<PAGE>

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                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                          WASHINGTON, D.C. 20549-1004

                                ---------------

                                   FORM 10-Q

                                ---------------

[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
   ACT OF 1934

  FOR THE PERIOD YEAR ENDED MARCH 31, 2000

                                       OR

[_]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
   ACT OF 1934

  FOR THE TRANSITION PERIOD FROM        TO

  COMMISSION FILE NUMBER 0-15632

                FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-4
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                ILLINOIS                               36-3441345
    (STATE OR OTHER JURISDICTION OF                 (I.R.S. EMPLOYER
     INCORPORATION OR ORGANIZATION)               IDENTIFICATION NO.)

       TWO NORTH RIVERSIDE PLAZA,
               SUITE 700,
           CHICAGO, ILLINOIS                           60606-2607
    (ADDRESS OF PRINCIPAL EXECUTIVE                    (ZIP CODE)
                OFFICES)

                                 (312) 207-0020
              (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

                                 NOT APPLICABLE
   (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 [_]

DOCUMENT INCORPORATED BY REFERENCE:

The First Amended and Restated Certificate and Agreement of Limited Partnership
filed as Exhibit A to the Partnership's Prospectus dated November 5, 1986,
included in the Partnership's Registration Statement on Form S-11, is
incorporated herein by reference in Part I of this report.

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<PAGE>

BALANCE SHEETS
(All dollars rounded to nearest 00s)

<TABLE>
<CAPTION>
                                             March 31,
                                               2000     December 31,
                                            (Unaudited)     1999
--------------------------------------------------------------------
<S>                                         <C>         <C>
ASSETS
Cash and cash equivalents                   $ 4,062,700 $   574,700
Investments in debt securities               14,960,100  18,628,700
Rents receivable                                 90,700      90,700
Other assets                                     12,900      14,100
--------------------------------------------------------------------
                                            $19,126,400 $19,308,200
--------------------------------------------------------------------
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
 Accounts payable and accrued expenses      $    86,200 $   149,500
 Due to Affiliates                                  100       3,900
 Distributions payable                       14,920,500  15,015,500
--------------------------------------------------------------------
                                             15,006,800  15,168,900
--------------------------------------------------------------------
Partners' capital:
 General Partner                                 90,500      87,700
 Limited Partners (593,025 Units issued and
  outstanding)                                4,029,100   4,051,600
--------------------------------------------------------------------
                                              4,119,600   4,139,300
--------------------------------------------------------------------
                                            $19,126,400 $19,308,200
--------------------------------------------------------------------
</TABLE>

STATEMENTS OF PARTNERS' CAPITAL
For the quarter ended March 31, 2000 (Unaudited) and the year ended December
31, 1999
(All dollars rounded to nearest 00s)

<TABLE>
<CAPTION>
                                        General     Limited
                                        Partner     Partners       Total
-----------------------------------------------------------------------------
<S>                                     <C>       <C>           <C>
Partners' capital, January 1, 1999      $ 40,300  $ 17,766,700  $ 17,807,000
Net income for the year ended December
 31, 1999                                142,400     2,095,000     2,237,400
Distributions for the year ended
 December 31, 1999                       (95,000)  (15,810,100)  (15,905,100)
-----------------------------------------------------------------------------
Partners' capital, December 31, 1999      87,700     4,051,600     4,139,300
Net income for the quarter ended March
 31, 2000                                  2,800       274,000       276,800
Distributions for the quarter ended
 March 31, 2000                                       (296,500)     (296,500)
-----------------------------------------------------------------------------
Partners' capital, March 31, 2000       $ 90,500  $  4,029,100  $  4,119,600
-----------------------------------------------------------------------------
</TABLE>
    The accompanying notes are an integral part of the financial statements
2
<PAGE>

STATEMENTS OF INCOME AND EXPENSES
For the quarters ended March 31, 2000 and 1999
(Unaudited)
(All dollars rounded to nearest 00s
except per Unit amounts)

