UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

                   Quarterly Report Under Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

         For Quarter Ended: June 30, 1997 Commission File Number: 1-9646
                            -------------

                           ASR Investments Corporation
             ------------------------------------------------------
             (Exact name of Registrant as specified in its Charter)

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

                                   86-0587826
                      ------------------------------------
                      (I.R.S. Employer Identification No.)

                   335 N. Wilmot, Suite 250, Tucson, AZ 85711
                   ------------------------------------------
                    (Address of principal executive offices)

                                 (520) 748-2111
              ----------------------------------------------------
              (Registrant's telephone number, including area code)

                                (Not applicable)
              ----------------------------------------------------
              (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.
                                X  Yes       No
                              ----      ----

                      APPLICABLE ONLY TO CORPORATE ISSUERS:
    Indicate the number of shares outstanding of each of the issuer's classes
              of common stock, as of the latest practicable date.

      Common Stock (par value $.01) outstanding as of August 11, 1997 were
                               4,437,611 shares.
<PAGE>
                           ASR INVESTMENTS CORPORATION
                           Consolidated Balance Sheets
                       June 30, 1997 and December 31, 1996
                             (Dollars in Thousands)
<TABLE>
<CAPTION>
                                                                  1997         1996
                                                                ---------    ---------
                                                               (Unaudited)
<S>                                                             <C>          <C>      
Assets
    Real estate investments, at cost:
       Land                                                     $  40,859    $  15,514
       Buildings and improvements                                 157,165       58,476
       Construction in progress                                    20,368       14,694
       Land held for development                                      925          925
       Investments in joint ventures                                             2,811
       Other real estate                                              565        1,022
                                                                ---------    ---------
           Total real estate investments                          219,882       93,442
       Accumulated depreciation                                    (9,537)      (7,504)
                                                                ---------    ---------
           Real estate investments, net of depreciation           210,345       85,938

    Cash and cash equivalents                                      17,701        2,403
    Mortgage assets                                                              5,039
    Restricted cash                                                 5,652        2,930
    Deferred loan fees                                              2,118        1,090
    Goodwill                                                        1,391
    Other assets                                                    1,953          396
                                                                ---------    ---------
           Total assets                                         $ 239,160    $  97,796
                                                                =========    =========

Liabilities
    Real estate notes payable                                   $ 128,340    $  48,855
    Construction loan payable                                      12,547          255
    Short-term borrowing                                                         2,014
    Construction costs payable                                        214        1,581
    Security deposits and deferred rental income                    1,730          644
    Other liabilities                                               7,026        4,345
                                                                ---------    ---------
           Total  liabilities                                     149,857       57,694
                                                                ---------    ---------

Stockholders' Equity
    Convertible LP Units  (Note 3)                                 18,910
    Common Stock, par value $.01 per share, 40,000,000 shares
    authorized; 4,622,353 and 3,307,892 shares issued                  45           33
    Additional paid in capital                                    180,813      155,964
    Deficit                                                      (107,053)    (112,964)
    Stock note receivable                                            (385)        (385)
    Treasury stock - 184,742 and 160,742  shares                   (3,027)      (2,546)
                                                                ---------    ---------
            Total  stockholders'  equity                           89,303       40,102
                                                                ---------    ---------
       Total liabilities and stockholders' equity               $ 239,160    $  97,796
                                                                =========    =========
</TABLE>
See Notes to Consolidated Financial Statements.
                                       2
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      Consolidated Statements of Operations
          For the Quarters and Six Months Ended June 30, 1997 and 1996
                     (In thousands except per share amounts)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                             Quarters            Six Months
                                                             --------            ----------
                                                       1997        1996        1997        1996
                                                     --------    --------    --------    --------
<S>                                                  <C>         <C>         <C>         <C>     
Real  Estate  Operations
     Rental and other income                         $  7,185    $  3,639    $ 10,888    $  7,281
                                                     --------    --------    --------    --------
     Operating and maintenance expenses                 2,648       1,301       3,991       2,555
     Real estate taxes and insurance                      808         359       1,149         719
     Interest expense on real estate mortgages          2,254       1,108       3,377       2,190
     Depreciation and amortization                      1,352         688       2,032       1,368
                                                     --------    --------    --------    --------
       Total operating expenses                         7,062       3,456      10,549       6,832
                                                     --------    --------    --------    --------
     Income from  real  estate                            123         183         339         449
                                                     --------    --------    --------    --------
     Gain on sale of real estate                          474                     474
                                                     --------    --------    --------    --------
Mortgage  Assets
     Prospective yield income                             258         799         588       1,569
     Income from redemptions and sales                 11,311       3,010      16,650       4,987
     Interest expense                                      (7)        (49)        (25)       (124)
                                                     --------    --------    --------    --------
     Income from mortgage assets                       11,562       3,760      17,213       6,432
                                                     --------    --------    --------    --------

