<PAGE>

================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 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 September 30, 1999

/ /   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 000-23463
                                               ---------

                       Philips International Realty Corp.
             (Exact name of registrant as specified in its charter)

                Maryland                                      13-3963667
     (State or other jurisdiction                          (I.R.S. Employer
   of incorporation or organization)                       Identification No)

                      417 Fifth Avenue, New York, NY 10016
               (Address of principal executive offices - Zip Code)

                                 (212) 545-1100
              (Registrant's telephone number, including area code)

      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   / /

APPLICABLE ONLY TO CORPORATE ISSUERS:

      Indicate the number of shares outstanding of each of the issuer's classes
of common stock as of the latest practicable date.

      7,340,474 shares outstanding as of October 31, 1999.

================================================================================

<PAGE>

                                     PART I

                              FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

            Condensed Consolidated Balance Sheets as of September 30, 1999 and
            December 31, 1998

            Condensed Consolidated Statements of Income for the Nine Months
            Ended September 30, 1999, and the Three Months ended September 30,
            1999 and 1998

            Condensed Consolidated Statement of Shareholders' Equity for the
            Nine Months Ended September 30, 1999

            Condensed Consolidated Statement of Cash Flows for the Nine Months
            Ended September 30, 1999

            Condensed Consolidated Statement of Income for the Nine Months Ended
            September 30, 1998

            Condensed Consolidated Statement of Shareholders' Equity for the
            Nine Months Ended September 30, 1998

            Condensed Consolidated Statement of Cash Flows for the Nine Months
            Ended September 30, 1998

            Notes to Condensed Consolidated Financial Statements

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

Item 3. Quantitative and Qualitative Disclosure of Market Risk

<PAGE>

                       PHILIPS INTERNATIONAL REALTY CORP.
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                         September 30,      December 31,
                                                                             1999                1998
                                                                         -------------      -------------
                                                                          (Unaudited)          (Note 2)
<S>                                                                      <C>                <C>
                      ASSETS

Rental properties - net                                                  $ 262,919,475      $ 208,914,386
Investments in and advances to real estate joint ventures                   23,707,578         34,663,524
Cash and cash equivalents                                                    3,023,465          9,116,070
Accounts receivable                                                          7,720,664          5,986,763
Deferred charges and prepaid expenses                                        5,812,095          3,879,574
Other assets                                                                 4,153,236          1,786,903
                                                                         -------------      -------------

Total Assets                                                             $ 307,336,513      $ 264,347,220
                                                                         =============      =============

       LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
      Mortgages and notes payable                                        $ 179,940,048      $ 137,486,668
      Accounts payable and accrued expenses                                  5,039,043          2,350,799
      Dividends payable                                                      2,771,031          2,477,412
      Other liabilities                                                      2,126,540          1,715,335
                                                                         -------------      -------------

Total Liabilities                                                          189,876,662        144,030,214
                                                                         -------------      -------------

Minority interests in Operating Partnership                                 30,234,242         30,919,150
                                                                         -------------      -------------

Shareholders' Equity:
      Preferred Stock, $.01 par value; 30,000,000 shares authorized;
          no shares issued and outstanding                                          --                 --
      Common Stock, $.01 par value; 150,000,000 shares authorized;
          7,340,474 shares issued and outstanding                               73,405             73,405
      Additional paid in capital                                            92,668,007         92,668,007
      Cumulative distributions in excess of net income                      (4,760,595)        (2,435,222)
                                                                         -------------      -------------
                                                                            87,980,817         90,306,190
      Stock purchase loans receivable                                         (755,208)          (908,334)
                                                                         -------------      -------------

Total Shareholders' Equity                                                  87,225,609         89,397,856
                                                                         -------------      -------------

Total Liabilities and Shareholders' Equity                               $ 307,336,513      $ 264,347,220
                                                                         =============      =============
</TABLE>

                             See accompanying notes.

<PAGE>

                       PHILIPS INTERNATIONAL REALTY CORP.
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
    For the Nine Months Ended September 30, 1999, and the Three Months Ended
                          September 30, 1999 and 1998
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                             Nine Months          Three Months        Three Months
                                                                Ended                Ended               Ended
                                                          September 30, 1999   September 30, 1999   September 30, 1998
                                                          ------------------   ------------------   ------------------
<S>                                                          <C>                  <C>                  <C>
Revenues from rental property                                $ 30,481,373         $ 11,922,312         $  8,769,106
                                                             ------------         ------------         ------------

Expenses:
     Operating expenses                                         3,570,738            1,346,478            1,239,938
     Real estate taxes                                          4,627,267            1,779,984            1,301,751
     Management fees to affiliates                                885,226              341,891              260,850
     Interest expense                                           6,590,717            2,844,238            1,652,873
     Depreciation and amortization                              5,277,899            1,946,279            1,480,848
     General and administrative expenses                        2,065,586              733,777              637,182
                                                             ------------         ------------         ------------

                                                               23,017,433            8,992,647            6,573,442
                                                             ------------         ------------         ------------

         Operating income                                       7,463,940            2,929,665            2,195,664

Equity in net income of real estate joint ventures              2,070,893              302,697              310,624

Minority interests in income of Operating Partnership          (2,016,184)            (756,602)            (588,442)

Other income (expense), net                                    (1,530,929)            (228,783)            (170,276)
                                                             ------------         ------------         ------------

         Net income                                          $  5,987,720         $  2,246,977         $  1,747,570
                                                             ============         ============         ============

Basic and diluted net income per common share                $       0.82         $       0.31         $       0.24
                                                             ============         ============         ============
</TABLE>

                             See accompanying notes.

<PAGE>

                       PHILIPS INTERNATIONAL REALTY CORP.
            CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                  For the Nine Months Ended September 30, 1999
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                       Cumulative
                                                     Common                                           Distributions
                                                     Stock              Additional        Stock        in Excess          Total
                                             ---------------------       Paid-In        Purchase         of Net       Shareholders'
                                             Shares         Amount       Capital          Loans          Income           Equity
                                             ------         ------       -------          -----          ------           ------
<S>                                         <C>         <C>           <C>             <C>             <C>             <C>
Balance, December 31, 1998                  7,340,474   $     73,405  $ 92,668,007    $   (908,334)   $ (2,435,222)   $ 89,397,856
  Net income                                                                                             5,987,720       5,987,720
  Dividends declared on Common Stock                                                                    (8,313,093)     (8,313,093)
  Amortization of stock purchase loans                                                     153,126                         153,126

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

Balance, September 30, 1999                 7,340,474   $     73,405  $ 92,668,007    $   (755,208)   $ (4,760,595)   $ 87,225,609
                                         ============   ============  ============    ============    ============    ============
</TABLE>

                             See accompanying notes.

