UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                                Washington, D.C.


                                   FORM 10-QSB


                  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 2003

                          Commission File No. 000-30724


                          MONTGOMERY REALTY GROUP, INC.
       ------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

                                     Nevada
          ------------------------------------------------------------
         (State or other jurisdiction of incorporation or organization)

                                   88-0377199
                        ---------------------------------
                        (IRS Employer Identification No.)

                        400 Oyster Point Blvd., Suite 415
                          South San Francisco, CA 94080
                    ----------------------------------------
                    (Address of principal executive offices)

                                 (650) 266-8080
                           ---------------------------
                           (Issuer's telephone number)

                                       N/A
              ----------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)


State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: As of August 14, 2003, issuer had
16,500,000 shares of issued and outstanding common stock, par value $0.001.

Transitional Small Business Disclosure Format:  Yes [ ]  No [X]

<PAGE>

                          MONTGOMERY REALTY GROUP, INC.


                              INDEX TO FORM 10-QSB


                          PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements

             Balance Sheets as of June 30, 2003, and
               December 31, 2002............................................3
             Statements of Operations for the Six Months Ended
               June 30, 2003 and 2002.......................................4
             Statements of Operations for the Three Months Ended
               June 30, 2003 and 2002.......................................5
             Statements of Cash Flows for the Six Months Ended
               June 30, 2003, and 2002......................................6
             Notes to Financial Statements..................................7

Item 2.  Management's Discussion and Analysis or Plan of Operations.........8

Item 3.  Controls and Procedures...........................................19

                      PART II. OTHER INFORMATION

Item 4.  Submission of Matters to a Vote of Security Holders...............20

Item 6.  Exhibits and Reports on Form 8-K..................................20

Signatures.................................................................21


                                        2
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<CAPTION>

                         PART I--FINANCIAL INFORMATION
                          ITEM 1. FINANCIAL STATEMENTS



MONTGOMERY REALTY GROUP, INC.

BALANCE SHEETS
JUNE 30, 2003 AND DECEMBER 31, 2002 (Unaudited)
-----------------------------------------------------------------------------------------------------------------------

                                                                                          June 30,        December 31,
                                                                                            2003              2002
                                                                                        ------------      ------------
<S>                                                                                     <C>               <C>
ASSETS

PROPERTY:
  Land                                                                                  $  2,614,000      $  2,614,000
  Building                                                                                 3,979,059         3,979,059
  Improvements                                                                             3,093,822         3,093,822
                                                                                        ------------      ------------

           Total                                                                           9,686,881         9,686,881

  Less accumulated depreciation                                                           (2,751,265)       (2,661,760)
                                                                                        ------------      ------------

           Property, net                                                                   6,935,616         7,025,121

ASSETS HELD FOR SALE - DISCONTINUED OPERATIONS                                               912,947           929,578

CASH                                                                                         327,587           386,565

TENANT RECEIVABLES                                                                             6,424             6,872

PREPAID EXPENSES AND OTHER ASSETS                                                            201,106           145,093

DEFERRED LOAN COSTS                                                                           73,236           101,759

DEFERRED TAX ASSET                                                                         1,704,035         1,679,091
                                                                                        ------------      ------------

TOTAL ASSETS                                                                            $ 10,160,951      $ 10,274,079
                                                                                        ============      ============

LIABILITIES AND STOCKHOLDERS' DEFICIT

LIABILITIES:
  Notes payable                                                                         $ 11,768,377      $ 11,890,160
  Accounts payable                                                                            18,105            31,303
  Accrued interest                                                                            65,144            61,984
  Note payable held for sale - discontinued operations                                       789,413           792,671
  Security deposits and prepaid rent                                                          95,387            25,546
                                                                                        ------------      ------------
TOTAL LIABILITIES                                                                         12,736,426        12,801,664
                                                                                        ------------      ------------
STOCKHOLDERS' DEFICIT:
  Common stock, $0.001 par value; authorized 80,000,000 shares;
    issued and outstanding, 16,500,000 shares at June 30, 2003 and,
    December 31, 2002                                                                         16,500            16,500
  Preferred stock, $0.001 par value; authorized 20,000,000 shares; no
    shares issued and outstanding at June 30, 2003 and December 31, 2002                           -                 -
  Additional capital                                                                       1,692,742         1,692,742
  Accumulated deficit                                                                     (4,284,717)       (4,236,827)
                                                                                        ------------      ------------
TOTAL STOCKHOLDERS' DEFICIT                                                               (2,575,475)       (2,527,585)
                                                                                        ------------      ------------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                             $ 10,160,951      $ 10,274,079
                                                                                        ============      ============

See notes to the financial statements.                                                                                  3
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<CAPTION>
MONTGOMERY REALTY GROUP, INC.

STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2003 AND 2002 (Unaudited)
--------------------------------------------------------------------------------------------------------------------------

                                                                                              2003               2002
                                                                                           ------------       -----------
<S>                                                                                        <C>                <C>
REVENUES:
  Rent                                                                                     $    693,871       $   690,924
  Other                                                                                               -               534
                                                                                           ------------       -----------
           Total revenues                                                                       693,871           691,458
                                                                                           ------------       -----------
EXPENSES:
  Real estate taxes                                                                             115,089           114,127
  Utilities                                                                                       6,004             6,460
  Repairs and maintenance                                                                         1,664             1,102
  General building                                                                               12,928             6,879
  Administration                                                                                 59,401            28,896
  Insurance                                                                                       8,527             5,254
  Management fee                                                                                 56,466            56,466
  Depreciation                                                                                   98,937            98,754
  Amortization                                                                                   29,371            31,642
                                                                                           ------------       -----------
           Total expenses                                                                       388,387           349,580
                                                                                           ------------       -----------
INCOME BEFORE INTEREST EXPENSE INCOME TAXES
  AND DISCONTINUED OPERATIONS                                                                   305,484           341,878

INTEREST EXPENSE, NET                                                                          (392,303)         (408,374)
                                                                                           ------------       -----------

LOSS BEFORE INCOME TAXES AND DISCONTINUED OPERATIONS                                            (86,819)          (66,496)

INCOME TAX BENEFIT                                                                               30,119            26,782
                                                                                           ------------       -----------
LOSS FROM CONTINUING OPERATIONS                                                                 (56,700)          (39,714)

DISCONTINUED OPERATIONS:

   Income from discontinued operations, net of tax effect of $5,174
      and $5,687, respectively                                                                    8,810             9,683
                                                                                           ------------       -----------

NET LOSS                                                                                   $    (47,890)      $   (30,031)
                                                                                           ============       ===========

NET LOSS PER COMMON SHARE, BASIC AND DILUTED                                               $     (0.003)      $    (0.002)
                                                                                           ============       ===========

WEIGHTED AVERAGE NUMBER OF COMMON SHARES,
  BASIC AND DILUTED                                                                          16,500,000        16,500,000
                                                                                           ============       ===========


See notes to the financial statements.                                                                                   4
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<CAPTION>
MONTGOMERY REALTY GROUP, INC.

STATEMENTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 2003 AND 2002 (Unaudited)
--------------------------------------------------------------------------------------------------------------------------

                                                                                                2003              2002
                                                                                             ----------        ----------
<S>                                                                                          <C>               <C>
REVENUES:
  Rent                                                                                       $  347,161        $  347,774
  Other                                                                                               -               283
                                                                                             ----------        ----------
           Total revenues                                                                       347,161           348,057
                                                                                             ----------        ----------

EXPENSES:
  Real estate taxes                                                                              57,544            57,064
  Utilities                                                                                       3,429             2,899
  Repairs and maintenance                                                                         1,379               666
  General building                                                                                6,607             4,126
  Administration                                                                                 43,260            15,487
  Insurance                                                                                       4,263             2,627
  Management fee                                                                                 28,233            28,233
  Depreciation                                                                                   49,468            49,468
  Amortization                                                                                   14,686            14,686
                                                                                             ----------        ----------
           Total expenses                                                                       208,869           175,256
                                                                                             ----------        ----------
INCOME BEFORE INTEREST EXPENSE,
  INCOME TAXES AND DISCONTINUED OPERATIONS                                                      138,292           172,801

INTEREST EXPENSE, NET                                                                          (196,635)         (202,776)
                                                                                             ----------        ----------
LOSS BEFORE INCOME TAXES AND DISCONTINUED OPERATIONS                                            (58,343)          (29,975)

INCOME TAX BENEFIT                                                                               20,156            12,729
                                                                                             ----------        ----------
LOSS FROM CONTINUING OPERATIONS                                                                 (38,187)          (17,247)

DISCONTINUED OPERATIONS:

   Income from discontinued operations, net of tax effect of $2,344
      and $2,181, respectively                                                                    3,990             3,714
                                                                                             ----------        ----------

NET LOSS                                                                                     $  (34,197)       $  (13,533)
                                                                                             ==========        ==========

NET LOSS PER COMMON SHARE, BASIC AND DILUTED                                                 $   (0.002)       $   (0.001)
                                                                                             ==========        ==========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES,
  BASIC AND DILUTED                                                                          16,500,000        16,500,000
                                                                                             ==========        ==========


See notes to the financial statements.                                                                                  5
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<CAPTION>
MONTGOMERY REALTY GROUP, INC.

STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 2003 AND 2002 (Unaudited)
-----------------------------------------------------------------------------------------------------------------------------

                                                                                                  2003               2002
                                                                                             ------------        -----------
<S>                                                                                          <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                                                                   $    (47,890)       $   (30,031)
  Depreciation and amortization                                                                   133,605            135,694
  Deferred rent receivable                                                                          1,054                (22)
  Deferred taxes                                                                                  (24,944)           (21,096)
  Adjustments to reconcile net loss to net cash
    provided by operating activities:
    Tenant receivables                                                                                448             17,756
    Prepaid expenses and other assets                                                             (56,013)               205
    Accounts payable                                                                              (13,198)            (6,446)
    Accrued interest                                                                                3,136             (1,083)
    Security deposits and prepaid rent                                                             69,841                  -
                                                                                             ------------        -----------

           Net cash provided by operating activities                                               66,039             94,977
                                                                                             ------------        -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Additions to property                                                                                 -             (7,304)
                                                                                             ------------        -----------
           Net cash used in investing activities                                                        -             (7,304)
                                                                                             ------------        -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from issuance of notes payable                                                               -          2,500,000
  Payment of loan costs                                                                                 -            (67,258)
  Payments on notes payable                                                                      (125,017)        (2,137,179)
                                                                                             ------------        -----------

           Net cash provided by (used in) financing activities                                   (125,017)           295,563
                                                                                             ------------        -----------
INCREASE (DECREASED) IN CASH                                                                      (58,978)           383,236

CASH, BEGINNING OF PERIOD                                                                         386,565             81,328
                                                                                             ------------        -----------
CASH, END OF PERIOD                                                                          $    327,587        $   464,564
                                                                                             ============        ===========


See notes to the financial statements.                                                                                     6
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<PAGE>

                          MONTGOMERY REALTY GROUP, INC.
                          NOTES TO FINANCIAL STATEMENTS


1.       BASIS OF PRESENTATION

         The accompanying unaudited financial statements have been prepared from
         the Company's accounting records in accordance with the rules and
         regulations of the Securities and Exchange Commission. Accordingly,
         they do not include all of the information and footnotes required by
         generally accepted accounting principles for complete financial
         statements. Such statements include all adjustments, consisting only of
         normal recurring adjustments, that are, in the opinion of management,
         necessary for a fair presentation of the Company's financial position,
         and results of operations for the interim period reported upon. The
         interim financial statements should be read in conjunction with the
         Company's annual report on Form 10-KSB for the year ended December 31,
         2002, including the financial statements and the notes thereto.

2.       TRANSACTIONS WITH AFFILIATE

         Property management fees of $60,000 were paid to an affiliate of the
         majority stockholder for the six months ended June 30, 2003 and 2002.

         Subsequent to June 30, 2003, new and amended agreements were initiated
         with an affiliate of the majority stockholder, see Note 4 for details.

3.       BASIC AND DILUTED LOSS PER SHARE OF BENEFICIAL INTEREST

         Basic and diluted loss per share is computed by dividing net loss by
         the weighted average number of shares outstanding of 16,500,000 for the
         six months ended June 30, 2003 and 2002. Common stock shares from
         options granted were not included in the calculation of diluted loss
         per share because they were antidilutive for the six months ended June
         30, 2002. There were no outstanding options for the six months ended
         June 30, 2002.

