Securities and Exchange Commission
                             Washington, D.C. 20549

                                    Form 10-Q


[X]  Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934 For the quarterly period ended June 30, 1997 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: 0-13091

IMH Commercial Holdings, Inc.
(Exact name of registrant as specified in its charter)

                  Maryland                                      33-0745075
      (State or other jurisdiction of                        (I.R.S. Employer
        incorporation or organization)                      Identification No.)

            20371 Irvine Avenue
       Santa Ana Heights, California                               92614
  (Address of Principal Executive Offices)                      (Zip Code)

       Registrant's telephone number, including area code: (714) 556-0122

       Securities registered pursuant to Section 12(b) of the Act:

                                                Name of each exchange on
            Title of each class                    which registered

---------------------------------------     ----------------------------------
     Common Stock $0.01 par value                American Stock Exchange

     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 [_] No [X]

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference in Part III of the Form 10-K or any amendment to this
Form 10-K. [_]

     The aggregate  market value of the voting stock held by  non-affiliates  of
the  registrant  based  upon the  closing  sales  price of its  Common  Stock on
November  7,  1997 on the  American  Stock  Exchange  was  approximately  $110.9
million.

The number of shares of Common Stock outstanding as of
November 7, 1997:   7,344,789

The number of shares of Class A Common Stock outstanding as of
November 7, 1997:   674,211

                       Documents incorporated by reference

                                      None




<PAGE>



<TABLE>


                          IMH COMMERCIAL HOLDINGS, INC.

                         1997 FORM 10-Q QUARTERLY REPORT

                                TABLE OF CONTENTS



                          PART I. FINANCIAL INFORMATION


<S>           <C>                                                                                                  <C>

ITEM 1.       FINANCIAL STATEMENTS - IMH COMMERCIAL HOLDINGS, INC.                                                  Page #

              Balance Sheets, June 30, 1997 and March 31, 1997...........................................                3

              Statements of Operations, Three-Months Ended June 30, 1997 and For the period
              from January 15, 1997 (commencement of operations) through June 30, 1997...................                4

              Statement of Cash Flows, For the period from January 15, 1997 (commencement of operations ) through
              June 30, 1997..............................................................................                5

              Selected Notes to Financial Statements.....................................................                6

ITEM 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
              RESULTS OF OPERATIONS                                                                                     10

                           PART II. OTHER INFORMATION

ITEM 1. - 5.  NOT APPLICABLE                                                                                            13

ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K                                                                          13

              SIGNATURES                                                                                                14


</TABLE>






<PAGE>


<TABLE>


                          PART I. FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS

                                            IMH COMMERCIAL HOLDINGS, INC.
                                                    BALANCE SHEETS
                                     (dollars in thousands, except per share data)


<CAPTION>

                                                                              June 30, 1997          March 31, 1997
                                                                         ----------------------  ----------------------
<S>                                                                     <C>                     <C>


                                 ASSETS
Cash and cash equivalents                                                $               9,686   $               4,400
Residual interest in securitization, held for trading                                    9,999                  10,025
Loan receivables:
     Finance receivables                                                                31,169                       -
     Commercial Mortgages held for investment                                           17,380                  17,535
     Allowance for loan losses                                                             (33)                    (13)
                                                                         ----------------------  ----------------------
          Net loan receivables                                                          48,516                  17,522

Due from affiliates                                                                      1,192                     134
Other assets                                                                               652                      41
Accrued interest receivable                                                                249                     128
                                                                         ----------------------  ----------------------

                                                                         $              70,294   $              32,250
                                                                         ======================  ======================

                  LIABILITIES AND STOCKHOLDERS' EQUITY
Warehouse facilities                                                     $              37,863   $                   -
Borrowings from Imperial Warehouse Lending Group                                         7,213                  16,563
Due to affiliates                                                                        9,096                     520
Other liabilities                                                                          649                       -
Accrued interest expense                                                                   137                     150
                                                                         ----------------------  ----------------------

     Total Liabilities                                                                  54,958                  17,233
                                                                         ----------------------  ----------------------

Stockholders' Equity:
   Preferred Stock;  $.01 par value;  10,000,000  shares  authorized;
      3,000,000 shares issued and outstanding at June 30, 1997 and
      March 31, 1997                                                                        30                      30
   Common Stock; $.01 par value; 46,000,000 shares authorized;
     599,000 shares issued and outstanding at June 30, 1997 and
     March 31, 1997                                                                          6                       6
   Additional paid-in-capital                                                           17,667                  17,667
   Accumulated deficit                                                                  (2,367)                 (2,686)
                                                                         ----------------------  ----------------------
     Total Stockholders' Equity                                                         15,336                  15,017
                                                                         ----------------------  ----------------------

                                                                         $              70,294   $              32,250
                                                                         ======================  ======================

</TABLE>






                   See accompanying notes to consolidated  financial statements.


