<PAGE>   1

                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

(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
                               ------------------------------------------------

                                       OR

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

FOR THE TRANSITION PERIOD FROM                     N/A
                               ------------------------------------------------

COMMISSION FILE NUMBER                           0-15680
                       --------------------------------------------------------


               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
--------------------------------------------------------------------------------
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)


         Massachusetts                                  04-2921566
-------------------------------             ------------------------------------
(STATE OR OTHER JURISDICTION OF             (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)


                     200 Clarendon Street, Boston, MA 02116
--------------------------------------------------------------------------------
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
                                   (ZIP CODE)


                                 (800) 722-5457
--------------------------------------------------------------------------------
               REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:


                                       N/A
--------------------------------------------------------------------------------
      (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED SINCE
                                  LAST REPORT)

INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED
TO BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING
THE PRECEDING 12 MONTHS (OR 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>   2

               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)




                                      INDEX





PART I:  FINANCIAL INFORMATION                                             PAGE

         Item 1 - Financial Statements:

                  Balance Sheets at March 31, 1998 and
                  December 31, 1997                                           3

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

                  Statements of Partners' Equity for the
                  Three Months Ended March 31, 1998 and
                  for the Year Ended December 31, 1997                        5

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

                  Notes to Financial Statements                            7-12

         Item 2 - Management's Discussion and Analysis of
                  Financial Condition and Results of Operations           13-18


PART II: OTHER INFORMATION                                                   19




                                       2
<PAGE>   3
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                          PART I: FINANCIAL INFORMATION

                          ITEM 1: FINANCIAL STATEMENTS

                                 BALANCE SHEETS
                                   (UNAUDITED)

                                     ASSETS



<TABLE>
<CAPTION>
                                                       MARCH 31,        DECEMBER 31,
                                                         1998               1997
                                                     ------------       ------------
<S>                                                  <C>                <C>         

Cash and cash equivalents                            $  2,435,171       $  2,502,844
Restricted cash                                            59,400             58,400
Other assets                                              200,816             90,816

Deferred expenses, net of accumulated
   amortization of $349,766 in 1998 and
   $329,823 in 1997                                       373,640            360,166

Investment in property:

   Land                                                 6,198,330          6,198,330
   Buildings and improvements                          17,342,479         17,342,479
                                                     ------------       ------------
                                                       23,540,809         23,540,809
   Less: accumulated depreciation                      (4,944,621)        (4,787,156)
                                                     ------------       ------------
                                                       18,596,188         18,753,653
                                                     ------------       ------------

       Total assets                                  $ 21,665,215       $ 21,765,879
                                                     ============       ============


                       LIABILITIES AND PARTNERS' EQUITY

Liabilities:

Accounts payable and accrued expenses                $    339,941       $    263,396
Accounts payable to affiliates                            149,290            150,907
                                                     ------------       ------------
       Total liabilities                                  489,231            414,303

Partners' equity/(deficit):

   General Partner's deficit                             (247,085)          (245,328)
   Limited Partners' equity                            21,423,069         21,596,904
                                                     ------------       ------------

       Total partners' equity                          21,175,984         21,351,576
                                                     ------------       ------------

       Total liabilities and partners' equity        $ 21,665,215       $ 21,765,879
                                                     ============       ============

</TABLE>



                        See Notes to Financial Statements


                                       3
<PAGE>   4
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                            STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                 THREE MONTHS ENDED
                                                      MARCH 31,
                                                 1998           1997
                                              ---------       ---------
<S>                                           <C>             <C>      

Income:

     Rental income                            $ 636,055       $ 700,593
     Interest income                             26,067          22,526
                                              ---------       ---------

       Total income                             662,122         723,119

Expenses:

     Depreciation                               157,465         173,083
     General and administrative expenses         71,572         129,654
     Property operating expenses                 61,520          83,636
     Amortization of deferred expenses           19,943          29,319
     Management fee                              18,063          18,903
                                              ---------       ---------

       Total expenses                           328,563         434,595
                                              ---------       ---------

       Net income                             $ 333,559       $ 288,524
                                              =========       =========


Allocation of net income:

     General Partner                          $   3,335       $   2,885
     John Hancock Limited Partner                (6,991)        (12,291)
     Investors                                  337,215         297,930
                                              ---------       ---------
                                              $ 333,559       $ 288,524
                                              =========       =========

Net income per Unit                           $    3.68       $    3.25
                                              =========       =========

</TABLE>










                        See Notes to Financial Statements

                                       4
<PAGE>   5
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                         STATEMENTS OF PARTNERS' EQUITY
                                   (UNAUDITED)

                      THREE MONTHS ENDED MARCH 31, 1998 AND
                          YEAR ENDED DECEMBER 31, 1997



<TABLE>
<CAPTION>
                                                      GENERAL          LIMITED
                                                      PARTNER          PARTNERS            TOTAL
                                                      -------          --------            -----
<S>                                                  <C>             <C>                <C>         

Partners' equity/(deficit) at January 1, 1997
   (91,647 Units outstanding)                        ($230,844)      $ 25,156,986       $ 24,926,142

Less: Cash distributions                               (20,848)        (4,190,101)        (4,210,949)

Add: Net income                                         (6,364)          (630,019)          (636,383)
                                                     ---------       ------------       ------------

Partners' equity/(deficit) at December 31, 1997
   (91,647 Units outstanding)                         (245,328)        21,596,904         21,351,576

Less: Cash distributions                                (5,092)          (504,059)          (509,151)

Add: Net income                                          3,335            330,224            333,559
                                                     ---------       ------------       ------------