 Income Before Administrative Expenses
   and Other Income (Expense)                          12,159       3,943      18,026       6,881
     Administrative expenses                             (837)       (698)     (1,944)     (1,336)
     Aquisition related expenses                       (6,215)                 (6,215)
     Other income (expense), net                          120          81         307         121
                                                     --------    --------    --------    --------
Net Income                                           $  5,227    $  3,326    $ 10,174    $  5,666
                                                     --------    --------    --------    --------

Net  Income  Per  Share of Common
     Stock and Common Stock Equivalents              $   1.11    $   1.05    $   2.58    $   1.80
                                                     ========    ========    ========    ========
Average  Shares of Common Stock and
     Common Stock Equivalents                           4,708       3,154       3,938       3,154
                                                     ========    ========    ========    ========
Dividends  Declared  Per  Share                      $   0.50    $   0.50    $   1.00    $   1.00
                                                     ========    ========    ========    ========
</TABLE>
See Notes to Consolidated Financial Statements. 
                                       3
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      Consolidated Statements of Cash Flows
                 For the Six Months Ended June 30, 1997 and 1996
                                 (In Thousands)
                                   (Unaudited)

                                                        1997        1996
                                                      --------    --------
OPERATING  ACTIVITIES

Net income                                            $ 10,174    $  5,666
Principal noncash charges
    Depreciation and amortization                        2,233       1,604
    Aquisition related expenses                          5,250
    Gain on sale of real estate                           (474)
    Increase in deferred compensation                    1,099
    Increase in stock appreciation rights                  672
    Increase in other assets                            (1,557)       (198)
    Increase in other liabilities                        2,522         496
                                                      --------    --------
Cash  Provided  By  Operations                          19,919       7,568
                                                      --------    --------

INVESTING  ACTIVITIES
Investment in apartments                               (10,628)       (420)
Construction expenditures                               (5,674)     (3,313)
Proceeds from sale of real estate                        2,830
Investment in joint ventures                               358          10
Purchase of land for development                                       (60)
Other real estate assets                                   457         213
Restricted cash                                         (2,722)       (304)
Reduction in mortgage assets                             5,039       3,014
                                                      --------    --------
Cash  Used  In  Investing  Activities                  (10,340)       (860)
                                                      --------    --------

FINANCING  ACTIVITIES
Issuance of real estate notes payable                    3,000
Payment of loan costs                                   (1,119)        (71)
Proceeds from construction loan                         12,292         243
Repayment of real estate notes                            (346)       (207)
Short-term borrowing                                    (2,014)     (2,129)
Construction costs payable                              (1,367)      1,636
Stock options exercised                                     17
Aquisition of treasury stock                              (481)
Payment of dividends                                    (3,792)     (3,154)
Distributions on LP Units                                 (471)
                                                      --------    --------
Cash Provided By (Used  In)  Financing  Activities       5,719      (3,682)
                                                      --------    --------

Cash
    Increase  during the period                         15,298       3,026
    Balance - beginning of period                        2,403       2,421
                                                      --------    --------
    Balance - end of period                           $ 17,701    $  5,447
                                                      ========    ========

Supplemental Disclosure of Cash Flow Information
Interest paid                                         $  3,928    $  2,342
Interest capitalized                                       482         133
Stock issued for contract termination                    5,250
Non-cash transactions associated with acquisitions:
     Issuance of common stock                           19,594
     Issuance of convertible LP Units                   18,910
     Notes payable assumed                              76,305

