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, 1998 

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934

    For the transition period from to ___________________ to ___________________

                         Commission file number 33-27399




                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)





             New Jersey                                       22-2469174
(State or other jurisdiction of 
 incorporation or organization)             (I.R.S. Employer Identification No.)


         Indiana Avenue & the Boardwalk, Atlantic City, New Jersey 08401
               (Address of principal executive offices) (Zip Code)

                                 (609) 340-3400
              (Registrant's telephone number, including area code)




     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Sections 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 ____


<PAGE>


                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.

                                      INDEX


PART I             FINANCIAL INFORMATION                           Page No.

     Item 1.   Financial Statements

               Introductory Note to Financial Statements               2

               Balance Sheets as of December 31, 1997 
               and  March 31, 1998                                     3

               Statements of Operations  For the Three 
               Months Ended March 31, 1997 and 1998                    4

               Statements of Partners' Capital Accounts 
               (Deficit) For the Year Ended December 31, 
               1997 and the Three Months Ended March 31, 1998          5

               Statements of Cash Flows For the Three Months
               Ended March 31, 1997 and 1998                           6

               Notes to Financial Statements                          7-8

     Item 2.   Management's  Discussion and Analysis of Financial  
               Condition and Results of Operations                    9-11



PART II                 OTHER INFORMATION

    Items 1-5   No  information  is  provided  as the answers to 
                Items 1  through  5 are inapplicable.

    Item 6.     Exhibits and reports on Form 8-K                      11


<PAGE>


                                     PART I

Item 1.   Financial Statements

Introductory Note to Financial Statements

The  accompanying  financial  statements  have been  prepared by  Atlantic  City
Boardwalk Associates,  L.P. ("Partnership") without audit, pursuant to the rules
and  regulations of the Securities  and Exchange  Commission.  In the opinion of
management,  these financial  statements  contain all  adjustments  necessary to
present fairly the financial  position of the  Partnership as of March 31, 1998,
and the results of  operations  and cash flows for the three  months ended March
31, 1997 and 1998.

Although management  believes that the disclosures  included herein are adequate
to make the information contained herein not misleading, certain information and
footnote  disclosures  normally  included in  financial  statements  prepared in
accordance with generally accepted accounting  principles are omitted herein and
are incorporated by reference from the Partnership's  Annual Report on Form 10-K
for the year ended  December  31, 1997 filed with the  Securities  and  Exchange
Commission.  While  the  Partnership  was  formed  to own,  and to  lease to the
Claridge  Hotel  and  Casino  Corporation  ("Corporation")  and its  affiliates,
certain real estate and related assets, the Partnership is separate and distinct
from the  Corporation.  Any person or entity seeking  information  regarding the
Corporation  or its  debt  or  equity  securities  should  review  the  reports,
statements and other  information  filed by the Corporation  with the Securities
and Exchange Commission.



<PAGE>

<TABLE>
<CAPTION>

                                          ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.
                                                       Balance Sheets
                                            December 31, 1997 and March 31, 1998

                                                                                                              (Unaudited)
                  Assets                                                                     1997                1998
                  ------                                                                ---------------     ---------------

Current assets:
<S>                                                                                  <C>                          <C>      
     Cash and cash equivalents                                                       $          552,000           1,008,000
     Rent due from New Claridge                                                                 810,000             809,000
     Interest receivable from partners                                                           41,000              49,000
     Prepaid expenses                                                                           254,000             169,000
      Other assets                                                                              150,000             111,000
                                                                                        ---------------     ---------------
              Total current assets                                                            1,807,000           2,146,000
                                                                                        ---------------     ---------------

Hotel Assets                                                                                183,707,000         183,905,000
Less:  Accumulated depreciation and amortization                                           (105,660,000)       (107,001,000)
                                                                                            -----------         -----------
              Net Hotel Assets                                                               78,047,000          76,904,000
                                                                                        ---------------     ---------------