<PAGE>




<TABLE>



                          IMH COMMERCIAL HOLDINGS, INC.
                            STATEMENTS OF OPERATIONS
                 (dollars in thousands, except earnings per share data)

<CAPTION>

                                                                                                 For the period from
                                                                                                  January 15, 1997
                                                                   For the Three Months     (commencement of operations)
                                                                   Ended June 30, 1997          through June 30, 1997
                                                                 -----------------------    -----------------------------
<S>                                                             <C>                        <C>

Revenues
Interest income                                                  $                 986     $                        1,353

Expenses
Interest expense on warehouse facilities                                           297                                371
Interest expense on affiliated borrowings                                          226                                431
Professional services                                                              119                                179
Provision for Commercial Mortgage losses                                            20                                 33
Stock compensation expense                                                           -                              2,697
General and administrative expense                                                   5                                  9
                                                                  ----------------------   -------------------------------
                                                                                   667                              3,720
                                                                  ----------------------   -------------------------------

Net earnings (loss)                                               $                319     $                       (2,367)
                                                                  ======================   ===============================

 Pro forma net earnings (loss) per common share                   $               0.20     $                        (1.48)
                                                                  ======================   ===============================

Pro forma weighted average number of shares outstanding
    used in net earnings (loss) per share calculation                        1,599,000                          1,599,000
                                                                  ======================   ===============================



</TABLE>




          See accompanying notes to consolidated financial statements.




<PAGE>



<TABLE>

                          IMH COMMERCIAL HOLDINGS, INC.
                             STATEMENT OF CASH FLOWS
                                 (in thousands)
                                   

<CAPTION>


                                                                                               For the period from
                                                                                                January 15, 1997
                                                                                          (commencement of operations)
                                                                                              through June 30, 1997
                                                                                      --------------------------------------
<S>                                                                                  <C>
  Cash flows from operating activities:
       Net loss                                                                       $                              (2,367)
       Adjustments to reconcile net loss to net cash
          used in operating activities:
          Provision for Commercial Mortgage losses                                                                       33
          Stock compensation expense                                                                                  2,697
          Net change in accrued interest receivable                                                                    (249)
          Net change in accrued interest expense                                                                        137
          Net change in other assets and liabilities                                                                 (1,195)
                                                                                      --------------------------------------
               Net cash used in operating activities                                                                   (944)

    Cash flows from investing activities:
          Net change in Commercial Mortgages held for investment                                                    (17,380)
          Net change in finance receivables                                                                         (31,169)
          Purchase of residual interest in securitization                                                           (10,098)
          Principal reductions on residual interest in securitization                                                    99
                                                                                      --------------------------------------
               Net cash used in investing activities                                                                (58,548)

    Cash flows from financing activities:
          Net change in warehouse facilities                                                                         37,863
          Net change in affiliated borrowings                                                                        16,309
          Issuance of preferred stock                                                                                15,000
          Issuance of common stock                                                                                        6
                                                                                      --------------------------------------
               Net cash provided by financing activities                                                             69,178

    Cash and cash equivalents at end of period                                        $                               9,686
                                                                                      ======================================

    Supplementary information:
          Interest paid                                                               $                                 665
                                                                                      ======================================

</TABLE>


                    See accompanying notes to consolidated financial statements.




<PAGE>



                          IMH COMMERCIAL HOLDINGS, INC.
                          Notes to Financial Statements

     Unless the context otherwise requires,  references herein to the "Company"'
     refer to IMH  Commercial  Holdings,  Inc.  ("ICH") and Imperial  Commercial
     Capital Corporation ("ICCC"), collectively.  References to ICH refer to IMH
     Commercial Holdings, Inc. as a separate entity from ICCC.

1.    Basis of Financial Statement Presentation

     The accompanying  consolidated  financial  statements have been prepared in
     accordance  with  Generally  Accepted  Accounting  Principles  and with the
     instructions  to Form 10-Q.  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  adjustments)  considered
     necessary for a fair presentation have been included. Operating results for
     the period from January 15, 1997 (commencement of operations)  through June
     30, 1997 are not necessarily indicative of the results that may be expected
     for the period from January 15, 1997  (commencement of operations)  through
     December 31, 1997.

     References  to financial  information  of ICH  reflects the  financial
     results  of the  Long-Term  Investment  Operations  ("Long-Term  Investment
     Operations")  for  the  period  from  January  15,  1997  (commencement  of
     operations)  through June 30, 1997, prior to the Contribution (as discussed
     below) on August 8, 1997 and excludes the Company's equity interest in ICCC
     which  the  Company  obtained  pursuant  to the  Contribution.  See Item 2.
     "Management's  Discussion of Financial  Analysis and Results of Operations"
     for additional information on the Contribution.