4.       SUBSEQUENT EVENTS

         Montgomery Realty Group, Inc. sold its San Ramon Retail Center in San
         Ramon, California, for $1,891,625, all cash, on July 25, 2003. The San
         Ramon Retail Center consists of a 4,823 square foot building situated
         on 0.21 acres of land and is contiguous with Montgomery's Orchard
         Supply Shopping Center. The sale resulted in net proceeds to Montgomery
         of $1,038,636, after payment of the existing mortgages (together with
         accrued interest) in the amount of $789,387 and payment of other sales
         expenses such as transfer taxes, escrow fees and related matters. As a
         result of the sale, Montgomery will recognize a gain of approximately
         $978,000 in the third quarter of 2003 and will reduce its retained
         deficit by this amount, net of the tax effect. An affiliate of
         Montgomery was contracted to be the broker for the transaction and
         received a commission of 2% of the gross sales price.

         The net proceeds were paid to an unrelated exchange accommodator as
         defined in regulations promulgated under Internal Revenue Code Section
         1031. The net sale proceeds were held by the exchange accommodator and
         used to acquire the Front Street property (the "Front Street Office
         Building") from Mr. Dinesh Maniar, the president and majority
         stockholder of Montgomery, for $4,485,000, plus closing costs, of which
         $3,400,000 is in the form of debt to which the property is subject,
         with the balance paid in cash.

                                       7
<PAGE>


         The Front Street Office Building consists of approximately 17,176 net
         rentable square feet. The Front Street Office Building was erected in
         1927 and consists of approximately 0.14 acres of land.

         Montgomery and an affiliate have entered into a further contract
         regarding the Front Street Office Building whereby Montgomery is paying
         the affiliate various sums, aggregating approximately $50,000, to
         obtain architectural plans and drawings. Montgomery is also paying the
         affiliate for its services on behalf of Montgomery related to the
         renovation and refurbishing of the property, including, but not limited
         to, obtaining building permits, construction financing, construction
         bidding and supervision. The affiliate is charging hourly rates that
         vary from $225 per hour to $75 per hour.

         In addition, following the purchase of the Front Street Office Building
         by Montgomery on July 30, 2003, the current property management
         agreement with the affiliate was amended to include the Front Street
         property. However, the total management fee of $10,000 per month will
         remain the same until reviewed by the board of directors.



        ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Forward-Looking Information May Prove Inaccurate

         This report contains statements about the future, sometimes referred to
as "forward-looking" statements. Forward-looking statements are typically
identified by the use of the words "believe," "may," "could," "should,"
"expect," "anticipate," "estimate," "project," "propose," "plan," "intend" and
similar words and expressions. Statements that describe future strategic plans,
goals or objectives of the Company are also forward-looking statements. The
Company intends the forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements contained in Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

         Readers of this report are cautioned that any forward-looking
statements, including those regarding the Company or its management's current
beliefs, expectations, anticipations, estimations, projections, proposals, plans
or intentions are not guarantees of future performance or results of events and
involve risks and uncertainties. The forward-looking information is based on
present circumstances and on the Company's predictions respecting events that
have not occurred, that may not occur or that may occur with different
consequences from those now assumed or anticipated. Actual events or results may
differ materially from those discussed in the forward-looking statements as a
result of various factors. The forward-looking statements included in this
report are made only as of the date of this report. The Company is not obligated
to update such forward-looking statements to reflect subsequent events or
circumstances.

         The following discussion should be read in conjunction with the
Financial Statements of the Company and the Notes thereto.

Overview

         Montgomery is a real estate company that emphasizes investment in both
developmental real estate assets and income-producing real estate assets.
Montgomery is engaged in the ownership, leasing, management, operation,
development, redevelopment, acquisition and sale of real estate assets in the
Greater San Francisco Bay Area. Montgomery currently owns retail shopping
centers and an office building. Montgomery also owns an undeveloped parcel of
land referred to as the "Eccles Project" in South San Francisco, as discussed in
more detail in Montgomery's report on Form 10-KSB.

                                       8
<PAGE>

         Basis of Presentation of Financial Information

         Montgomery accounts for its real estate assets using the historical
cost method consistent with generally accepted accounting principles. Since
Montgomery acquired all of its real estate assets from its principal
stockholder, Dinesh Maniar, in a "reverse acquisition," the historical cost as
shown on the financial statements is Mr. Maniar's original purchase cost, which
in some instances may be quite dated. For example, the historical cost of the
Eccles Project is $539,500 dating back to 1980. The appraised value of the
Eccles Project as of February 2002 was $12,370,000. While the Eccles Project is
the most extreme example of such a disparity between historical cost and
appraised value, other disparities are identified under Capital Requirements
below.

Results of Operations

         Six Months Ended June 30, 2003 and June 30, 2002

         Montgomery's total continuing revenues increased from $691,458 for the
period ended June 30, 2002, to $693,871 for the period ended June 30, 2003, or
0.4%. This increase is due primarily to annual increase in base rents from two
tenants at the San Ramon Shopping Center property.

         As of June 30, 2003, with the exception of the Eccles Project, all of
Montgomery's properties are 100% leased under lease terms extending beyond the
end of 2003, so that no rent reductions due to vacancies are expected for the
balance of the year nor are significant rent increases likely, absent early
termination of an existing lease and a releasing. Revenues will vary slightly
due to changes in the amount of expenses reimbursable under net leases and
changes in base rents that are keyed to the Consumer Price Index.

         As a result of the sale of the San Ramon Retail Center, as discussed
below, Montgomery's revenue will be decreased by $12,574 per month; however,
upon repayment of the promissory note of approximately $784,000 secured by the
property, Montgomery will no longer be required to make payments on the
promissory note of $6,495 per month. In addition, revenues will be affected by
the acquisition of the Front Street Office Building, which currently has one
tenant, Schroeders' Restaurant, under a 10-year lease and is expected to be
renovated, as discussed below.

         Total continuing operating expenses increased from $349,580 for the
period ended June 30, 2002, to $388,387 for the six months ended June 30, 2003,
or 11.1%, which is primarily the result of the honorarium discussed below.

         Net continuing interest expense decreased from $408,374 for the six
months ended June 30, 2002, to $392,303 for the six months ended June 30, 2003,
or 3.9%. This decrease is due to a lower interest rate on the prime-based loan
that encumbered the Eccles Project.