Partners' equity/(deficit) at March 31, 1998
   (91,647 Units outstanding)                        ($247,085)      $ 21,423,069       $ 21,175,984
                                                     =========       ============       ============
</TABLE>











                        See Notes to Financial Statements



                                       5
<PAGE>   6
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                            STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                              THREE MONTHS ENDED
                                                                    MARCH 31,
                                                             1998              1997
                                                          -----------       -----------
<S>                                                       <C>               <C>        

Operating activities:

   Net income                                             $   333,559       $   288,524

   Adjustments to reconcile net income to net
   cash provided by operating activities:

      Depreciation                                            157,465           173,083
      Amortization of deferred expenses                        19,943            29,319
                                                          -----------       -----------

                                                              510,967           490,926
   Changes in operating assets and liabilities:
      Increase in restricted cash                              (1,000)             (594)
      Decrease/(increase) in other assets                    (110,000)         (105,775)
      Increase in accounts payable and accrued
         expenses                                              76,545             2,678
      Increase in accounts payable to affiliates               (1,617)           36,844
                                                          -----------       -----------

           Net cash provided by operating activities          474,895           424,079

Investing activities:

   Increase in deferred expenses                              (33,417)          (62,783)
                                                          -----------       -----------

           Net cash used in investing activities              (33,417)          (62,783)

Financing activities:

   Cash distributed to Partners                              (509,151)         (521,184)
                                                          -----------       -----------

           Net cash used in financing activities             (509,151)         (521,184)
                                                          -----------       -----------

           Net decrease in cash and cash
               equivalents                                    (67,673)         (159,888)

           Cash and cash equivalents at
               beginning of year                            2,502,844         2,197,847
                                                          -----------       -----------

           Cash and cash equivalents at
               end of period                              $ 2,435,171       $ 2,037,959
                                                          ===========       ===========

</TABLE>





                        See Notes to Financial Statements



                                       6
<PAGE>   7
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.     ORGANIZATION OF PARTNERSHIP

       John Hancock Realty Income Fund Limited Partnership (the "Partnership")
       was formed under the Massachusetts Uniform Limited Partnership Act on
       June 12, 1986. As of March 31, 1998, the Partnership consisted of John
       Hancock Realty Equities, Inc. (the "General Partner"), a wholly-owned,
       indirect subsidiary of John Hancock Mutual Life Insurance Company; John
       Hancock Realty Funding, Inc. (the "John Hancock Limited Partner"); and
       3,948 Investor Limited Partners (the "Investors"), owning 91,647 Units of
       Investor Limited Partnership Interests (the "Units"). The John Hancock
       Limited Partner and the Investors are collectively referred to as the
       Limited Partners. The initial capital of the Partnership was $2,000,
       representing capital contributions of $1,000 from the General Partner and
       $1,000 from the John Hancock Limited Partner. The Amended Agreement of
       Limited Partnership of the Partnership (the "Partnership Agreement")
       authorized the issuance of up to 100,000 Units of Limited Partnership
       Interests at $500 per unit. During the offering period, which terminated
       on September 9, 1987, 91,647 Units were sold and the John Hancock Limited
       Partner made additional capital contributions of $7,330,760. There have
       been no changes in the number of Units outstanding subsequent to the
       termination of the offering period.

       The Partnership is engaged in the business of acquiring, improving,
       holding for investment and disposing of existing, income-producing,
       commercial and industrial properties on an all-cash basis, free and clear
       of mortgage indebtedness. Although the Partnership's properties were
       acquired and are held free and clear of mortgage indebtedness, the
       Partnership may incur mortgage indebtedness on its properties under
       certain circumstances, as specified in the Partnership Agreement.

       The latest date on which the Partnership is due to terminate is 
       December 31, 2016, unless it is sooner terminated in accordance with the
       terms of the Partnership Agreement. It is expected that in the ordinary 
       course of the Partnership's business, the properties of the Partnership 
       will be disposed of, and the Partnership terminated, before December 31,
       2016.

2.     SIGNIFICANT ACCOUNTING POLICIES

       The accompanying unaudited financial statements have been prepared in
       accordance with generally accepted accounting principles for interim
       financial information and with the instructions to Form 10-Q and Rule
       10-01 of Regulation S-X. Accordingly, they do not include all of the
       information and footnotes required by generally accepted accounting
       principles for complete financial statements. In the opinion of
       management, all adjustments (consisting of normal recurring accruals)
       considered necessary for a fair presentation have been included.
       Operating results for the three-month period ended March 31, 1998 are not
       necessarily indicative of the results that may be expected for the year
       ending December 31, 1998. For further information, refer to the financial
       statements and footnotes thereto included in the Partnership's Annual
       Report on Form 10-K for the year ended December 31, 1997.

       The preparation of financial statements in conformity with generally
       accepted accounting principles 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 revenue and expenses
       during the reporting period. Actual results may differ from those
       estimates.

       Cash equivalents are highly liquid investments with maturities of three
       months or less when purchased. These investments are recorded at cost
       plus accrued interest, which approximates market value. Restricted cash
       represents funds restricted for tenant security deposits and other
       escrows.




                                       7
<PAGE>   8
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

2.     SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

       Investments in property are recorded at cost less any property
       write-downs for permanent impairment in values. Cost includes the initial
       purchase price of the property plus acquisition and legal fees, other
       miscellaneous acquisition costs, and the cost of significant
       improvements.

