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                           June 30, 1998

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

     For the transition period from _________  to __________

                                              Commission file number   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            (I.R.S. Employer Identification No.)
  incorporation or organization)


         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  
              June 30, 1998                                            3

              Statements of Operations For the Three-Month 
              and Six-Month Periods Ended June 30, 1997 and 1998       4

              Statements  of Partners'  Capital  Accounts 
              (Deficit) For the Year Ended December 31, 1997 
              and the Six Months Ended June 30, 1998                   5

              Statements  of Cash  Flows For the Six Months  
              Ended June 30,  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 June 30, 1998,
and the results of  operations  for the three and six months ended June 30, 1997
and 1998, and cash flows for the six months ended June 30, 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>

                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.
                                 Balance Sheets
                       December 31, 1997 and June 30, 1998


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

Current assets:
     Cash and cash equivalents                   $     552,000          830,000
     Rent due from New Claridge                        810,000          801,000
     Interest receivable from partners                  41,000           58,000
     Prepaid expenses                                  254,000           91,000
      Other assets                                     150,000           56,000
                                                     ---------        ----------
              Total current assets                   1,807,000        1,836,000
                                                     ---------        ----------
Hotel Assets                                       183,707,000      184,137,000
Less:  Accumulated depreciation and amortization  (105,660,000)    (108,331,000)
                                                   ------------    -------------
              Net Hotel Assets                      78,047,000       75,806,000
                                                   ------------    -------------
Note receivable from New Claridge, including 
     accrued interest  of $3,690,000 and 
     $3,906,000 in 1997 and 1998, respectively       7,290,000        7,506,000
Deferred rent from New Claridge                     31,022,000       24,086,000
Intangibles, net of accumulated amortization of
     $3,727,000 and $3,770,000 in 1997 and 
     1998, respectively                                 78,000           35,000
                                                   -----------      ------------
                                                  $118,244,000      109,269,000
                                                  ============      ============
            Liabilities and Partners' Capital Accounts

Current liabilities:
     Accounts payable                             $  1,391,000        1,268,000
     Accrued interest due New Claridge                 948,000          843,000
     Current portion of long-term debt due 
          principally to New Claridge               18,615,000       10,552,000
                                                    ----------       -----------
              Total current liabilities             20,954,000       12,663,000

Long-term debt due principally to New Claridge, 
     including accrued interest of $20,000,000 
     in 1997 and 1998                               75,465,000       76,068,000
                                                    ----------       -----------
              Total liabilities                     96,419,000       88,731,000
                                                    ----------       -----------
Partners' capital accounts (deficit):
     New general partners                              134,000          121,000
     Former general partners                           191,000          183,000
     Special limited partners                         (158,000)        (171,000)
     Investor limited partners                      21,658,000       20,405,000
                                                    ----------       -----------
         Total partners' capital accounts (deficit) 21,825,000       20,538,000

Commitments and contingencies
                                                  ------------      ------------
                                                  $118,244,000      109,269,000
                                                  ============      ===========

                See accompanying notes to financial statements.

<PAGE>

<TABLE>
<CAPTION>
                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.

                            Statements of Operations
                                   (Unaudited)


                                                                  Three Months Ended                     Six Months Ended
                                                                       June 30,                              June 30,
                                                               1997              1998                1997              1998
                                                               ----              ----                ----              ----
Revenues:
<S>                                                      <C>                    <C>                 <C>               <C>    
     Rent from New Claridge for
         the lease of Hotel Assets                        $    9,398,000        6,405,000           19,429,000        13,668,000
     Interest from New Claridge                                  108,000          108,000              216,000           216,000
     Interest from Special Limited Partners                        9,000            9,000               18,000            18,000
     Investment                                                    6,000           12,000               18,000            22,000
     Other                                                           -              1,000                2,000             1,000
                                                               ---------        ---------           ----------        ----------
                                                               9,521,000        6,535,000           19,683,000        13,925,000
                                                               ---------        ---------           ----------        ----------
Expenses:
     Cost of maintaining and repairing
         Hotel Assets, paid to New Claridge                    2,853,000        2,958,000            5,649,000         5,843,000
     Interest, principally on mortgages to
         New Claridge                                          3,627,000        3,079,000            7,373,000         6,295,000
     General and administrative                                  201,000          178,000              371,000           294,000
     General Partners' management fee                             32,000           32,000               65,000            65,000
     Depreciation and amortization                             1,374,000        1,353,000            2,782,000         2,715,000
                                                               ---------        ---------           ----------        ----------
                                                               8,087,000        7,600,000           16,240,000        15,212,000
                                                               ---------        ---------           ----------        ----------

Net income (loss)                                         $    1,434,000       (1,065,000)           3,443,000        (1,287,000)
                                                               =========       ===========           =========        ===========


Net income (loss) per limited partnership unit
(450 units outstanding
      at the end of each period)                          $        3,136           (2,329)               7,529            (2,813)
                                                           =============        ==========           =========         ==========



                See accompanying notes to financial statements.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.