<TABLE>
<CAPTION>
                                                     2000      1999
---------------------------------------------------------------------
<S>                                                <C>       <C>
Income:
 Rental                                            $         $525,100
 Interest                                           290,900    58,600
---------------------------------------------------------------------
                                                    290,900   583,700
---------------------------------------------------------------------
Expenses:
 Depreciation and amortization                                107,500
 Property operating:
  Affiliates                                          5,500     4,800
  Nonaffiliates                                                51,800
 Real estate taxes                                             76,000
 Insurance--Affiliate                                  (900)    4,500
 Repairs and maintenance                                       63,300
 General and administrative:
  Affiliates                                          2,200     5,300
  Nonaffiliates                                       7,300    37,000
---------------------------------------------------------------------
                                                     14,100   350,200
---------------------------------------------------------------------
Net income                                         $276,800  $233,500
---------------------------------------------------------------------
Net income allocated to General Partner            $  2,800  $ 23,000
---------------------------------------------------------------------
Net income allocated to Limited Partners           $274,000  $210,500
---------------------------------------------------------------------
Net income allocated to Limited Partners per Unit
 (593,025) Units outstanding)                      $   0.46  $   0.35
---------------------------------------------------------------------
</TABLE>
STATEMENTS OF CASH FLOWS
For the quarters ended March 31, 2000 and 1999
(Unaudited)
(All dollars rounded to nearest 00s)

<TABLE>
<CAPTION>
                                                          2000        1999
------------------------------------------------------------------------------
<S>                                                    <C>         <C>
Cash flows from operating activities:
 Net income                                            $  276,800  $  233,500
 Adjustments to reconcile net income to net cash
  provided by operating activities:
  Depreciation and amortization                                       107,500
  Changes in assets and liabilities:
   Decrease in rents receivable                                        39,100
   Decrease in other assets                                 1,200
   (Decrease) increase in accounts payable and accrued
    expenses                                              (63,300)     96,600
   (Decrease) in due to Affiliates                         (3,800)     (1,200)
   (Decrease) in other liabilities                                     (6,400)
------------------------------------------------------------------------------
    Net cash provided by operating activities             210,900     469,100
------------------------------------------------------------------------------
Cash flows from investing activities:
 Decrease in investments in debt securities, net        3,668,600     854,400
------------------------------------------------------------------------------
    Net cash provided by investing activities           3,668,600     854,400
------------------------------------------------------------------------------
Cash flows from financing activities:
 Distributions paid to Partners                          (391,500)   (389,300)
------------------------------------------------------------------------------
    Net cash (used for) financing activities             (391,500)   (389,300)
------------------------------------------------------------------------------
Net increase in cash and cash equivalents               3,488,000     934,200
Cash and cash equivalents at the beginning of the
 period                                                   574,700   1,107,100
------------------------------------------------------------------------------
Cash and cash equivalents at the end of the period     $4,062,700  $2,041,300
------------------------------------------------------------------------------
</TABLE>
    The accompanying notes are an integral part of the financial statements
                                                                               3
<PAGE>

NOTES TO FINANCIAL STATEMENTS
(Unaudited)
March 31, 2000

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

DEFINITION OF SPECIAL TERMS:
Capitalized terms used in this report have the same meaning as those terms have
in the Partnership's Registration Statement filed with the Securities and
Exchange Commission on Form S-11. Definitions of these terms are contained in
Article III of the First Amended and Restated Agreement of Limited Partnership,
which is included in the Registration Statement and incorporated herein by
reference.

ACCOUNTING POLICIES:
The Partnership sold its remaining property during 1999. The Partnership is in
the process of resolving post closing matters related to the sold properties,
which includes reprorations, adjustments and expiration of representations and
warranties made to the purchaser of the final property. Upon completion of this
process, together with the resolution of the other pending matters, the
Partnership will make a liquidating distribution to Partners and dissolve.

The financial statements have been prepared in accordance with accounting
principles generally accepted in the United States ("GAAP"). The Partnership
utilizes the accrual method of accounting. Under this method, revenues are
recorded when earned and expenses are recorded when incurred.

Preparation of the Partnership's financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from those estimates.

The financial information included in these financial statements is unaudited;
however, in management's opinion, all adjustments (consisting of only normal,
recurring accruals) necessary for a fair presentation of the results of
operations for the periods included have been made. Results of operations for
the three months ended March 31, 2000, are not necessarily indicative of the
operating results for the year ending December 31, 2000.

The Partnership has one reportable segment as the Partnership is in the
disposition phase of its life cycle, wherein it is seeking to resolve post-
closing matters related to the properties sold by the Partnership.

Cash equivalents are considered all highly liquid investments with a maturity
of three months or less when purchased.

Investments in debt securities are comprised of obligations of the United
States government and are classified as held-to-maturity. These investments are
carried at their amortized cost basis in the financial statements, which
approximated fair value. All of these securities had maturities of less than
one year when purchased.

Reference is made to the Partnership's annual report for the year ended
December 31, 1999, for a description of other accounting policies and
additional details of the Partnership's financial condition, results of
operations, changes in Partners' capital and changes in cash balances for the
year then ended. The details provided in the notes thereto have not changed
except as a result of normal transactions in the interim or as otherwise
disclosed herein.