2.    Summary of Business and Significant Accounting Policies

     ICH is a recently formed specialty commercial property finance company
     which  has  elected  to be taxed at the  corporate  level as a real  estate
     investment trust ("REIT") for federal income tax purposes,  which generally
     allows the Company to pass through income to  stockholders  without payment
     of federal income tax at the corporate  level. The Company was incorporated
     in February 1997 for the purpose of originating,  purchasing,  securitizing
     and selling commercial  mortgages and investing in commercial mortgages and
     commercial mortgage-backed  securities.  Imperial Credit Mortgage Holdings,
     Inc.  ("IMH")  capitalized  the Company with $15.0 million in cash in March
     1997. Upon the closing of the Initial Public Offering  ("IPO") on August 8,
     1997, IMH owned 719,789,  or 9.8%, of ICH Common Stock and 674,211  shares,
     or 100%,  of ICH  non-voting  Class A Stock (as  defined  hereinafter)  and
     contributed  (the   "Contribution")  100%  of  the  outstanding  shares  of
     non-voting  preferred  stock of ICCC in exchange  for 95,000  shares of ICH
     non-voting Class A Stock. See Item 2. "Management's Discussion and Analysis
     of Financial Condition and Results of Operations--Significant Transactions"
     for additional information on the IPO.

     ICH  was  formed  to seek  opportunities  in the  commercial  mortgage
     market.    Commercial   mortgage   assets   include   mortgage   loans   on
     condominium-conversions,  mortgage loans on commercial properties,  such as
     industrial and warehouse space, office buildings, retail space and shopping
     malls, hotels and motels, nursing homes, hospitals, multifamily, congregate
     care  facilities  and  senior  living  centers  (collectively,  "Commercial
     Mortgages").  The Company  operates the  Long-Term  Investment  Operations,
     which  invests  primarily  in  Commercial   Mortgages  and  mortgage-backed
     securities on  commercial  properties  ("CMBS") and  subsequent to the IPO,
     engages in the Conduit Operations, which originates, purchases and sells or
     securitizes  Commercial  Mortgages.  In April  1997,  ICH  secured a $200.0
     million warehouse line agreement to finance the origination and purchase of
     Commercial  Mortgages.  The Company's  Conduit  Operations  operates  three
     divisions:   the  Condominium  Division,   the  Retail  Division,  and  the
     Correspondent and Bulk Purchase Division.

     Long-Term Investment Operations

     The Long-Term  Investment  Operations  invests primarily in adjustable rate
     Commercial  Mortgages  for  long-term  investment  and CMBS  backed by such
     Commercial  Mortgages.  Income is earned  principally from the net interest
     income  received  by the  Company  on  the  Commercial  Mortgages,  finance
     receivables,  and CMBS  purchased  and held in its  portfolio.  At June 30,
     1997, the Company's earning assets consisted of $17.4 million in Commercial
     Mortgages, $31.2 million in finance receivables, and a $10.0 million CMBS.

<PAGE>

     Conduit Operations

     The Company's  Conduit  Operations  operates three  divisions,  subsequent
     to the IPO: the Condominium  Division,  the Retail Division, and the
     Correspondent and Bulk Purchase Division.

     Condominium  Division.  This Division  offers on a retail basis  adjustable
     rate  financing to  developers  and project  owners who have  completed the
     development  of a  condominium  complex or the  conversion  of an apartment
     complex to a condominium  complex on property with a typical loan amount of
     $3.0 million to $10.0 million. All originations,  underwriting,  processing
     and  funding  are  performed  at  ICCC's  executive  offices.  The  Company
     anticipates that the Condominium  Division's  Commercial  Mortgages will be
     offered on a  nationwide  basis and that  Commercial  Mortgages  originated
     through the Condominium  Division will be financed  through the utilization
     of CMO borrowings by the Long-Term Investment Operations.

     Retail  Division.   This  Division  originates   Commercial  Mortgages  for
     properties  including  general  retail  property such as shopping  centers,
     super markets and department stores, light industrial property,  and office
     buildings.  The Retail Division  offers smaller  balance  ($500,000 to $1.5
     million) fixed and adjustable rate  Commercial  Mortgages to developers and
     project owners for smaller properties and projects than those funded by the
     Correspondent and Bulk Purchase Division.  Although  processing and funding
     operations  relating to these Commercial  Mortgages are performed centrally
     at ICCC's executive  offices,  the Company has targeted major  metropolitan
     areas for the opening of  satellite  offices for regional  originations.  A
     portion of the adjustable rate Commercial  Mortgages that are originated by
     the Retail  Division may be held in portfolio by the  Long-Term  Investment
     Operations,  while the  balance  thereof and a  substantial  portion of the
     fixed rate  Commercial  Mortgages  originated will be resold by the Conduit
     Operations through bulk sale or REMIC securitizations.