Note receivable from New Claridge, including accrued interest  of
     $3,690,000 and $3,798,000 in 1997 and 1998, respectively                                 7,290,000           7,398,000
Deferred rent from New Claridge                                                              31,022,000          27,554,000
Intangibles, net of accumulated amortization of
     $3,727,000 and $3,748,000 in 1997 and 1998, respectively                                    78,000              57,000
                                                                                        ---------------     ---------------

                                                                                     $      118,244,000         114,059,000
                                                                                            ===========         ===========
                  Liabilities and Partners' Capital Accounts

Current liabilities:
     Accounts payable                                                                $        1,391,000           1,159,000
     Accrued interest due New Claridge                                                          948,000             902,000
     Current portion of long-term debt due principally to
         New Claridge                                                                        18,615,000          14,633,000
                                                                                        ---------------     ---------------
              Total current liabilities                                                      20,954,000          16,694,000

Long-term debt due principally to New Claridge, including                                    75,465,000          75,762,000
  accrued interest of $20,000,000 in 1997 and 1998                                      ---------------        ------------
     

              Total liabilities                                                              96,419,000          92,456,000
                                                                                        ---------------        ------------

Partners' capital accounts (deficit):
     New general partners                                                                       134,000             132,000
     Former general partners                                                                    191,000             189,000
     Special limited partners                                                                  (158,000)           (160,000)
     Investor limited partners                                                               21,658,000          21,442,000
                                                                                        ---------------     ---------------

         Total partners' capital accounts (deficit)                                          21,825,000          21,603,000

Commitments and contingencies
                                                                                        ---------------     ---------------
                                                                                     $      118,244,000         114,059,000
                                                                                        ===============     ================
                See accompanying notes to financial statements.
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.

                            Statements of Operations
                                   (Unaudited)

               For the Three Months Ended March 31, 1997 and 1998


                                                                                              1997                  1998
                                                                                          -------------          --------

<S>                                                                                  <C>                         <C>      
Revenues:
     Rent from New Claridge for the lease of Hotel Assets                            $       10,031,000          7,263,000
     Interest from New Claridge                                                                 108,000            108,000
     Interest from Special Limited Partners                                                       9,000              9,000
     Investment                                                                                  12,000             10,000
     Other                                                                                        2,000             -
                                                                                         --------------          ---------

                                                                                             10,162,000          7,390,000
                                                                                             ----------          ---------


Expenses:
     Cost of maintaining and repairing
         Hotel Assets paid to New Claridge                                                    2,796,000          2,885,000
     Interest, principally on mortgages to New Claridge                                       3,746,000          3,216,000
     General and administrative                                                                 170,000            116,000
     General Partners' management fee                                                            33,000             33,000
     Depreciation and amortization                                                            1,408,000          1,362,000
                                                                                            -----------          ---------

                                                                                              8,153,000          7,612,000
                                                                                            -----------          ---------


Net income (loss)                                                                    $        2,009,000           (222,000)
                                                                                            ===========          =========

Net income (loss) per limited partnership unit
(450 units outstanding at the end of each period)                                                 4,393               (484)
                                                                                         ==============       ============

</TABLE>

                See accompanying notes to financial statements.



<PAGE>

<TABLE>

                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.

               Statements of Partners' Capital Accounts (Deficit)

                      For the Year Ended December 31, 1997
                    and the Three Months Ended March 31, 1998

<CAPTION>

                                                          Class A       Class B        Class A           Class B           Total
                               New         Former         Special       Special       Investor          Investor         Partners'
                             General       General        Limited       Limited        Limited           Limited          Capital
                            Partners      Partners       Partners      Partners        Partners          Partners        Accounts
                            --------      --------       --------      --------        --------          --------        --------

<S>                          <C>           <C>            <C>          <C>             <C>              <C>              <C>       
Partners' Capital
Accounts (Deficit),
December 31, 1996            105,000       173,000        (12,000)     (175,000)       4,593,000        14,204,000       18,888,000

