Property), to an unrelated third party. In connection with the sale of the Baton
Rouge Property, the Company, as the master lessee on a master lease on the Baton
Rouge Property,  canceled such master lease.  Of the gross proceeds,  $1,896,208
was used to satisfy the underlying mortgage debt on the Baton Rouge Property. As
a result of the  payment  of the  wraparound  note and the  satisfaction  of the
underlying   mortgage   debt,   the  Company   realized  net  cash  proceeds  of
approximately $2,045,000 and a book gain of approximately $321,000.

2.       Legal Proceedings

As previously reported, during 1996 Milestone,  certain past and present members
of its Board of Directors and executive officers, and Concord Assets Group, Inc.
("Concord"),  a New York  Corporation,  were named as  defendants in a purported
class action and  derivative  lawsuit (the "Winston  Actions")  commenced in the
Court of  Chancery  of the State of  Delaware  (the  "Delaware  Court").  In the
Winston Actions, the plaintiff,  a Series A Preferred Stockholder  purporting to
bring the action on behalf of himself, all other Series A Preferred Stockholders
and  derivatively  on behalf  of  Milestone,  alleged  that in  connection  with
Milestone's  acquisition in October 1995 of certain wraparound notes, wraparound
mortgages  and fee  properties  from certain  affiliates  of Concord and certain
related  transactions  (collectively,  the  "Transactions"),  Milestone  and its
directors  engaged in  self-dealing,  violated  federal  securities  laws and an
injunction  against such violations and breached their  fiduciary  duties to the
Series A Preferred  Stockholders.  The  plaintiff  claimed,  among other things,
that, as a result of the Transactions, Milestone would not have sufficient funds
to pay dividends on the Series A Preferred  Stock and that the properties  which
were not  transferred  to  Union  Properties  Investors,  Inc.  ("UPI"),  a then
wholly-owned  Delaware  subsidiary  of  Milestone,  in the Transfer were grossly
inferior to the properties that were transferred to UPI.

On August 5, 1998,  the counsel for the named  plaintiff in the Winston  Actions
and the counsel for the defendants  entered into a Stipulation  and Agreement of
Settlement (the "Winston Settlement  Agreement") which memorialized the terms of
a settlement (the "Winston  Settlement") of the Winston Actions.  On January 28,
1999,  the Delaware  Court  approved  the Winston  Settlement  Agreement,  which
approval became final effective as of the close of business on March 5, 1999. At
such time,  (i) the shares of Series A  Preferred  Stock  owned by each Series A
Preferred  Stockholder who was eligible to participate in the Winston Settlement
and who did not properly opt out of the Winston  Settlement and who owned shares
of Series A  Preferred  Stock as of the close of  business on March 5, 1999 were
canceled and represented  only the right of such Series A Preferred  Stockholder
to receive $3.00 in cash from the Company in exchange for each such share;  (ii)
the holders of shares of the Series A Preferred  Stock between  October 23, 1995
and the close of  business  on March 5,  1999,  other  than  Series A  Preferred
Stockholders who properly opted out of the Winston  Settlement  Agreement or who
were precluded from  participating in the Winston  Settlement,  released any and
all claims they may have had against the Company and the other named  defendants
in connection with the Transactions;  (iii) Milestone's  stockholders other than
Series A Preferred  Stockholders who were eligible to participate in the Winston
Settlement  and who properly  opted out of the Winston  Settlement  released all
derivative claims in connection with the Transactions; and (iv)

                                                         7

<PAGE>



the Winston Actions were dismissed.  In connection with the Winston Actions, the
Company  retained  counsel  for  all  of  the  defendants  (including,   without
limitation,  Leonard S.  Mandor,  Robert A.  Mandor,  Harvey  Jacobson,  Gregory
McMahon and Geoffrey  Aaronson (each of whom is a director and/or officer of the
Company)) and assumed  responsibility for the payment of all legal fees incurred
by such  persons  in  connection  with  the  Winston  Actions  and  the  Winston
Settlement (subject to the insurance coverage litigation described below).

The foregoing  description of the Winston  Settlement and the Winston Settlement
Agreement is  qualified  in its entirety by reference to the Winston  Settlement
Agreement,  a copy of which was filed by the  Company  with the  Securities  and
Exchange  Commission (the  "Commission")  on August 14, 1998 as Exhibit 10.01 to
the Company's  Quarterly Report on Form 10-Q for the quarterly period ended June
30, 1998.