     Correspondent  and Bulk Purchase  Division.  This Division both  originates
     Commercial  Mortgages on a retail basis and purchases  Commercial Mortgages
     on a bulk and flow basis.  This Division  offers larger  principal  balance
     ($1.5  million  to  $10.0  million)  Commercial  Mortgages  for  commercial
     projects than those funded by the Retail Division.  The  Correspondent  and
     Bulk Purchase  Division  offers  adjustable  rate and fixed rate Commercial
     Mortgages offered through specified correspondents who may in the future be
     provided with  Company-sponsored  warehouse  facilities.  In addition,  the
     Division will purchase Commercial  Mortgages in bulk and flow from selected
     financial  institutions and mortgage  bankers.  A portion of the adjustable
     rate Commercial  Mortgages  originated or purchased by this Division may be
     held in portfolio by the Long-Term Investment Operations, while the balance
     thereof and a substantial  portion of the fixed rate  Commercial  Mortgages
     originated  or  purchased  will  be  resold  through  bulk  sale  or  REMIC
     securitizations.

     In June 1996, the Financial  Accounting Standards Board issued Statement of
     Financial  Accounting  Standards  No.  125  (SFAS  125),   "Accounting  for
     Transfers  and  Servicing  of  Financial  Assets  and   Extinguishment   of
     Liabilities,"  which supersedes SFAS 122. SFAS 125 provides  accounting and
     reporting  standards for  transfers  and servicing of financial  assets and
     extinguishments  of  liabilities.  These  standards are based on consistent
     application  of a financial  components  approach  that focuses on control.
     Under  that  approach,  after a transfer  of  financial  assets,  an entity
     recognizes  the  financial  and  servicing   assets  it  controls  and  the
     liabilities it has incurred, derecognizes financial assets when control has
     been surrendered and derecognizes  liabilities when extinguished.  SFAS 125
     provides  consistent  standards for  distinguishing  transfers of financial
     assets that are sales from transfers that are secured borrowings.  SFAS 125
     requires  that   liabilities  and  derivatives   incurred  or  obtained  by
     transferors as part of a transfer of financial assets be initially measured
     at fair value, if practicable.  It also requires that servicing  assets and
     other  retained   interests  in  the  transferred  assets  be  measured  by
     allocating  the previous  carrying  amount between the assets sold, if any,
     and retained  interest,  if any, based on their relative fair values at the
     date of the transfers.  SFAS 125 includes specific  provisions to deal with
     servicing  assets or  liabilities.  SFAS 125 is effective for  transactions
     occurring  after  December 31, 1996 except for certain  transactions  which
     according to Statement of Financial Accounting Standards No. 127, "Deferral
     of the Effective Date of Certain Provisions of FASB 125," will be effective
     if  occurring  after  December 31,  1997.  The Company  adopted SFAS 125 on
     January  1, 1997 with no  significant  impact  on the  Company's  financial
     position or results of operations.

     In February 1997, the Financial Accounting Standards Board issued Statement
     of Financial  Accounting  Standards  No. 128 ("SFAS  128"),  "Earnings  per
     Share".  SFAS 128 supersedes  APB Opinion No. 15 ("APB 15"),  "Earnings per
     Share" and  specifies  the   computation,   presentation,   and  disclosure
     requirements  for earnings per share (EPS) for entities  with publicly held
     common  stock  or  potential  common  stock.

<PAGE>

     SFAS 128 will replace the  presentation  of primary EPS with a
     presentation  of basic EPS, and replace  fully  diluted EPS with diluted
     EPS.  SFAS 128 will also require  dual  presentation  of basic and  diluted
     EPS on the face of the income statement  for all  entities  with  complex
     capital  structures  and requires a reconciliation of the numerator and
     denominator of the basic EPS computation and the numerator and denominator
     of the diluted EPS computation.  This statement is effective for financial
     statements  for both interim and annual  periods ending after December 15,
     1997. Earlier  application is not permitted.  The Company has determined 
     that this statement will have no significant  impact on the financial
     position or results of operations.

3.    Residual Interest in Securitization

     The accompanying  1997 balance sheet includes one residual interest in
     securitization  ("residual")  of real estate mortgage  investment  conduits
     ("REMICS")  which  was  recorded  as a result of a 1995  securitization  by
     Imperial Credit  Industries,  Inc.  ("ICII") of commercial  loans through a
     special purpose trust vehicle. ICII has one director who also serves on the
     Board of ICH.  ICH  purchased  the  residual in March 1997 from ICI Funding
     Corporation  ("ICIFC"),  the conduit operations for IMH, for $10.1 million.
     ICIFC and ICH have estimated future cash flows from the residual  utilizing
     assumptions  that they believe are  commensurate  with the risk inherent in
     the  investment  and  consistent  with  those  that they  believe  would be
     utilized by an unaffiliated  third-party purchaser and discounted at a rate
     commensurate  with the risk  involved.  The  Company  has  classified  this
     residual as a held-for trading security.  Unrealized gains and losses,  net
     of related  income  taxes,  will be  recognized  as a reduction  to current
     earnings.  To the Company's knowledge,  there is currently no active market
     for the purchase or sale of this  residual.  At June 30, 1997,  the Company
     recorded  $10.0  million  in  residual  interest  in  securitization  which
     management estimates to approximate fair value.