Net income                    29,000        18,000          2,000        27,000          702,000         2,159,000        2,937,000
                            --------      --------      ---------      --------       ----------       -----------      -----------

Partners' Capital
Accounts (Deficit),
December 31, 1997            134,000       191,000        (10,000)     (148,000)       5,295,000        16,363,000       21,825,000

Net loss
(unaudited)                   (2,000)       (2,000)          -           (2,000)         (53,000)         (163,000)        (222,000)
                            --------      --------      ---------      --------      -----------      ------------     ------------

Partners' Capital
Accounts (Deficit),
March 31, 1998
(unaudited)               $  132,000       189,000        (10,000)     (150,000)       5,242,000        16,200,000       21,603,000
                             =======       =======         ======       =======        =========        ==========       ==========

</TABLE>

                See accompanying notes to financial statements.



<PAGE>

<TABLE>
<CAPTION>

                                          ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.

                                                  Statements of Cash Flows
                                                         (Unaudited)

                                     For the Three Months Ended March 31, 1997 and 1998


                                                                                                1997                1998
                                                                                             ----------         ----------
<S>                                                                                  <C>                           <C>      
Cash flows from operating activities:
     Net income (loss)                                                               $        2,009,000            (222,000)
         Adjustments to reconcile net income (loss) to
         net cash provided by operating activities:
              Depreciation and amortization                                                   1,408,000           1,362,000
              Accretion of discount on mortgage note                                            415,000             477,000
              (Increase) decrease in deferred rent                                             (876,000)          3,468,000
              Deferred interest on receivable from New Claridge                                (108,000)           (108,000)
              Change in current assets and liabilities:
                  (Increase) decrease in rent due from New Claridge,
                      interest receivable from partners, prepaid expenses
                      and other assets                                                          (86,000)            117,000
                  Increase (decrease) in accounts payable and
                      accrued interest due New Claridge                                          43,000            (278,000)
                                                                                            -----------          ----------

                      Net cash provided by operating activities                               2,805,000           4,816,000
                                                                                              ---------           ---------

Cash flows from investing activities:
     Purchase of Hotel Assets                                                                    (9,000)           (198,000)
                                                                                           ------------          ----------

Cash flows from financing activities:
     Proceeds of borrowings from New Claridge                                                    61,000             495,000
     Principal payments of debt, principally to New Claridge                                 (4,171,000)         (4,657,000)
                                                                                              ---------           ---------

                      Net cash used in financing activities                                  (4,110,000)         (4,162,000)
                                                                                              ---------           ---------

Net (decrease) increase in cash and cash equivalents                                         (1,314,000)            456,000
Cash and cash equivalents, beginning of period                                                1,446,000             552,000
                                                                                              ---------          ----------

Cash and cash equivalents, end of period                                             $          132,000           1,008,000
                                                                                             ==========           =========

Supplemental cash flow information:
     Interest paid, principally to New Claridge                                      $        3,604,000           3,091,000
                                                                                              =========           =========
</TABLE>

                See accompanying notes to financial statements.


<PAGE>


                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.
                          Notes to Financial Statements
                                   (Unaudited)


(1)      The Partnership

         Atlantic City Boardwalk Associates,  L.P. ("Partnership") was formed on
         October  31,  1983 to  acquire  the  buildings,  parking  facility  and
         non-gaming  depreciable,   tangible  property   (collectively,   "Hotel
         Assets")  of The  Claridge  Hotel and  Casino  ("Claridge")  located in
         Atlantic City, New Jersey; to hold a leasehold  interest in the land on
         which the  Claridge is located  ("Land"),  which Land was  subsequently
         acquired  by the  Partnership  as  part  of a  financial  restructuring
         ("Restructuring  Agreement");  and to engage in  activities  related or
         incidental thereto. The Partnership leases the Land and Hotel Assets to
         The  Claridge  at  Park  Place,   Incorporated   ("New  Claridge"),   a
         wholly-owned  subsidiary of The Claridge  Hotel and Casino  Corporation
         ("Corporation"), under operating leases.