The  Company   maintains  a  directors   and  officers   insurance  and  company
reimbursement  policy (the  "National  Policy")  issued by  National  Union Fire
Insurance Company of Pittsburgh,  PA ("National  Union") with a $2,000,000 limit
and an excess directors and officers liability and company  reimbursement policy
(the "Stonewall  Policy") issued by Stonewall  Surplus Lines Insurance  Company,
now known as American  Dynasty  Surplus Lines Insurance  Company  ("Stonewall"),
with a $2,000,000  limit.  The Company  believes that the amounts that it has to
pay  pursuant  to the  Winston  Settlement  and in  connection  with the Winston
Actions  are  covered  losses  under  both the  National  Union  Policy  and the
Stonewall  Policy.  In addition,  the Company  believes  that the legal fees and
other  expenses  incurred by the Company and the other  defendants in connection
with the Winston Actions are also covered losses under the National Union Policy
and the Stonewall Policy.  In connection with a previous proposed  settlement of
the Winston  Actions which was never  consummated,  National Union and Stonewall
both refused to  contribute  to such proposed  settlement,  asserting  that such
proposed  settlement  did not  encompass  any  covered  loss (as  defined in the
National Policy and the Stonewall  Policy,  respectively).  On January 29, 1998,
the Company  commenced  a lawsuit in the United  States  District  Court for the
Southern District of New York against National Union and Stonewall in connection
with such refusal to contribute to such proposed  settlement.  In the complaint,
the plaintiffs  alleged that National Union and Stonewall  wrongfully  failed to
contribute to the proposed  settlement  and sought  reimbursement  from National
Union and  Stonewall  up to the limits of their  respective  policies.  National
Union and  Stonewall  both answered the  complaint  and denied  liability.  As a
result of the termination of the previously proposed settlement,  the Company on
one hand, and Stonewall and National Union, on the other hand, agreed to dismiss
such action  without  prejudice and such action was dismissed on May 29, 1998 by
the United  States  District  Court for the Southern  District of New York.  The
Company gave both National Union and Stonewall notice of the Winston  Settlement
and  provided  each of them with a copy of the Winston  Settlement  Agreement on
August 12, 1998.  National Union and Stonewall  reviewed the Winston  Settlement
Agreement and separately informed the Company that their basic position, denying
coverage, had not changed. On February 12, 1999, the Company commenced a lawsuit
in the Circuit  Court for the Fifteenth  Judicial  Circuit in and for Palm Beach
County, Florida against both National Union and Stonewall alleging,  among other
things,  that National Union and Stonewall have wrongfully refused to contribute
to the Winston  Settlement  and seeking  reimbursement  from National  Union and
Stonewall up to the limits of their respective  policies.  The initial complaint
in the new  lawsuit  was  served  on each of  National  Union and  Stonewall  on
February 12, 1999 and on March 17, 1999 the Company filed an amended  complaint,
which, among other

                                                         8

<PAGE>



things,  added  certain  of the  other  defendants  to the  Winston  Actions  as
plaintiffs.  On April 12,  1999,  National  Union served a motion to dismiss the
amended complaint or to strike part thereof and a motion to recuse the Company's
Florida  counsel.  National  Union has since  agreed to  withdraw  its motion to
dismiss and to serve its answer to the amended  complaint  by June 1, 1999.  The
motion to recuse the Company's  Florida  counsel is still pending.  On April 12,
1999, Stonewall served its answer to the amended complaint and denied liability.
In connection with this action,  the Company has retained counsel for all of the
plaintiffs  and is  assuming  responsibility  for the  payment of all legal fees
incurred by such  persons in  connection  with this  action.  At this time,  the
Company  is not in a position  to render an  opinion  as to the  outcome of this
action.

