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  June 30, 1999
                                ------------------------------------------------

                                       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:  0-27562
                         -------------------------------------------------------

                              ATLANTIC REALTY TRUST
       ------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)



                     Maryland                                 13-3849655
------------------------------------------------    ---------------------------
  (State or other jurisdiction of incorporation             (I.R.S. Employer
                 or organization)                            Identification No.)


                   747 Third Avenue, New York, New York 10017
          -----------------------------------------------------------
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (212) 702-8561
          -----------------------------------------------------------
              (Registrant's telephone number, including area code)

           Indicate  by check  mark  whether  the  registrant  (1) has filed all
reports  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
   ----------           ----------

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

         The number of shares of beneficial interest,  par value $.01 per share,
outstanding on July 28, 1999 was 3,561,553.

858348.1


<PAGE>



                                    I N D E X

This  Quarterly  Report  on  Form  10-Q  contains  historical   information  and
forward-looking  statements.  Statements looking forward in time are included in
this  Form  10-Q  pursuant  to the  "safe  harbor"  provisions  of  the  Private
Securities  Litigation  Reform Act of 1995. They involve known and unknown risks
and uncertainties that may cause the Trust's actual results in future periods to
be materially  different from any future  performance  suggested  herein. In the
context of forward-looking  information  provided in this Form 10-Q and in other
reports,  please refer to the discussion of risk factors detailed in, as well as
the  other  information  contained  in,  the  Trust's  Form 10  filed  with  the
Securities  and  Exchange  Commission  on March 28,  1996 as well as the Trust's
filings with the Securities and Exchange Commission during the past 12 months.

<TABLE>
<S>                                                                                                                 <C>

Part I -- FINANCIAL INFORMATION                                                                                     PAGE NO.

Item 1.  Financial Statements.

       Consolidated Statements of Net Assets in Liquidation
       June 30, 1999 and December 31,1998.................................................................................1

       Consolidated  Statements  of Changes in Net Assets in  Liquidation --
       Periods April 1, 1999 through June 30, 1999 and January 1, 1999 through
       June 30, 1999 and Periods April 1, 1998 through June 30, 1998 and January 1, 1998 through June 30, 1998............2

       Notes to Consolidated Financial Statements.........................................................................3

Item 2.  Management's Discussion and Analysis of Financial Condition and Liquidation Activities...........................6

Item 3.  Quantitative and Qualitative Disclosure About Market Risk........................................................6

Part II -- OTHER INFORMATION

Item 1.  Legal Proceedings................................................................................................7

Item 2.  Changes in Securities and Use of Proceeds........................................................................7

Item 3.  Defaults Upon Senior Securities..................................................................................7

Item 4.  Submission of Matters to a Vote of Security Holders..............................................................7

Item 5.  Other Information................................................................................................7

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

Signatures................................................................................................................9
</TABLE>

858348.1

<PAGE>



                         PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.


                      ATLANTIC REALTY TRUST AND SUBSIDIARY
              CONSOLIDATED STATEMENTS OF NET ASSETS IN LIQUIDATION
                        (Liquidation Basis of Accounting)


<TABLE>
<CAPTION>

                                                                          June 30, 1999                   December 31, 1998
                                                                          --------------                  -----------------
ASSETS
<S>                                                                      <C>                                 <C>
Investments in Real Estate............................................   $  37,775,000                       $  38,625,000
Cash and Short Term Investments.......................................      22,950,760                          21,751,057
                                                                         -------------                       -------------
                Total Assets..........................................   $  60,725,760                       $  60,376,057
                                                                         =============                       =============


LIABILITIES

Estimated Costs of Liquidation .......................................   $   4,152,918                       $  4,164,168
                                                                         -------------                       ------------
                 Total Liabilities....................................   $   4,152,918                       $  4,164,168
                                                                         -------------                       ------------

Net Assets in Liquidation.............................................   $  56,572,842                       $ 56,211,889
                                                                         =============                       ============
</TABLE>












                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


858348.1
                                        1

<PAGE>




                      ATLANTIC REALTY TRUST AND SUBSIDIARY
         CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS IN LIQUIDATION
                        (Liquidation Basis of Accounting)

<TABLE>
<CAPTION>

                                                                              For the Period                      For the Period
                                                                             April 1, 1999 to                     January 1, 1999 to
                                                                             June 30, 1999                        June 30, 1999
                                                                            ------------------                   -------------------
<S>                                                                           <C>                                 <C>
Net Assets in Liquidation
   Beginning of Period..................................................      $56,313,419                         $56,211,889
Adjustments to Reflect
   Liquidation Basis of Accounting......................................          259,423                             360,953
                                                                              -----------                         -----------
Net Assets in Liquidation End of Period.................................      $56,572,842                         $56,572,842
                                                                              ===========                         ===========