       The Partnership measures impairment in value in accordance with Financial
       Accounting Standards Board Statement No. 121, "Accounting for the
       Impairment of Long-Lived Assets to Be Disposed Of" ("Statement 121").
       Statement 121 requires impairment losses to be recorded on long-lived
       assets used in operations where indicators of impairment are present and
       the undiscounted cash flows estimated to be generated by those assets are
       less than the assets' carrying amounts.

       Depreciation has been provided on a straight-line basis over the
       estimated useful lives of the various assets: thirty years for the
       buildings and five years for related improvements. Maintenance and
       repairs are charged to operations as incurred.

       Deferred expenses relating to tenant improvements and lease commissions
       are amortized on a straight-line basis over the terms of the leases to
       which they relate. During 1993, the Partnership reduced the period over
       which its remaining deferred acquisition fees are amortized from thirty
       years, the estimated useful life of the buildings owned by the
       Partnership, to four and one-half years, the then estimated remaining
       life of the Partnership.

       The net income per Unit for the periods hereof are computed by dividing
       the Investors' share of net income by the number of Units outstanding at
       the end of such periods.

       No provision for income taxes has been made in the financial statements
       as such taxes are the responsibility of the individual partners and not
       of the Partnership.

3.     THE PARTNERSHIP AGREEMENT

       Distributable Cash from Operations (defined in the Partnership Agreement)
       is distributed 99% to the Limited Partners and 1% to the General Partner.
       The Limited Partners' share of Distributable Cash from Operations is
       distributed as follows: first, to the Investors until they receive a 7%
       non-cumulative, non-compounded annual cash return on their Invested
       Capital (defined in the Partnership Agreement); second, to the John
       Hancock Limited Partner until it receives a 7% non-cumulative,
       non-compounded annual cash return on its Invested Capital; and third, to
       the Investors and the John Hancock Limited Partner in proportion to their
       respective Capital Contributions (defined in the Partnership Agreement).
       However, any Distributable Cash from Operations which is available as a
       result of the reduction of working capital reserves funded by Capital
       Contributions of the Investors will be distributed 100% to the Investors.

       Cash from Sales or Financings (defined in the Partnership Agreement) is
       first used to pay all debts and liabilities of the Partnership then due
       and is then used to fund any reserves for contingent liabilities. Cash
       from Sales or Financings is then distributed as follows: first, to the
       Limited Partners until they receive an amount equal to their Invested
       Capital with the distribution being made between the Investors and the
       John Hancock Limited Partner in proportion to their respective Capital
       Contributions; second, to the Investors until they have received, with
       respect to all previous distributions during the year, their Cumulative
       Return on Investment (defined in the Partnership Agreement); third, to
       the John Hancock Limited Partner until it has received, with respect to
       all previous distributions during the year, its Cumulative Return on
       Investment; fourth, to the General Partner to pay any Subordinated
       Disposition Fees (defined in the Partnership Agreement); and fifth, 99%
       to the Limited Partners and 1% to the General Partner, with the
       distribution being made between the Investors and the John Hancock
       Limited Partner in proportion to their respective Capital Contributions.




                                       8
<PAGE>   9
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

3.     THE PARTNERSHIP AGREEMENT (CONTINUED)

       Cash from the sale of the last of the Partnership's properties is to be
       distributed in the same manner as Cash from Sales or Financings, except
       that before any other distribution is made to the Partners, each Partner
       shall first receive from such cash, an amount equal to the then positive
       balance, if any, in such Partner's Capital Account after crediting or
       charging to such account the profits or losses for tax purposes from such
       sale. To the extent, if any, that a Partner is entitled to receive a
       distribution of cash based upon a positive balance in its capital account
       prior to such distribution, such distribution will be credited against
       the amount of such cash the Partner would have been entitled to receive
       based upon the manner of distribution of Cash from Sales or Financings,
       as specified in the previous paragraph.

       Profits from the normal operations of the Partnership for each fiscal
       year are allocated to the Limited Partners and General Partner in the
       same amounts as Distributable Cash from Operations for that year. If such
       profits are less than Distributable Cash from Operations for any year,
       they are allocated in proportion to the amounts of Distributable Cash
       from Operations for that year. If such profits are greater than
       Distributable Cash from Operations for any year, they are allocated 99%
       to the Limited Partners and 1% to the General Partner, with the
       allocation made between the John Hancock Limited Partner and the
       Investors in proportion to their respective Capital Contributions. Losses
       from the normal operations of the Partnership are allocated 99% to the
       Limited Partners and 1% to the General Partner, with the allocation made
       between the John Hancock Limited Partner and the Investors in proportion
       to their respective Capital Contributions. Depreciation deductions are
       allocated 1% to the General Partner and 99% to the Investors, and not to
       the John Hancock Limited Partner.

       Profits and Losses from Sales or Financings are generally allocated 99%
       to the Limited Partners and 1% to the General Partners. In connection
       with the sale of the last of the Partnership's properties, and therefore
       the dissolution of the Partnership, profits will be allocated to any
       Partners having a deficit balance in their Capital Account in an amount
       equal to the deficit balance. Any remaining profits will be allocated in
       the same order as cash from the sale would be distributed.