         Discontinued operations represent the net results of the San Ramon
Retail Center for the six months ended June 30, 2003 and 2002.

         Montgomery's net loss for the six months ended June 30, 2003, was
$47,890, a 59.5% increase from the net loss of $30,031 for the six months ended
June 30, 2002. The increase in net loss is principally attributable to the
increase in administration expense, which was due to a one-time honorarium
payment of $25,000 to the board of directors in connection with its special work
imposed by the sale of the San Ramon Shopping Center and the acquisition of the
Front Street Office Building.

                                       9
<PAGE>

         Three Months Ended June 30, 2003 and June 30, 2002

         Montgomery's total continuing revenue decreased from $348,057 for the
three months ended June 30, 2002, to $347,161 for the three months ended June
30, 2003, or 0.3%. This decrease was due primarily to a prior year increase in
base rent of a tenant in the San Ramon Shopping Center that was paid in the
second quarter of 2002.

         Montgomery's administrative expenses increased from $15,487 for the
three months ended June 30, 2002, to $43,260 for the three months ended June 30,
2003, or 179.3%, primarily due to the special one-time honorarium payment to the
board of directors of $25,000, which is 90% of the increase.

         With the exception of the Eccles Project and portions of the Front
Street Office Building, all of Montgomery's properties are 100% leased under
lease terms extending beyond the end of 2003, so that no rent reductions due to
vacancies are expected for the balance of the year nor are significant rent
increases likely, absent early termination of an existing lease and a releasing
and/or the renovation of the Front Street Office Building. The Orchard Supply
Lease rent is fixed, the Keker & Van Nest rent is fixed until the option
exercise date of June 2004, while the Schroeders' lease of the Front Street
Office Building does provide for annual rent increases up to a maximum of
$144,000. All of the other existing leases revenues have slight increases each
year based upon increases in the Consumer Price Index.

         Total continuing operating expenses for the three months ended June 30,
2003, increased from $175,256 at June 30, 2002, to $208,869 at June 30, 2003, or
19.2%, primarily due to the escalation of administrative expenses.

         General management fees remained constant at $10,000 per month, as
discussed above. However, with the acquisition of the Front Street Office
Building, Montgomery is entering into a new management agreement, portions of
which provide for the payment to Diversified Investment & Management
Corporation, or DIMC, of its costs for its entitlements, together with fees for
assistance with the development and renovation.

         Net continuing interest expense decreased from $202,776 for the
three-month period ended June 30, 2002, to $196,635 for the three-month period
ended June 30, 2003, or 3.0%. This decrease is due to lower interest rates on
the Eccles project loan.

         As noted above, income from discontinued operations for the three
months ended June 30, 2003 and 2002, represent the net operations of the San
Ramon Retail Center.

         Montgomery's net loss for the three months ended June 30, 2003, was
$34,197, a 152.7% increase from the net loss of $13,532 reported for the three
months ended June 30, 2002. The increase in net loss is principally attributable
to three factors:

         o        increase in general building by approximately $2,481;

         o        increase in administration expense by approximately $27,773 by
                  reason of the special one-time Honorarium payment discussed
                  above; and

         o        increase in insurance expense by approximately $1,636.

These three items account for $31,890, or 154.32% of the change in net income.

                                       10
<PAGE>

Liquidity and Capital Resources

         Montgomery has met its requirements for liquidity and capital resources
principally from cash provided by operations and by refinancing and realization
of equity.

         Montgomery's liquidity consists of cash on hand at June 30, 2003, of
$327,587. The sale of the San Ramon Retail Center increased Montgomery's cash
position by the $1,038,295 in sale proceeds, while the cash position then
decreased by $1,092,215 paid for the purchase of the Front Street Office
Building (which sum consists of $1,085,000 paid to the seller and $7,215 in
closing costs). The net effect of the exchange resulted in a net decrease in
cash of $53,920.

         Operating activities provided $66,039 in net cash for the six months
ended June 30, 2003, as compared with $94,977 during the same period in the
preceding fiscal year.

         The Front Street Office Building has current rental income of
approximately $132,000 per year.

         Interest and principal payments on the mortgages that encumber the
Front Street Office Building total approximately $221,933 (based upon
annualization of the July 2003 mortgage payments.) The debt expense may increase
as the first mortgage of $2,800,000 is at a variable interest rate and is
currently only 5% per annum. Additionally, the $600,000 second mortgage will
mature on December 1, 2003, and management has not yet made arrangements to
refinance said sum.

         Operating expenses are minimal, as the tenant is required to pay for
its own utilities and related matters, and with the absence of other tenants,
the common area expenses are currently low at approximately $5,560 per annum,
although this number could change.

         Total expenses currently paid by Montgomery for the Front Street Office
Building are approximately $227,493, such that the net use of cash in the amount
of $95,493 per year (or $7, 958 per month) is the short-term result.

         However, Montgomery is no longer paying the mortgage debt on the San
Ramon Retail Center, which was $77,936 per annum, or $6,495 per month (that
mortgage was up for a rate change effective August 1, 2003, and the debt expense
is based upon the historical mortgage expenses under the loan as paid during the
prior three-year period at a fixed rate of 9.03%).

         The net change in mortgage expense is therefore an increase of
$143,997, or $11,999 per month.

         Consequently, the net effect of sale of the San Ramon Retail Center and
the acquisition of the Front Street Office Building is a net decrease in annual
cash flow of approximately $128,000, so that instead of Montgomery having a
positive cash flow of approximately $132,000 per annum (annualizing the net cash
flow from operations for the six months ended June 30, 2003), such that
Montgomery now has a positive net cash flow of $4,000 or $330 per month.

         As discussed in the section on Front Street Office Building Development
below, Montgomery is planning to renovate the Front Street Office Building.
Building permits are likely to issue within 30 to 90 days, whereupon Montgomery
will be able to finalize a construction loan to take out the existing mortgage
debt and provide an interest reserve, so that no interest expense is paid during
the construction period (as is standard in most commercial construction loans).

                                       11
<PAGE>

         However, at this time, Montgomery does not have a commitment for a
construction loan, nor have building permits been issued. Therefore, there are a
number of risk factors that can affect Montgomery's long-term liquidity,
especially in view of Montgomery's plan to terminate its current mortgage loan
expenses as they relate to the Front Street Office Building.