                                                                              For the Period                      For the Period
                                                                             April 1, 1998 to                     January 1, 1998 to
                                                                               June 30, 1998                      June 30, 1998
                                                                            ------------------                  --------------------

Net Assets in Liquidation
   Beginning of Period..................................................      $54,508,375                         $54,048,704
Adjustments to Reflect
   Liquidation Basis of Accounting......................................           24,356                             484,027
                                                                              -----------                         -----------
Net Assets in Liquidation End of Period.................................      $54,532,731                         $54,532,731
                                                                              ===========                         ===========
</TABLE>


















                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


858348.1
                                        2

<PAGE>



                      ATLANTIC REALTY TRUST AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.               Organization and Significant Accounting Policies:

                 Atlantic  Realty Trust (the  "Trust"),  a Maryland  real estate
investment trust, was formed on July 27, 1995 for the purpose of liquidating its
interests in real properties, a mortgage loan portfolio and certain other assets
and  liabilities  which  were  transferred  to the Trust  from  Ramco-Gershenson
Properties  Trust (formerly named RPS Realty Trust) ("RPS") on May 10, 1996 (the
"Spin-Off Transaction").  The Trust had no operations from the date of formation
to the date of the Spin-Off Transaction. The Trust adopted the liquidation basis
of accounting as of the date of the Spin-Off  Transaction based on its intention
to liquidate its assets or merge or combine  operations with another real estate
entity within eighteen months from the date of the Spin-Off Transaction.

Liquidation Basis of Accounting

                 As a result of the Spin-Off Transaction,  the Trust has adopted
the  liquidation  basis of accounting.  The  liquidation  basis of accounting is
appropriate when liquidation  appears imminent and the Trust is no longer viewed
as a going concern. Under this method of accounting,  assets are stated at their
estimated net realizable  values and  liabilities  are stated at the anticipated
settlement amounts.

                 The valuations presented in the accompanying  Statements of Net
Assets in  Liquidation  represent  the  estimates at the dates  shown,  based on
current facts and circumstances, of the estimated net realizable value of assets
and estimated  costs of liquidating the Trust. In determining the net realizable
values of the assets,  the Trust  considered  each  asset's  ability to generate
future cash flows,  offers to purchase received from third parties,  if any, and
other general market information. Such information was considered in conjunction
with operating the Trust's plan for  disposition of assets.  The estimated costs
of liquidation  represent the estimated costs of operating the Trust through its
anticipated termination.  These costs primarily include payroll,  consulting and
related costs, rent, shareholder relations, legal and auditing.  Computations of
net realizable value  necessitate the use of certain  assumptions and estimates.
Future events,  including economic conditions that relate to real estate markets
in  general,  may  differ  from  those  assumed  or  estimated  at the time such
computations  are made.  Because of inherent  uncertainty  of valuation  when an
entity is in liquidation,  the amounts ultimately  realized from assets disposed
and costs  incurred to settle  liabilities  may  materially  differ from amounts
presented.

                 Pursuant  to the  terms of the  Trust's  Amended  and  Restated
Declaration  of Trust,  the Trust was to continue for a period of 18 months from
the date of the Spin-Off  Transaction,  subject to, among  certain other things,
satisfactory  resolution  of the RPS Tax  Issues  (as such  term is  defined  in
footnote 5 below).  Because the RPS Tax Issues have not yet been  satisfactorily
resolved,  the Trust has continued its business past that date. The Trust cannot
currently estimate the timing of the future  satisfactory  resolution of the RPS
Tax  Issues.  Accordingly,  the  Trust  will  continue  until  there  is a final
determination of these issues.

Consolidation

                 The consolidated  financial  statements include the accounts of
the  Trust  and  its  subsidiary.  All  significant  intercompany  accounts  and
transactions have been eliminated in consolidation.

2.         Investments in Real Estate:


                                                            Estimated Net
Property                         Location            Realizable Value 6/30/99(a)
--------                         --------           ----------------------------
Hylan Shopping Center        Staten Island, NY               $37,775,000

---------------
(a)        Includes estimated cash flows using a disposition period of 9 months.
           Realized values may differ  depending on actual  disposition  results
           and time period.


858348.1
                                        3

<PAGE>


                      ATLANTIC REALTY TRUST AND SUBSIDIARY
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (Continued)

3.         Shares Outstanding:

           The  weighted  average  number  of  shares  of  beneficial   interest
outstanding for the period ending June 30, 1999 was 3,561,553.

4.         Short-Term Investments:

           Short-term  investments  at June  30,  1999  consist  primarily  of a
Certificate of Deposit at a major New York bank of $21,500,000  bearing interest
at a fixed rate of 3.75%.