       Neither the General Partner nor any Affiliate (as defined in the
       Partnership Agreement) of the General Partner shall be liable,
       responsible or accountable in damages to any of the Partners or the
       Partnership for any act or omission of the General Partner in good faith
       on behalf of the Partnership within the scope of the authority granted to
       the General Partner by the Partnership Agreement and in the best interest
       of the Partnership, except for acts or omissions constituting fraud,
       negligence, misconduct or breach of fiduciary duty. The General Partner
       and its Affiliates performing services on behalf of the Partnership shall
       be entitled to indemnity from the Partnership for any loss, damage, or
       claim by reason of any act performed or omitted to be performed by the
       General Partner in good faith on behalf of the Partnership and in a
       manner within the scope of the authority granted to the General Partner
       by the Partnership Agreement and in the best interest of the Partnership,
       except that they shall not be entitled to be indemnified in respect of
       any loss, damage, or claim incurred by reason of fraud, negligence,
       misconduct, or breach of fiduciary duty. Any indemnity shall be provided
       out of and to the extent of Partnership assets only. The Partnership
       shall not advance any funds to the General Partner or its Affiliates for
       legal expenses and other costs incurred as a result of any legal action
       initiated against the General Partner or its Affiliates by a Limited
       Partner in the Partnership, except under certain specified circumstances.



                                       9
<PAGE>   10
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

4.     INVESTMENT IN PROPERTY

       Investment in property at cost and reduced by write-downs consists of
       managed, fully-operating, commercial real estate as follows:

<TABLE>
<CAPTION>
                                                     March 31, 1998    December 31, 1997
                                                     --------------    -----------------
         <S>                                          <C>                 <C>        

         Marlboro Square Shopping Center              $ 1,000,000         $ 1,000,000
         Crossroads Square Shopping Center             12,266,920          12,266,920
         Carnegie Center Office/Warehouse               3,800,000           3,800,000
         Warner Plaza Shopping Center                   6,473,889           6,473,889
                                                      -----------         -----------

                      Total                           $23,540,809         $23,540,809
                                                      ===========         ===========
</TABLE>

       The real estate market is cyclical in nature and is materially affected
       by general economic trends and economic conditions in the market where a
       property is located. As a result, determination of real estate values
       involves subjective judgments. These judgments are based on current
       market conditions and assumptions related to future market conditions.
       These assumptions involve, among other things, the availability of
       capital, occupancy rates, rental rates, interest rates and inflation
       rates. Amounts ultimately realized from each property may vary
       significantly from the values presented and the differences could be
       material. Actual market values of real estate can be determined only by
       negotiation between the parties in a sales transaction.

5.     DEFERRED EXPENSES

       Deferred expenses consist of the following:

<TABLE>
<CAPTION>
                                                                          Unamortized        Unamortized
                                                                           Balance at         Balance at
                               Description                               March 31, 1998    December 31, 1997
                               -----------                               --------------    -----------------
              <S>                                                            <C>                 <C>        
                                
              $454,362 of tenant improvements.  These amounts
              are amortized over the terms of the leases to which
              they relate.                                                   231,484             221,699

              $255,544 of lease commissions.  These amounts
              are amortized over the terms of the leases to which
              they relate.                                                   142,156             138,467
                                                                            --------            --------
                                                                            $373,640            $360,166
                                                                            ========            ========
</TABLE>




                                       10
<PAGE>   11
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

6.     TRANSACTIONS WITH THE GENERAL PARTNER AND AFFILIATES

       Fees and expenses incurred or paid by the General Partner or its
       Affiliates on behalf of the Partnership and to which the General Partner
       or its Affiliates are entitled to reimbursement from the Partnership were
       as follows:

<TABLE>
<CAPTION>
                                                              Three Months Ended
                                                                   March 31,
                                                            1998             1997
                                                            ----             ----
              <S>                                          <C>             <C>   
  
              Reimbursement for operating expenses         $35,480         $ 96,155
              Partnership management fee expense            18,063           18,903
                                                           -------         --------
                                                           $53,543         $115,058
                                                           =======         ========
</TABLE>

       These expenses are included in expenses on the Statements of Operations.

       The Partnership provides indemnification to the General Partner and its
       Affiliates for any acts or omissions of the General Partner in good faith
       on behalf of the Partnership, except for acts or omissions constituting
       fraud, negligence, misconduct or breach of fiduciary duty. The General
       Partner believes that this indemnification applies to the class action
       complaint described in Note 8. Accordingly, included in the Statements of
       Operations for the three months ended March 31, 1998 and 1997 is $3,462
       and $31,579, respectively, representing the Partnership's share of costs
       incurred by the General Partner and its Affiliates relating to the class
       action complaint. Through March 31, 1997, the Partnership has accrued a
       total of $99,029 as its share of the costs incurred by the General
       Partner and its Affiliates resulting from this matter.

       Accounts payable to affiliates represents amounts due to the General
       Partner or its Affiliates for various services provided to the
       Partnership, including amounts to indemnify the General Partner or its
       Affiliates for claims incurred by them in connection with their actions
       as General Partner of the Partnership. All amounts accrued by the
       Partnership to indemnify the General Partner or its Affiliates for legal
       fees incurred by them shall not be paid unless or until all conditions
       set forth in the Partnership Agreement for such payment have been
       fulfilled.

       The General Partner serves in a similar capacity for two other affiliated
       real estate limited partnerships.