     The Company financed the purchase of the residual with borrowings from ICII
     due December 2007 at a stated  interest rate of 10%. At June 30, 1997,  the
     balance of the affiliated  borrowings was $7.9 million,  which was included
     in due to affiliates on the balance sheet.

4.    Warehouse Facilities

     In April 1997,  ICH as a stand-alone  entity  entered into a warehouse
     line  agreement  to provide up to $200.0  million to finance the  Company's
     businesses.  Terms  of the  warehouse  line  of  credit  require  that  the
     Commercial Mortgages be held by an independent third party custodian, which
     gives the  Company  the  ability  to borrow  against  the  collateral  as a
     percentage  of the fair  market  value  of the  Commercial  Mortgages.  The
     borrowing  rates  are  expressed  in basis  points  over  one-month  LIBOR,
     depending on the type of collateral provided by the Company. The margins on
     the warehouse line  agreement are based on the type of mortgage  collateral
     used and  generally  range from 85% to 88% of the fair market  value of the
     collateral.  At  June  30,  1997  ICH  had  $37.9  million  outstanding  in
     borrowings under warehouse facilities.

5.    Stockholders' Equity

     The  authorized  stock of ICH consists of 46,000,000  shares of Common
     Stock ("ICH Common Stock"),  and 4,000,000  shares of Class A Non-Voting
     Common Stock ("ICH Class A Stock"). On February 3, 1997, the Company issued
     300,000 shares of ICH Common Stock to certain officers and directors of the
     Company and 299,000  shares of ICH Common  Stock to IMH for an aggregate of

     $5,990. In April 1997, IMH exchanged the 299,000 shares of ICH Common Stock
     for an equivalent number of shares of ICH Class A Stock

     The  authorized  stock of ICH also  consists  of  6,000,000  shares of
     Preferred  Stock,  $.01  par  value  per  share  ("Preferred  Stock"),  and
     4,000,000 shares of Class A Convertible Preferred Stock, $.01 par value per
     share ("ICH Preferred  Stock").  In March 1997, IMH converted $15.0 million
     principal amount  promissory notes into an aggregate of 3,000,000 shares of
     ICH Preferred Stock.

6.    Subsequent Events

     In August 1997, the Company raised $88.2 million,  net of underwriting
     expenses, from its IPO as stockholders purchased 6,325,000 shares of Common
     Stock at a price of $15.00 per  share.  Upon the  closing  of the IPO,  IMH
     contributed to ICH 100% of the outstanding  shares of non-voting  preferred
     stock of ICCC in  exchange  for 95,000  shares of ICH Class A Stock.  As of
     September 30, 1997, IMH owns 719,789  shares,  or 9.8%, of ICH Common Stock
     in addition to 674,211 shares, or 100%, of ICH Class A Stock.
<PAGE>

     In August  1997,  IMH/ICH  Dove  Street,  LLC,  a  California  limited
     liability  company,  of which each of IMH and ICH own a 50%  interest,
     purchased an office  building for $7.7 million plus related  closing costs.
     IMH and ICH intend to relocate their  headquarters to the building over the
     next two-year period.

     In August 1997,  the Company  agreed to provide to IMH a $15.0 million
     revolving  line of credit  expiring on August 8, 1998 at an  interest  rate
     determined  at the time of each advance with  interest and  principal  paid
     monthly.  As of September 30, 1997, there was no balance outstanding on the
     line of credit.

     In  October  1997,  the  Company  agreed to  provide  to ICIFC a $15.0
     million  revolving  line of credit  expiring  on  December  31,  1997 at an
     interest rate of Prime plus 1% with interest and principal paid monthly. As
     of October 31,  1997,  there was $2.0  million  outstanding  on the line of
     credit.



<PAGE>



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

     The  following  Management's  Discussion  and  Analysis  of  Financial
     Condition and Results of  Operations  contains  forward-looking  statements
     which involve risks and  uncertainties.  The Company's actual results could
     differ   materially  from  those   anticipated  in  these   forward-looking
     statements as a result of certain factors.

     References to financial  information of ICH reflects the financial  results
     of the Long-Term Investment Operations for the period from January 15, 1997
     (commencement   of  operations)   through  June  30,  1997,  prior  to  the
     Contribution,  and excludes the Company's equity interest in ICCC which the
     Company obtained pursuant to the Contribution.

     Significant Transactions

     In February  1997,  certain  officers and  directors  of the Company,  as a
     group, and IMH purchased  300,000 and 299,000 shares of the Common Stock of
     ICH,  respectively.  In  addition,  IMH  purchased  all of  the  non-voting
     preferred stock of ICCC, which  represents 95% of the economic  interest in
     ICCC, for $500,000,  and certain of the Company's officers purchased all of
     the outstanding  shares of common stock of ICCC, which represents 5% of the
     economic  interest in ICCC. In addition,  ICCC brokered  ICH's  purchase of
     $7.3 million and $10.2 million of condominium  conversion  loans which were
     financed  with  $16.6  million  in  borrowings  under a  warehouse  lending
     facility  provided by a subsidiary of IMH, and $900,000 in borrowings  from
     IMH.