5.         Tax Contingency:

           During the third quarter of 1994, RPS held more than 25% of the value
of its gross assets in overnight Treasury Bill reverse  repurchase  transactions
which the Internal Revenue Service ("IRS") may view as non-qualifying assets for
the purposes of  satisfying  an asset  qualification  test  applicable to REITs,
based on a Revenue Ruling  published in 1977 (the "Asset Issue").  RPS requested
that the IRS enter into a closing  agreement with RPS that the Asset Issue would
not impact RPS' status as a REIT.  The IRS declined  such  request.  In February
1995, the IRS initiated an  examination  of the 1991-1995  income tax returns of
RPS (the "RPS Audit" and,  together with the Asset Issue, the "RPS Tax Issues").
Based on  developments  in the law which occurred since 1977,  RPS' tax counsel,
Battle  Fowler LLP,  rendered an opinion that RPS'  investment  in Treasury Bill
repurchase obligations would not adversely affect its REIT status. However, such
opinion is not binding upon the IRS.

           In connection  with the Spin-Off  Transaction,  the Trust assumed all
tax  liability  arising  out of the RPS Tax Issues  (other than  liability  that
relates to events  occurring or actions  taken by RPS  following the date of the
Spin-Off  Transaction)  pursuant to a tax agreement,  dated May 10, 1996, by and
between RPS and the Trust,  which provides that RPS (now named  Ramco-Gershenson
Properties  Trust)  under  the  direction  of four  trustees,  each of whom  are
trustees  of both RPS and the  Trust  (the  "Continuing  Trustees")  and not the
Trust, will control, conduct and effect the settlement of any tax claims against
RPS  relating  to the RPS Tax Issues.  Accordingly,  the Trust does not have any
control as to the timing of the resolution or disposition of any such claims and
no assurance can be given that the  resolution or disposition of any such claims
will be on  terms or  conditions  as  favorable  to the  Trust  as if they  were
resolved or disposed  of by the Trust.  RPS and the Trust also have  received an
opinion from Wolf, Block, Schorr and Solis-Cohen LLP (the "Special Tax Counsel")
that,  to the extent there is a deficiency in RPS  distributions  arising out of
the IRS examination,  and provided RPS timely makes a deficiency  dividend (i.e.
declares and pays a  distribution  which is permitted to relate back to the year
for which each deficiency was determined to satisfy the requirement  that a REIT
distribute 95 percent of its taxable  income),  the  classification  of RPS as a
REIT for the taxable years under examination would not be affected.

           As of June 30, 1999,  the Trust has not been  required to perform its
indemnity  obligation with respect to the RPS Tax Issues other than with respect
to legal fees and expenses paid in connection with the IRS' ongoing examination.
On March 1, 1999, the IRS revenue agent  conducting the  examination  issued his
examination report (the "Revenue Agent's Report") with respect to the tax issues
in the RPS Tax Audit,  including the RPS Tax Issues.  The Revenue Agent's Report
sets forth a number of positions  which the IRS  examining  agent has taken with
respect to the RPS Tax  Issues for the years that are  subject to the RPS Audit,
which Special Tax Counsel to the Continuing Trustees believes are not consistent
with  applicable  law and  regulations  of the IRS.  One of the  positions,  the
acquisition  of assets by RPS that could be viewed as  nonqualifying  assets for
REIT purposes,  has been addressed in the opinion letter of counsel  referred to
above.  In  addition,  the IRS  revenue  agent  has  proposed  to  disallow  the
deductions  for bad debts and certain  other  items  claimed by RPS in the years
under examination.  In reaching his conclusion with respect to the deduction for
bad  debts,  the IRS  revenue  agent has  disregarded  the fact that the  values
actually  obtained  for  assets  corresponded  to  the  values  used  by  RPS in
determining its bad debt deductions. If all

858348.1
                                        4

<PAGE>


                      ATLANTIC REALTY TRUST AND SUBSIDIARY
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (Continued)

of the positions taken in the Revenue Agent's Report were to be sustained,  RPS,
with funds supplied by the Trust,  would have to distribute up to  approximately
$16.5  million  to its  shareholders,  in  accordance  with the  procedures  for
deficiency  dividends,  in order to preserve its status as a REIT and could,  in
addition,  be subject to taxes,  interest and penalties up to approximately  $24
million  through  March 15,  1999.  The issuance of the Revenue  Agent's  Report
constitutes  only  the  first  step  in  the  IRS  administrative   process  for
determining  whether there is any deficiency in RPS' tax liability for the years
at issue and any adverse  determination  by the IRS revenue  agent is subject to
administrative appeal with the IRS and, thereafter, to judicial review. As noted
above, the Revenue Agent's Report sets forth a number of positions which Special
Tax Counsel to RPS and the Trust believe are not consistent  with applicable law
and  regulations  of the IRS. The Trust has been  informed that RPS has filed an
administrative  appeal challenging the findings contained in the Revenue Agent's
Report.