<PAGE>

                       PHILIPS INTERNATIONAL REALTY CORP.
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                  For the Nine Months Ended September 30, 1999
                                   (Unaudited)

Cash flow provided by operating activities:                        $ 12,137,917
                                                                   ------------

Cash flow from investing activities:
     Acquisitions of land, buildings and improvements               (39,503,813)
     Investments in and advances to joint ventures                   (8,709,523)
     Purchase of mortgage note, secured by real estate               (1,750,000)
                                                                   ------------

     Net cash used in investing activities                          (49,963,336)
                                                                   ------------

Cash flow from financing activities:

     Repayment of mortgage notes payable                             (3,800,000)
     Principal amortization of mortgage notes payable                  (771,338)
     Proceeds from debt financing                                    47,024,718
     Dividends paid on Common Stock                                  (8,019,474)
     Distributions to minority interests                             (2,701,092)
                                                                   ------------

Net cash provided by financing activities                            31,732,814
                                                                   ------------

Net decrease in cash and cash equivalents                            (6,092,605)
Cash and cash equivalents, beginning of period                        9,116,070
                                                                   ------------

Cash and cash equivalents, end of period                           $  3,023,465
                                                                   ============

Noncash investing and financing activities:

     Acquisition of real estate assets accounted for at the
     time of purchase on the equity method                         $ 19,461,901
                                                                   ============

     Dividends declared and paid in succeeding period              $  2,771,031
                                                                   ============

                             See accompanying notes.

<PAGE>

                PHILIPS INTERNATIONAL REALTY CORP.
            CONDENSED CONSOLIDATED STATEMENT OF INCOME
           For the Nine Months Ended September 30, 1998
                           (Unaudited)

Revenues from rental property                                      $ 13,296,773
                                                                   ------------

Expenses:
     Operating expenses                                               1,809,163
     Real estate taxes                                                1,947,528
     Management fees to affiliates                                      395,795
     Interest expense                                                 2,406,196
     Depreciation and amortization                                    2,261,143
     General and administrative expenses                                978,817
                                                                   ------------

                                                                      9,798,642
                                                                   ------------

        Operating income                                              3,498,131

Equity in net income of real estate joint ventures                      310,624

Minority interests in income of Operating Partnership                  (922,823)

Preferred units income allocation from Operating Partnership             63,143

Equity in net income of Operating Partnership, as adjusted
        for the allocation of income to preferred units                   6,823

Other income (expense), net                                            (165,954)
                                                                   ------------

        Income before extraordinary items                             2,789,944

Extraordinary items                                                     (65,361)
                                                                   ------------

        Net income                                                 $  2,724,583
                                                                   ============

        Net income applicable to common shares                     $  2,661,440
                                                                   ============

Basic and diluted income per common share

        Income before extraordinary items                          $       0.71

        Extraordinary items                                               (0.02)
                                                                   ------------

        Net income                                                 $       0.69
                                                                   ============

                     See accompanying notes.

<PAGE>

                       PHILIPS INTERNATIONAL REALTY CORP.
            CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                  For the Nine Months Ended September 30, 1998
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                          Preferred                     Common
                                                            Stock                       Stock                Additional
                                                    -----------------------     -----------------------        Paid-In
                                                    Shares        Amount         Shares        Amount          Capital
                                                    ------        ------         ------        ------          -------
<S>                                                <C>         <C>             <C>            <C>           <C>
Balance, December 31, 1997                           1,940     $  1,940,000        47,660     $     477     $    805,523
    Net income
    Issuance of Common Stock                                                    7,292,814        72,928      114,004,100
    Redemption of Preferred Stock                   (1,940)      (1,940,000)
    Dividends on Preferred Stock
    Dividends on Common Stock
    Amortization of stock purchase loan
    Reallocation of equity to minority partners
         in Operating Partnership                                                                            (22,141,616)

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

Balance, September 30, 1998                             --     $         --     7,340,474     $  73,405     $ 92,668,007
                                                    ======     ============     =========     =========     ============

<CAPTION>
                                                                          Cumulative
                                                                         Distributions
                                                         Stock             in Excess            Total
                                                        Purchase             of Net          Shareholders'
                                                          Loans              Income             Equity
                                                          -----              ------             ------
<S>                                                    <C>               <C>                <C>
Balance, December 31, 1997                                               $    (542,723)     $   2,203,277
    Net income                                                               2,724,583          2,724,583
    Issuance of Common Stock                           $ (1,050,000)                          113,027,028
    Redemption of Preferred Stock                                                              (1,940,000)
    Dividends on Preferred Stock                                               (63,143)           (63,143)
    Dividends on Common Stock                                               (3,807,506)        (3,807,506)
    Amortization of stock purchase loan                      83,296                                83,296
    Reallocation of equity to minority partners
         in Operating Partnership                                                             (22,141,616)

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

Balance, September 30, 1998                            $   (966,704)     $  (1,688,789)     $  90,085,919
                                                       ============      =============      =============
</TABLE>

                             See accompanying notes.