Operating Activities

         Operating activities for the six months ended June 30, 2003, provided
net cash of $66,039, compared to net cash of $94,977 provided by operating
activities for the six months ended June 30, 2002, a decrease of 30.5%.

         Cash at June 30, 2003, decreased to $327,587 from the balance on
December 31, 2002, of $386,565, a decrease of 15.3%. This decrease is primarily
attributable to the payment of the refundable prepaid commission fee of $40,000
to DIMC for the sale of the San Ramon Retail Center and the special one-time
honorarium payment to the board of directors of $25,000 as discussed earlier.

Investing Activities

         Montgomery's investing activities used no cash for the period ended
June 30, 2003, as compared to $7,304 for the same period in 2002. The investing
activities for the six months ended June 30, 2002, consisted of capital
improvements at the 710 Sansome Street building.

Financing Activities

         Montgomery had no financing activities for the six months ended June
30, 2003, except for scheduled repayments on existing debt.

Equity in Real Estate

         Montgomery has net cash flow from its current activities, which it
believes will continue on a long-term basis, providing sufficient cash to cover
activities, other than new acquisitions or developments, while sheltering cash
flow from income tax by reason of the net taxable loss that is generated by
depreciation and amortization. While Montgomery is able to realize cash flow
from refinancing of existing assets, Montgomery's principal methods for
obtaining acquisition and development capital come from either additional
financing activities, as discussed below, or the sale or exchange of existing
real estate assets, so as to realize a cash or trade value from the equity
generated by appreciation of real estate assets. Absent additional capital from
financing activities or the sale or exchange of real estate assets, Montgomery
may not have sufficient cash flow to fund expansions or acquisitions.

Capital Requirements

         Based upon independent appraisals performed between October 1998 and
July 2003, Montgomery's properties had a combined value of approximately
$26,820,000 at June 30, 2003, as compared to the historical cost, net of
depreciation of $7,796,373, at which such properties are reported in
Montgomery's financial statements as of June 30, 2003. The related indebtedness
secured by such properties totaled $12,551,849 as of June 30, 2003.

                                       12
<PAGE>

         However, as a result of the exchange in July 2003, the cumulative
effect on assets and fair market values, based on independent third-party
evaluations obtained by Montgomery by qualified independent appraisers as shown
in Footnote 2 to the audited financial statements of Montgomery's 10-KSB for the
year ended December 31, 2002 (with the exception of the Front Street Office
Building, which is shown at the purchase price for all purposes), is shown as
follows:

                                      Historical Cost (Net)  Fair Market Values
                                      ---------------------  ------------------
    Assets:

    Keker & Van Nest Building:           $  4,593,808          $  6,750,000
    Orchard Supply Shopping Center          4,185,104             6,500,000
    Eccles Project                            539,500            12,370,000
    Front Street Office Building.           4,485,000             4,485,000
                                         ------------          ------------
             TOTAL                       $ 13,802,692          $ 30,105,000
                                         ============          ============

Therefore, Montgomery's properties had a combined fair market value of
approximately $30,105,000 at July 31, 2003, as compared to the historical cost,
net of depreciation of $11,420,616, at which such properties will be reported in
Montgomery's financial statements in future periods. The aggregate indebtedness
of Montgomery's properties totaled $15,168,377 as of July 31, 2003. The
difference of $14,936,623 represents an important financial resource for
Montgomery.

         Montgomery's plans to expand its asset base have been realized in part
with its sale of the San Ramon Shopping Center and the acquisition of the Front
Street Office Building. The net proceeds from the sale of the San Ramon Retail
Center were $1,038,635. Those proceeds were used by Montgomery to expand its
asset base and provide for both increased net worth and the potential for
increased cash flow and increased appreciation on a larger asset base.
Montgomery continues to seek expansion of its asset base. Although immediate
plans for expansion are focused upon the renovation of the Front Street Office
Building and bringing its value up to approximately $6,500,000, Montgomery
believes that the successful renovation, lease up and refinancing of the Front
Street Office Building will help Montgomery establish a successful track record
as a real estate development company. While long-term expansion remains focused
upon the development, sale or exchange of the Eccles Project, Montgomery has no
specific development or other plans as to that property at this time.

         Montgomery believes that diversification is the key to long-term real
estate industry viability and success. Therefore, Montgomery plans to continue
to diversify its current portfolio with future acquisitions of income-producing
real estate and/or real estate with development potential. Montgomery may seek
the capital for such growth and diversification through a combination of asset
sales or exchanges, refinancings through commercial loan sources, as well as
through the sale of debt or equity securities.

Cumulative Effects on Montgomery's Earnings of the Exchange

         The San Ramon Shopping Center generated net operating income of
approximately $40,000 per annum in recent years, before depreciation and
amortization. The Front Street Office Building has current annual debt expense
of $221,800, while the income from Schroeders' Restaurant is approximately
$132,000 per annum, so that without a renovation, the Front Street Office
Building would likely generate a net operating loss (before depreciation and
amortization) of $89,800 per annum. However, after the renovation of the Front
Street Office Building as discussed below, Montgomery's net cash flow on the
property should increase to approximately $105,000 per annum.

                                       13
<PAGE>

Exchange of San Ramon Retail Center for the Front Street Office Building

         On July 25, 2003, Montgomery closed the sale of its San Ramon Retail
Center in San Ramon, California, to an unrelated party in an arm's-length
transaction for $1,891,625 in cash. The San Ramon Retail Center consists of a
4,823 square foot building situated on 0.21 acres of land and is contiguous with
Montgomery's Orchard Supply Shopping Center. The sale resulted in net proceeds
to Montgomery of $1,038,636, after payment of $789,387 for principal and
interest due on existing mortgages and other sales and closing expenses. The net
proceeds were paid to an unrelated exchange accommodator to be held and used to
acquire a new property for Montgomery in transactions intended to meet the
requirements of Internal Revenue Code Section 1031, which sets forth the
conditions that must be met in order for two parties to exchange like-kind real
property without triggering taxation of the amount by which the value of the
consideration received exceeds the tax basis of the property transferred.

