FORM 10-Q

		   SECURITIES AND EXCHANGE COMMISSION
			 Washington, D.C. 20549

	 (Mark One)

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

	 For the quarterly period ended September 30, 1996

				   OR

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

	 For the transition period from ____________ to
	 ___________

	 Commission file number 0-768

		       GARMENT CAPITOL ASSOCIATES
	 (Exact name of registrant as specified in its
	 charter)

	    A New York Partnership                  13-6083208 
	    (State or other jurisdiction of         (I.R.S. Employer
	    incorporation or organization)          Identification No.)

		    60 East 42nd Street, New York, New York 10165
		       (Address of principal executive offices)
				      (Zip Code)

				    (212) 687-8700
		 (Registrant's telephone number, including area code)

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

	    Indicate by check mark whether the Registrant (1) has filed
	    all reports required to be filed by Section 13 or 15(d) of
	    the Securities Exchange Act of 1934 during the preceding 12
	    months (or for such shorter period that the Registrant was
	    required to file such reports), and (2) has been subject to
	    such filing requirements for the past 90 days. 
	    Yes [ X ].  No [   ].


		An Exhibit Index is located on Page 14 of this Report.
	       Number of pages (including exhibits) in this filing: 14<PAGE>

									    2.
			  PART I.  FINANCIAL INFORMATION

 Item 1.  Financial Statements.

			    Garment Capitol Associates
			  Condensed Statement of Income
				  (Unaudited)          


				    For the Three Months    For the Nine Months
				     Ended September 30,    Ended September 30,
				      1996       1995         1996      1995

  Income:

     Rent income, from a related
       party (Note B)             $272,500    $272,500     $817,500   $817,500 
     Dividend income                    11          76           32      3,002 
     Interest income                56,723         -0-       83,542        -0- 
				  --------    --------     --------   -------- 
       Total income                329,234     272,576      901,074    820,502 
				  --------    --------     --------   -------- 
  Expenses:

     Interest on mortgage          138,084      81,813      330,122    247,807 
     Supervisory services, to a 
       related party (Note C)       10,625      10,625       31,875     31,875 
     Amortization of mortgage
       refinancing costs             7,042       7,042       21,126     21,127 
				  --------    --------     --------   -------- 
       Total expenses              155,751      99,480      383,123    300,809 
				  --------    --------     --------   -------- 
  Net income                      $173,483    $173,096     $517,951   $519,693 
				  ========    ========     ========   ======== 

  Earnings per $5,000 partici-
     pation unit, based on 1,050
     participation units outstand-
     ing during the year          $ 165.22    $ 164.85     $ 493.29   $ 494.95 
				  ========    ========     ========   ======== 

  Distributions per $5,000 parti-
     cipation unit consisted of the 
     following:

     Income                       $ 142.36    $ 145.74     $ 427.08   $ 437.22 
				  ========    ========     ========   ======== 

  At September 30, 1996 and 1995, there were $5,250,000 of participations
  outstanding.<PAGE>
									3.
			    Garment Capitol Associates
			      Condensed Balance Sheet
				    (Unaudited)
									
 Assets                                 September 30, 1996   December 31, 1995
 Current assets
   Cash                                        $  115,981          $   88,199 
   Due from lessee                              2,093,679                 -0- 
					       ----------          ---------- 
   Total current assets                         2,209,660              88,199 
					       ----------          ---------- 
 Real Estate  
   Land                                         2,500,000           2,500,000 
					       ----------          ---------- 
   Building                                     8,000,000           8,000,000 
     Less, allowance for depreciation           8,000,000           8,000,000 
					       ----------          ---------- 
						      -0-                 -0- 
					       ----------          ---------- 
 Intangible assets
   Mortgage refinancing costs                     107,050             107,050 
     Less, allowance for amortization              74,151              53,025 
					       ----------          ---------- 
						   32,899              54,025 
					       ----------          ---------- 
   Total assets                                $4,742,559          $2,642,224 
					       ==========          ========== 
 Liabilities and Capital
 Current liabilities
   Accrued interest payable                    $   44,612          $   26,906 
   Prepaid interest                                 8,923                 -0- 
   Principal payments of first mortgage
     payable within one year                    5,050,177             133,052 
					       ----------          ---------- 
       Total current liabilities                5,103,712             159,958 
 Long-term debt                                       -0-           2,912,936 
					       ----------          ---------- 
       Total liabilities                        5,103,712           3,072,894 
					       ----------          ---------- 
 Capital
   Capital deficit, January 1,                   (430,670)           (512,096)
   Add, Net income: 
     January 1, 1996 through Sept. 30, 1996       517,951                     
     January 1, 1995 through Dec. 31, 1995                            693,538 