(2)      Financial Condition of the Partnership and New Claridge

         The ability of the  Partnership to fulfill its obligations is dependent
         upon the  ability  of New  Claridge  to pay rental  payments  when due.
         Accordingly,  the financial  stability of the  Partnership is dependent
         upon the financial condition of New Claridge.

         As discussed in the Claridge's  Annual Report on Form 10-K for the year
         ended December 31, 1996, the Corporation  experienced  recurring losses
         and  serious  deterioration  in  its  cash  flow  in  1996.  Since  the
         Corporation does not have substantial cash reserves or access to a line
         of  credit,   the  Corporation   needed  to  experience  a  significant
         improvement  in operating  results in 1997 over 1996 levels in order to
         meet its on-going  obligations,  including  the interest due on the $85
         million of First Mortgage Notes.  Operating results in 1997 did improve
         over  1996  levels,  due  primarily  to  the  positive  impact  of  the
         availability of the self-parking garage, lower bus package pricing, and
         other  cost  containment   initiatives.   Although  management  of  the
         Corporation  believes that  operating  results will continue to improve
         over  1996  levels,  no  assurances  as to  the  continuation  of  this
         improvement  can be given.  Management of New Claridge will continue to
         conserve  cash through  various cost  containment  measures,  including
         limiting  capital  expenditures  in 1998 to  approximately  $2 million.
         Given the various  improvements  made to the property in recent  years,
         including  the casino  expansion  in 1994 and the  construction  of the
         self-parking garage, the current condition of the property is such that
         the above-mentioned  level of capital  expenditures is deemed adequate.
         Management  of New  Claridge  will also  consider  various  refinancing
         efforts, including a sale of the Corporation. In addition, New Claridge
         has  retained  the law firm of Zelle  and  Larson  LLP of  Minneapolis,
         Minnesota  to assist in  evaluating  the  recovery of certain  expenses
         incurred  in  reopening  the  self-parking  garage  and  in  evaluating
         potential lost profit claims as a result of the accident which occurred
         in the  self-parking  garage on July 10, 1996.  On July 22,  1997,  New
         Claridge filed a Complaint and Demand for  Arbitration in the amount of
         $10 million  against the general  contractor  and the architect for the
         self-parking  garage;  recovery of these  claims  would have a positive
         impact on New  Claridge's  financial  results and  liquidity.  However,
         there  is no  assurance  that the  Corporation  will be  successful  in
         realizing any recovery.

         The Corporation had a net loss of $1,645,000 for the three months ended
         March  31,  1998,  compared  to a net loss of  $4,815,000  for the same
         period in 1997. The decrease in net loss is due primarily to a decrease
         in  general  and  administrative  expenses  and  rent  expense  to  the
         Partnership. During the first quarter of 1997, the Corporation incurred
         significant   professional   and  legal  fees  due  to  its   attempted
         reorganization   last  year,   resulting  in   decreased   general  and
         administrative expenses during 1998. Rent expense to the Partnership in
         the  first  quarter  of 1998  decreased  due to the  abatement  of rent
         pursuant to the March 1, 1997  amendments  to the  Operating  Lease and
         Expansion  Operating Lease.  Prior to these  amendments,  lease expense
         (including the effect of the $38.8 million of rent abatements  provided
         in accordance with the 1989 Restructuring  Agreement) was recognized on
         a leveled basis over the initial lease term ending  September 30, 1998.
         Since the amount of abatements  permitted in accordance  with the March
         1, 1997 amendments will vary depending

<PAGE>
         on  the Partnership's  cash flow, the actual amount abated on a monthly
         basis  is  recorded  as a  reduction  to lease  expense.  For the three
         months  ended March 31, 1998, the reduction to lease expense  resulting
         from  the  abatement  of   rent  was  approximately  $2.5  million;  no
         reduction to lease  expense  was recorded in the first  quarter of 1997
         as a result of the abatement of rent.