<PAGE>

                       PHILIPS INTERNATIONAL REALTY CORP.
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                  For the Nine Months Ended September 30, 1998
                                   (Unaudited)

<TABLE>
<S>                                                                                          <C>
Cash flow provided by operating activities:                                                  $   4,980,092
                                                                                             -------------

Cash flow from investing activities:
      Acquisitions of land, buildings and improvements                                         (11,517,231)
      Investments in joint ventures                                                            (19,302,207)
                                                                                             -------------

      Net cash used in investing activities                                                    (30,819,438)
                                                                                             -------------

Cash flow from financing activities:

      Repayment of mortgage notes payable, exclusive of scheduled principal amortization      (109,303,875)
      Principal amortization of mortgage notes payable                                            (240,676)
      Proceeds from debt financing                                                              29,900,000
      Redemption of Preferred Stock                                                             (1,940,000)
      Proceeds from sale of Common Stock                                                       113,027,028
      Dividends paid on Preferred Stock                                                         (1,330,095)
      Dividends paid on Common Stock                                                               (63,143)
                                                                                             -------------

Net cash provided by financing activities                                                       30,049,239
                                                                                             -------------

Net increase in cash and cash equivalents                                                        4,209,893
Cash and cash equivalents, beginning of period                                                           0
                                                                                             -------------

Cash and cash equivalents, end of period                                                     $   4,209,893
                                                                                             =============

Noncash investing and financing activities:

      Acquisition of land, building and improvements with assumed indebtedness               $ 196,863,763
                                                                                             =============

      Dividends declared and paid in succeeding period                                       $   2,477,411
                                                                                             =============
</TABLE>

                             See accompanying notes.

<PAGE>

                       PHILIPS INTERNATIONAL REALTY CORP.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                      (In thousands, except share amounts)

1. Formation Transactions

      Philips International Realty Corp. (the "Company"), a Maryland
corporation, and Philips International Realty, L.P. (the "Operating
Partnership"), a Delaware limited partnership, were formed in July 1997 for the
purpose of combining certain real estate properties which were owned by various
partnerships and limited liability companies (the "Contributing Companies") in
which Mr. Philip Pilevsky owned an interest.

      On December 31, 1997, the partners and members of the Contributing
Companies transferred their shopping center assets or, in certain instances,
their partnership or membership interests in the entities which hold title to
such shopping center assets, to certain newly-formed entities (the "Property
Partnerships") as designated by the Operating Partnership in exchange for
limited partnership interests ("Units") therein. Simultaneously, the Company
contributed its fee title interest in another shopping center property plus $533
in cash to the Operating Partnership in exchange for a non-managing general
partnership interest therein. Philips International Realty, LLC (the "Interim
Managing General Partner"), a Delaware limited liability company whose sole
member was Mr. Pilevsky, made pro rata contributions to the Operating
Partnership and to each of the Property Partnerships in exchange for managing
general partner/member interests therein. Additionally, the Company capitalized
various wholly-owned subsidiaries so as to enable such entities to similarly
obtain general partner or managing member interests in each of the Property
Partnerships. The resultant effect of the foregoing, together with certain other
events constituting the Formation Transactions, was that the ownership of (A)
the Operating Partnership was comprised (i).001% by a managing general partner
interest held by the Interim Managing General Partner (ii) 6.1% by a
non-managing general partner interest held by the Company, and (iii) 93.899% by
limited partner interests held by the Unit holders and (B) the Property
Partnerships were each comprised (i).001% by a managing general partner/member
interest held by the Interim Managing General Partner (ii).01% by a non-managing
general partner/member interest held by subsidiaries of the Company, and (iii)
99.989% by a limited partner or member interest held by the Operating
Partnership.

      Upon completion of the public stock offering discussed in Note 3, the
Interim Managing General Partner withdrew from the Operating Partnership and
each of the Property Partnerships and the Company (directly or through its
subsidiaries) assumed in full the rights and responsibilities associated with
the management of the business and affairs of the Operating Partnership and each
of the Property Partnerships as sole general partner/managing member. Prior to
this time, the Company was required to account for its interests in the
Operating Partnership and the Property Partnerships on the equity method.

      Reference should be made to the Company's Annual Report on Form 10-K for
the year ended December 31, 1998, for further information with regard to the
Formation Transactions.

2. Interim Financial Statements

      The accompanying Condensed Consolidated Financial Statements include the
accounts of the Company and its subsidiaries, all of which are wholly-owned, and
the Operating Partnership and the Property Partnerships effective as of May 13,
1998. See Note 3. All significant intercompany accounts and balances have been
eliminated in consolidation. The information furnished is unaudited and reflects
all adjustments which are, in the opinion of management, necessary to reflect a
fair presentation of the results for the interim periods presented, and all such
adjustments are of a normal recurring nature. These Condensed Consolidated
Financial Statements should be read in conjunction with the financial statements
included in the Company's Annual Report on Form 10-K for the year ended December
31, 1998.

      The Condensed Consolidated Balance Sheet at December 31, 1998, has been
derived from the audited financial statements at that date but does not include
all of the information and footnote disclosure required by generally accepted
accounting principles for complete financial statements.

3. Stock Split and Public Stock Offering

      On April 14, 1998 the Company authorized a 1.7051 for 1 split of its
Common Stock which was effected immediately prior to the consummation of the
stock offering referred to below. As a result, the number of outstanding shares
of Common Stock prior to the stock offering increased to 81,265 shares from
47,660 shares.

<PAGE>

      On May 13, 1998, the Company completed a primary public stock offering
(the "Offering") of 7,200,000 shares of Common Stock at $17.50 per share. The
proceeds from this sale of Common Stock, net of related transaction costs of
approximately $13,000, totaling approximately $113,000, were used primarily to
(i) repay certain mortgage loans and other indebtedness (including accrued
expenses incurred in connection with the Formation Transactions) of the
Operating Partnership and the Property Partnerships, and (ii) to redeem the
Series A Convertible Redeemable Preferred Stock outstanding. As a consequence of
this use of proceeds, the ownership of the Operating Partnership is now
comprised of a 74.8% general partner interest held by the Company and a 25.2%
limited partner interest held by the Unit holders. Accordingly, the Company has
accounted for its interests in the Operating Partnership and the Property
Partnerships on a consolidated basis effective as of the completion of the stock
offering. A total 9,812,869 shares of Common Stock (7,340,474) and Units
(2,472,395) have been outstanding since completion of the stock offering.

4. Income (Loss) per Common Share

      Basic net income (loss) per share excludes the dilutive effects of any
outstanding options. Diluted net income (loss) per share includes the dilutive
(but not any anti-dilutive) effect of outstanding options calculated under the
treasury stock method.

      Basic and diluted net income per common share in the accompanying
Condensed Consolidated Statements of Income are based upon weighted average
numbers of 7,340,474 shares of Common Stock outstanding for the three months
ended September 30, 1999 and 1998, and 7,340,474 and 3,830,527 shares of Common
Stock outstanding for the nine months ended September 30, 1999, and 1998,
respectively.