   Less, Distributions: 
     Monthly distributions,
     January 1, 1996 through Sept. 30, 1996       448,434 
     January 1, 1995 through Dec. 31, 1995                            612,112 
					       ----------          ---------- 
 Capital deficit:
   September 30, 1996                            (361,153)
   December 31, 1995                                                 (430,670)
					       ----------          ---------- 
     Total liabilities and capital deficit:
       September 30, 1996                      $4,742,559                     
       December 31, 1995                                           $2,642,224 
					       ==========          ========== <PAGE>

									    4.
			   Garment Capitol Associates 
		       Condensed Statement of Cash Flows  
				    (Unaudited)           


					   January 1, 1996   January 1, 1995
					       through           through
					 September 30, 1996 September 30, 1995


    Cash flows from operating activities:
      Net income                                $  517,951        $ 519,693
    Adjustments to reconcile net income 
      to cash provided by operating activities:
    Amortization of mortgage refinancing costs      21,126           21,127 
    Change in accrued interest payable              17,706          (38,190)
    Change in prepaid interest                       8,923              -0- 
						----------        --------- 
      Net cash provided by
	  operating activities                     565,706          502,630 

    Cash flows from financing activities:
      Cash distributions                          (448,434)        (459,084)
      Change in due from lessee                 (2,093,679)             -0- 
      Change in first mortgage                   2,004,189         (235,578)
      Mortgage refinancing costs                       -0-          (37,568)
						----------        --------- 
      Net cash used in financing activities       (537,924)        (732,230)
						----------        --------- 
      Net increase (decrease) in cash               27,782         (229,600)

    Cash, beginning of period                       88,199          321,323 
						----------        --------- 
    Cash, end of period                         $  115,981        $  91,723     
						==========        =========     


					   January 1, 1996   January 1, 1995
					       through           through
					 September 30, 1996 September 30, 1995


    Cash paid for:
      Interest                                  $  312,416        $ 285,997     
						==========        ========= <PAGE>
	 Garment Capitol Associates                                      5.

	 September 30, 1996





	 Notes to Condensed Financial Statements (Unaudited)

	 Note A - Basis of Presentation

	       The accompanying unaudited condensed financial statements
	 have been prepared in accordance with the instructions to Form
	 10-Q and therefore do not include all information and footnotes
	 necessary for a fair presentation of financial position, results
	 of operations and statement of cash flows in conformity with
	 generally accepted accounting principles.  The accompanying
	 unaudited condensed financial statements include all adjustments
	 (consisting only of normal recurring accruals) which are, in the
	 opinion of the partners in Registrant, necessary for a fair
	 statement of the results for such interim periods.  The partners
	 in Registrant believe that the accompanying unaudited condensed
	 financial statements and the notes thereto fairly disclose the
	 financial condition and results of Registrant's operations for the
	 periods indicated and are adequate to make the information
	 presented therein not misleading.


	 Note B - Interim Period Reporting

	       The results for the interim period are not necessarily
	 indicative of the results to be expected for a full year. 

	       Registrant was organized on January 10, 1957.  On May 1,
	 1957, Registrant acquired fee title to the Garment Capitol
	 Building (the "Building") and the land thereunder, located at 498
	 Seventh Avenue, New York, New York (the "Property").  Registrant's
	 partners are Stanley Katzman, John L. Loehr and Peter L. Malkin
	 (collectively the "Partners"), each of whom also acts as an agent
	 for holders of participations in their respective partnership
	 interests in Registrant (the "Participants").