See Notes to Consolidated Financial Statements.
                                       4
<PAGE>
                           ASR INVESTMENTS CORPORATION
                 Consolidated Statement of Stockholders' Equity
                     For the Six Months Ended June 30, 1997
                                 (In thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                           
                                                                                                          Common
                                                                       Additional                        Stock in
                             Number of Number of      LP       Par      Paid-In                Notes     Treasury -      
                              Shares   LP Units      Units    Value     Capital    Deficit   Receivable   at Cost     Total
                            ---------  ---------  --------- ---------  ---------  ---------  ---------   ---------  ---------
<S>                         <C>        <C>        <C>       <C>        <C>        <C>        <C>         <C>        <C>
Balance, December 31, 1996      3,308                       $      33  $ 155,964 ($112,964) ($    385)   ($  2,546) $  40,102
Net income                                                                          10,174                             10,174
Dividends declared                                                                  (4,263)                            (4,263)
Stock issuance (repurchase)     1,314        944  $  18,910        12     24,849                              (481)    43,290
                            ---------  ---------  --------- ---------  ---------  ---------  ---------   ---------  ---------
Balance, June 30, 1997          4,622        944  $  18,910 $      45  $ 180,813  ($107,053) ($    385)  ($  3,027) $  89,303
                            ---------  ---------  --------- ---------  ---------  ---------  ---------   ---------  ---------
</TABLE>
See Notes to Consolidated Financial Statements.
                                       5
<PAGE>
                           ASR INVESTMENTS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


1.       BASIS OF PRESENTATION

         The accompanying interim consolidated  financial statements include the
accounts  of  the  Company  and  its  wholly  owned  subsidiaries  and  Heritage
Communities L.P. (collectively the "Company").  Investments in joint ventures in
which the Company does not own a  controlling  interest are  accounted for under
the equity method. All significant  inter-company balances and transactions have
been eliminated.  In the opinion of management,  all adjustments  (consisting of
normal recurring adjustments)  considered necessary for a fair presentation have
been  included.  They do not  include  all of the  information  and  disclosures
generally  required for annual  financial  statements.  These interim  operating
results are not  necessarily  indicative of the results that may be expected for
the entire year. These interim consolidated  financial statements should be read
in  conjunction  with the  December  31,  1996  audited  consolidated  financial
statements and notes thereto.

         Reclassification  - Certain  reclassification  has been made to conform
the prior year with the current year presentation.

         New Accounting  Standard - In February  1997, the Financial  Accounting
Standards Board issued FASB No. 128, "Earnings Per Share," which establishes new
standards for computing and presenting earnings per share (EPS). It replaces the
presentation  of primary EPS with a presentation  of basic EPS. It also requires
dual  presentation of basic and diluted EPS on the face of the income  statement
for all entities with complex capital  structures and requires a  reconciliation
of the numerator and  denominator of the basic EPS  computation to the numerator
and denominator of the diluted EPS  computation.  The new statement is effective
for  financial  statements  for both  interim and annual  periods  ending  after
December  15,  1997.  Adoption  of SFAS No. 128 will not result in any  material
change to the earnings  per share  amounts for the quarters and six months ended
June 30, 1997 and 1996.

         FASB No. 129 - Disclosure of information about Capital Structure,  FASB
No. 130 - Reporting  Comprehensive  Income, and FASB No. 131 - Disclosures about
Segments of an Enterprise  and Related  Information  were also issued during the
first six months of 1997.  These new  statements  are  effective  for  financial
statements  for both interim and annual  periods ending after December 15, 1997.
Adoption of these  statements will not have any material effect on the Company's
consolidated financial statements for the
                                        6
<PAGE>
                           ASR INVESTMENTS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


quarters and six months ended June 30, 1997 and 1996.

         Convertible  LP  Units - The  limited  partnership  units  of  Heritage
Communities  L.P. held by  non-affiliates  of the Company are accounted for as a
part of  stockholders'  equity.  Distributions  on the units are subtracted from
deficit as declared. LP units held by non-affiliates are considered common stock
equivalents  in  the  determination  of  earnings  per  share.  See  Note  3 for
additional description of the Partnership and the limited partnership units.

         Gain on Sale  of  Real  Estate  - Gains  on  sales  of  properties  are
recognized by the Company when the  recognition  criteria set forth by generally
accounting principles have been met.