5. Investments in Operating Partnership and Property Partnerships

      Prior to completion of the public stock offering referred to in Note 3,
the Company and its subsidiaries held a 6.1% non-managing general partnership
interest in the Operating Partnership (which held a 99.989% limited partner or
member interest in each of the Property Partnerships) and .01% non-managing
general partner/member interests in the Property Partnerships, respectively.
Accordingly, the Company accounted for its investments in the Operating
Partnership and the Property Partnerships on the equity method.

      Condensed operating information for the Property Partnerships (comprising
thirteen shopping center properties) for the nine months ended September 30,
1998, follows. Certain balances have been reclassified to conform with current
year presentations.

                                                                  Nine Months
                                                                 Ended 9/30/98
                                                                 -------------
Revenues from rental property ..................................    $25,521
                                                                    -------
Expenses:
         Operating expenses ....................................      3,314
         Real estate taxes .....................................      3,696
         Management fees to affiliates .........................        759
         Interest expense ......................................      7,745
         Depreciation and amortization .........................      4,282
         General and administrative expenses ...................         53
                                                                    -------
                                                                     19,849
                                                                    -------
                             Income from operations ............    $ 5,672
                                                                    =======

6. Dividends on Preferred and Common Stock

      On March 1, June 15, and September 15, 1999, the Board of Directors
declared dividends on its Common Stock of $.3775 per share, which amounts were
paid on April 15, July 15, and October 15, 1999, to common shareholders of
record on March 31, June 30, and September 30, 1999, respectively. The $.3775
rate of dividend, if annualized, would equal $1.51 per share.

      During March and May 1998, the Board of Directors of the Company declared
dividends on the Series A Convertible Redeemable Preferred Stock at the rates of
$22.50 and $10.04 per share, respectively. These dividends were paid on March 31
and May 13, 1998, and the Series A Convertible Redeemable Preferred Stock was
simultaneously redeemed in conjunction with the stock offering discussed in Note
3.

<PAGE>

7. Segment Information

      Management considers the Company's various operating, investing and
financing activities to comprise a single business segment and evaluates real
estate performance and allocates resources based on net income.

8. Property Acquisitions

      On July 15 1999, the Company acquired nine shopping center properties (the
"Properties") anchored by Kmart and comprising approximately 1.1 million square
feet of leasable space located in the states of Florida, California, Washington,
Minnesota, Illinois and Kentucky. Prior to these acquisitions, the Company had
purchased, through a series of unrelated transactions since July 1998, limited
partnership interests in the Properties. The amount invested by the Company
since July 1998 and to acquire the Properties, totaling approximately $49.5
million, was funded with borrowings under the Company's revolving line of
credit. The reporting of financial position and results of operations for the
Company pertaining to these Properties reflects a change from the equity to
consolidation method of accounting.

9. Pro Forma Financial Information

      As discussed in Note 8, the Company acquired nine shopping center
properties (the "Properties") during the three months ended September 30, 1999.
The pro forma information set forth below is based upon the Company's historical
Condensed Consolidated Statement of Income for the nine months ended September
30, 1999, and the historical operating results for 1998 after giving effect to
the Offering, adjusted to give effect to the Properties acquisition as of
January 1, 1998.

      This pro forma financial information is presented for informational
purposes only and may not be indicative of what actual results of operations
would have been had the Properties acquisition occurred as of January 1, 1999
and 1998, nor does it purport to represent the results of future operations.

                                                Nine Months Ended September 30,
                                                -------------------------------
                                                     1999            1998
                                                     ----            ----

Revenue from rental property ..................    $34,521         $31,887
Net income ....................................      6,383           6,241
Net income, per common share ..................    $   .87         $   .85

10. Subsequent Event

      In a press release issued on October 13, 1999, the Company announced that
it has retained a financial advisor to assist in examining strategic
alternatives to maximize shareholder value.

<PAGE>

                                     PART I

                              FINANCIAL INFORMATION
                                   (Continued)

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

      The following discussion should be read in conjunction with the
accompanying Condensed Consolidated Financial Statements and Notes thereto, and
the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1998. These unaudited financial statements include all adjustments which are, in
the opinion of management, necessary to reflect a fair presentation of the
results for the interim periods presented, and all such adjustments are of a
normal recurring nature.

      When used in this Quarterly Report on Form 10-Q, the words "may", "will",
"expect", "anticipate", "continue", "estimate", "project", "intend" and similar
expressions are intended to identify forward-looking statements regarding
events, conditions and financial trends that may affect the Company's future
plans of operations, business strategy, results of operations and financial
position. Such forward-looking statements are not guarantees of future
performance and are subject to risks and uncertainties. Actual results may
differ materially from those included within the forward-looking statements as a
result of various factors.

Results of Operations

      Prior to completion of the public stock offering referred to in Note 3 to
the accompanying Condensed Consolidated Financial Statements, the Company and
its subsidiaries held a 6.1% non-managing general partnership interest in the
Operating Partnership (which held a 99.989% limited partner or member interest
in each of the Property Partnerships) and .01% non-managing general
partner/member interests in the Property Partnerships, respectively.
Accordingly, the Company accounted for its investments in the Operating
Partnership and the Property Partnerships on the equity method from January 1
through May 12, 1998.

      The following discussion compares the results of property operations of
the Company for the three and nine months ended September 30, 1999, with the
results of property operations of the Company and The Property Partnerships,
respectively, for the three and nine months ended September 30, 1998, as more
fully described in Note 5 to the accompanying Condensed Consolidated Financial
Statements.

      The Company recently acquired nine shopping center properties (the
"Properties") anchored by Kmart and comprising approximately 1.1 million square
feet of leasable space located in six states. Prior to these acquisitions, the
Company had purchased, through a series of unrelated transactions since July
1998, limited partnership interests in the Properties and reported its
investment on the equity method of accounting. The accompanying Condensed
Consolidated Statements of Income for the three and nine months ended September
30, 1999, report the operations of these Properties on a consolidated basis
effective July 1999. Consequently, the acquisition of the Properties gives rise
to significant changes when comparing the Company's results of operations for
the three and nine months ended September 30, 1999 to the three and nine months
ended September 30, 1998. Historic and pro forma financial information
pertaining to the operation of these Properties was disclosed by the Company in
a Form 8-K dated July 15, 1999, and filed with the SEC on July 30, 1999.