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

General

     This  Quarterly  Report on Form 10-Q for the period  ended  March 31,  1999
     filed  by  Milestone   contains  or  incorporates   by  reference   certain
     forward-looking  statements  within  the  meaning  of  Section  27A  of the
     Securities  Act of 1933 and Section 21E of the  Securities  Exchange Act of
     1934 and Milestone intends that such forward-looking  statements be subject
     to the  safe  harbors  created  thereby.  Such  forward-looking  statements
     involve  risks and  uncertainties  and  include,  but are not  limited  to,
     statements  regarding  future events and its plans,  goals and  objectives.
     Such  statements  are  generally  accompanied  by words  such as  "intend,"
     "anticipate," "believe," "estimate," "expect" or similar terms. Milestone's
     actual results may differ  materially  from such  statements.  Factors that
     could cause or contribute to such differences include,  without limitation,
     the following:  (i) its plans,  strategies,  objectives,  expectations  and
     intentions  are  subject  to  change  at any time at its  discretion;  (ii)
     general  economic and business  conditions,  which may, among other things,
     affect the demand for retail space or retails goods,  the  availability and
     creditworthiness  of  prospective  tenants,  rental terms and the terms and
     availability of financing, are subject to change at any time; (iii) adverse
     changes in real estate markets including,  among other things,  competition
     with other companies; (iv) adverse changes in the properties Milestone owns
     which  could  require  the  expenditure  of funds to fix or  maintain  such
     properties;   (v)  the  general  risks  of  real  estate   development  and
     acquisitions,  such as changes in demographics,  construction  delays, cost
     overruns,  work  stoppages  and  slowdowns,  the cost and  availability  of
     skilled  labor  and  weather  conditions;  (vi)  governmental  actions  and
     initiatives, such as seizures of property, condemnation and construction of
     alternative  roadways;   (vii)  environmental  and  safety  conditions  and
     hazards;  (viii) the adequacy of Year 2000  compliance  measures;  and (ix)
     other risks and  uncertainties  indicated  from time to time in Milestone's
     filings with the  Securities  and Exchange  Commission and in the documents
     incorporated  herein by  reference.  Although  Milestone  believes that the
     assumptions underlying its forward-looking  statements are reasonable,  any
     of the assumptions could prove inaccurate and, therefore,  Milestone cannot
     make any assurances that the results  contemplated in such  forward-looking
     statements  will  be  realized.   The  inclusion  of  such  forward-looking
     information  should not be regarded as a representation by Milestone or any
     other person that the future events, plans or expectations  contemplated by
     Milestone  will  be  achieved.   Furthermore,   past   performance  is  not
     necessarily an indicator of future performance.



                                                         9

<PAGE>




The  Company  is  engaged  in  the  business  of  owning,  acquiring,  managing,
developing  and  investing  in  commercial  real estate and real estate  related
assets.  The  Company is  primarily  engaged  in the  ownership,  operation  and
management  of  interests  in  commercial  real  estate  properties,   currently
consisting of (i) 10 properties  owned in fee (the "Fee  Properties"),  (ii) the
ownership of wraparound notes (the "Wraparound Notes") and wraparound  mortgages
(the "Wraparound  Mortgages" and,  together with the Wraparound Notes, the "Wrap
Debt")  which are secured by 23  commercial  real  properties  (the  "Underlying
Properties" and,  together with the Fee Properties,  the "Properties") and (iii)
the operation and management of the  Properties.  At March 31, 1999, the Company
possessed  interests in 35 commercial real estate  properties  consisting of (i)
10 Fee Properties and (ii) Wrap Debt interests in 25 Underlying Properties.  At
March 31, 1998, the Company possessed interests in 31 commercial real properties
consisting  of (i) four  Fee  Properties  and (ii)  Wrap  Debt  interests  in 27
Underlying Properties.


Impact of Year 2000

The Year 2000 problem  arises from the  historic use of only two digits  (rather
than four) for the  designation of a year in date  information  within  computer
programs. If not corrected,  any of the Company's equipment or software programs
that perform time sensitive  calculations may incorrectly identify the year 2000
and beyond or not  function  after  December  31,  1999.  This  could  result in
miscalculations  or a major failure of certain systems.  The Company may also be
vulnerable to the Year 2000 problems of its tenants,  financial  institutions or
other service  vendors and/or other  companies  with which it conducts  business
(e.g., utility companies, etc).

Early in calendar  year 1998,  the Company  developed  and initiated a Year 2000
compliance program, including information systems modifications, in an effort to
ensure  that its  business  is not  interrupted  by the Year 2000  problem.  The
Company's Year 2000 compliance program is broken into the following components:

Renovating   internal  systems  and  applications  and  ensuring  compliance  of
peripheral third party systems.  The Company's internal systems and applications
include  the  accounting  system,  the lease  asset  management  system  and the
operating  system (AS 400).  The Company  uses a number of third  party  package
systems to supplement its internally developed programs.  From time to time, the
Company updates the accounting  system and the operating system with upgrades it
receives  from the  software  manufacturers.  The  software  manufacturers  have
informed  the Company that they will  continue to provide all updates  necessary
for such systems to be Year 2000 compliant.  These software  manufacturers  have
informed the Company that they  anticipate all such upgrades will be provided to
the Company by June 1999. The Company  anticipates  that it will then be able to
implement  by the end of June 1999 such  upgrades  assuming  such  upgrades  are
received by June 1999.  The lease asset  management  system is  currently  being
updated to be Year 2000 compliant by the Company using in-house technology.  The
Company  anticipates that this upgrade to the lease asset management system will
be completed by the end of September 1999.