7.     FEDERAL INCOME TAXES

         A reconciliation of the net income reported on the Statements of
         Operations to the net income reported for federal income tax purposes
         is as follows:

<TABLE>
<CAPTION>
                                                                      Three Months Ended
                                                                            March 31,
                                                                      1998            1997
                                                                      ----            ----
              <S>                                                   <C>            <C>     

              Net income per Statements of Operations               $333,559       $288,524

              Add/(deduct):    Excess of tax depreciation
                                 over book depreciation              (24,539)       (47,383)
                               Excess of book amortization
                                 over tax amortization                10,022          3,491
                                                                    --------       --------

              Net income for federal income tax purposes            $319,042       $244,632
                                                                    ========       ========
</TABLE>



                                       11
<PAGE>   12
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

8.     CONTINGENCIES

       In February 1996, a putative class action complaint was filed in the
       Superior Court in Essex County, New Jersey by a single investor in a
       limited partnership affiliated with the Partnership. The complaint named
       as defendants the Partnership, the General Partner, certain other
       Affiliates of the General Partner, and certain unnamed officers,
       directors, employees and agents of the named defendants. The plaintiff
       sought unspecified damages stemming from alleged misrepresentations and
       omissions in the marketing and offering materials associated with the
       Partnership and two limited partnerships affiliated with the Partnership.
       On March 18, 1997, the court certified a class of investors who were
       original purchasers in the Partnership.

       The Partnership provides indemnification to the General Partner and its
       Affiliates for acts or omissions of the General Partner in good faith on
       behalf of the Partnership, except for acts or omissions constituting
       fraud, negligence, misconduct or breach of fiduciary duty. The General
       Partner believes that this indemnification applies to the class action
       complaint described above.

       The Partnership has incurred an aggregate of approximately $248,000 in
       legal expenses in connection with the class action lawsuit (see Part l,
       Item 3 of this Report). Of this amount, approximately $149,000 relates to
       the Partnership's own defense and approximately $99,000 relates to the
       indemnification of the General Partner and its Affiliates for their
       defense. These expenses are funded from the operations of the
       Partnership.

       At the present time, the General Partner can not estimate the aggregate
       amount of legal expenses and indemnification claims to be incurred and
       their impact on the Partnership's Financial Statements, taken as a whole.
       Accordingly, no provision for any liability which could result from the
       eventual outcome of these matters has been made in the accompanying
       financial statements. However, while it is still too early the estimate
       potential damages, they could possible be material.





                                       12
<PAGE>   13
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



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

GENERAL

During the offering period from September 9, 1986 to September 9, 1987, the
Partnership sold 91,647 Units representing gross proceeds (exclusive of the John
Hancock Limited Partner's contribution which was used to pay sales commissions,
acquisition fees and organizational and offering expenses) of $45,823,500. The
proceeds of the offering were used to acquire investment properties and fund
reserves. The Partnership's properties are described more fully in Note 4 to the
Financial Statements included in Item 1 of this Report.

IMPACT OF YEAR 2000

The General Partner and John Hancock Mutual Life Insurance Company, the General
Partner's ultimate parent (together, John Hancock) along with the Partnership,
have developed a plan to modify or replace significant portions of the
Partnership's computer information and automated technologies so that its
systems will function properly with respect to the dates in the year 2000 and
thereafter. The Partnership presently believes that with modifications to
existing systems and conversions to new technologies, the year 2000 will not
pose significant operational problems for its computer systems. However, if
certain modifications and conversions are not made, or are not completed timely,
the year 2000 issue could have an adverse impact on the operations of the
Partnership.

John Hancock as early as 1994 had begun assessing, modifying and converting the
software related to its significant systems and has initiated formal
communications with its significant business partners and customers to determine
the extent to which John Hancock's interface systems are vulnerable to those
third parties' failure to remediate their own year 2000 issues. While John
Hancock is developing alternative third party processing arrangements as it
deems appropriate, there is no guarantee that the systems of other companies on
which the Partnership's systems rely will be converted timely or will not have
an adverse effect on the Partnership's systems.

The Partnership expects the project to be substantially complete by early 1999.
This completion target was derived utilizing numerous assumptions of future
events, including availability of certain resources and other factors. However,
there can be no guarantee that this completion target will be achieved.

FORWARD-LOOKING STATEMENTS

In addition to historical information, certain statements contained herein
contain forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. Those statements appear in a number of places in this
Report and include statements regarding the intent, belief or expectations of
the General Partner with respect to, among other things, the prospective sale of
Partnership properties, actions that would be taken in the event of lack of
liquidity, unanticipated leasing costs, repair and maintenance expenses,
distributions to the General Partner and to Investors, the possible effects of
tenants vacating space at Partnership properties, the absorption of existing
retail space in certain geographical areas, and the impact of inflation.

Forward-looking statements involve numerous known and unknown risks and
uncertainties, and they are not guarantees of future performance. The following
factors, among others, could cause actual results or performance of the
Partnership and future events to differ materially from those expressed or
implied in the forward-looking statements: general economic and business
conditions; any and all general risks of real estate ownership, including
without limitation adverse changes in general economic conditions and adverse
local conditions, the fluctuation of rental income from properties, changes in
property taxes, utility costs or maintenance costs and insurance, fluctuations
of real estate values, competition for tenants, uncertainties about whether real
estate sales under contract will close; the ability of the Partnership to sell
its properties; and other factors detailed from time to time in the filings with
the Securities and Exchange Commission.

Readers are cautioned not to place undue reliance on forward-looking statements,
which reflect the General Partner's analysis only as of the date hereof. The
Partnership assumes no obligation to update forward-looking statements. See also
the Partnership's reports to be filed from time to time with the Securities and
Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended.



                                       13
<PAGE>   14
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS (CONTINUED)

LIQUIDITY AND CAPITAL RESOURCES

At March 31, 1998, the Partnership had $2,435,171 in cash and cash equivalents
and $59,400 in restricted cash.