Comparison of Three Months Ended 9/30/99 to Three Months Ended 9/30/98

      Revenues from rental property increased $3,153,000 or 36.0% to $11,922,000
for the quarter ended September 30, 1999, as compared with $8,769,000 for the
quarter ended September 30, 1998. This net increase includes growth in base
rental revenues associated with higher rent levels achieved on new and renewal
leases and the acquisition of twelve shopping center properties.

      Property operating expenses increased $106,000 from $1,240,000 for the
quarter ended September 30, 1998, to $1,346,000 for the quarter ended September
30, 1999. This net increase reflects increased expenses associated with the
acquisition of twelve shopping center properties offset by management's efforts
to reduce operating expenses at existing properties. Property real estate taxes
increased by approximately $478,000 to $1,780,000 for the quarter ended
September 30, 1999, as compared with $1,302,000 for the corresponding period in
1998, reflecting the acquisition of the twelve shopping center properties, and
the effect of increased assessments associated with property expansions and
renovations.
<PAGE>

      Management fees remained constant at approximately 3% of gross revenues
for the quarters ended September 30, 1999, and 1998, as provided for in the
Management Agreement.

      Interest charges increased $1,191,000 to $2,844,000 for the quarter ended
September 30, 1999, as compared with $1,653,000 for the quarter ended September
30, 1998, due to interest costs on borrowings to fund the acquisition of twelve
shopping center properties, combined with the effect of higher rates on variable
rate debt.

      Depreciation and amortization expenses increased $465,000 to $1,946,000
for the quarter ended September 30, 1999, as compared with $1,481,000 for the
quarter ended September 30, 1998. This increase reflects the depreciation and
amortization of capital expenditures associated with the renovation and
retenanting of properties in the portfolio and the acquisition of twelve
shopping center properties.

Comparison of Nine Months Ended 9/30/99 to Nine Months Ended 9/30/98

      Revenues from rental property increased $4,960,000 or 19.4% to $30,481,000
for the nine months ended September 30, 1999, as compared with $25,521,000 for
the nine months ended September 30, 1998. This net increase is largely due to
growth in base rental revenues associated with the leasing of available premises
in the portfolio, higher rent levels achieved on new and renewal leases, and the
acquisition of twelve shopping center properties.

      Property operating expenses increased $257,000 from $3,314,000 for the
nine months ended September 30, 1998, to $3,571,000 for the nine months ended
September 30, 1999. This net increase reflects increased expenses associated
with the acquisition of twelve shopping center properties partially offset by
management's efforts to reduce operating expenses at existing properties.
Property real estate taxes increased by approximately $931,000 between the
corresponding periods, reflecting the acquisition of twelve shopping center
properties and the effect of increased assessments associated with property
expansions and renovations.

      Management fees remained constant at approximately 3% of gross revenues
for the nine months ended September 30, 1999, and 1998, as provided for in the
Management Agreement.

      Interest charges decreased $1,154,000 to $6,591,000 for the nine months
ended September 30, 1999, as compared with $7,745,000 for the nine months ended
September 30, 1998, reflecting the repayment of indebtedness with proceeds of
the Company's initial public offering as discussed in Note 3, partially offset
by interest costs on borrowings to fund the acquisition of twelve shopping
center properties.

      Depreciation and amortization expenses increased $996,000 to $5,278,000
for the nine months ended September 30, 1999, as compared with $4,282,000 for
the nine months ended September 30, 1998. This increase reflects the
depreciation and amortization of capital expenditures associated with the
renovation and retenanting of properties in the portfolio and the acquisition of
twelve shopping center properties.

Liquidity and Capital Resources

      The Property Partnerships historically relied on fixed and floating rate
mortgage financing to fund acquisitions and refinance maturing debt. Working
capital and funds required for distributions, debt service and capital
expenditures were generally provided through net cash flows from operations and,
in certain instances, capital contributions of partners and/or additional
borrowing. The ability to refinance debt prior to maturity and to fund
acquisitions was generally dependent upon interest rates, the general
availability of both mortgage debt and private equity in the marketplace and the
cash flow and value of the asset to be financed or refinanced. Distributions
were generally made based upon 100% of excess cash over identified, near-term
requirements.

      The Company believes that its public stock offering improved its financial
position, principally through enabling the Company to substantially reduce the
outstanding indebtedness on its shopping center portfolio. In connection with
this offering, the Company utilized approximately $109.3 million of the net
proceeds to repay all of its then outstanding floating-rate debt and certain
secured, fixed-rate obligations. The secured, fixed-rate debt then remaining,
totaling approximately $71.5 million, had a weighted average interest rate and
term to maturity of 7.6% and 5.2 years, respectively. The significant reduction
in the Company's overall debt served to reduce annual mortgage interest expense
as a percentage of total revenue and the cash from operations required to fund
debt service requirements.

      Since completion of its initial public stock offering, the Company has
financed the acquisition of interests in fifteen real estate properties, with
borrowings under its revolving line of credit, assumed property indebtedness and
the placement of new mortgage financing. Indebtedness outstanding at September
30, 1999, totaled $179.9 million, and was comprised of $88 million fixed rate
mortgage debt with a weighted average interest rate and remaining term to
maturity of 7.6% and 5.0 years, respectively, and $91.9 million in borrowings
under the Company's line of credit.

<PAGE>

      The combined aggregate principal maturities of mortgages and notes payable
outstanding as of September 30, 1999 are as follows:

                             Fixed Rate Obligations   Variable Rate Obligations
                             ----------------------   -------------------------
                                 Rate    Amount            Rate      Amount
                                 ----    ------            ----      ------
                                         (000's)                    (000's)
      10/1/99-12/31/99 .....     7.66%  $   285             --      $    --
      2000 .................     7.65%    1,195           7.13%      91,900
      2001 .................     6.35%    2,540             --           --
      2002 .................     7.50%   12,913             --           --
      2003 .................     7.40%   25,365             --           --
      Thereafter ...........     7.85%   45,742             --           --

      The Company considers (i) the availability of funds under its revolving
credit facility described below, (ii) the potential net proceeds from divesting
unencumbered shopping center properties located outside its target markets, and
(iii) its access to other sources of debt and equity capital, sufficient to
pursue its identified growth strategies. The Company intends to make regular
quarterly distributions to the holders of its Common Stock. The distribution for
the period ended September 30, 1999, was $0.3775 per share (which, if
annualized, would equal $1.51 per share), or an annual yield of approximately
9.6% based on the September 30, 1999, closing price of $15.75 per share.