         The ownership and operation of casino-hotel facilities in Atlantic City
         are subject to extensive state  regulation under the Casino Control Act
         under the direction of the New Jersey Casino  Control  Commission.  The
         Casino  Control Act provides  that various  categories of entities must
         hold appropriate  casino licenses.  The Partnership  currently operates
         under a four-year casino service industry license effective October 31,
         1995, while New Claridge  operates under a four-year casino  operator's
         license effective September 30, 1995.

(3)      Contingencies

         The 1989  Restructuring  Agreement  provided  for Del Webb  Corporation
         ("Webb") to retain an interest, which was assigned to a trustee for the
         benefit of the Valley of the Sun United Way on April 2, 1990,  equal to
         $20  million  plus  interest  at a rate  of 15% per  annum,  compounded
         quarterly,  commencing  December 1, 1988,  in any  proceeds  ultimately
         recovered  from the  operations  and/or the sale or  refinancing of the
         Claridge  facility  in  excess  of the  first  mortgage  loan and other
         liabilities  ("Contingent  Payment").  Consequently,  New  Claridge has
         deferred  the  recognition  of $20 million of  forgiveness  income with
         respect  to  the  Contingent  Payment   obligation.   Interest  on  the
         Contingent  Payment has not been recorded by the Corporation  since the
         likelihood  of paying  such amount is not  considered  probable at this
         time.  As of March 31, 1998,  accrued  interest  would have amounted to
         approximately $59.1 million.

         In connection with the 1989 restructuring,  Webb agreed to permit those
         partners/investors  in  the  Partnership  and  Corporation  ("Releasing
         Partners/Investors")  from whom Webb had received written releases from
         all  liabilities,  rights  ("Contingent  Payment  Rights")  to  receive
         certain  amounts  to  the  extent  available  for  application  to  the
         Contingent   Payment.    Approximately   84%   in   interest   of   the
         partners/investors    provided    releases    and   became    Releasing
         Partners/Investors.  Payments to Releasing Partners/Investors are to be
         made in  accordance  with a schedule of  priorities,  as defined in the
         1989 Restructuring Agreement.

         On February 23, 1996, the  Corporation  acquired an option to purchase,
         at a discount from the carrying  value,  the  Contingent  Payment.  The
         purchase price of the option was $1 million,  and the option could have
         been exercised any time prior to December 31, 1997.

         Given the recent operating results at New Claridge, the Corporation was
         not able to exercise this Contingent  Payment Option, and it expired in
         accordance with its terms on December 31, 1997.


<PAGE>


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

Results of Operations for the Three Months Ended March 31, 1998
as Compared to the Three Months Ended March 31, 1997

Rental income for the three months ended March 31, 1998 decreased  $2,768,000 as
compared to the three months ended March 31,  1997.  This  decrease is primarily
due to the  abatement of rent  pursuant to the March 1, 1997  amendments  to the
Operating Lease and Expansion Operating Lease. Prior to these amendments, rental
income (including the effect of the $38.8 million of rent abatements provided in
accordance  with the 1989  Restructuring  Agreement) was recognized on a leveled
basis over the initial lease term ending September 30, 1998. Since the amount of
abatements  permitted in accordance  with the March 1, 1997 amendments will vary
depending on the Partnership's  cash flow, the actual amount abated on a monthly
basis is recorded as a reduction  to rental  income.  For the three months ended
March 31, 1998,  the reduction to rental income  resulting from the abatement of
rent was approximately $2.5 million;  no reduction to rental income was recorded
in the first  quarter of 1997 as a result of the  abatement of rent. In addition
to basic rent, New Claridge pays as additional  rent,  certain expenses and debt
service relating to furniture,  fixture and equipment  replacements and building
improvements  ("FF&E").  During 1997, FF&E note principal and interest  payments
were higher in 1997 than in 1998  resulting  in  decreased  additional  rents in
1998.