               Statements of Partners' Capital Accounts (Deficit)

                      For the Year Ended December 31, 1997
                     and the Six Months Ended June 30, 1998

<S>                          <C>           <C>            <C>           <C>           <C>               <C>               <C>
                                                          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


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)                  (13,000)       (8,000)        (1,000)      (12,000)        (307,000)       (946,000)       (1,287,000)
                             --------      --------       --------     ---------       ----------      ----------      ------------
Partners' Capital
Accounts (Deficit),
June 30, 1998
(unaudited)               $  121,000       183,000        (11,000)     (160,000)       4,988,000      15,417,000        20,538,000
                           =========       =======        =======      =========       =========      ==========        ==========

</TABLE>


                See accompanying notes to financial statements.

<PAGE>
<TABLE>
<CAPTION>

                    ATLANTIC CITY BOARDWALK ASSOCIATES, L.P.

                            Statements of Cash Flows
                                   (Unaudited)
                 For the Six Months Ended June 30, 1997 and 1998

                                                                                                 1997                1998
                                                                                                 ----                ----
<S>                                                                                       <C>                    <C> 
Cash flows from operating activities:
     Net income (loss)                                                                    $    3,443,000         (1,287,000)
         Adjustments to reconcile net income to
         net cash provided by operating activities:
              Depreciation and amortization                                                    2,782,000          2,714,000
              Accretion of discount on mortgage note                                             845,000            972,000
              Decrease in deferred rent from New Claridge                                        650,000          6,936,000
              Deferred interest on receivable from New Claridge                                 (216,000)          (216,000)
              Change in current assets and liabilities:
               Decrease in rent due from New Claridge,
                  interest receivable from partners,
                  prepaid expenses and other assets                                               30,000            249,000
               Decrease in accounts payable and
                  accrued interest due New Claridge                                             (182,000)          (228,000)
                                                                                               ---------          ---------

                  Net cash provided by operating activities                                    7,352,000          9,140,000
                                                                                               ---------          ---------
Cash flows from investing activities:
     Purchase of Hotel Assets                                                                   (44,000)           (430,000)
                                                                                                --------          ---------
Cash flows from financing activities:
     Proceeds of borrowings from New Claridge                                                   101,000             654,000
     Principal payments of debt, principally to New Claridge                                 (8,533,000)         (9,086,000)
                                                                                              -----------        -----------

               Net cash used in financing activities                                         (8,432,000)         (8,432,000)
                                                                                             ----------          -----------
Net increase (decrease) in cash and cash equivalents                                         (1,124,000)            278,000
Cash and cash equivalents, beginning of period                                                1,446,000             552,000
                                                                                             ----------          -----------

Cash and cash equivalents, end of period                                                       322,000              830,000
                                                                                             =========           ===========

Supplemental cash flow information:
     Interest paid                                                                          $7,082,000            6,043,000
                                                                                             =========           ==========

                See accompanying notes to financial statements.
</TABLE>

<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 did 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 $1.5 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 the recovery of certain  expenses
          incurred in  reopening  the  self-parking  garage and  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.  Arbitration proceedings commenced in April 1998,
          and are expected to continue into the fourth quarter of 1998. 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 $2,040,000 for the six months ended
          June  30,  1998,  compared  to a net loss of  $3,540,000  for the same
          period  in  1997.  The  decrease  in net  loss is due  primarily  to a
          decrease  in rent  expense  to the  Partnership.  Rent  expense to the
          Partnership  in the first half 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 on
          the  Partnership's  cash flow,  the actual  amount abated on a monthly
          basis is recorded as a reduction to lease expense.  For the six months
          ended June 30, 1998, the reduction to lease expense resulting from the
          abatement   of  rent  was   approximately   $6  million   compared  to
          approximately $3.7 million for the same period in 1997.

          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 June 30, 1998,  accrued  interest would have amounted
          to approximately $62 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-Month  and Six-Month  Periods Ended June 30,
1998 as Compared to the Three-Month and Six-Month Periods Ended June 30, 1997

Rental income for the three months ended June 30, 1998  decreased  $2,993,000 as
compared to the three  months ended June 30, 1997,  and  $5,761,000  for the six
months  ended June 30, 1998 as compared to the six months  ended June 30,  1997.
These decreases are 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
1997 amendments will vary depending on the  Partnership's  cash flow, the actual
amount  abated on a monthly  basis is recorded as a reduction of rental  income.
For the three- and six-month periods ended June 30, 1998 the reduction to rental
income  resulting  from the abatement of rent was  approximately  $3,453,000 and
$5,966,000,  respectively,  compared to $2,485,000  and  $3,715,000 for the same
periods in 1997. In addition to the 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  significantly  higher than in 1998
resulting in decreased additional rents in 1998.

For the three- and  six-month  periods  ended June 30,  1998,  interest  expense
decreased $548,000 and $1,078,000, respectively, as compared to the same periods
ended June 30, 1997.  These decreases are due to principal  payments made during
1997 and 1998 that reduced the average outstanding balance of the wraparound and
expansion mortgages.

General and  administrative  expenses  for the three  months ended June 30, 1998
decreased  $23,000 as  compared  to the three  months  ended  June 30,  1997 and
$77,000  for the six months  ended June 30,  1998 as  compared to the six months
ended June 30, 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.

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 continues this deferral or abatement
of excess  cash flow  through  1998 and  thereafter.  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.

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 six months ended June 30, 1998, rents
abated amounted to approximately $6 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 $10,827,000 as of June 30,
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.



                                     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 
                     June 30, 1998.

<PAGE>

                                   SIGNATURES


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

                                     Atlantic City Boardwalk Associates, L.P.
                                                 Registrant





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


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


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