      The Company expects to invest temporarily available cash in short-term,
investment-grade interest bearing securities, such as securities of the United
States government or its agencies, high-grade commercial paper and bank
deposits.

      The Company expects to meet its short-term liquidity requirements
generally through net cash provided by operations. The Company believes that its
net cash provided by operations will be sufficient to allow the Company to make
distributions necessary to enable the Company to continue to qualify as a REIT.
The Company also believes that the foregoing sources of liquidity will be
sufficient to fund its short-term liquidity needs for the foreseeable future.

      The Company expects to meet its long-term liquidity requirements, such as
property acquisition and development, scheduled debt maturities, renovations,
expansions and other non-recurring capital improvements through long-term
secured and unsecured indebtedness and the issuance of additional equity or debt
securities. The Company also expects to use funds available under its credit
facility to finance acquisition and development activities and capital
improvements on an interim basis.

      Upon consummation of its public stock offering, the Company entered into a
$100 million senior revolving credit facility with a financial services
institution to finance acquisition, redevelopment and development activities and
for general corporate purposes. Borrowings under the credit facility bear
interest at rates ranging from 1.25% to 1.75% over the 30-day London Interbank
Offered Rate ("LIBOR") based on the Company's total indebtedness outstanding
relative to total assets, as defined. The availability of funds under the credit
facility will be subject to the Company's compliance with a number of customary
financial and other covenants. Borrowings under the credit facility, totaling
$91,900 at September 30, 1999, are secured by certain shopping center properties
with recourse to the Company. The credit facility matures in May 2000, subject
to extension upon mutual agreement of the parties.

Funds from Operations

      The White Paper on Funds from Operations approved by the Board of
Governors of NAREIT in March 1995 defines Funds from Operations as net income
(loss) (computed in accordance with GAAP), excluding gains (or losses) from debt
restructuring and sales of properties, plus real estate related depreciation and
amortization and after adjustments for unconsolidated partnerships and joint
ventures. The Company believes that Funds from Operations is helpful to
investors as a measure of the performance of an equity REIT because, along with
cash flow from operating activities, financing activities and investing
activities, it provides investors with an indication of the ability of the
Company to incur and service debt, to make capital expenditures and to fund
other cash requirements. The Company computes Funds from Operations in
accordance with standards established by NAREIT which may not be comparable to
Funds from Operations reported by other REITs that do not define the term in
accordance with the current NAREIT definition or that interpret the current
NAREIT definition differently than the Company. Funds from Operations does not
represent cash generated from operating activities in accordance with GAAP and
should not be considered as an alternative to net income (determined in
accordance with GAAP) as an indication of the Company's financial performance or
to cash flow from operating activities (determined in accordance with GAAP) as a
measure of the Company's liquidity, nor is it indicative of funds available to
fund the Company's cash requirements, including its ability to make cash
distributions.

<PAGE>

      Funds from Operations (FFO) increased approximately 28% to $5.0 million
for the three months ended September 30, 1999, as compared to $3.9 million for
the three months ended September 30, 1998. FFO for the nine months ended
September 30, 1999, totaling $13.9 million, increased approximately 21% over the
corresponding pro forma period in 1998. This third quarter 1999 performance also
represents an approximate 9% increase over the second quarter 1999 FFO of $4.6
million. The pro forma FFO figure for 1998 gives retroactive effect as of
January 1, 1998 to the Company's IPO completed May 13, 1998, and reflects
adjustments consistent with those noted in the Company's IPO prospectus.

<TABLE>
<CAPTION>
                                                   Calculation of Funds From Operations
                                                              (In thousands)

                                                 Three Months Ended     Nine Months Ended
                                                 September 30, 1999     September 30, 1999
                                                 ------------------     ------------------
<S>                                                    <C>                  <C>
Net income                                             $ 2,247              $ 5,988

Minority interests in Operating Partnership                757                2,016

Depreciation and amortization                            1,947                5,278

Adjustment for unconsolidated joint ventures                76(1)               645(1)
                                                       -------              -------

Funds from Operations                                  $ 5,027              $13,927
                                                       =======              =======

Distributions                                          $ 3,704              $11,113
                                                       =======              =======

Payout ratio                                              73.7%                79.8%
                                                       =======              =======
</TABLE>

(1)   Company share of depreciation and amortization charges in unconsolidated
      real estate joint ventures.

Inflation

      Substantially all of the Company's leases contain provisions designed to
mitigate the adverse impact of inflation. Such provisions include clauses
enabling the Company to receive percentage rentals based on tenants' gross
sales, which generally increase as prices rise, and/or escalation clauses, which
generally increase rental rates during the terms of the leases. Such escalation
clauses are often related to increases in the consumer price index or similar
inflation indices. In addition, many of the Company's leases are for terms of
less than 10 years, which permits the Company to seek to increase rents on
re-rental at market rates. Most of the Company's leases require the tenant to
pay its share of operating expenses, including common area maintenance, real
estate taxes and insurance, thereby reducing the Company's exposure to increases
in costs and operating expenses resulting from inflation.

Computer Systems and Year 2000 Issues

      Potential Disruption in Operations Due to Year 2000 Problems. The Year
2000 issue concerns the potential exposures related to the automated generation
of business and financial misinformation resulting from the application of
computer programs which have been written using two digits, rather than four, to
define the applicable year of business transactions. The Company recognizes the
importance of minimizing the frequency and significance of any disruptions in
its business and financial affairs that may occur as a result of Year 2000, and
has adopted a comprehensive compliance program designed to achieve this
objective.

      The Company's program encompasses the following:

      o     the assessment and modification, as necessary, of its internal
            information technology systems that may be affected by the Year 2000
            problem;

      o     the identification and interrogation of third parties, including
            tenants, vendors, contractors and joint venture partners, to enable
            the Company to evaluate and appropriately respond to the state of
            preparedness by such parties to address Year 2000 problems, and;

      o     the assessment of property operating systems to avert operational
            malfunctions associated with Year 2000.