General and administrative expenses decreased $54,000 for the three months ended
March  31,  1998  as  compared  to  the  three  months  ended  March  31,  1997.
Professional  fees  during  1997  were  significant  due  to  the  Corporation's
attempted  reorganization  last year,  resulting in reduced fees in 1998.  Also,
insurance expense decreased due to a decrease in the insurance premium.

For the three months ended March 31, 1998,  interest expense decreased  $530,000
as compared to the same period  ended March 31, 1997 due to  principal  payments
made during 1997 and 1998 that  reduced the average  outstanding  balance of the
wraparound and expansion mortgages.

Liquidity and Capital Resources

The  ability of the  Partnership  to  continue  to fulfill  its  obligations  is
dependent  upon the ability of New Claridge to continue to make rental  payments
when due.  Current lease payments from New Claridge,  as recently  amended,  are
sufficient to pay the Partnership's debt service and operating expenses. As part
of the 1989 Restructuring  Agreement,  rental payments in excess of monthly cash
flow requirements were deferred or abated so that excess cash did not accumulate
in the Partnership.  The 1997 restructuring continued this deferral or abatement
of excess cash flow through 1998. At the Closing of the 1989  restructuring  the
Partnership  loaned New Claridge $3.6  million.  The note,  including  interest,
along with those rentals  deferred under the amendment to the operating  leases,
are to be  repaid to the  Partnership  upon (i) the sale or  refinancing  of the
Claridge;  (ii)  full  or  partial  satisfaction  of the  Expandable  Wraparound
Mortgage;  and (iii) full  satisfaction of any first mortgage then in place. The
deferral of $1.3 million of rental obligation as part of the 1997  restructuring
leaves the Partnership with minimal liquidity.

The Operating  Lease and the Expansion  Operating  Lease were amended as part of
the 1989  Restructuring  Agreement to provide for the deferral of $15,078,000 of
rental  payments  during the period July 1, 1988 through the  beginning of 1992,
and to provide for the  abatement of  $38,820,000  of basic rent  through  1998,
thereby  reducing  the  Partnership's  cash  flow to an amount  estimated  to be
necessary only to meet the  Partnership's  cash  requirements.  During the third
quarter of 1991,  the maximum  deferral of rent was reached.  On August 1, 1991,
the Operating  Lease and the Expansion  Operating  Lease were amended further to
revise the abatement  provisions so that,  commencing  January 1, 1991, for each
calendar year through 1998, the lease abatements could not exceed $10 million in
any one calendar year, nor $38,820,000 in the aggregate.  All of the $38,820,000
of available rent  abatements was fully utilized by the end of the first quarter
of 1997.

<PAGE>

The Fifth  Amendment  to the  Operating  Lease and the Fourth  Amendment  to the
Expansion  Operating Lease, which were effective on March 1, 1997,  provided for
the  abatement of $867,953 of basic rent and for the deferral of  $1,300,000  of
basic rent on March 1, 1997,  and provides for  additional  abatements  of basic
rent, commencing on April 1, 1997, as necessary to reduce the Partnership's cash
flow to an amount necessary to meet the Partnership's cash requirements  through
December 31, 1998  (determined  without  regard to the repayment of the deferred
rent). The $1.3 million of basic rent deferred on March 1, 1997 is to be paid to
the Partnership in monthly  installments of $25,000 for the period April 1, 1997
through December 31, 1997, and monthly installments of $50,000 for the year 1998
and  thereafter  until  paid in full  (subject  to  acceleration  under  certain
circumstances).  For the years 1999 through 2003, additional abatements of basic
rent are to be made to provide the  Partnership  with the amount  needed to meet
the Partnership's cash requirements plus an additional amount ($83,333 per month
in 1999 and 2000, $125,000 per month in 2001, and $166,667 per month in 2002 and
2003).  All abatements of rent in excess of the $38.8 million which were allowed
in accordance with the 1989  restructuring  will be recognized as a reduction of
rental  income as it is abated.  During the three  months  ended March 31, 1998,
rents abated amounted to approximately $2.5 million.