858348.1
                                        5

<PAGE>



Item 2.    Management's  Discussion  and  Analysis of  Financial  Condition  and
           Liquidation Activities.

Capital Resources and Liquidity

           At June 30, 1999,  the Trust owned one retail  property  (Hylan Plaza
Shopping Center, located in Staten Island, New York) as well as cash and certain
other assets,  which include furniture,  fixtures and equipment.  The Trust does
not intend to make new loans or actively  engage in either the mortgage  lending
or the property acquisition business.

           The Trust's primary  objective has been to liquidate its assets in an
eighteen-month  period from the date of the Spin-Off Transaction while realizing
the maximum values for such assets;  however because the RPS Tax Issues have not
been satisfactorily  resolved,  the Trust has continued its business beyond such
period.  Although the Trust  considers its  assumptions  and estimates as to the
values and timing of such  liquidations to be reasonable,  the period of time to
liquidate  the assets and  distribute  the proceeds of such assets is subject to
significant business,  economic and competitive uncertainties and contingencies,
many of which are beyond the Trust's control. There can be no assurance that the
net values ultimately  realized and costs actually incurred for such assets will
not materially differ from the Trust's estimates.

           The Trust believes that cash and cash  equivalents on hand,  proceeds
generated by the  remaining  property and the proceeds from the eventual sale of
such property will be sufficient to support the Trust and meet its  obligations.
As of June  30,  1999,  the  Trust  had  approximately  $22,305,000  in cash and
short-term investments.

Item 3.    Quantitative and Qualitative Disclosure About Market Risk.

           Not applicable.



858348.1
                                        6

<PAGE>



                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

           Not applicable.

Item 2.  Changes in Securities and Use of Proceeds.

           Not applicable.

Item 3.  Defaults Upon Senior Securities.

           Not applicable.

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

           The Annual Meeting of  Shareholders  of the Trust was held on May 19,
1999 (i) to elect eight  trustees to sit on the Board of  Trustee's of the Trust
(the  "Board")  until the next Annual  Meeting of  Shareholders  and until their
successors  are duly elected and  qualified  and (ii) to ratify the selection by
the Board of Deloitte & Touche LLP as the  independent auditors of the Trust for
the fiscal year commencing January 1, 1999.

           On the first proposal, the vote of the Shareholders was as follows:


      NOMINEE                       FOR          WITHHELD             ABSTAIN
-----------------------------------------------------------------------------
Stephen R. Blank                 2,729,864        23,122                --
Edward Blumenfeld                2,730,014        22,972                --
Samuel M. Eisenstat              2,729,923        23,063                --
Edwin J. Glickman                2,729,980        23,006                --
Arthur H. Goldberg               2,729,874        23,112                --
Herbert Liechtung                2,729,594        23,392                --
Joel M. Pashcow                  2,729,516        23,470                --
William A. Rosoff                2,729,824        23,162                --

           On  the  second  proposal,  the  Shareholders  voted  to  ratify  the
selection by the Board of Deloitte & Touche LLP as the  independent  auditors of
the Trust.  There  were  2,730,297  votes for,  14,350  against  and 8,339 votes
abstained.

Item 5.  Other Information.

           Pursuant to the terms of the Trust's Amended and Restated Declaration
of Trust,  the Trust was to continue  for a period of 18 months from the date of
the Spin-Off  Transaction  (which  18-month  period ended on November 10, 1997),
subject to, among certain other things,  satisfactory  resolution of the RPS Tax
Issues.  Because the RPS Tax Issues have not yet been  satisfactorily  resolved,
the Trust has continued its business past that date. The Trust cannot  currently
estimate the timing of the future satisfactory resolution of the RPS Tax Issues.
Accordingly,  the Trust will continue  until there is a final  determination  of
these issues.

858348.1
                                        7

<PAGE>



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

1.         Exhibits:  The registrant  has filed the following  exhibit as a part
                      of this Quarterly Report on Form 10-Q:

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

           27.1                           Financial Data Schedule

2. The  registrant  has not filed any  reports  on Form 8-K for the three  month
period ended June 30, 1999.



858348.1
                                        8

<PAGE>


                                   SIGNATURES

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



                                ATLANTIC REALTY TRUST
                                (Registrant)



Date: July 28, 1999             /s/ Joel M. Pashcow
                                ------------------------------------
                                Name:  Joel M. Pashcow
                                Title: Chairman and President
                                        (Principal Executive Officer)


Date: July 28, 1999             /s/ Edwin R. Frankel
                                ------------------------------------
                                Name:  Edwin R. Frankel
                                Title: Executive Vice President, Chief Financial
                                       Officer and Secretary
                                       (Principal Financial and Accounting
                                       Officer)


858348.1