	       Registrant does not operate the Property.  Registrant leased
	 the Property to 498 Seventh Avenue Associates (the "Original
	 Lessee") under a net operating lease (the "Lease") which commenced
	 as of May 1, 1957 and currently was to expire on April 30, 2007.
	 The Lease provides for one 25-year renewal option which had not
	 been exercised and which, if exercised, would have extended the
	 Lease to April 30, 2032.

	       In 1994 and 1995, the Original Lessee made capital calls on
	 its partners in the aggregate amount of $1,300,000 to defray
	 certain operating expenses and improvement costs at the Property.
	 Despite these new capital infusions, however, the Original Lessee
	 concluded that to return the Property to profitability would
	 require a very large additional capital investment, estimated by<PAGE>
	 Garment Capitol Associates                                      6.

	 September 30, 1996



	 the Original Lessee to be as high as $16,000,000.  Therefore, on
	 December 29, 1995, in accordance with the terms of the Operating
	 Lease, the Original Lessee assigned the Operating Lease to 4987
	 Corporation (the "New Lessee"), thereby effectively terminating
	 the liability of the Original Lessee and its partners under the
	 Lease.  The shares in the New Lessee are owned by the partners in
	 the Original Lessee except that a substantial portion of the
	 shares owned by Peter L. Malkin is held by him for the benefit of
	 members of his family but he retains voting control.  

	      The New Lessee has paid basic rent under the Lease through
	 November 1, 1996.  Registrant applied or reserved these rents to
	 cover (1) its monthly mortgage payments to the Apple Bank for
	 Savings ("Apple Bank") on Registrants' fee mortgage on the
	 Property (the "Mortgage Loan"), (2) its monthly fee for
	 supervisory services and (3) its distributions to the Participants
	 in Registrant.  The New Lessee did not pay the New York City real
	 estate taxes and Business Improvement District ("BID") assessments
	 in the amounts of $936,180.00 and $29,695.14, respectively, and
	 certain other minor assessments and charges aggregating less than
	 $1,500, all of which were due on January 1, 1996 or shortly
	 thereafter.  The New Lessee also failed to pay the New York City
	 real estate taxes and BID assessments in the amounts of
	 $1,053,254.50 and $28,529.26, respectively, which were due on July
	 1, 1996.  As a result, although payment of the January 1, 1996 and
	 July 1, 1996 real estate taxes and BID assessments has been made
	 as described below, the New Lessee was in default of the Operating
	 Lease as of January 1, 1996.

	      The New Lessee requested that Registrant forbear from
	 exercising its rights and remedies under the Lease, including
	 termination of the Lease, by reason of the failure to pay the
	 January 1, 1996 and July 1, 1996 real estate taxes and BID
	 assessments, while Registrant solicited the consent of the
	 Participants to a sale of the Property.  On July 26, 1996, the
	 Partners mailed to the Participants a STATEMENT ISSUED BY THE
	 AGENTS IN CONNECTION WITH THE SOLICITATION OF CONSENTS OF THE
	 PARTICIPANTS (the "Statement") requesting their authorization for
	 a sale of the Property and forbearance in favor of the New Lessee.
	 The details of the Partners' proposal are provided in the
	 Definitive Proxy Statement which was filed with the Securities and
	 Exchange Commission as Schedule 14-A on July 25, 1996, and is
	 incorporated herein by reference.  If Registrant did forbear, the
	 New Lessee agreed to cooperate fully with Registrant in connection
	 with the sale of the Property and to continue to perform its other
	 obligations under the Lease, including payment of basic rent, to
	 enable Registrant to continue its monthly distributions to the
	 Participants, pay its supervisory fee and pay its monthly mortgage
	 obligation.  The continuation of the Lease will also serve to
	 insulate Registrant from third party liabilities attendant on
	 property operations.  Because the consent<PAGE>
	 Garment Capitol Associates                                      7.