2. RELATED PARTY TRANSACTIONS:

In accordance with the Partnership Agreement, as compensation for services
rendered in managing the affairs of the Partnership, the General Partner shall
be entitled to receive subsequent to May 4, 1988, the Termination of the
Offering, a Partnership Management Fee payable annually within 60 days
following the last day of each fiscal year, which shall be an amount equal to
the lesser of (i) 0.5% of the net value of the Partnership's assets as of the
end of such fiscal year reflected on the Certificate of Value furnished to the
Limited Partners, plus, to the extent the Partnership Management Fee paid in
any prior year was less than 0.5% of the net value of the Partnership's assets
in such prior year, the amount of such deficit, or (ii) an amount equal to the
difference between 10% of the Partnership's aggregate Cash Flow (as defined in
the Partnership Agreement) for the period from the Commencement of Operations
to the end of the fiscal year for which such Partnership Management Fee is
payable, and the aggregate amount previously paid to the General Partner as a
Partnership Management Fee. In addition, Sale Proceeds are distributed: first,
75% to all Limited Partners and 25% to the General Partner until the earlier of
(i) receipt by Limited Partners of cumulative distributions of Sale Proceeds in
an amount equal to 100% of their Original Capital Contribution, or (ii) receipt
by the General Partner of cumulative distributions of Sale Proceeds sufficient
to repay the Loan (as defined hereafter), until the outstanding balance of the
Loan has been repaid; thereafter, to the Limited Partners, until they have
received cumulative distributions of Sale Proceeds in an amount equal to 100%
of their Original Capital Contribution, plus an amount (including Cash Flow (as
defined in the Partnership Agreement)) equal to a cumulative return of 6% per
annum simple interest on their Capital Investment from their investment date in
the Partnership; thereafter, 85% to all Limited Partners; and 15% to the
General Partner, provided, however, that no distribution of the General
Partner's 15% share of Sale Proceeds shall be made until Limited Partners have
received the greater of (i) Sale Proceeds plus Cash Flow (as defined in the
Partnership Agreement) previously received in excess of the Preferred Return
equal to 125% of the Limited Partners' Original Capital Contribution, or (ii)
Sale Proceeds plus all Cash Flow (as defined in the Partnership Agreement)
previously received equal to their Original Capital Contribution plus a 10% per
annum simple interest return on their Capital Investment from the date of
investment.

In accordance with the Partnership Agreement, Net Profits (exclusive of Net
Profits from the sale or disposition of Partnership properties) shall be
allocated to the General Partner in an amount equal to the greater of 1% of
such Net Profits or the Partnership Management Fee paid by the Partnership to
the General Partner during such year, and the balance, if any, to the Limited
Partners. Net Losses (exclusive of Net Losses from the sale, disposition or
provision for value impairment of Partnership properties) are allocated 1% to
the General Partner and 99% to the Limited Partners. Net Profits from the sale
or disposition of a Partnership property are allocated: first, prior to giving
effect to any distributions of Sale Proceeds from the transaction, to the
General Partner and Limited Partners with negative balances in their Capital
Accounts, pro rata in proportion to such respective negative balances, to the
extent of the total of such negative balances; second, to each Limited Partner
in an amount, if any, necessary to make the positive balance in its Capital
Account equal to the Sale Proceeds to be distributed to such Limited Partner
with respect to the sale or disposition of such property; third, to the General
Partner in an amount, if any, necessary to make the positive balance in its
Capital Account equal to the Sale Proceeds to be distributed to the General
Partner with respect to the sale or disposition of such property; and fourth,
the balance, if any, 15% to the General Partner and 85% to the Limited
Partners. Net Losses from the sale, disposition or provision for value
impairment of Partnership properties are allocated: first, after giving effect
to any distributions of Sale Proceeds from the transaction to the General
Partner and Limited Partners with positive balances in their Capital Accounts,
pro rata in proportion to such respective positive balances, to the extent of
the total amount of such positive balances; and second, the balance, if any, 1%
to the General Partner and 99% to the Limited Partners. Notwithstanding
anything to the contrary, there shall be allocated to the General Partner not
less than 1% of all items of Partnership income, gain, loss, deduction and
credit during the existence of the Partnership. For the three months ended
March 31, 2000 the General Partner was allocated Net Profits of $2,800. For the
three months ended March 31, 1999 the General Partner was entitled to a
Partnership Management Fee and allocated Net Profits of $23,000.