The Partnership has established a working capital reserve with a current balance
of approximately 3% of the Investors' Invested Capital (defined in the
Partnership Agreement). The General Partner anticipates that such amount should
be sufficient to satisfy the Partnership's general liquidity requirements.
Liquidity would, however, be materially adversely affected by a significant
reduction in revenues or significant unanticipated operating costs (including
but not limited to litigation expenses), unanticipated leasing costs or
unanticipated capital expenditures. If any or all of these events were to occur,
to the extent that the working capital reserve would be insufficient to satisfy
the cash requirements of the Partnership, it is anticipated that additional
funds would be obtained through a reduction of cash distributions to Investors,
bank loans, short-term loans from the General Partner or its Affiliates, or the
sale or financing of Partnership properties.

During the three months ended March 31, 1998, cash from working capital reserves
was used for the payment of leasing costs in the amount of $33,417 incurred at
the Carnegie Center property. The General Partner estimates that the Partnership
will incur approximately $356,000 of additional leasing costs at its properties
during the remainder of 1998. The General Partner anticipates that the current
balance in the working capital reserve will be sufficient to pay such costs.

During the three months ended March 31, 1998, approximately $20,000 of cash from
operations was used to fund non-recurring maintenance and repair expenses
incurred at the Partnership's properties. The General Partner estimates that the
Partnership will incur additional non-recurring repair and maintenance expenses
of approximately $230,000 at the properties during the remainder of 1998. These
additional expenses will be funded from the operations of the Partnership's
properties and are not expected to have a significant impact on the
Partnership's liquidity.

Cash in the amount of $509,151 generated from the Partnership's operations was
distributed to the General Partner and Investors during the three months ended
March 31, 1998. The General Partner currently anticipates that the Partnership
will be able to make comparable distributions during each of the three remaining
quarters of 1998.

The Partnership has incurred approximately $248,000 in legal expenses in
connection with the class action lawsuit (see Part II, Item 1 of this Report).
Of this amount, approximately $149,000 relates to the Partnership's own defense
and approximately $99,000 relates to the indemnification of the General Partner
and its Affiliates for their defense. These expenses are funded from the
operations of the Partnership. At the present time, the General Partner cannot
estimate the aggregate amount of legal expenses and indemnification claims to be
incurred and their impact on the Partnership's future operations. Liquidity
would, however, be materially adversely affected by a significant increase in
such legal expenses and related indemnification costs. If such increases were to
occur, to the extent that cash from operations and the working capital reserve
would be insufficient to satisfy the cash requirements of the Partnership, it is
anticipated that additional funds would be obtained through a reduction of cash
distributions to investors, bank loans, short-term loans from the General
Partner or its affiliates, or the sale or financing of Partnership properties.




                                       14
<PAGE>   15
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS (CONTINUED)

LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)

The following table summarizes the leasing activity and occupancy status at the
Partnership's properties during the three months ended March 31, 1998:

<TABLE>
<CAPTION>
                                   MARLBORO SQ.    CROSSROADS SQ.    CARNEGIE      WARNER PL.
                                   SHOPPING CTR.    SHOPPING CTR.     CENTER      SHOPPING CTR.
                                   ------------    -------------     --------     ------------
<S>                                  <C>             <C>             <C>            <C>   

Square Feet                          42,150          174,196         128,059        92,848

Occupancy at January 1, 1998             67%              95%             73%           98%

New Leases                               16%               1%              0%            0%

Lease Renewals                            0%               0%              0%            0%

Leases Expired (1)                       11%               0%              0%            7%

Occupancy at
   March 31, 1998                        72%              96%             73%           91%

Leases Scheduled to
   Expire, Balance of 1998                0%              11%             17%            7%

Leases Scheduled to
   Commence, Balance of 1998              0%               0%              0%            0%

</TABLE>

(1)    Includes leases terminated by the General Partner for non-payment of
       rent.

At March 31, 1998, Marlboro Square's occupancy was 72%. During the first quarter
of 1998, a new tenant took occupancy of 6,600 square feet, or 16% of the
property under a lease that will expire in January 1999, at which time the
tenant will have the option to renew its lease for a five-year term.
Approximately $20,000 in leasing costs was incurred in connection with this new
lease. However, a lease representing 3,000 square feet, or 7% of the property,
expired. In addition, a tenant with a lease for approximately 1,600 square feet,
or 4% of the property, is delinquent in rental payments due since February 1998
and the General Partner understands that the tenant intends to vacate its space
at the property. The General Partner will use all legal remedies to obtain
collection from this tenant of all obligations due under its lease agreement.

The General Partner anticipates that absorption of available retail space in the
Marlboro, Massachusetts area will remain sluggish during 1998 based upon both
the lack of demand and the oversupply amount of available retail space in the
area. The General Partner will continue to offer competitive rental rates and
concessions in an effort to retain existing tenants as well as to lease the
remaining vacant space at the property.

The Carnegie Center's occupancy at March 31, 1998, was 73%. During the remainder
of 1998, four leases representing approximately 19,500 square feet, or 17% of
the property are scheduled to expire. The Cincinnati industrial real estate
market, where the Carnegie Center is located, has an oversupply of
office/industrial space, which has resulted in a decline in rental rates and an
increase in vacancy rates. Because of these current market conditions, rental
rates and concessions will be priced aggressively in an effort to retain
existing tenants as well as secure new tenants at the property.

A tenant at the Warner Plaza property with a lease for approximately 6,200
square feet, or 7% of the property, vacated the property and filed for
bankruptcy under Chapter 7 of the U.S Bankruptcy Code. The General Partner is
seeking to find a replacement tenant for this space.