	 September 30, 1996



	 solicitation program included the continuation of the Lease with
	 the New Lessee, Registrant did not send a notice of default under
	 the Lease based on the failure of the New Lessee to pay the
	 January 1, 1996 and July 1, 1996 real estate taxes and BID
	 assessments.

	      Although the failure to pay the January 1, 1996 and July 1,
	 1996 real estate taxes and BID assessments also constitutes a
	 breach of Registrant's obligations under the Mortgage Loan, Apple
	 Bank had agreed to forbear from exercising its rights and remedies 
	 during the period of the solicitation of consents through a sale
	 of the Property based on arrangements consummated in March 1996
	 between the shareholders of the New Lessee (or designees on their
	 behalf) and Apple Bank to fund the January 1, 1996 real estate
	 taxes and BID assessments and certain future real estate taxes and
	 BID assessments on the Property (together with the January 1, 1996
	 real estate taxes, the "Real Estate Taxes") through protective
	 advances under the Mortgage Loan.  The shareholders of the New
	 Lessee (or designees on their behalf) have personally borrowed
	 from Apple Bank (a) on April 2, 1996, the sum of $1,012,274.18,
	 equal to the January 1, 1996 real estate taxes and BID assessments
	 and interest thereon to the date of the borrowing, and certain
	 other minor city charges and interest aggregating less than $1,500
	 and (b) on June 28, 1996, the sum of $1,081,783.76 equal to the
	 July 1, 1996 real estate taxes and BID assessment.  The April 2,
	 1996 borrowing was used to fund a protective advance by Apple Bank
	 to pay the January 1, 1996 real estate taxes and BID assessments,
	 interest thereon and such minor charges, through the purchase of a
	 subordinate participating interest in the Mortgage Loan in such
	 amount.  The June 28, 1996 borrowing was used to fund a protective
	 advance by Apple Bank to pay the July 1, 1996 Real Estate Taxes
	 and BID assessments through the purchase of an additional
	 subordinate participating interest in the Mortgage Loan in such
	 amount.  Interest and principal required to be paid on the
	 protective advances and on any future protective advances will be
	 paid by the New Lessee so long as the Lease continues in effect.

	      As to future Real Estate Taxes, Apple Bank has agreed to make
	 additional personal loans to such individual shareholders (or
	 their designees) to fund further protective advances to cover the
	 Real Estate Taxes due January 1, 1997 (covering the period to June
	 30, 1997).  Those individual borrowers intend to borrow the funds
	 from Apple Bank and fund the protective advances as required to
	 pay the January 1, 1997 Real Estate Taxes so long as the Lease
	 continues in effect.  <PAGE>
	 Garment Capitol Associates                                      8.

	 September 30, 1996



	      Registrant has received the consent of the Participants for
	 the sale and forbearance program and for the liquidation of
	 Registrant, as described in the Statement.  Registrant is
	 currently in discussion with a number of prospective purchasers
	 for the property and anticipates signing a contract shortly.  It
	 is likely that the sale will be consummated after January 1, 1997.  

	      The Original Lessee was a partnership in which Peter L.
	 Malkin was among the partners.  The stockholders in the New Lessee
	 are the partners in the Original Lessee except that a substantial
	 portion of the shares owned by Peter L. Malkin is held by him for
	 the benefit of members of his family but he retains voting
	 control.  The Partners in Registrant are also members of the law
	 firm of Wien, Malkin & Bettex, 60 East 42nd Street, New York, New
	 York, counsel to Registrant and to Original Lessee ("Counsel").  

	      Under the Lease, New Lessee must pay (i) annual basic rent of
	 $1,090,000 (the "Basic Rent") to Registrant and (ii) additional
	 rent equal to 50% of New Lessee's net operating profit in excess
	 of $200,000 for each Lease year (the "Additional Rent").  

	      Additional Rent income is recognized when earned from the New
	 Lessee, at the close of the lease years ending April 30.  Such
	 income, if any, is not determinable until the New Lessee, pursuant
	 to the Lease, renders to Registrant a certified report on the
	 operation of the Property.  The Lease does not provide for the New
	 Lessee to render interim reports to Registrant, so no Additional
	 Rent income is reflected for the period between the end of the
	 lease year and the end of Registrant's fiscal year.  