Fees and reimbursements paid and payable by the Partnership to Affiliates
during the quarter ended March 31, 2000 were as follows:

<TABLE>
<CAPTION>
                                        Paid    Payable
-------------------------------------------------------
<S>                                    <C>      <C>
Asset management fees                  $ 5,500   None
Refund of property insurance premiums     (900)  None
Reimbursement of expenses, at cost:
 --Accounting                            3,600   None
 --Investor communication                2,300    100
-------------------------------------------------------
                                       $10,500   $100
-------------------------------------------------------
</TABLE>

4
<PAGE>

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

Reference is made to the Partnership's annual report for the year ended
December 31, 1999 for a discussion of the Partnership's business.

Statements contained in this Management's Discussion and Analysis of Financial
Condition and Results of Operations, which are not historical facts, may be
forward-looking statements. Such statements are subject to certain risks and
uncertainties, which could cause actual results to differ materially from those
projected. Readers are cautioned not to place undue reliance on these forward-
looking statements, which speak only as of the date hereof.

The Partnership has substantially completed the disposition phase of its life
cycle. The Partnership has sold its remaining real property investments and is
working toward resolution of post closing property sale matters.

OPERATIONS
Net income increased by $43,300 for the three months ended March 31, 2000 when
compared to the three months ended March 31, 1999. The increase was primarily
due to the increase in interest earned on the Partnership's short-term
investments, which was due to the investment of cash proceeds generated from
the December 1999 sale of Indian Ridge Plaza Shopping Center ("Indian Ridge")
prior to their distribution to Limited Partners on May 31, 2000. The increase
was partially offset by the absence of 2000 operating results from Indian Ridge
resulting from its sale.

LIQUIDITY AND CAPITAL RESOURCES
The increase in the Partnership's cash position of $3,488,000 for the three
months ended March 31, 2000 resulted primarily from net maturities of a portion
of its investments in debt securities. Liquid assets (including cash, cash
equivalents and investments in debt securities) of the Partnership as of March
31, 2000 were comprised of amounts held for distribution to Partners, post
property sale matters and for Partnership liquidation expenses.

Net cash provided by operating activities decreased by $258,200 for the three
months ended March 31, 2000 when compared to the three months ended March 31,
1999. The decrease was primarily due to the 2000 absence of results from Indian
Ridge, exclusive of depreciation and amortization, due to its December 1999
sale. In addition, the decrease was due to the timing of the payment of certain
expenses. The decrease was partially offset by the increase in interest earned
on the Partnership's short-term investments, as previously discussed.

Net cash provided by investing activities increased by $2,814,200 for the three
months ended March 31, 2000 when compared to the three months ended March 31,
1999. The increase was primarily due to a net maturity of investments in debt
securities during the three months ended March 31, 2000 exceeding the net
maturity during the comparable period of 1999. Investments in debt securities
are a result of the continued extension of the maturities of certain of the
Partnership's short-term investments in an effort to maximize the return on
these amounts as they are held for working capital purposes or for distribution
to Partners. These investments are of investment-grade and mature less than one
year from their date of purchase.

The Partnership has no financial instruments for which there are significant
market risks. Due to the timing of the maturities and liquid nature of the
Partnership's investments in debt securities, the Partnership does not believe
that it has material market risk.

The increase in net cash used for financing activities of $2,200 was due
primarily to a slight increase in 1999 distributions to the General Partner.

The General Partner has begun the process of wrapping-up the Partnership's
affairs. This process, which is expected to be completed during the second half
of 2000, includes a resolution of all post-closing property and Partnership
matters together with the expiration of representations and warranties included
in the contract for the sale of Indian Ridge. Following the resolution of post-
closing property matters and the establishment of a reserve for contingencies
and wrap-up expenses, the General Partner will make a liquidating distribution
to Partners and dissolve.

Distributions to Limited Partners of Cash Flow (as defined in the Partnership
Agreement) for the three months ended March 31, 2000 were declared in the
amount of $296,500, or $0.50 per Unit. Cash distributions are made 60 days
after the last day of each fiscal quarter.

                                                                               5
<PAGE>

PART II. OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K:

(a) Exhibits: None

(b) Reports on Form 8-K:

There were no reports filed on Form 8-K for the three months ended March 31,
2000.

6
<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.

                                     FIRST CAPITAL INSTITUTIONAL REAL ESTATE,
                                     LTD.-4

                                     By:  FIRST CAPITAL FINANCIAL CORPORATION
                                        GENERAL PARTNER

Date: May 12, 2000                              /s/ DOUGLAS CROCKER II
                                     By: ______________________________________
                                                  DOUGLAS CROCKER II
                                         PRESIDENT AND CHIEF EXECUTIVE OFFICER

Date: May 12, 2000                                /s/ NORMAN M. FIELD
                                     By: ______________________________________
                                                    NORMAN M. FIELD
                                         VICE PRESIDENT--FINANCE AND TREASURER

                                                                               7