                                                        10

<PAGE>



Ensuring Year 2000 compliance by external  companies that conduct  business with
the Company. The Company has contacted all of its major tenants which remit rent
and other payments to the Company and financial  institutions  which process the
rental and other  payments  from  major  tenants  on behalf of the  Company,  to
inquire about their Year 2000 compliance. The Company has not received responses
from all those  contacted,  but those who have  responded have not indicated any
problems at this time. For those  financial  institutions  that process  payroll
electronically  by  debiting  the  Company's  bank  account  and  crediting  the
employees' bank accounts, the Company will be conducting tests to determine Year
2000 compliance.  These tests are expected to be completed by September 1999. If
such financial institutions are not Year 2000 compliant by December 31, 1999, it
is possible that  employees  will not receive direct deposit pay, or the correct
amount  of such  pay,  or that  the  Company's  bank  accounts  will be  debited
incorrect amounts of money.

Implementing  standards and  conducting  testing in an effort to ensure that the
Company's existing and future systems are Year 2000 compliant.  All new systems,
whether hardware or software,  are tested before  implementation in an effort to
ensure Year 2000 compliance.

The Company  believes  that the total cost of its Year 2000  compliance  program
will not exceed $50,000. To date, the Company has incurred approximately $10,000
of such expenses  which includes  hardware and software  purchases and upgrades.
The Company does not anticipate that the costs of any required  modifications to
its information  technology or embedded  technology systems will have a material
adverse  effect on its financial  position,  results of operations or liquidity,
although there can be no assurances that this will be the case.

Although the Company believes that it will have its own systems  compliant prior
to September 1999,  there can be no assurances that it will be able to do so nor
can there be any assurances that, even if the Company  completes timely its Year
2000 compliance program,  the systems,  when actually  implemented in full, will
work  properly  independently  or in  conjunction  with the systems of any third
parties. In addition,  the Company would continue to bear the risk of a material
adverse affect, if any, if its third party systems do not appropriately  address
their own Year 2000 compliance  issues.  The Company's  current estimates of the
impact of the Year 2000 problem on its operations  and financial  results do not
include  costs and time  that may be  incurred  as a result of other  companies'
failure to become Year 2000  compliant on a timely  basis,  which costs could be
material.  There can be no assurance that such other companies will achieve Year
2000  compliance or that any  conversions  by such companies to become Year 2000
compliant will be compatible with the Company's  computer and operating systems.
The inability of the Company or any of its material third parties to become Year
2000  compliant in a timely manner could have a material  adverse  effect on the
Company's financial condition or results of operations.

In the event that the Company or material  third parties fail to complete  their
Year 2000 compliance programs successfully and on time, the Company's ability to
operate its business,  service  tenants,  bill,  collect its revenue in a timely
manner,  pay  debts  and  communicate  generally  could be  adversely  affected.
Although there can be no assurance that the conversion of the Company's  systems
will be successful or that the Company's key third-party relationships will have
successful conversion programs, management does not expect that any such failure
would have a  material  adverse  effect on the  financial  position,  results of
operations or liquidity of the Company, although there can be no assurances that
this will be the case.

                                                        11

<PAGE>




The Company has day-to-day  operational  contingency plans, and management is in
the process of updating these plans for possible Year 2000 specific  operational
requirements.  If the Company's major tenants,  financial  institutions or third
party  systems  are  not  Year  2000  compliant,  it may  have  to  arrange  for
alternative  sources of services in the fall of 1999 in preparation for the Year
2000.  The Company  does not have any other  contingency  plans with  respect to
other  problems  that could  arise in its  business as a result of the Year 2000
problem.  Any of these  could have a material  adverse  effect on the  Company's
financial condition or results of operations.

Recent Developments

On March 29,  1999,  an  agreement  (the "SGSC  Agreement")  which was in effect
between  the Company and  certain of its  affiliates,  on one hand,  and Societe
Generale  Securities  Corporation  ("SGSC") on the other hand, was terminated by
the  Company  and such  affiliates,  via  written  notice.  The Company and such
affiliates  had retained SGSC to act as financial  advisor in connection  with a
transaction  involving the sale of a number of shopping center  properties owned
by such affiliates and two retail  properties owned by the Company.  Pursuant to
the terms of the SGSC  Agreement,  upon certain  dispositions  of the properties
covered by the SGSC Agreement  prior to March 29, 2000 to persons or entities to
whom SGSC had shown such properties, the Company and or such affiliates would be
obligated to pay SGSC a fee based on the sale price of such properties.

The Winston  Settlement  became  effective  at the close of business on March 5,
1999. At such time,  pursuant to the terms of the Winston Settlement  Agreement,
Milestone  canceled and retired  2,983,284  shares of Series A Preferred  Stock,
representing more than 99% of the then outstanding  shares of Series A Preferred
Stock. Furthermore,  on March 18, 1999, Milestone wired approximately $9,000,000
to a court appointed  trustee to be held for the benefit of the plaintiffs.  See
Part II-Other  Information,  Item 1. Legal  Proceedings for a description of the
Winston Settlement and Liquidity and Capital Resources within this section for a
discussion of the costs associated with the Winston Settlement.