     In March 1997, IMH loaned ICH $15.0 million  evidenced by a promissory
     note  convertible  into shares of non-voting  preferred stock of ICH at the
     rate of one share of ICH Preferred Stock for each $5.00 principal amount of
     said note. IMH converted the aforementioned  $15.0 million principal amount
     promissory  note into an  aggregate of  3,000,000  shares of ICH  Preferred
     Stock. All shares of ICH Preferred Stock were automatically  converted upon
     the  closing  of the IPO into  shares of ICH  Common  Stock  determined  by
     multiplying  the number of shares of ICH Preferred Stock to be converted by
     a fraction,  the numerator of which was $5.00 and the  denominator of which
     was   $15.00. Notwithstanding  the  foregoing,   consistent   with   IMH's
     classification  as a REIT,  IMH was not entitled to convert into ICH Common
     Stock more than that number of shares of ICH  Preferred  Stock  whereby IMH
     would own,  immediately  after such conversion,  greater than 9.8% of ICH's
     outstanding  Common Stock.  Any shares of ICH Preferred Stock not converted
     into ICH  Common  Stock  upon  the  closing  of the IPO were  automatically
     converted into shares of ICH  non-voting  Class A Stock at the same rate as
     the ICH Preferred  Stock  converted  into ICH Common  Stock.  Shares of ICH
     Class A Stock  convert into shares of Common Stock on a  one-for-one  basis
     and each such class of Common Stock is entitled to cash  dividends on a pro
     rata basis. Upon any subsequent issuances of Common Stock by ICH or sale of
     ICH  Common  Stock  held  by  IMH,  shares  of  ICH  Class  A  Stock  shall
     automatically  convert into  additional  shares of the Common Stock of ICH,
     subject to a 9.8% limitation.  In addition,  ICH purchased $10.1 million in
     mortgage-backed  securities from ICIFC which was financed with a promissory
     note.  The  promissory  note was  repaid  to ICIFC  with  cash  from  IMH's
     above-referenced  $15.0 million  investment.  Concurrently,  ICH repaid the
     $900,000  owed  to IMH in  connection  with  its  purchase  of  condominium
     conversion loans. Subsequently, ICH entered a borrowing agreement with ICII
     for $7.9 million secured by a $10.1
     CMBS.

     In April 1997, IMH exchanged the 299,000  shares of ICH Common Stock held
     by it for an equivalent  number of shares of ICH Class A Stock.

     In August 1997, the Company raised $88.2 million,  net of underwriting
     expenses, from its IPO as shareholders purchased 6,325,000 shares of common
     stock at a price of $15.00 per  share.  Upon the  closing  of the IPO,  IMH
     contributed to ICH 100% of the outstanding  shares of non-voting  preferred
     stock of ICCC in  exchange  for 95,000  shares of ICH Class A Stock.  As of
     September 30, 1997, IMH owns 719,789  shares,  or 9.8%, of ICH Common Stock
     in addition to 674,211 shares, or 100%, of ICH Class A Stock.

     In August 1997,  IMH/ICH Dove Street,  LLC, a California  limited liability
     company,  of which  each of IMH and ICH own a 50%  interest,  purchased  an
     office  building for $7.7 million plus related  closing costs.  IMH and ICH
     intend  to  relocate  their  headquarters  to the  building  over  the next
     two-year period.

     Other Matters

          William D  Endresen,  the ICH's  current  Senior  Vice  President  and
     President  and Director of ICCC,  filed a petition for Chapter 7 bankruptcy
     in July 1995 in federal court,  Santa Ana. The bankruptcy was discharged in
     November 1995

<PAGE>

     Results of Operations

     Three Months Ended June 30, 1997

     Revenues  for the three  months  ended June 30, 1997 were  $986,000  due to
     interest   income  earned  on  Commercial   Mortgages,   CMBS  and  finance
     receivables.  Revenues  were  comprised  primarily  of $362,000 of interest
     income  earned on Commercial  Mortgages  held for  investment,  $387,000 of
     interest income from CMBS and $189,000 of interest income earned on finance
     receivables with ICCC.  Interest income for the three months ended June 30,
     1997 was earned on total average Mortgage Assets of $36.2 million which was
     comprised of $17.5 million of  Commercial  Mortgages  held for  investment,
     $9.8  million of CMBS and $8.9 million of finance  receivables.  Commercial
     Mortgages  and  CMBS  resulted  from  the  purchase  of  $17.5  million  of
     condominium  conversion  loans and  purchase  of a $10.1  million  residual
     interest in securitization from ICIFC in March 1997, respectively.  Finance
     receivables  were the result of providing  warehouse  financing to ICCC for
     the origination of Commercial Mortgages.