	       The current term of the Lease expires on April 30, 2007, and
	 the Lease is subject to the renewal option described above.
	 Pursuant to the Lease, the lessee has the option of surrendering
	 its leasehold interest, at any time, upon 60 days' prior written
	 notice without further liability after the date of surrender.  In
	 addition, the New Lessee has the right to assign the Lease,
	 without Registrant's consent, so long as the assignee assumes, in
	 writing, all of the obligations of the Lease. 

	       On March 23, 1995, Registrant entered into a Modification
	 and Extension Agreement (the "Modification"), as of December 1,
	 1992, with Apple Bank concerning the Mortgage Loan, which was
	 originally made on November 30, 1987 in the principal amount of
	 $3,485,000.  The Mortgage Loan is secured by a first mortgage on
	 the Property.  

	       The New Lessee reported net loss of $1,862,412 for the lease
	 year ended April 30, 1996; therefore, there was no additional rent
	 payable for such lease year.  Consequently, no additional payments
	 for supervisory services were payable to Counsel for the lease
	 year ended April 30, 1996.  See Note C below.<PAGE>
	 Garment Capitol Associates                                      9.

	 September 30, 1996





	 Note C - Supervisory Services

	       Registrant pays Counsel for supervisory services and
	 disbursements (i) the basic payment of $42,500 per annum ("Basic
	 Payment"); (ii) an additional annual basic payment of the first
	 $37,500 of Additional Rent paid by Lessee in any lease year
	 ("Additional Basic Payment"); and (iii) an additional payment of
	 10% of all distributions to Participants in any year in excess of
	 the amount representing a return at the rate of 18% per annum on
	 their remaining cash investment in any year (the "Additional
	 Payment").  The Additional Basic Payment will be payable in each
	 year only from Additional Rent received by Registrant from New
	 Lessee.  If Additional Rent in any year is inadequate to cover the
	 Additional Basic Payment, such deficiency shall be payable in the
	 following year in which Additional Rent is sufficient.

	       No remuneration was paid during the three and nine month
	 periods ended September 30, 1996 by Registrant to any of the
	 Partners as such.  Pursuant to the fee arrangements described
	 herein, Registrant paid Counsel $42,500 during the fiscal year
	 ended December 31, 1995.  Registrant also paid Counsel $10,625 and
	 $31,875, respectively, of the Basic Payment for supervisory
	 services for the three and nine month periods ended September 30,
	 1996.  

	       The supervisory services provided to Registrant by Counsel
	 include legal and administrative services and financial services.
	 The legal and administrative services include acting as general
	 counsel to Registrant, maintaining all of its partnership and
	 Participant records, performing physical inspections of the
	 Building, reviewing insurance coverage and conducting annual
	 partnership meetings.  Financial services include monthly receipt
	 of rent from the New Lessee, payment of monthly and additional
	 distributions to the Participants, payment of all other
	 disbursements, confirmation of the payment of real estate taxes,
	 and active review of financial statements submitted to Registrant
	 by the New Lessee and financial statements audited by and tax
	 information prepared by Registrants' independent certified public
	 accountant, and distribution of such materials to the
	 Participants.  Counsel also prepares quarterly, annual and other
	 periodic filings with the Securities and Exchange Commission and
	 applicable state authorities.

	       Reference is made to Note B of Item 1 ("Note B") for a
	 description of the terms of the Lease between Registrant and New
	 Lessee.  <PAGE>
	 Garment Capitol Associates                                     10.

	 September 30, 1996



	      As of September 30, 1996, Mr. and Mrs. Peter L. Malkin own
	 shares in the New Lessee.  Mr. Malkin disclaims any beneficial
	 ownership of Mrs. Malkin's interest in the New Lessee.  