On February 12, 1999,  the Company  served a complaint  against each of National
Union Fire  Insurance  Company of  Pittsburgh,  PA and  Stonewall  Surplus  Line
Insurance Company, now known as American Dynasty Surplus Line Insurance Company,
wherein the Company alleged that National Union and Stonewall  wrongfully failed
to contribute to the Winston Settlement and seeking  reimbursement from National
Union and Stonewall up to the limits of their respective policies. See Part II -
Other  Information,  Item 1. Legal  Proceedings for a description of the lawsuit
against National Union and Stonewall.




                                                        12

<PAGE>



Results of Operations

Three Months Ended March 31, 1999 compared to Three Months Ended March 31, 1998

For the three months ended March 31, 1999, the Company  recognized a net loss of
$233,057,  or $0.05 per share of common stock,  on total revenues of $4,071,004.
For the three months ended March 31, 1998, the Company  recognized a net loss of
$534,294, or $0.13 per share of common stock, on total revenues of $5,659,776.

Total  revenues for the three months  ended March 31, 1999 were  $4,071,004,  as
compared to $5,659,776  for the three months ended March 31, 1998, a decrease of
$1,588,772, or 28%, due to the following:

Rent  decreased  $703,708,  or 26%, from  $2,042,097  for the three months ended
March 31, 1999 as compared to  $2,745,805  for the three  months ended March 31,
1998. This decrease is primarily due to property sales in 1998.

Interest income decreased $733,522, or 33%, from $1,507,034 for the three months
ended March 31, 1999  compared to  $2,240,556  the three  months ended March 31,
1998.  This  decrease  is  primarily  due to a decrease  in  interest  income of
approximately  $700,000 as a result of the Company receiving payment during 1998
on  wraparound  notes held by the Company as a result of the sale of some of the
underlying properties by their owners during 1998.

Total  operating  expenses  for the  three  months  ended  March  31,  1999 were
$3,328,409, as compared to $4,953,437 for the three months ended March 31, 1998,
a decrease of  $1,625,028,  or 33%, due  primarily to a decrease in master lease
expense of approximately  $1,491,000  resulting from a decrease in the number of
properties  leased  by the  Company  as a  result  of the  sale  of  some of the
underlying properties by their owners during 1998.

Interest  expense for the three  months ended March 31, 1999 was  $1,069,973,  a
decrease of $449,625,  or 30%, from  $1,519,598 for the three months ended March
31,  1998.  Such  decrease is due to a reduction in the  underlying  debt of the
Company resulting from property sales in 1998.

Depreciation and amortization  expense for the three months ended March 31, 1999
was $191,795,  a decrease of $16,278,  or 8%, from $208,073 for the three months
ended  March 31,  1998.  Such  decrease  was  primarily  due to  property  sales
in 1998.



                                                        13

<PAGE>



Cash Flows

For the three months  ended March 31,  1999,  the Company had a decrease in cash
and cash  equivalents of $9,347,475,  as compared to a decrease in cash and cash
equivalents  of  $1,205,160  for the three months ended March 31, 1998.  For the
three  months  ended  March 31,  1999,  cash used in  operating  activities  was
$3,970,316,  cash provided by investing  activities was $4,067,956 and cash used
in  financing  activities  was  $9,445,115.   The  decrease  in  cash  and  cash
equivalents is primarily due to the restriction of  approximately  $8,949,000 of
cash directly  related to the Winston  Actions and the Winston  Settlement.  See
Part II - Other Information,  Item 1. Legal Proceedings for a description of the
Winston Actions and the Winston Settlement.


Liquidity and Capital Resources

The  Company,  as the  holder of 44,550  shares of Kranzco  Series C  Redeemable
Preferred  Shares of Kranzco  Realty Trust,  a Maryland  real estate  investment
trust  ("Kranzco")  as of January 1, 1999,  received from the redemption of such
shares,  in one  installment  on January 29, 1999,  an aggregate  amount of cash
equal to  approximately  $445,500,  plus interest at the rate of 8% per annum on
the  applicable  outstanding  balance of such shares.  Such  redemption  payment
liquidated  the  Company's  holdings of Kranzco  Series C  Redeemable  Preferred
Shares,  and  accordingly,  the  Company is not  entitled  to future  redemption
payments on such shares.