         Forward-Looking   Statements   -  This   Form   10Q   report   contains
forward-looking  statements  within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended.  The Company's actual results could differ materially from those set
forth in the forward-looking  statements as a result of, among other things, the
risk factors set forth in the Company's filings with the Securities and Exchange
Commission,   changes  in  general  economic   conditions  and  changes  in  the
assumptions used in making such forward-looking statements.
                                       7
<PAGE>
                           ASR INVESTMENTS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


2.       REAL ESTATE ACQUISITIONS AND DEVELOPMENT

         At  December  31,  1996,   the  Company  owned  directly  19  apartment
communities  (3,093 units) located in Arizona,  Texas, and New Mexico.  In March
1997, the Company acquired a 266-unit apartment  community in northwest Houston,
Texas  for  $4,450,000.   The  Company  plans  to  spend  $700,000  on  numerous
substantive improvements to the community. The Company obtained a first mortgage
loan of $3,700,000 with a fixed rate of 8.39%.  The Company issued 86,500 shares
of common stock for net proceeds of  $1,622,000  to provide for the cash used in
the acquisition.

         In April 1997,  the Company  acquired a 257-unit  community in Houston,
Texas,  for $6,000,000 and obtained a first mortgage loan for $4,400,000 with an
interest  rate of  8.57%.  The  Company  plans to  spend  $600,000  on  numerous
substantive  improvements to the community. On May 9, 1997, the Company acquired
a 176-unit  apartment  community  in Seattle,  Washington,  for  $4,059,000  and
obtained a first mortgage loan of $2,900,000 with an interest rate of 8.67%. The
Company  plans to spend  $400,000 on numerous  substantive  improvements  to the
community.  The  Company  issued  187,847  shares of common  stock for total net
proceeds of $3,394,000 to pay for the two purchases.

         In March 1996, the Company began  construction of a 356-unit  apartment
community, Finisterra Apartments, in Tempe, Arizona. The total cost is estimated
to be approximately $21,000,000.  As of June 30, 1997 and December 31, 1996, the
Company had invested  $20,368,000  and  $14,694,000 in construction in progress.
The Company has obtained a $15,350,000  construction  loan of which  $12,547,000
was  outstanding  at June 30, 1997. The Company has begun the lease-up phase and
anticipates  construction to be substantially  completed at the end of the third
quarter.

         On  April  30,  1997,  the  Company  completed  the  acquisition  of 13
apartment  communities  containing  2,260  units  located in Houston and Dallas,
Texas and  Pullman,  Washington,  and one  office  building  located  in Seattle
Washington (the "Winton  Properties").  The acquisitions were made pursuant to a
Master  Combination  and  Contribution  Agreement  dated  November 8, 1996.  The
sellers  were 15 separate  limited  partnerships  in which Don W. Winton was the
general  partner.  The total purchase price of the properties was  approximately
$83,223,000.  The  Company  (i)  assumed  or  refinanced  first  mortgage  loans
totalling $49,396,000, (ii) issued 682,095 shares of
                                       8
<PAGE>
                           ASR INVESTMENTS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


common stock, (iii) issued limited partnership units ("LP Units") convertible to
943,705 shares of common stock of the Company after April 30, 1998 and (iv) paid
the sellers $1,250,000 for transaction costs. As a part of the acquisition,  the
Company issued 70,284 shares of common stock to acquire the entire  interests in
Winton & Associates, the property management company for the Winton Properties.

         The acquisitions of the Winton  properties and Winton & Associates have
been accounted for under the purchase method.  The common stock and the LP Units
are recorded at $20.038 per share,  the average  closing  price of the Company's
common stock for the ten days preceding the  announcement  the  acquisitions  on
November  19,  1996.  The excess of the cost of the  purchase  price of Winton &
Associates over the net tangible assets acquired is recorded as goodwill that is
amortized over 20 years.

         Prior to May 1997, the Company owned six apartment  communities  (1,441
units)  located in Arizona  through joint ventures with a pension plan affiliate
of Citicorp.  The Company was a 15% equity  partner and the managing  partner or
managing member of the joint ventures.  On May 1, 1997, the Company acquired the
remaining  interest in one of the joint ventures,  La Privada Apartments L.L.C.,
for $8,233,000. The La Privada Apartments is a 350-unit community in Scottsdale,
Arizona. The Company obtained a $3,000,000 loan to pay for the acquisition.  The
loan bears  interest at 3% over LIBOR.  The  purchase  increased  the  Company's
investment  in  apartments by  approximately  $25,500,000  and real estate notes
payable by  $19,000,000.  The Company sold to its partner the  Company's  entire
interests in the other five joint ventures for total net proceeds of $2,062,000.
The  Company  recorded a gain of $474,000  on the sale of the  interests  in the
joint ventures.