     Expenses  for the  three  months  ended  June 30,  1997 was  $667,000,
     comprised  primarily of $523,000 of interest  expense  related to warehouse
     financing,  of  which  $297,000  was  from  non-affiliated  borrowings  and
     $226,000  was the result of  borrowings  from  Imperial  Warehouse  Lending
     Group,  Inc.,  a  subsidiary  of IMH  ("IWLG")  and other  affiliates,  and
     professional  expenses of $119,000.  Interest  expense for the three months
     ended June 30, 1997 was the result of average  borrowings  under  warehouse
     facilities of $24.7 million. Professional services was primarily the result
     of  allocation of costs from ICIFC of $115,000 for services  performed by
     ICIFC  management  and staff for  finance  and  accounting  services,  MIS,
     marketing,  asset/liability  management  and reporting.  Additionally,  the
     Company  recorded a provision  for loan losses of $20,000  during the three
     months ended June 30, 1997. At June 30, 1997,  the Company's  allowance for
     loan losses  expressed as a percentage of loan  receivables  which includes
     Commercial Mortgages held for investment and finance receivables was 0.07%.
     As the Company experiences  increases in loan receivables and corresponding
     increases in delinquencies, the Company expects to add to the allowance for
     loan losses.  The Company  anticipates  that  expenses will increase in the
     future as the Company builds its  infrastructure,  increases its borrowings
     under  warehouse  lines of credit and  reverse  repurchase  facilities  and
     relies more heavily on RAI Advisors,  LLC ("RAI" or the  "Manager") for its
     day-to-day operations.

     For the period from January 15, 1997  (commencement of operations)  through
     June 30, 1997.

     Revenues for the period from January 15, 1997  (commencement of operations)
     through  June 30, 1997 were $1.4 million due to interest  income  earned on
     Commercial Mortgages, CMBS and finance receivables. Revenues were comprised
     primarily of $581,000 of interest  income  earned on  Commercial  Mortgages
     held for investment,  $518,000 of interest income from CMBS and $189,000 of
     interest income earned on finance  receivables  with ICCC.  Interest income
     for the period from January 15, 1997  (commencement of operations)  through
     June 30, 1997 was earned on total average  Mortgage Assets of $24.3 million
     which was  comprised  of $13.8  million of  Commercial  Mortgages  held for
     investment,  $6.0 million of CMBS and $4.5 million of finance  receivables.
     Commercial  Mortgages  and CMBS resulted from the purchase of $17.5 million
     of condominium  conversion  loans and purchase of a $10.1 million  residual
     interest in securitization from ICIFC in March 1997, respectively.  Finance
     receivables  were the result of providing  warehouse  financing to ICCC for
     the origination of Commercial Mortgages.

     Expenses for the period from January 15, 1997  (commencement of operations)
     through June 30, 1997 were $3.7 million  which was  comprised  primarily of
     stock  compensation  expense of $2.7 million,  interest  expense related to
     borrowings  of  $802,000,   of  which  $371,000  was  from   non-affiliated
     borrowings  and $431,000 was the result of  borrowings  from IWLG and other
     affiliates,  and  professional  expenses of  $179,000.  Stock  compensation
     expense  was due to the  issuance  of 300,000  shares of ICH Common  Stock.
     Stock  compensation  expense represents the difference between the price at
     which ICH issued  300,000  shares of its Common  Stock on  February 3, 1997
     ($.01 per share) and the estimated  fair value of such shares for financial
     reporting  purposes  as  determined  by  the  Company's  management,  as of
     February  3, 1997  ($9.00 per  share).  Fair value was based  primarily  on
     management's projection of the Company's future cash flow and net earnings.
     Interest  expense for the period from  January  15, 1997  (commencement  of
     operations)  through  June 30,  1997 was the result of  average  borrowings
     under  warehouse  facilities of $17.2  million.  Professional  services was
     primarily  the result of  allocation  of costs from ICIFC of  $178,000  for
     services performed by ICIFC management and staff for finance and accounting
     services,  MIS,  marketing,   asset/liability   management  and  reporting.
     Additionally,  the Company  recorded a provision for loan losses of $33,000
     during the period  from  January  15,  1997  (commencement  of  operations)
     through June 30, 1997.

<PAGE>

     Liquidity and Capital Resources

     The Company's principal liquidity requirements result from the need to fund
     the  origination or purchase of Commercial  Mortgages held for sale by ICCC
     and  investment in Commercial  Mortgages and CMBS by ICH.  Prior to the IPO
     and the  Contribution,  ICCC was  funded  by  intercompany  borrowings  and
     $500,000  from the  issuance  of  capital  stock.  ICH was  funded by $15.0
     million in investments by IMH, $900,000 in borrowings from IMH and a $200.0
     million   warehouse  line   agreement.   Subsequent  to  the  IPO  and  the
     Contribution,   the  Long-Term   Investment   Operations  and  the  Conduit
     Operations were funded by warehouse line agreements with a major investment
     banking  firm,  proceeds  from the issuance of common stock and  affiliated
     borrowings.