The Underlying Debt on the Property  located in Quincy,  Illinois,  (the "Quincy
Property")  came due in July 1998.  Beginning  July 1998,  the  mortgagor on the
Underlying  Debt did not demand  payment while the  Partnership,  which owns the
Quincy Property,  attempted to sell the Quincy Property. Although the Underlying
Debt on the  Quincy  Property  has not  been  satisfied,  regular  monthly  debt
payments have been made by the Company through March 1999. On March 1, 1999, the
mortgagor of the  Underlying  Debt sent a demand  letter  seeking to collect the
outstanding balance of the Underlying Debt of approximately $2,910,000. To date,
the mortgagor of the  Underlying  Debt has not made any  additional  demands for
payment of the outstanding balance of the Underlying Debt.

The Underlying  Debt of  approximately  $850,000 on the Fee Property  located in
Zanesville,  Ohio (the  "Zanesville  Property") came due in October 1998 and the
mortgagor  on the  Underlying  Debt  extended  the balance due to May 1999.  The
Company has obtained a loan commitment for approximately $1,750,000 to refinance
the Zanesville Property subject to various terms and conditions,  some or all of
which may not be in the control of the Company.

The  Company's  existing  borrowings  and  the  encumbrances  on the  properties
securing  those  borrowings  may  inhibit  or result in  increased  costs to the
Company in connection with its ability to incur future indebtedness and/or raise
substantial equity capital in the marketplace.

The Company has invested available funds in secure, short-term, interest bearing
investments.  The Company believes that its levels of working capital, liquidity
and funds from operations are sufficient to support present  operations and make
any payments required by the Winston Settlement.



                                                        14

<PAGE>




As a result of, and in connection  with, the settlement of the Winston  Actions,
the Company has disbursed  approximately  $7.5 million,  which amount includes a
portion of the  settlement  consideration  to Series A  Preferred  Stockholders,
defendants's  attorneys fees, court and Commission  filing fees,  printing costs
and  other  expenses.  The  Company  expects  to  disburse  additional  cash  of
approximately $3 million,  including payments of the settlement consideration to
Series A Preferred  Stockholders and fees of the plaintiff's  lawyers.  Although
the expected  expenditures of such funds represents a substantial  amount of the
Company's cash reserves, the Company believes that it would have sufficient cash
to continue operating in the ordinary course of business. The Company,  however,
is  considering  whether  to, and ways it could,  raise cash to make  additional
investments  in suitable real estate  properties.  If the Company  determines to
raise additional  funds, it may decide to do so through a public or private sale
of debt or equity  securities,  by conducting  rights  offerings,  by selling or
realizing on assets (including,  but not limited to, sales of its properties and
interest in the Wrap Debt), through corporate borrowings, or by other means. The
Company does not currently  have any plans with respect to, and may never decide
to  do,  any  of  the  foregoing.  In  addition,  the  Company  has  no  current
understandings or arrangements with respect to purchasing additional properties.

Other  than  described  herein,  management  is not aware of any  other  trends,
events,  commitments or  uncertainties  that will, or are likely to,  materially
impact the Company's liquidity.



Item 3.        Quantitative and Qualitative Disclosure about Market Risk.

At March 31,  1999,  the Company was not  invested in any market risk  sensitive
instruments held for either trading purposes or for purposes other than trading.
As a result,  the Company is not subject to interest rate risk, foreign currency
exchange rate risk,  commodity price risk, or other relevant market risks,  such
as equity price risk.


                                                        15

<PAGE>



                                            PART II - OTHER INFORMATION

Item 1.        Legal Proceedings

As previously reported, during 1996 Milestone,  certain past and present members
of its Board of  Directors  and  executive  officers,  and Concord were named as
defendants in the Winston Actions which were commenced in the Delaware Court. In
the Winston Actions, the plaintiff,  a Series A Preferred Stockholder purporting
to bring  the  action  on  behalf  of  himself,  all  other  Series A  Preferred
Stockholders and derivatively on behalf of Milestone, alleged that in connection
with  Milestone's  acquisition  in  October  1995 of certain  wraparound  notes,
wraparound  mortgages and fee properties from certain  affiliates of Concord and
certain   related   transactions,   Milestone  and  its  directors   engaged  in
self-dealing,  violated federal  securities laws and an injunction  against such
violations  and  breached  their  fiduciary  duties  to the  Series A  Preferred
Stockholders.  The plaintiff claimed,  among other things,  that, as a result of
the Transactions,  Milestone would not have sufficient funds to pay dividends on
the Series A Preferred Stock and that the properties  which were not transferred
to UPI in the  Transfer  were  grossly  inferior  to the  properties  that  were
transferred to UPI.