         The buyer, which is owned by the former tenant at the property, has
advised Montgomery that the buyer intends to continue to operate its business at
the property and thus qualifies as an end-user purchaser under Section 1031. The
buyer and its affiliate have no contractual obligation to Montgomery to continue
in business for such period, and Montgomery cannot assure that the buyer will do
so. The buyer must hold the property as an end-user purchaser for at least two
years after the transaction in order for Montgomery's sale to qualify for
treatment under Section 1031.

         On July 16, 2003, Montgomery's board of directors elected to proceed
with the sale prior to any extension date Montgomery was otherwise entitled to
under its contract with the buyer in order to enable the buyer to complete its
acquisition loan before expiration of the loan commitment.

         The board also reviewed the options for an exchange property for
purposes of qualifying the transaction under Section 1031 and determined that,
given the current economic conditions in the San Francisco Bay area, it was in
the best interests of Montgomery to acquire from Dinesh Maniar, the president
and 97.3% stockholder of Montgomery, an office building commonly known as the
Front Street Office Building in the heart of downtown San Francisco at 234-240
Front Street.

         The Front Street Office Building was erected in 1927 and contains
approximately 17,176 net rentable square feet on approximately 0.14 acres of
land. The ground floor and basement of the Front Street Office Building has been
occupied for over 40 years by a single tenant, Schroeders' Restaurant.

         The Front Street Office Building was appraised on July 9, 2002, at a
stabilized value of $4,380,000 and with an as-is price of $4,030,000.

         Montgomery purchased the Front Street Office Building from Mr. Maniar
at his capitalized cost of $4,533,346, consisting of the $4,030,000 purchase
price Mr. Maniar paid to an unaffiliated party in an arm's-length transaction on
September 18, 2002; $56,346 in closing costs; and $447,000 in fees for
architects and related capitalized carrying costs. The architectural fees were
incurred to develop plans to renovate the office space and basement and expand
the effective space for Schroeders' Restaurant, while at the same time providing
a wine tasting room at the front of the building for another of Mr. Maniar's
ventures, Diamond Oaks Vineyards. The renovation plans were included with the
purchase. Montgomery closed the purchase and exchange and took possession of the
Front Street Office Building on July 30, 2003.

                                       14
<PAGE>

         The board of directors agreed to acquire the property subject to the
existing loans of approximately $3,400,000 and use the net cash proceeds from
the San Ramon Shopping Center sale of approximately $1,038,638 to finance the
purchase.

         The purchase of the Front Street Office Building was unanimously
approved by the board of directors of Montgomery, with Mr. Maniar abstaining. In
approving the transaction, the board of directors considered in particular the
cost per square foot price of the Front Street Office Building as compared to
comparable properties; the proposal from affiliates of Mr. Maniar to lease the
top floor and a portion of the expanded basement for an aggregate of $16,000 per
month; the Schroeders' Restaurant lease, which pays over $11,000 per month; and
the potential for market appreciation.

         Pursuant to the instructions of the board of directors, Montgomery has
structured the foregoing transactions with the intent of satisfying the
conditions of Section 1031, but is uncertain at this time the transaction will
meet all of such conditions. Internal Revenue Code Sections 1031(f) and 1031(g)
require that when a related party is involved in a tax-free exchange under
Internal Revenue Code Section 1031, each of the parties must hold its exchange
property for at least two years for the exchange to qualify as a tax-free
transaction. Mr. Maniar is a related party because of his controlling stock
ownership, and thus can assure that Montgomery will meet the two-year holding
period requirement for the transaction to qualify as a tax-free exchange.
However, Montgomery cannot assure that the buyer of Orchard Supply Shopping
Center will hold the San Ramon Retail Center for two years.

         The directors were made aware of the risk that the transactions might
not qualify as a tax-free exchange and quantified the adverse tax effects of the
transaction if its tax-free nature were challenged. Based upon preliminary
figures, the total gain on sale from the San Ramon Shopping Center was
approximately $978,000, of which Montgomery had a federal net operating loss of
approximately $1,077,000. Therefore any federal taxable gain would be fully
offset by Montgomery's net operating loss carry forwards. California would also
tax the sale, and since California did not allow net operating losses, the full
gain of approximately $978,000 would be taxed. However, the California marginal
rate is only about 10%, such that the California tax liability would at most be
approximately $98,000. Nevada, the state of Montgomery's organization, does not
impose an income tax on these transactions. However, as all such tax matters
involve a high degree of uncertainty, additional investigations by outside
accountants and tax attorneys are still ongoing. No decision needs to be made by
Montgomery until its 2003 tax return is filed in March 2004.

Front Street Office Building Project

         Montgomery plans to renovate the Front Street Office Building property
to increase leasable space to approximately 18,000 square feet above ground and
another 5,000 square feet of basement space. Such renovation is based upon plans
drawn by an outside architect that Montgomery purchased for $14,000. Montgomery,
with the assistance of DIMC as its agent, is in the process of filing these
plans with the San Francisco Planning Department to obtain building permits. If
permits are issued as Montgomery expects, Montgomery will be able to renovate
the top three floors into first class office space in downtown San Francisco.

         Montgomery is also seeking to reacquire certain transferable
development rights, or TDRs, to erect office buildings in downtown San Francisco
in excess of that otherwise permitted by the City's Master Plan. TDRs were
commonly purchased and sold in San Francisco in the 1980s, when a great deal of
construction was going on, and developers that wished to erect large buildings
were forced to acquire from others the seller's TDRs, so that the initial
development space could be expanded. Owners with no intent to expand often sold
their TDRs to good economic advantage. The TDRs associated with the Front Street
Office Building were sold; however, local counsel has indicated that the TDRs
may be recaptured, subject to payment of a fair market price, so that the
current building can be expanded, providing even more space for offices and/or
other amenities.

                                       15
<PAGE>

         Montgomery currently estimates that renovation pursuant to the plans to
be filed with the City of San Francisco Planning Department would entail a
construction cost of approximately $2,000,000. With the assistance of DIMC,
Montgomery has begun to look for a construction lender; however, until permits
are actually issued, it is unlikely that a commitment will be made to
Montgomery. Additionally, given Montgomery's lack of history in real estate
development and the successful record of Montgomery's president, Mr. Dinesh
Maniar, any construction lender may well require that Mr. Maniar personally
guarantee the construction loan. No assurance that Mr. Maniar will do so can be
made.