	       The respective interests of Messrs. Katzman, Loehr and
	 Malkin, if any, in Registrant arise solely from the ownership of
	 their respective participations in Registrant.  The Partners
	 receive no extra or special benefit not shared on a pro rata basis
	 with all other Participants in Registrant or shareholders in the
	 New Lessee.  However, each of the Partners, by reason of his
	 respective interest in Counsel, is entitled to receive his pro
	 rata share of any legal fees or other remuneration paid to Counsel
	 for legal and supervisory services rendered to Registrant and the
	 New Lessee.

	       As of September 30, 1996, the Partners owned of record and
	 beneficially an aggregate $50,000 of Participations, representing
	 less than 1% of the currently outstanding Participations in
	 Registrant.

	       In addition, as of September 30, 1996, certain of the
	 Partners in Registrant (or their respective spouses) held
	 additional Participations in Registrant as follows:

	       Peter L. Malkin owned of record as trustee, but not
	       beneficially, $5,000 of Participations.  Mr. Malkin
	       disclaims any beneficial ownership of such Participations.

	       Isabel Malkin, the wife of Peter L. Malkin, owned of record
	       and beneficially, $21,250 of Participations.  Mr. Malkin
	       disclaims any beneficial ownership of such Participations.  

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

	       Registrant was organized solely for the purpose of acquiring
	 the Property subject to the Lease.  Registrant is required to pay
	 from Basic Rent the annual charges due under the Mortgage Loan and
	 the Basic Payment for supervisory services, and to distribute the
	 balance to the Participants.  Additional Rent is distributed to
	 the Participants after the Additional Basic Payment and the
	 Additional Payment are made to Counsel.  See Note C of Item 1
	 ("Note C").  Pursuant to the Lease, the New Lessee has assumed
	 responsibility for the condition, operation, repair, maintenance
	 and management of the Property.  Registrant need not maintain
	 substantial reserves or otherwise maintain liquid assets to defray
	 any operating expenses of the Property.<PAGE>
	 Garment Capitol Associates                                     11.

	 September 30, 1996



	       Registrant does not pay dividends.  During the three and
	 nine month periods ended September 30, 1996, Registrant made
	 regular monthly distributions of $47.45 for each $5,000
	 participation ($569.40 per annum for each $5,000 participation).
	 As a result of no Additional Rent being payable to Registrant for
	 the lease year ended April 30, 1996, there was no additional
	 distribution for 1996.  There are no restrictions on Registrant's
	 present or future ability to make distributions; however, the
	 amount of such distributions depends solely on the ability of New
	 Lessee to make monthly payments of Basic Rent and Additional Rent
	 to Registrant in accordance with the terms of the Lease.
	 Registrant expects to make distributions so long as it receives
	 the payments provided for under the Lease.  See Note B.

	       Registrant's results of operations are affected primarily by
	 the amount of rent payable to it under the Lease.  The following
	 summarizes, with respect to the current period and the
	 corresponding period of the previous year, the material factors
	 affecting Registrant's results of operations for such periods:

		Total income increased for the three and nine month
		periods ended September 30, 1996, as compared with
		the three and nine month periods ended September
		30, 1995.  Such increase resulted mainly from
		interest income on a receivable from the Lessee.
		Total expenses increased for the three and nine
		month periods ended September 30, 1996, as compared
		with the three and nine month periods ended
		September 30, 1995.  Such increase resulted from an
		increase in interest expense on the first mortgage
		reflecting interest on additional principal
		advanced for the payment of Real Estate Taxes.  See
		Note B.  

			   Liquidity and Capital Resources

		   There has been no significant change in Registrant's
	 liquidity for the three and nine month periods ended September 30,
	 1996 as compared with the three and nine month periods ended
	 September 30, 1995.  As stated in Note B, Apple Bank has extended
	 the Mortgage Loan until December 1, 1997.

		   Registrant believes that the value of the Property is
	 currently in excess of the amount of the mortgage balance and
	 anticipates that the value of the Property will be in excess of
	 the mortgage balance at maturity.  Changes in the short-term or
	 long-term financial liquidity position of Registrant are dependent
	 on the payments made by New Lessee under the Lease.  Registrant
	 foresees no need for it to make material commitments for capital
	 expenditures while the Lease is in effect.<PAGE>
	 Garment Capitol Associates                                     12.