On August 5, 1998,  the counsel for the named  plaintiff in the Winston  Actions
and the counsel for the defendants entered into the Winston Settlement Agreement
which memorialized the terms of the Winston Settlement. On January 28, 1999, the
Delaware Court approved the Winston Settlement Agreement,  which approval became
final  effective as of the close of business on March 5, 1999. At such time, (i)
the  shares  of  Series  A  Preferred  Stock  owned by each  Series A  Preferred
Stockholder  who was eligible to participate  in the Winston  Settlement and who
did not  properly  opt out of the  Winston  Settlement  and who owned  shares of
Series A  Preferred  Stock as of the  close of  business  on March 5,  1999 were
canceled and represented  only the right of such Series A Preferred  Stockholder
to receive $3.00 in cash from the Company in exchange for each such share;  (ii)
the holders of shares of the Series A Preferred  Stock between  October 23, 1995
and the close of  business  on March 5,  1999,  other  than  Series A  Preferred
Stockholders who properly opted out of the Winston  Settlement  Agreement or who
were precluded from  participating in the Winston  Settlement,  released any and
all claims they may have had against the Company and the other named  defendants
in connection with the Transactions;  (iii) Milestone's  stockholders other than
Series A Preferred  Stockholders who were eligible to participate in the Winston
Settlement  and who properly  opted out of the Winston  Settlement  released all
derivative  claims in  connection  with the  Transactions;  and (iv) the Winston
Actions were  dismissed.  In connection  with the Winston  Actions,  the Company
retained  counsel  for all of the  defendants  (including,  without  limitation,
Leonard S.  Mandor,  Robert A.  Mandor,  Harvey  Jacobson,  Gregory  McMahon and
Geoffrey  Aaronson  (each of whom is a director  and/or officer of the Company))
and assumed  responsibility  for the payment of all legal fees  incurred by such
persons in  connection  with the  Winston  Actions  and the  Winston  Settlement
(subject to the insurance coverage litigation described below).



                                                        16

<PAGE>



The foregoing  description of the Winston  Settlement and the Winston Settlement
Agreement is  qualified  in its entirety by reference to the Winston  Settlement
Agreement,  a copy of which  was filed by the  Company  with the  Commission  on
August 14, 1998 as Exhibit 10.01 to the Company's  Quarterly Report on Form 10-Q
for the quarterly period ended June 30, 1998.

The  Company   maintains  a  directors   and  officers   insurance  and  company
reimbursement  policy  issued by National  Union with a $2,000,000  limit and an
excess directors and officers liability and company  reimbursement policy issued
by Stonewall with a $2,000,000 limit. The Company believes that the amounts that
it has to pay  pursuant to the Winston  Settlement  and in  connection  with the
Winston  Actions are covered losses under both the National Union Policy and the
Stonewall  Policy.  In addition,  the Company  believes  that the legal fees and
other  expenses  incurred by the Company and the other  defendants in connection
with the Winston Actions are also covered losses under the National Union Policy
and the Stonewall Policy.  In connection with a previous proposed  settlement of
the Winston  Actions which was never  consummated,  National Union and Stonewall
both refused to  contribute  to such proposed  settlement,  asserting  that such
proposed  settlement  did not  encompass  any  covered  loss (as  defined in the
National Policy and the Stonewall  Policy,  respectively).  On January 29, 1998,
the Company  commenced  a lawsuit in the United  States  District  Court for the
Southern District of New York against National Union and Stonewall in connection
with such refusal to contribute to such proposed  settlement.  In the complaint,
the plaintiffs  alleged that National Union and Stonewall  wrongfully  failed to
contribute to the proposed  settlement  and sought  reimbursement  from National
Union and  Stonewall  up to the limits of their  respective  policies.  National
Union and  Stonewall  both answered the  complaint  and denied  liability.  As a
result of the termination of the previously proposed settlement,  the Company on
one hand, and Stonewall and National Union, on the other hand, agreed to dismiss
such action  without  prejudice and such action was dismissed on May 29, 1998 by
the United  States  District  Court for the Southern  District of New York.  The
Company gave both National Union and Stonewall notice of the Winston  Settlement
and  provided  each of them with a copy of the Winston  Settlement  Agreement on
August 12, 1998.  National Union and Stonewall  reviewed the Winston  Settlement
Agreement and separately informed the Company that their basic position, denying
coverage, had not changed. On February 12, 1999, the Company commenced a lawsuit
in the Circuit  Court for the Fifteenth  Judicial  Circuit in and for Palm Beach
County, Florida against both National Union and Stonewall alleging,  among other
things,  that National Union and Stonewall have wrongfully refused to contribute
to the Winston  Settlement  and seeking  reimbursement  from National  Union and
Stonewall up to the limits of their respective  policies.  The initial complaint
in the new  lawsuit  was  served  on each of  National  Union and  Stonewall  on
February 12, 1999 and on March 17, 1999 the Company filed an amended  complaint,
which, among other things,  added certain of the other defendants to the Winston
Actions as  plaintiffs.  On April 12,  1999,  National  Union served a motion to
dismiss the amended complaint or to strike part thereof,  and a motion to recuse
the Company's  Florida counsel.  National Union has since agreed to withdraw its
motion to dismiss  and to serve its answer to the amended  complaint  by June 1,
1999. The motion to recuse the Company's  Florida  counsel is still pending.  On
April 12, 1999,  Stonewall served its answer to the amended complaint and denied
liability.  In connection with this action, the Company has retained counsel for
all of the  plaintiffs  and is  assuming  responsibility  for the payment of all
legal fees  incurred by such persons in  connection  with this  action.  At this
time, the Company is not in a position to render an opinion as to the outcome of
this action.