In  addition,  under the  March 1,  1997  restructuring  agreement  between  the
Corporation,  New Claridge and the Partnership,  New Claridge agreed to exercise
the first of three ten-year renewal options  extending the term of the Operating
Lease and  Expansion  Operating  Lease through  September  30, 2008.  Basic rent
during the renewal term of the Operating Lease will be calculated  pursuant to a
formula  with annual  basic rent not to be more than $29.5  million or less than
$24 million for the twelve months commencing  October 1, 1998, and subsequently,
not to be  greater  than  10%  more  than the  basic  rent  for the  immediately
preceding  lease  year in each  lease year  thereafter.  Basic  rent  during the
renewal term of the Expansion  Operating Lease will also be calculated  pursuant
to a formula  with annual basic rent not to be more than $3 million or less than
$2.5 million for the twelve months commencing October 1, 1998, and subsequently,
not to be  greater  than  10%  more  than the  basic  rent  for the  immediately
preceding lease year in each lease year thereafter.

Under the terms of the Operating Lease, as amended  effective March 1, 1997, New
Claridge had an option to purchase  (the  "Purchase  Option"),  on September 30,
1998,  the Hotel Assets and the  underlying  land for their fair market value at
the time the Purchase  Option is  exercised,  which in no event may be less than
(i) the amount then outstanding under the Expandable  Wraparound Mortgage,  plus
(ii) $2.5 million, plus (iii) any amount of the $1.3 million of rent deferred on
March 1, 1997 not then paid. To exercise the Purchase  Option,  New Claridge was
required to give notice to the  Partnership,  at least nine months  prior to the
option date, of its election to do so. Based on its current financial situation,
New  Claridge  did not give such  notice to the  Partnership  in  respect of the
September  30, 1998 option date.  However,  New  Claridge  may also  exercise an
option,  on September 30, 2003, to purchase the Hotel Assets and the  underlying
land on January 1, 2004,  for their fair market  value at the time the option is
exercised.

The  Partnership  funds the  purchase of  additional  Hotel  Assets by borrowing
funds, at a 14% interest rate, from New Claridge.  The ensuing notes are secured
under the  Expandable  Wraparound  Mortgage  up to $25  million.  Principal  and
interest  on  these  notes  are  then  reimbursed  to  the  Partnership  through
additional rentals from New Claridge. Under the Operating Lease, New Claridge is
required to reimburse the Partnership for all taxes, assessments,  insurance and
general and administrative costs of the Partnership.

The Partnership had a working capital  deficiency of $14,548,000 as of March 31,
1998 and  $19,147,000  as of December 31, 1997. The working  capital  deficiency
primarily results from the consummation of the 1989  Restructuring  Agreement as
well  as the  1997  restructuring.  As  part  of  the  1989  restructuring,  the
Partnership's  cash  flow was  reduced  to an amount  no  greater  than what the
Partnership  needs to pay  Partnership  expenses,  including debt service.  Such
concept was continued through 1998 in the 1997  restructuring.  Thus, so long as
the Claridge is financially  viable and continues to make all payments under the
operating  leases,  the  Partnership  expects  to be  able  to pay  its  current
liabilities.

<PAGE>

                                     PART II

Item 6.   Exhibits and reports on Form 8-K

          (a)  Not applicable.
          (b)  No  reports  on  Form  8-K  were filed  during the quarter  ended
March 31, 1998.




                                   SIGNATURES


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                        Atlantic City Boardwalk Associates, L.P.
                                                   Registrant





Date          May 14, 1998             /s/ Anthony C. Atchley
       ----------------------          ------------------------------------
                                       by  Anthony C. Atchley, General Partner


Date          May 14, 1998             /s/ Gerald C. Heetland
       ----------------------          -----------------------------------------
                                       by  Gerald C. Heetland, General Partner


Date          May 14, 1998             /s/ Anthony C. Atchley
       ---------------------           -----------------------------------------
                                       by  AC Boardwalk Partners Corporation, 
                                             General Partner
                                       by  Anthony C. Atchley, President