	 September 30, 1996




				      Inflation

		   Registrant believes that there has been no material
	 change in the impact of inflation on its operations since the
	 filing of its report on Form 10-K for the year ended December 31,
	 1995, which report and all exhibits thereto are incorporated
	 herein by reference and made a part hereof.

			     PART II.  OTHER INFORMATION

	 Item 1.  Legal Proceedings.

		   The Registrant is the subject of the following pending
	 litigation:  

		   On October 4, 1996, the alleged holder of a $20,000
	      original participation in Registrant brought suit in the U.S.
	      District Court for the Southern District of New York against
	      New Lessee, Original Lessee, the Partners, and Counsel.
	      Registrant is a nominal defendant.  The suit claims that
	      defendants violated the federal proxy rules, committed
	      breaches of fiduciary duty and fraud in relation to the
	      Partners' solicitation of consents of the Participants for
	      the sale and forbearance program and for the liquidation of
	      Registrant, as described in the Statement.  The suit is
	      styled as a class action, but the plaintiff has not applied
	      for class certification to date.  The suit seeks to enjoin
	      the allocation of sale proceeds to New Lessee approved by the
	      Participants, money damages and related relief.  Defendants'
	      response to the complaint is currently due by November 25,
	      1996.  The complaint does not seek any relief against
	      Registrant, and, accordingly, Registrant's counsel is of the
	      opinion that no loss or other unfavorable outcome of the
	      action against Registrant is anticipated.


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

		   (a)  The exhibits hereto are being incorporated by
			reference.  

		   (b)  Registrant has not filed any report on Form 8-K
			during the quarter for which this report is being
			filed.  <PAGE>
	 Garment Capitol Associates                                     13.
	 September 30, 1996






				     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.  

		   The individual signing this report on behalf of
	 Registrant is Attorney-in-Fact for Registrant and each of the
	 Partners in Registrant, pursuant to a Power of Attorney, dated
	 April 10, 1996 (the "Power").



	 GARMENT CAPITOL ASSOCIATES
	 (Registrant)



	 By:  /s/ Stanley Katzman
	      Stanley Katzman, Attorney-in-fact*


	 Date:  November 14, 1996


		   Pursuant to the requirements of the Securities Exchange
	 Act of 1934, this report has been signed by the undersigned as
	 Attorney-in-Fact for each of the Partners in Registrant, pursuant
	 to the Power, on behalf of Registrant and as a Partner in
	 Registrant on the date indicated.



	 By:  /s/ Stanley Katzman
	      Stanley Katzman, Attorney-in-fact*


	 Date:  November 14, 1996





	 ______________________
	    *   Mr. Katzman supervises accounting functions for
		Registrant.<PAGE>
	 Garment Capitol Associates                                     14.
	 September 30, 1996







				    EXHIBIT INDEX


	 Number                     Document                       Page*

	 2(a)         Proxy Statement issued by the Agents
		      in connection with the solicitation
		      of consents of the Participants, which
		      was filed on Schedule 14A by Registrant
		      on July 25, 1996 and is incorporated
		      herein by reference. 

	 2(b)         Letter to Participant dated August 8, 
		      1996 and accompanying financial reports 
		      for the lease years ended April 30, 1996 
		      and April 30, 1995.  Foregoing material 
		      shall not be deemed to be "filed" with 
		      the Commission or otherwise subject to 
		      the liabilities of Section 18 of the 
		      Securities Exchange Act of 1934.  

	 25           Power of Attorney dated April 10, 1996
		      between Peter L. Malkin, John L. Loehr 
		      and Stanley Katzman as Partners in 
		      Registrant and Richard A. Shapiro and 
		      Stanley Katzman, which was filed as 
		      Exhibit 25 to Registrant's 10-Q for
		      the quarter ended March 31, 1996 and
		      is incorporated herein by reference.














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