         A decision to go forward with such a renovation would subject
Montgomery to a number of risks that could keep Montgomery from realizing any
economic benefit from such a renovation, including:

         o        adverse changes in general economic conditions;

         o        adverse changes in local conditions, such as excessive
                  building resulting in an oversupply of commercial units in an
                  area where Montgomery's properties are located;

         o        reduction in the appeal of particular types of properties;

         o        reduction in the cost of operating competing properties or
                  decreases in employment that reduce the demand for properties
                  in the area;

         o        the possible need for unanticipated renovations, particularly
                  in older structures;

         o        adverse changes in surrounding land values;

         o        adverse changes in zoning laws, other laws and regulations and
                  real property tax rates;

         o        damage from earthquakes or other natural disasters;

         o        the availability and expense of liability insurance; and

         o        the ability of the enterprise to provide for adequate
                  maintenance of its property.

         There can be no assurance that any property will be sufficiently
occupied at rents sufficient to ensure sustained operations or allow adequate
cash flows to Montgomery to secure take out financing to pay off the
construction loan. The success of Montgomery and any of Montgomery's investments
will depend upon factors that may be beyond the control of Montgomery,
Montgomery's directors, or any of its officers, and cannot be predicted at this
time.

         Montgomery's development of the Front Street Project will be subject to
construction and development risks. In the event Montgomery undertakes
development of the Front Street Project or any other property, such construction
and development activities will expose Montgomery to certain risks such as cost
overruns, carrying costs, availability and costs of materials and labor, weather
conditions and government regulation. Additionally, Montgomery will incur costs
in connection with the design and implementation of any development and costs in
connection with performing certain oversight and review functions, including
costs for reviewing construction design proposals, negotiation and contracting
for feasibility studies and supervising compliance with local, state and federal
laws and regulations.

                                       16
<PAGE>

         The renovated building is pre-leased in part. Schroeders' Restaurant
has orally agreed to restructure its leasehold premises to take a remodeled
basement that will provide more effective storage space for Schroeders', while
at the same time leaving the portion of the basement facing the entry and street
available for a lease to Diamond Oaks Vineyard as a wine tasting room, at a rent
of $72,000 per annum as set forth in the Purchase and Sale Agreement. Also, DIMC
has agreed to lease the renovated top floor of the Front Street Office Building
for $120,000 per annum as set forth in the Purchase and Sale Agreement. The
renovation will leave two floors vacant, with each floor having approximately
5,000 square feet of leasable space. Current San Francisco rents vary from a low
of $25 per square foot per year to a high of $60 per square foot per year.
Montgomery anticipates that it will be able to lease the space for approximately
$30 to $40 per square foot per year. See discussion of Liquidity and Capital
Resources above.

         While Montgomery currently anticipates being able to lease the
remaining office space in the Front Street Office Building, consisting of
approximately 10,000 square feet, and while it is currently anticipated that the
lease rate will be approximately $30 to $40 per square foot per year, such that
post-renovation lease income would be increased by up to $300,000 to $400,000
over and above the Schroeders' lease income and the pre-leased space, no
assurance can be given that such additional rents will materialize, nor can any
assurance be given as to the length of time acquired to lease the property, the
costs for leasing commissions, or similar matters.

         The San Francisco commercial lease market is very volatile, having seen
some of the highest prices for office space in the United States during the
height of the "dot-com boom" quickly to be followed by extremely low rental
rates following the downturn in the stock market in 2001, with rental rates
falling as much as 75%. Consequently, the actual rent will be determined by
market conditions at the time the renovation is completed, which cannot be fully
predicted. Further, demand for office space in downtown San Francisco may vary
due to other factors beyond the control of Montgomery ranging from adverse
economic conditions related to incidents such as the tragedy of the September
11, 2001 attack, to worldwide markets. San Francisco is a major port city, with
much of its business dealing with Pacific Rim businesses. These are merely
examples of the various conditions that could affect not only the rental rates,
but the cost of lease up, the amount of time to lease the property, and
ultimately whether or not a full lease does occur.

         Montgomery is currently negotiating a written contract with DIMC for
DIMC to act as Montgomery's agent with respect to obtaining the building
permits, obtaining other necessary permits and planning department approvals,
obtaining TDRs, assisting in the construction bid process, and supervising and
monitoring the construction. DIMC will also offer its services to assist
Montgomery in obtaining a construction loan for the renovation and will act as a
broker to assist Montgomery in leasing the building once all renovation is
completed.

         In addition to the foregoing risks of development of the Front Street
Office Building, there are further risks associated with the renovation of the
building initially erected in 1927. While Montgomery believes the Front Street
Office Building meets all material, current San Francisco City and County
building code requirements, including requirements regarding earthquake
structural integrity and related matters, any renovation of a building that is
now 75 years old may result in the discovery of matters that are not apparent in
the building's current condition. Accordingly, once alterations begin, certain
matters that may impact compliance with the San Francisco City and County
building codes or the structural integrity of the building may come to light.
Montgomery will be required to incur the costs necessary to bring the building
into compliance. Such additional costs and related delays, if any, could have a
significant impact upon the renovation and economic feasibility of the
renovation.

                                       17
<PAGE>

         Montgomery believes that the successful development of the Front Street
Office Building will help establish a record of successful real estate
development for Montgomery and wishes to employ DIMC because of its experience
in real estate development, financing and leasing. Fees for DIMC personnel will
vary from $225 to $75 per hour. Additionally, Montgomery has paid $14,000 for
plans and will incur approximately another $500,000 in soft costs for additional
professional services and carrying costs as part of the renovation. With a
successful development in its history, Montgomery believes that it is more
likely to obtain a good price for its Eccles Project and increase its chances of
successful development of that site should the board of directors choose such a
course of action.

Eccles Project

         The Eccles Project area consists of approximately 7.4 acres of
unimproved land located at Eccles Avenue and Gull Road in South San Francisco,
California. This area, known as Oyster Point, is approximately four miles from
the downtown central business district of South San Francisco, California.

         Management has evaluated three alternatives with respect to the Eccles
Project land: (1) development by Montgomery, either alone or through a joint
venture with third parties; (2) sale or exchange of the property; or (3) a
long-term ground lease. Montgomery has placed its development efforts for the
Eccles Project on indefinite hold due to the downturn in the real estate market
and the national recession.