         As of  June  30,  1997,  the  Company  owns  36  apartment  communities
containing 6,346 units and an office building.

         The following  selected  unaudited pro forma results of operations data
for the six  months  ended  June 30,  1997  have  been  prepared  as if the 1997
acquisitions  described above had occurred at January 1, 1997. The proforma data
are provided for information purposes only and are not indicative of the results
that would have occurred or which may occur in the future (dollars in thousands,
except per share amounts).
                                       9
<PAGE>
                           ASR INVESTMENTS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


         Real estate revenues                                  $18,012 
         Real estate operating expenses:
                  Operating expenses                            (8,402)
                  Depreciation                                  (3,761)
                  Interest                                      (5,448)
                                                               -------
         Income from real estate                                   401
         Income from mortgage assets                            17,265
         Administrative expenses                                (8,039)
         Other income                                              615
                                                               -------
                  Net Income                                   $10,242
                                                               =======

                  Pro Forma Net Income Per  Share                $1.90
                                                                 =====


3.       HERITAGE COMMUNITIES L.P.

         The Company  formed  Heritage  Communities  L.P.  ("Heritage  LP"),  an
operating  partnership,  for the purpose of acquiring the Winton  Properties and
other apartment communities. Heritage is a Delaware limited partnership in which
the Company and a wholly owned subsidiary of the Company,  Heritage SGP, are the
sole general partners.  To the extent that Heritage LP has sufficient  operating
cash flows,  holders of limited  partnership  units ("LP  Units")  will  receive
quarterly  distributions  per  unit  equal  to the  per  share  dividend  on the
Company's common stock. To the extent that Heritage LP has insufficient  cash to
pay the  distributions,  the holders of LP units will be credited for the unpaid
distribution and interest on the unpaid distribution;  such unpaid balances will
be given priority for future distributions.

         Heritage LP's items of income,  gain,  loss and deduction are allocated
among its partners, subject to certain special allocations,  in a similar manner
for  purposes  of both  book  gain or loss and tax gain or loss.  Net  income is
allocated (i) first, to each limited partner to the extent that, on a cumulative
basis, net losses previously allocated to the limited partners exceed net income
previously  allocated to limited partners,  (ii) second, to each limited partner
to the extent that such  limited  partner  has been  allocated  on a  cumulative
basis,  net income  equal to the sum of the  distributions  paid to such limited
partner  and the  unreturned  balances in the  accrual  accounts  and the unpaid
distribution  accounts  maintained  with  respect  to the LP Units  held by such
limited partner, and (iii)
                                       10
<PAGE>
                           ASR INVESTMENTS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


the general partners on a pro rata basis. Notwithstanding the allocations in (i)
and (ii)  above,  at least one  percent of each item of gain,  loss,  income and
deduction for each year is allocated to the general partners.

         Net losses are  allocated  to the  partners  in  accordance  with their
respective  percentage  interests in Heritage LP, except that net losses are not
allocated to any limited partner to the extent that such allocation  would cause
the limited  partner to have an adjusted  capital  account deficit at the end of
the taxable year. All net losses in excess of such limitations will be allocated
to the general partners on a pro rata basis

         After  April  30,  1998,  the  first  anniversary  of  the  Partnership
Agreement, each LP Unit will be convertible to one share of the Company's Common
Stock.  If an LP Unit is converted prior to April 30, 2007, the holder will also
be paid any unpaid  balances in the holder's  distribution  account.  An LP Unit
holder who  exercises the  conversion  after April 30, 2007 will not be paid any
unpaid balance in the holder's  distribution  account if the market value of the
Company's  common  stock is equal  to at  least  110% of the sum of the  initial
contribution and the unpaid balance.

         Holders  of LP  Units  do not  have  the  right  to  take  part  in the
management or control of the business or affairs of Heritage  L.P.  Amendment of
the partnership  agreement would require the consent of the general partners and
more  than  50% of the LP  Units.  Heritage  L.P.  will be  dissolved  upon  the
occurrence of certain specified and limited events or December 31, 2086.