                                       15
<PAGE>   16
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS (CONTINUED)

LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)

During the second quarter of 1997, the anchor tenant at the Crossroads Square
property that occupies 49% of the property under a lease scheduled to expire in
August 2010 informed the General Partner of its intention to vacate its space
during the second half of 1998. As a result, the General Partner has commenced
efforts to find a replacement tenant for the space. The General Partner does not
believe that this situation is likely to have a materially adverse effect on the
Partnership's liquidity.

One tenant at the Crossroads Square property has a clause in its lease that may
be exercisable if the anchor tenant described above ceases to operate at the
property and a replacement tenant is not secured. Such clause provides that the
tenant may: i) reduce rental payments to the lesser of the fixed monthly rent or
2% of gross receipts if the anchor ceases to operate for 180 days, and, ii)
terminate lease obligations if the cessation of operations continues for an
additional six months and a substitute tenant has not been provided. This tenant
occupies approximately 10,500 square feet, of 6% of the property, under a lease
that is scheduled to expire in July 2005. The General Partner does not believe
that any reduction in rental payments or any possible lease termination that may
result from the anchor tenant vacating the property is likely to have a
materially adverse affect on the Partnership's liquidity.

The General Partner evaluated the carrying value of each of the Partnership's
properties as of December 31, 1997 by comparing such value to the respective
property's future undiscounted cash flows and the then most recent independent
or internal appraisal. Based on such evaluations, the General Partner determined
that the Marlboro Square property's estimated future undiscounted cash flows
were not expected to exceed its carrying value. Therefore, a write-down in value
of $668,520, representing the difference between the property's carrying value
and its then estimated market value (and not its estimated future undiscounted
cash flows) was required as of December 31, 1997. No permanent impairment in
values existed with respect to the Partnerships other properties as of December
31, 1997 and, therefore, no additional write-downs were recorded.

The General Partner will continue to conduct property valuations, using internal
or independent appraisals, in order to determine whether a permanent impairment
in value exists on any of the Partnership's properties.

RESULTS OF OPERATIONS

The Partnership generated net income of $333,559 for the three months ended
March 31, 1998 as compared to net income of $288,524 for the same period in
1997.

Average occupancy for the Partnership's investments was as follows:

<TABLE>
<CAPTION>
                                                          Three Months Ended
                                                               March 31,
                                                       1998              1997
                                                       ----              ----
           <S>                                          <C>               <C>
           Marlboro Square Shopping Center              71%               68%
           Crossroads Square Shopping Center            95%               93%
           Carnegie Center Office/Warehouse             73%               66%
           Warner Plaza Shopping Center                 96%               99%
</TABLE>


Rental income for the three months ended March 31, 1998 decreased by $64,538, or
9%, as compared to the same period in 1997. This decrease is primarily due to
the sale of the 1300 North Dutton Avenue property on September 29, 1997.
Excluding rental income generated by the 1300 North Dutton Avenue property,
rental income increased slightly due to increases in rental income at the
Marlboro Square, Carnegie Center and Crossroads Square properties. Rental income
increased at each of these properties primarily due to increases in average
occupancy. Rental income at the Warner Plaza property was consistent between
periods.




                                       16
<PAGE>   17
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)




ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS (CONTINUED)

RESULTS OF OPERATIONS (CONTINUED)

Interest income for the three months ended March 31, 1998 increased by $3,541,
or 16%, as compared to the same period in 1997. This increase was primarily due
to an increase in the balance of the Partnership's working capital reserves. The
Partnership's working capital reserves increased because the Partnership
retained a portion of the net sales proceeds from the sale of the 1300 North
Dutton Avenue property.

Depreciation expense for the three months ended March 31, 1998 decreased by
$15,618, or 9%, as compared to the same period in 1997. This decrease is
primarily due to the write-down in value of Marlboro Square's carrying value at
December 31, 1997.

General and administrative expenses for the quarter ended March 31, 1998
decreased by $58,082, or 45%, primarily due to a decline in legal fees incurred
by the Partnership in connection with the class action complaint (see Part II,
Item 1 of this Report). Excluding such legal fees, general and administrative
expenses were consistent between periods.

The Partnership's share of property operating expenses for the three months
ended March 31, 1998 decreased by $22,116, or 26%, as compared to the same
period in 1997. This decrease is primarily due to the sale of the 1300 North
Dutton Avenue property. Excluding amounts attributable to the 1300 North Dutton
Avenue property, the Partnership's share of property operating expenses
increased by 91% primarily due to non-recurring maintenance and repair expenses
incurred at the Carnegie Center and Marlboro Square properties. Property
operating expenses at the Crossroads Square and Warner Plaza properties were
consistent between periods.

Amortization of deferred expenses for the three months ended March 31, 1998
decreased by $9,376, or 32%, as compared to the same period in 1997. This
decrease is primarily due to the write-down in carrying value of the Marboro
Square property at December 31, 1997. The net book value of the Marlboro Square
plus any unamortized deferred expenses relating to the property at the time the
property was written-down were combined to arrive at the property's carrying
value (current market value) after its write-down. Accordingly, some deferred
expense amounts that were amortized during 1997 are included in the property's
carrying value, and depreciated, during 1998.

The General Partner believes that inflation has had no significant impact on the
Partnership's operations during the three months ended March 31, 1998, and the
General Partner anticipates that inflation will not have a significant impact
during the remainder of 1998.