<PAGE>

      Internal Information Technology. We have completed a review of key
computer hardware and software and other equipment, and have modified, upgraded
or replaced all identified hardware and equipment in our offices that we believe
may be affected by problems associated with Year 2000. Such hardware includes
desktop and laptop computers, servers, printers, telecopier machines and
telephones. We, as part of our routine modernization efforts, have also
completed necessary upgrades to identified secondary software systems, such as
word processing, spreadsheet applications, telephone voicemail systems and
computer calendar programs. Consequently, we believe we have adequately
addressed Year 2000 concerns as they related to our internal information
technology and systems and we anticipate minimal, if any, disruption in the
future in this regard.

      Third Party Preparedness. While we believe the foregoing initiatives will
minimize Year 2000 problems as pertaining to our internal operations, we may
still be adversely impacted by Year 2000 issues as a result of problems relating
to the state of preparedness of third parties outside our control, such as the
inability of tenants to pay rent when due. In order to assess such risk, we sent
questionnaires to each of our tenants to determine their Year 2000 compliance
status. The responses to these questionnaires continue to be received, reviewed
and evaluated. Based on the responses received, we do not anticipate any
material adverse impact on the orderly payment of monthly rent. Therefore, while
there can be no assurance that Year 2000 problems of tenants will not have a
material adverse effect on our operating results or financial condition, the
information available to us indicates such an occurrence is not likely.

      The Company's principal property management systems are licensed from and
maintained by a third party software development company, which has modified its
real estate products to address the Year 2000 issue.

      Property Compliance. Our property managers are completing a building by
building survey of all of our properties to determine whether building support
systems such as heat, power, light, security and elevators will be affected by
the advent of the Year 2000. Most of such systems either are already Year 2000
compliant or contain no computerized parts. However, our property managers plan
to timely modify, upgrade or replace non-compliant building systems as may be
required.

      We have communicated with vendors of building systems or other services to
our building regarding their Year 2000 compliance. We intend to rely on
representations from these vendors regarding the Year 2000 compliance of their
product or service. We are also relying on assurances requested from utility
providers of their Year 2000 compliance and their continued ability to provide
uninterrupted service to our buildings.

      Compliance Costs. The Company's expenditures on its Year 2000 program
initiatives to date have been nominal, and the Company does not anticipate any
significant future costs with becoming Year 2000 compliant.

      Risks. The failure to correct material Year 2000 problems could result in
an interruption in, or a failure of, certain normal business activities or
operations. Such failures could materially and adversely affect the Company's
results of operations, liquidity and financial condition. Due to the general
uncertainty inherent in the Year 2000 problem, resulting in part from the
uncertainty of the Year 2000 readiness of third parties, the Company is unable
to determine at this time whether the consequences of failing to adequately
address all Year 2000 concerns will have a material impact on the Company's
results of operations, liquidity or financial condition. However, the Company
expects that its Year 2000 program will significantly reduce its level of
uncertainty about the Year 2000 problem. The Company anticipates that, with
appropriate modification of its information and operating systems and completion
of the program as scheduled, the possibility of significant interruptions of
normal operations should be reduced. The Company is not in a position to assess
or evaluate the impact of a worst case scenario.

      Certain statements in this Year 2000 issue discussion regarding the
Company's efforts to become Year 2000 compliant, the timing thereof and costs
associated therewith are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Although the Company believes
the statements and projections are based upon reasonable assumptions, actual
results may differ from those that the Company has projected.

Item 3. Quantitative and Qualitative Disclosure of Market Risk

      See Management's Discussion and Analysis of Financial Condition and
Results of Operations - Liquidity and Capital Resources.

<PAGE>

                                     PART II

                                OTHER INFORMATION

Item 1. Legal Proceedings

      The Company is not presently involved in any litigation, nor to its
knowledge is any litigation threatened against the Company or its subsidiaries,
that in management's opinion, would result in any material adverse effect on the
Company's ownership, management or operation of its properties, or which is not
covered by the Company's liability insurance.

Item 2. Changes in Securities and Use of Proceeds

      None.

Item 3. Defaults upon Senior Securities

      None

Item 4. Submission of Matters to a Vote of Security Holders

      None

Item 5. Other Information

      In a press release issued on October 13, 1999, the Company announced that
it has retained a financial advisor to assist the Company in examining strategic
alternatives to maximize shareholder value.