         In connection with the acquisition of the Winton  Properties,  Heritage
LP issued  943,705 LP Units to the sellers and 705,386 LP Units to the  Company.
In connection with the  acquisition of three apartment  communities in April and
May, 1997,  Heritage LP issued an additional 274,350 LP Units to the Company. As
of June 30,  1997,  Heritage LP had  1,923,441  LP Units  outstanding,  of which
979,736  Units  (50.94%)  were  owned by the  Company.  Heritage  LP  declared a
distribution of $0.50 per Unit for the quarter ended June 30, 1997 that was paid
in July.
                                       11
<PAGE>
                           ASR INVESTMENTS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


4.  MORTGAGE ASSETS

         In April 1997, the Company redeemed two assets for proceeds of $715,000
and income of  $341,000.  In June 1997,  the Company  sold all of its  remaining
mortgage assets for $13,350,000 and a gain of $10,970,000.  The Company paid off
the related  short-term  borrowing of  $500,000.  During the first six months of
1997, the Company  received a total of $20,880,000 from the sale of the mortgage
assets and realized total redemption income of $16,650,000. During the first six
months of 1996,  the  Company  received a total of  $6,000,000  from the sale or
redemption  of  mortgage  assets  and  realized  total   redemption   income  of
$4,987,000.

5.       NOTES PAYABLE

         During the second  quarter of 1997,  the Company  obtained new mortgage
loans or assumed  existing  mortgage loans  totalling  $75,605,000 in connection
with its apartment acquisitions.  At June 30, 1997, the total permanent mortgage
loans had a weighted average stated rate of 8.2%.

         As  discussed  in  Note 2,  the  Company  has  obtained  a  $15,350,000
construction  loan to  finance  the  construction  of its  Finisterra  apartment
community.  The loan bears  interest at 1% per annum above the bank's prime rate
(8.5%).  At June 30, 1997 and December 31, 1996,  the amount  outstanding on the
loan was $12,547,000 and $255,000, respectively.

6.  RELATED PARTY TRANSACTIONS

         From the inception of the Company through April 30, 1997, Pima Mortgage
L.P.  (the  "Manager"),  managed the  operations  of the  Company  pursuant to a
management agreement.  The Company also had a property management agreement with
Pima Realty  Advisors,  Inc. (the "Property  Manager") for each of its apartment
communities.  The Manager and the Property Manager were owned by three principal
executive officers of the Company.  On April 30, 1997,  pursuant to the approval
of the Company's stockholders,  the Company acquired the entire interests in the
Manager and the Property  Manager for 262,008 shares of common stock. The shares
are  recorded at $20.038 per share  which was the average  closing  price of the
common stock for the ten days preceding the public announcement of
                                       12
<PAGE>
                           ASR INVESTMENTS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


the  acquisition.  In  addition,  the  Company  also  paid the  three  principal
executive  officers  $802,700 in connection  with the  acquisition of the Winton
Properties. As the contracts with the Pima entities were effectively terminated,
the cost of the Pima  entities  and the amounts paid to the  executive  officers
were recorded as an acquisition  related expense in the accompanying  statements
of income.

         The Company paid the Manager  management fee and  administrative fee of
$84,000 and  $219,000  for the  quarter  and six months  ended June 30, 1997 and
$165,000  and  $313,000  for the same  periods  of 1996.  The  Company  paid the
Property  Manager $45,000 and $190,000 for the quarter and six months ended June
30, 1997 and $90,000 and $202,000, for the same periods of 1996.
                                       13
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


General

         ASR Investments Corporation (the "Company") is a real estate investment
trust  engaged   primarily  in  the   acquisition  and  operation  of  apartment
communities in the southwestern United States. At December 31, 1996, the Company
owned 3,093  units.  In March 1997,  the Company  acquired a 266-unit  apartment
community.  In April 1997, the Company acquired a 257-unit apartment  community.
On April 30,  1997,  the Company  acquired 13 apartment  communities  containing
2,260 units and one office building (the "Winton Properties").  In May 1997, the
Company  acquired two  apartment  communities  totalling  526 units and sold its
investment in joint  ventures.  At June 30, 1997, the Company owned 36 apartment
communities with a total of 6,347 units and an office  building.  As the Company
acquired these new properties  throughout the quarter, its operating results for
the  quarter  ended June 30, 1997  include  only a partial  quarter's  operating
results of the new properties  acquired.  Their full  quarterly  results will be
reflected in the quarter ending September 30, 1997.

         In connection with the acquisition of the Winton  Properties,  on April
30,  1997,  the  Company  also  acquired  (i) Winton  Associates  (the  property
management company for the Winton Properties),  (ii) Pima Realty Advisors,  Inc.
(the  Company's  Property  Manager) and (iii) Pima Mortgage L.P. (the  Company's
Manager).