                                       17
<PAGE>   18

               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)




ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS (CONTINUED)

CASH FLOW

The following table provides the calculations of Cash from Operations and
Distributable Cash from Operations which are calculated in accordance with
Section 17 of the Partnership Agreement:

<TABLE>
<CAPTION>
                                                           Three Months Ended
                                                                March 31,
                                                          1998             1997
                                                        ---------       ---------
<S>                                                     <C>             <C>      

Net cash provided by operating activities (a)           $ 474,895       $ 424,079
Net change in operating assets and liabilities (a)         36,072          66,847
                                                        ---------       ---------
Cash provided by operations (a)                           510,967         490,926
Increase in working capital reserves                       12,926            --
Add: Accrual basis Partnership
     management fee                                        18,063          18,903
                                                        ---------       ---------
Cash from operations (b)                                  516,104         509,829
Decrease in working capital reserves                                       30,258
Less: Accrual basis Partnership
      management fee                                      (18,063)        (18,903)
                                                        ---------       ---------
Distributable cash from operations (b)                  $ 498,041       $ 521,184
                                                        =========       =========

Allocation to General Partner                           $   4,980       $   5,212
Allocation to John Hancock Limited Partner                   --              --
Allocation to Investors                                   493,061         515,972
                                                        ---------       ---------
Distributable cash from operations (b)                  $ 498,041       $ 521,184
                                                        =========       =========
</TABLE>


       (a)    Net cash provided by operating activities, net change in operating
              assets and liabilities, and cash provided by operations are as
              calculated in the Statements of Cash Flows included in Item 1 of
              this Report.

       (b)    As defined in the Partnership Agreement. Distributable Cash from
              Operations should not be considered as an alternative to net
              income (i.e. not an indicator of performance) or to reflect cash
              flows or availability of discretionary funds.

During the second quarter of 1998, the Partnership expects to make a cash
distribution of $493,061, representing a 5% annualized return, to all Investors
of record at March 31, 1998, based on Distributable Cash from Operations for the
quarter then ended.

The source of future cash distributions is dependent upon cash generated by the
Partnership's properties and the use of working capital reserves. The General
Partner currently anticipates that the Partnership's Distributable Cash from
Operations during each of the remaining three quarters of 1998 will be
comparable to that generated during the first quarter of 1998.




                                       18
<PAGE>   19
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)


                           PART II: OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

          In February 1996, a putative class action complaint was filed in the
          Superior Court in Essex County, New Jersey by a single investor in a
          limited partnership affiliated with the Partnership. The complaint
          named as defendants the Partnership, the General Partner, certain
          other affiliates of the General Partner, and certain unnamed officers,
          directors, employees and agents of the named defendants.

          The plaintiff sought unspecified damages stemming from alleged
          misrepresentations and omissions in the marketing and offering
          materials associated with the Partnership and two limited partnerships
          affiliated with the Partnership. The complaint alleged, among other
          things, that the marketing materials for the Partnership and the
          affiliated limited partnerships did not contain adequate risk
          disclosures.

          On March 18, 1997, the court certified a class of investors who were
          original purchasers in the Partnership. The certification order should
          not be construed as suggesting that any member of the class is
          entitled to recover, or will recover, any amount in the action.

          The General Partner believes the allegations are totally without merit
          and intends to vigorously contest the action.

          There are no other material pending legal proceedings, other than
          ordinary routine litigation incidental to the business of the
          Partnership, to which the Partnership is a party or to which any of
          its properties is subject.

          In September 1997, a complaint for damages was filed in the Superior
          Court of the State of California for the County of Los Angeles by an
          investor in John Hancock Realty Income Fund-II Limited Partnership
          ("RIF-II"), a limited partnership affiliated with the Partnership. The
          complaint named the General Partner as a defendant.

          The plaintiff sought unspecified damages which allegedly arose from
          the General Partner's refusal to provide, without reasonable
          precautions on plaintiff's use of, a list of investors in the
          Partnership and in RIF-II. Plaintiff alleges that the General
          Partner's refusal unconditionally to provide a list was a breach of
          contract and a breach of the General Partner's fiduciary duty.

          In 1998, the plaintiff amended the complaint to name the Partnership
          and RIF-II as defendants. The defendants filed demurrer motions,
          asking that the complaint be dismissed at law. These motions were
          under consideration during the first quarter of 1998. 

          Although the court dismissed the complaint against RIF-II during the
          second quarter of 1998, the plaintiff subsequently amended its
          complaint, again naming RIF-II as a defendant. The defendants continue
          to contest the action.

          There can be no assurances given as to the timing, costs or outcome of
          this legal proceeding.

          There are no other material pending legal proceedings, other than
          ordinary routine litigation incidental to the business of the
          Partnership, to which the Partnership is a party or to which any of
          its properties is subject.

ITEM 2.   CHANGES IN SECURITIES

          There were no changes in securities during the first quarter of 1998.

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

          There were no defaults upon senior securities during the first quarter
          of 1998.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

          There were no matters submitted to a vote of security holders of the
          Partnership during the first quarter of 8

ITEM 5.   OTHER INFORMATION

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K 

          (a) There are no exhibits to this report.
          (b) There were no Reports on Form 8-K filed during the first quarter
              of 1998.




                                       19
<PAGE>   20
               JOHN HANCOCK REALTY INCOME FUND LIMITED PARTNERSHIP
                      (A MASSACHUSETTS LIMITED PARTNERSHIP)



                                   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, on the 15th day of May, 1998.



                                   John Hancock Realty Income Fund
                                   Limited Partnership


                                   By: John Hancock Realty Equities, Inc.,
                                       General Partner



                                   By:  /s/ William M. Fitzgerald       5/15/98
                                       ----------------------------------------
                                       William M. Fitzgerald, President



                                   By:  /s/ Richard E. Frank            5/15/98
                                       ----------------------------------------
                                       Richard E. Frank, Treasurer
                                       (Chief Accounting Officer)




                                       20