<PAGE>

Item 6. Exhibits and Reports on Form 8-K

      (a) Exhibits

             3.1 -   Amended and Restated Articles of Incorporation of the
                     Company (filed as Exhibit 3.1 to the Company's Current
                     Report on Form 8-K dated December 31, 1997, and
                     incorporated herein by reference)
             3.2 -   Articles Supplementary dated July 27, 1999, (filed as
                     Exhibit 3.1 to the Company's Current Report on Form 8-K
                     dated July 15, 1999, and incorporated herein by reference).
             3.3 -   Third Amended and Restated By-Laws of the Company dated
                     July 27, 1999,(filed as Exhibit 3.2 to the Company's
                     Current Report on Form 8-K dated July 15, 1999, and
                     incorporated herein by reference)
             4.1 -   Shareholder Rights Agreement, dated as of June 30, 1999,
                     between the Company and BankBoston, N.A. (filed as Exhibit
                     4.1 to the Company's Annual Report on Form 10-K for the
                     year ended December 31, 1998, and incorporated herein by
                     reference)
             4.2 -   Amendment No. 1, dated July 27, 1999, to Shareholder
                     Rights Agreement dated as of March 31, 1999, between the
                     Company and Bank Boston N.A., as Rights Agent (filed as
                     Exhibit 4.1 to the Company's Current Report on Form 8-K
                     dated July 15, 1999, and incorporated herein by reference)
             4.3 -   Articles Supplementary for Series A Junior Participating
                     Preferred Stock (filed as Exhibit 4.2 to the Company's
                     Annual Report on Form 10-K for the year ended December 31,
                     1998, and incorporated herein by reference)
             10.1 -  Amended and Restated Agreement of Limited Partnership of
                     the Operating Partnership (filed as Exhibit 10.1 to the
                     Company's Registration Statement on Form S-11, Registration
                     No. 333- 47975, and incorporated herein by reference)
             10.2 -  First Amendment to the Amended and Restated Agreement of
                     Limited Partnership of the Operating Partnership (filed as
                     Exhibit 10.2 to the Company's Annual Report on Form 10-K
                     for the year ended December 31, 1998, and incorporated
                     herein by reference)
             10.3 -  Contribution and Exchange Agreement, dated August 11,
                     1997, among National Properties Investment Trust, the Board
                     of Trustees, the Company, the Operating Partnership and
                     certain contributing partnerships or limited liability
                     companies associated with a private real estate firm
                     controlled by Philip Pilevsky and certain partners and
                     members thereof (filed as Exhibit 10.6 to the Company's
                     Registration Statement on Form S-4, Registration No.
                     333-41431, and incorporated herein by reference)
             10.4 -  Amended and Restated Management Agreement, dated as of
                     March 30, 1998, among the Company, the Operating
                     Partnership and Philips International Management Corp.
                     (Filed as Exhibit 10-8 to the Company's Form 10-K for the
                     year ended December 31, 1997, and incorporated herein by
                     reference)
             10.5 -  Amended and Restated Non-Competition Agreement, dated as
                     of March 30, 1998, among the Company, the Operating
                     Partnership, Philip Pilevsky and Sheila Levine (filed as
                     Exhibit 10.9 to the Company's Form 10-K for the year ended
                     December 31, 1997, and incorporated herein by reference)
             10.6 -  Amendment No. 1 to Contribution and Exchange Agreement,
                     dated as of December 29, 1997 (filed as Exhibit 10.13 to
                     the Company's Form 8-K dated December 31, 1997, and
                     incorporated herein by reference)
             10.7 -  Credit Agreement among the Operating Partnership and
                     Prudential Securities Credit Corporation (filed as Exhibit
                     10.18 to the Company's Report on Form 10-Q for the period
                     ended March 31, 1998 and incorporated herein by reference)
             27.1* - Financial Data Schedule

             ----------
             *     filed herewith

             (b)   Reports on Form 8-K

      During the quarter ended September 30, 1999, the Company filed a report on
Form 8-K with the SEC dated July 15, 1999, to disclose the acquisition of a
portfolio of nine Kmart-anchored shopping centers.

<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.

                               PHILIPS INTERNATIONAL REALTY CORP.


November 15, 1999              /s/ Philip Pilevsky
-----------------              -------------------------------------------------
(Date)                         Philip Pilevsky
                               Chairman of the Board and Chief Executive Officer


November 15, 1999              /s/ Carl Kraus
-----------------              -------------------------------------------------
(Date)                         Carl Kraus
                               Chief Financial Officer

<PAGE>

EXHIBIT INDEX

Exhibit
Number      Description
------      -----------

  3.1       Amended and Restated Articles of Incorporation of the Company (filed
            as Exhibit 3.1 to the Company's Current Report on Form 8-K dated
            December 31, 1997, and incorporated herein by reference)
  3.2       Articles Supplementary dated July 27, 1999, (filed as Exhibit 3.1 to
            the Company's Current Report on Form 8-K dated July 15, 1999, and
            incorporated herein by reference)
  3.3       Third Amended and Restated By-Laws of the Company dated July 27,
            1999,(filed as Exhibit 3.2 to the Company's Current Report on Form
            8-K dated July 15, 1999, and incorporated herein by reference)
  4.1       Shareholder Rights Agreement, dated as of June 30, 1999, between the
            Company and BankBoston, N.A. (filed as Exhibit 4.1 to the Company's
            Annual Report on Form 10-K for the year ended December 31, 1998, and
            incorporated herein by reference)
  4.2       Amendment No. 1, dated July 27, 1999, to Shareholder Rights
            Agreement dated as of March 31, 1999, between the Company and Bank
            Boston N.A., as Rights Agent (filed as Exhibit 4.1 to the Company's
            Current Report on Form 8-K dated July 15, 1999, and incorporated
            herein by reference)
  4.3       Articles Supplementary for Series A Junior Participating Preferred
            Stock (filed as Exhibit 4.2 to the Company's Annual Report on Form
            10-K for the year ended December 31, 1998, and incorporated herein
            by reference)
  10.1      Amended and Restated Agreement of Limited Partnership of the
            Operating Partnership (filed as Exhibit 10.1 to the Company's
            Registration Statement on Form S-11, Registration No. 333- 47975,
            and incorporated herein by reference)
  10.2      First Amendment to the Amended and Restated Agreement of Limited
            Partnership of the Operating Partnership (filed as Exhibit 10.2 to
            the Company's Annual Report on Form 10-K for the year ended December
            31, 1998, and incorporated herein by reference)
  10.3      Contribution and Exchange Agreement, dated August 11, 1997, among
            National Properties Investment Trust, the Board of Trustees, the
            Company, the Operating Partnership and certain contributing
            partnerships or limited liability companies associated with a
            private real estate firm controlled by Philip Pilevsky and certain
            partners and members thereof (filed as Exhibit 10.6 to the Company's
            Registration Statement on Form S-4, Registration No. 333-41431, and
            incorporated herein by reference)
  10.4      Amended and Restated Management Agreement, dated as of March 30,
            1998, among the Company, the Operating Partnership and Philips
            International Management Corp. (Filed as Exhibit 10-8 to the
            Company's Form 10-K for the year ended December 31, 1997, and
            incorporated herein by reference)
  10.5      Amended and Restated Non-Competition Agreement, dated as of March
            30, 1998, among the Company, the Operating Partnership, Philip
            Pilevsky and Sheila Levine (filed as Exhibit 10.9 to the Company's
            Form 10-K for the year ended December 31, 1997, and incorporated
            herein by reference)
  10.6      Amendment No. 1 to Contribution and Exchange Agreement, dated as of
            December 29, 1997 (filed as Exhibit 10.13 to the Company's Form 8-K
            dated December 31, 1997, and incorporated herein by reference)
  10.7      Credit Agreement among the Operating Partnership and Prudential
            Securities Credit Corporation (filed as Exhibit 10.18 to the
            Company's Report on Form 10-Q for the period ended March 31, 1998
            and incorporated herein by reference)
  27.1*     Financial Data Schedule

            ----------
            * filed herewith