     For the period from January 15, 1997  (commencement of operations)  through
     June 30,  1997,  net  cash  used in  operating  activities  was  $(944,000)
     primarily due to $(1.2) million in advances to affiliates.

     For the period from January 15, 1997  (commencement of operations)  through
     June 30, 1997, net cash used in investing  activities was $(58.5)  million.
     Cash flows were  negatively  affected due to the  acquisition of Commercial
     Mortgages and CMBS and providing warehouse financing to ICCC.

     For the period from January 15, 1997  (commencement of operations)  through
     June 30, 1997, net cash provided by financing activities was $69.2 million.
     Cash flows were  positively  affected by borrowings  under  warehouse  line
     agreements,  other  affiliated  borrowings to fund the purchase of CMBS and
     the issuance of 3,000,000  shares of ICH  Preferred  Stock in March 1997 to
     IMH.

     In April 1997, as a  stand-alone,  ICH entity entered into a warehouse
     line agreement which provides up to $200.0 million to finance the Company's
     businesses.  Terms  of the  warehouse  line  of  credit  require  that  the
     Commercial Mortgages be held by an independent third party custodian, which
     gives the  Company  the  ability  to borrow  against  the  collateral  as a
     percentage  of the fair  market  value  of the  Commercial  Mortgages.  The
     borrowing  rates  are  expressed  in basis  points  over  one-month  LIBOR,
     depending on the type of collateral provided by the Company. The margins on
     the warehouse line  agreement are based on the type of mortgage  collateral
     used and  generally  range from 85% to 88% of the fair market  value of the
     collateral.  Management  believes that the warehouse line agreement will be
     sufficient to handle the Company's liquidity needs.

     On August 4, 1997, the Company's  Registration  Statement (file number
     333-25423) used in connection with the sale of its Common Stock for the IPO
     was declared effective by the Securities and Exchange Commission. On August
     8, 1997, the Company raised $88.2 million,  net of  underwriting  expenses,
     from its IPO as stockholders  purchased 6,325,000 shares of common stock at
     a price of $15.00 per share.  Underwriting  discount and  commissions  were
     $6.6 million and the total expenses were approximately $1.1 million,  which
     the Company  believes is a reasonable  estimated of such expenses.  The net
     offering proceeds to the Company, after deducting the above expenses,  were
     $87.2  million of which $36.8 million was used to reduce  borrowings  under
     warehouse  facilities,  $18.7  and  $12.4  million  was  used  to  purchase
     Commercial  Mortgages  and CMBS,  respectively,  $3.9  million  was used to
     purchase a 50%  interest in a  commercial  office  building,  IMH/ICH  Dove
     Street, LLC ("Dove") and $15.4 million was used for general working capital
     needs.

     In August  1997,  the  Company  agreed to  provide  to IMH a $15.0  million
     revolving  line of credit  expiring on August 8, 1998 at an  interest  rate
     determined  at the time of each advance with  interest and  principal  paid
     monthly.  As of September 30, 1997, there was no balance outstanding on the
     line of credit.

     In October  1997,  the  Company  agreed to  provide to ICIFC,  a $15.0
     million  revolving  line of credit  expiring  on  December  31,  1997 at an
     interest rate of Prime plus 1% with interest and principal paid monthly. As
     of October 31,  1997,  there was $2.0  million  outstanding  on the line of
     credit.


<PAGE>



                           PART II. OTHER INFORMATION


     ITEM 1 - 5:   NOT APPLICABLE.


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


               (a)  Exhibits
<PAGE>
                Exhibit 11. Pro Forma Statement Regarding Computation of 
                            Earnings per Share
<TABLE>

                                                   IMH COMMERCIAL HOLDINGS, INC.
                                   Pro Forma Statement Regarding Computation of Earnings per share
                                              (in thousands, except per share data)

<CAPTION>

                                                                                                      For the period from
                                                                                                        January 15, 1997
                                                                       For the Three Months       (commencement of operations)
                                                                       Ended June 30, 1997           through June 30, 1997

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

         Net earnings                                                 $                    319    $                      (2,367)
                                                                    ===========================  ===============================

         Average number of  pro forma shares outstanding                                 1,599                            1,599
                                                                    ===========================  ===============================

         Pro forma net earnings per share                             $                   0.20    $                       (1.48)
                                                                    ===========================  ===============================

</TABLE>

<PAGE>

                  (a)  27 Financial Data Schedule

                            (b)  Reports on Form 8-K:

                                   None.






<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.

                                                  IMH COMMERCIAL HOLDINGS, INC.

                                                   By:  /s/ Richard J. Johnson
                                                            Richard J. Johnson

                                                         Senior Vice President
                                                   and Chief Financial Officer

                                                      Date:  November 14, 1997