                                                        17

<PAGE>



Item 5.        Other Information

Milestone's  Board of Directors  determined  not to declare any dividends on the
Series A Preferred Stock during the years ended December 31, 1996, 1997 and 1998
and during the three months ended March 31, 1999. The last dividend  declared by
Milestone was for the quarter  ended  December 31, 1995 and was paid on February
15, 1996 at $0.195 per share of Series A Preferred Stock.

After September 30, 1995,  holders of the Series A Preferred Stock have not been
entitled to receive dividends on a cumulative basis. Pursuant to the Certificate
of  Designations  of the Series A  Preferred  Stock,  after  such date,  no cash
dividend may be paid on the Common Stock unless full  dividends of $0.195 on all
outstanding  shares of Series A Preferred  Stock for the then current  quarterly
dividend  period are declared and either paid or sufficient sums for the payment
thereof  are  set  apart.  As  a  result  of  Milestone's  Board  of  Directors'
determination  not to declare a dividend  for the quarter  ended June 30,  1997,
which was the sixth consecutive quarter for which no dividend was declared,  the
number  of  persons  entitled  to serve as  directors  on  Milestone's  Board of
Directors  has been  increased by one, and the holders of the Series A Preferred
Stock, who are otherwise entitled to elect one member of the Board of Directors,
became  entitled to elect a second member of the Board of Directors to fill such
newly  created  directorship.  Such  election of a second member of the Board of
Directors is scheduled to occur at the Annual Meeting of Stockholders to be held
on May 28,  1999.  Any  decision as to the future  payment of  dividends  on the
Series A  Preferred  Stock  will  depend on the  results of  operations  and the
financial  condition of the Company and such other factors as Milestone's  Board
of  Directors,   in  its  discretion,   deems  relevant.  See  Part  I-Financial
Information, Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operation, Liquidity and Capital Resources.



                                                        18

<PAGE>



Item 6.        Exhibits and Reports on Form 8-K

         (a)       The following exhibits are included herein:

                    10.01 Amendment No. 1 to Employment  Agreement,  dated as of
               April 19, 1999 by and between the Company and Robert A. Mandor.

                    10.02 Amendment No. 1 to Employment  Agreement,  dated as of
               April 19, 1999 by and between the Company and Harvey Shore.

                             27 - Financial Data Schedule Article 5 included for
                             Electronic Data  Gathering,  Analysis and Retrieval
                             (EDGAR)  purposes  only.  This  Schedule   contains
                             summary  financial  information  extracted from the
                             consolidated   balance   sheets  and   consolidated
                             statements  of revenues and expenses of the Company
                             as of and for the three  month  period  ended March
                             31,  1999,  and is  qualified  in its  entirety  by
                             reference to such financial statements.

         (b)       Reports on Form 8-K:

                   Current  Report  on Form 8-K  filed  with the  Commission  on
                   February 11, 1999 reporting that the Court of Chancery of the
                   State of Delaware  had approved  the Winston  Settlement  and
                   that the order approving the Winston  Settlement would become
                   final,  effective  upon the  expiration  of a  30-day  appeal
                   period which ended at the close of business on March 5, 1999.




                                                        19

<PAGE>


                                                    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.


                               MILESTONE PROPERTIES, INC.
                               (Registrant)



Date:    May 14, 1999          By    /s/ Robert A. Mandor                  
                                     --------------------------------------
                                     Robert A. Mandor
                                     President and Chief Financial Officer



Date:    May 14, 1999          By    /s/ Patrick S. Kirse                  
                                     --------------------------------------
                                     Patrick S. Kirse
                                     Vice President of Accounting
                                     (Principal Accounting Officer)