         Dinesh Maniar, the majority stockholder of Montgomery (and its
president and chairman of the board), has more than 28 years experience in real
estate development. With such a background and the assistance of DIMC,
Montgomery believes it is capable of developing the project once economic
conditions again warrant such development.

         In addition to the potential development of the Eccles Project as noted
above, management has also considered the possibility of selling or exchanging
the Eccles Project land. A tax-free exchange would allow Montgomery to exchange
the Eccles Project for another property that would provide additional
opportunities to Montgomery consistent with its strategies while deferring the
realization of a taxable gain that would result from a sale of the Eccles
Project.

         Management has also considered the possibility of entering into a
long-term ground lease. This would provide cash flow to Montgomery while
eliminating any tax liability associated with the sale of the Eccles Project.

         Management will continue to evaluate the available options to determine
how to proceed with the Eccles Project in a manner that provides the greatest
return and cash flow to Montgomery while minimizing risk and advancing
Montgomery's strategy. There can be no assurance that management will indeed be
successful in identifying and pursuing the best possible financial return to
Montgomery for the Eccles Project.

     Other Transactions

         DIMC, which is 100% owned by Dinesh Maniar, who also owns approximately
97.3% of Montgomery's common stock, acted as broker for Montgomery and received
a commission of 2% of the gross sales price. DIMC was not paid a commission for
the purchase of the Front Street Office Building. DIMC's role as broker and its
commission amount were approved by Montgomery's board of directors at a special
meeting, with Dinesh Maniar abstaining.

                                       18
<PAGE>

Other Matters

         Montgomery has reviewed all recently issued, but not yet effective,
accounting standards in order to determine their effects, if any, on
Montgomery's financial condition or results of operations. Based on that review,
Montgomery believes that none of these pronouncements will have a significant
effect on current or future earnings or operations.


                         ITEM 3. CONTROLS AND PROCEDURES

         Montgomery maintains a system of internal controls and procedures
designed to provide reasonable assurance as to the reliability of its financial
statements and other disclosures included in this report. Montgomery's board of
directors, operating through its audit committee, provides oversight to its
financial reporting process.

         Within the 90-day period prior to the date of this report, Montgomery
evaluated the effectiveness of the design and operation of its disclosure
controls and procedures pursuant to Rule 13a-14 of the Securities Exchange Act
of 1934. Based upon that evaluation, Montgomery's Chief Executive Officer and
Chief Financial Officer concluded that its disclosure controls and procedures
are effective in alerting him in a timely manner to material information
relating to Montgomery required to be included in this quarterly report on Form
10-QSB.

         There have been no significant changes in Montgomery's internal
controls or in other factors that could significantly affect internal controls
subsequent to the date that it carried out its evaluation and there were no
corrective actions regarding significant deficiencies or material weaknesses.

                                       19
<PAGE>

                           PART II. OTHER INFORMATION

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

         The Company's annual meeting of stockholders was held June 24, 2003. At
that meeting, the stockholders reelected Dinesh Maniar, Keith A. Cannon, O. Lee
Barnett, James M. Hanavan, and Arthur A. Torres as directors by a plurality as
shown below:

              Director             For          Against       Abstain
         ------------------- -------------- ------------- ------------
         Dinesh Maniar         16,193,200          --            --
         Keith A. Cannon       16,193,200          --            --
         O. Lee Barnett        16,193,200          --            --
         James M. Hanavan      16,193,200          --            --
         Arthur A. Torres      16,193,200          --            --


                    ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

         (a) Exhibits. The following exhibits are included as part of this
report at the location indicated:
<TABLE>
<CAPTION>
                   SEC
   Exhibit      Reference
    Number        Number                            Title of Document                                Location
-------------- ------------ ------------------------------------------------------------------- -------------------
    <S>              <C>    <C>                                                                 <C>
   Item 10                  Material Contracts
-------------------------------------------------------------------------------------------------------------------
    10.01            10     Amended Commercial Lease between Theodore Max Kniesche, Jr. and     To be filed by
                            Betty Ann Kniesche, individually and as trustees of the Kniesche    amendment
                            Family Irrevocable Trust (Landlord) and Stefan Filipcik (Tenant)
                            dated April 22, 1997

    10.02            10     Assignment and Assumption of Leases between Theodore Max            To be filed by
                            Kniesche, Jr. and Betty Ann Kniesche, individually and as           amendment
                            trustees of the Theodore Max, Jr. and Betty Ann Kniesche Living
                            Trust and Theodore Max Kniesche, III and Lisa Alma Lutz, as
                            trustees of the Kniesche Family Irrevocable Trust (Assignor) to
                            Hollywood Associates, LLC (Assignee) executed on May 22, 2000

   Item 31                  Rule 13a-14(a)/15d14(a) Certifications
-----------------------------------------------------------------------------------------------
    31.01            31     Certification of Chief Executive Officer Pursuant to Rule 13a-14    Attached

    31.02            31     Certification of Chief Financial Officer Pursuant to Rule 13a-14    Attached

   Item 32                  Section 1350 Certifications
-----------------------------------------------------------------------------------------------
    32.01            32     Certification of Chief Executive Officer Pursuant to 18 U.S.C.      Attached
                            Section 1350, as Adopted Pursuant to Section 906 of the
                            Sarbanes-Oxley Act of 2002

    32.02            32     Certification of Chief Financial Officer Pursuant to 18 U.S.C.      Attached
                            Section 1350, as Adopted Pursuant to Section 906 of the
                            Sarbanes-Oxley Act of 2002
</TABLE>

                                       20
<PAGE>

         (b) Reports on Form 8-K. During the quarter ended June 30, 2003,
Montgomery filed the following report on Form 8-K:

       Date of Event Reported                    Item(s) Reported
       ----------------------       --------------------------------------------
           July 25, 2003            Item 2. Acquisition or Disposition of Assets



                                   SIGNATURES

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

                                              MONTGOMERY REALTY GROUP, INC.
                                              (Registrant)



Date: August 14, 2003                         By: /s/ Dinesh Maniar
                                                 -------------------------------
                                                  Dinesh Maniar, President
                                                  Principal Executive Officer



Date: August 14, 2003                         By: /s/ O. Lee Barnett
                                                  ------------------------------
                                                  O. Lee Barnett
                                                  Principal Financial Officer

                                       21