         In June 1997,  the Company sold all its remaining  mortgage  assets for
$13,350,000 for a gain of  $10,970,000.  For the six months ended June 30, 1997,
the Company received  $22,277,000 from the mortgage assets. The Company plans to
invest a majority  of this  amount in  additional  apartment  communities.  As a
result of the sale of all of its mortgage  assets,  the Company will not realize
any mortgage asset cash flows or income in future periods.
                                       14
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


Results of Operations

Comparison of Quarters Ended June 30, 1997 and 1996

         Real Estate  Operations  - Real estate  operating  income and  expenses
increased  substantially  primarily due to acquisitions  made on April 30, 1997.
Below are the operating  results of the new  communities for the period owned by
the Company during the second quarter of 1997 (in thousands):

         Rental and other income                                       $  3,432
         Property management income                                          46
                                                                       --------
         Total real estate revenues                                       3,478
                                                                       --------
         Operating & maintenance expenses                                 1,166
         Property management expenses                                        63
         Real estate taxes & insurance expenses                             451
         Interest expense                                                 1,072
         Depreciation expense                                               683
                                                                       --------
         Total real estate operating expenses                             3,435
                                                                       --------
         Income from real estate                                       $     43
                                                                       ========

         On the "same store" basis (i.e.,  for  properties  owned by the Company
during the second  quarter of 1996),  the  Company  realized  (i) an increase of
$65,000 in rental income  (primarily in the Houston market) and (ii) an increase
of $29,000 in operating  expenses  (primarily in the Albuquerque  market).  As a
result of the sale of the Company's interest in joint ventures,  income from the
joint ventures decreased by $16,000.

         The gain on sale of real estate of $474,000  resulted  from the sale of
the Company's  interest in the joint ventures in May of 1997. The Company had no
sales of real estate in 1996.

         Mortgage  Assets  -  Prospective  yield  income  decreased  due  to the
decrease  in  the  mortgage  asset  balance  as a  result  of  amortization  and
redemptions and to the sale of the entire mortgage asset portfolio in June 1997.
Interest expense on mortgage assets decreased due to lower short-term  borrowing
as well as the full repayment in June 1997.
                                       15
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


         Administrative Expenses,  Acquisition Related Expenses and Other Income
Administrative  expenses  increased by $139,000  primarily as a result of (i) an
increase in expense accruals for stock appreciation  rights of $93,000 due to an
increase  in  the  Company's   common  stock  price  and  (ii)  an  increase  of
approximately $44,000 in accounting and tax consulting fees. Acquisition related
expenses of $6,215,000  relates to (i) the acquisition of the Company's  Manager
and Property  Manager for $5,250,000  (see Note 6), (ii) $802,700 paid its three
principal  executive  officers  who are also owners of the Manager and  Property
Manager in connection with the acquisition of the Winton Properties (see Note 6)
and (iii) $162,000 in other  expenses  related to the Winton  Properties.  Other
income increased by $39,000 due to interest earned on the Company's cash balance
which was higher during the 1997 quarter compared with the 1996 quarter.

Comparison of Six Months Ended June 30, 1997 and 1996

         Real Estate  Operations  - Real estate  operating  income and  expenses
increased  substantially  primarily due to acquisitions  made on April 30, 1997.
Below are the operating  results of the new  communities for the period owned by
the Company during the first six months of 1997 (in thousands):

         Rental and other income                                      $  3,441
         Property management income                                         46
                                                                      ---------
         Total real estate revenues                                      3,487
                                                                      ---------
         Operating & maintenance expenses                                1,253
         Property management expenses                                       63
         Real estate taxes & insurance expenses                            451
         Interest expense                                                1,072
         Depreciation expense                                              683
                                                                      ---------
         Total real estate operating expenses                            3,522
                                                                      ---------
         Income from real estate                                     ($     35)
                                                                      =========

         On the "same store" basis (i.e.,  for  properties  owned by the Company
during the first six months of 1996),  the Company  realized  (i) an increase of
$105,000 in rental income (primarily in the Houston market) and (ii) an increase
of  $99,000  in  operating  expenses.  As a result of the sale of the  Company's
interest in joint ventures, income from the joint ventures decreased by $10,000.
                                       16
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


         The gain on sale of real estate of $474,000  resulted  from the sale of
the Company's  interest in the joint ventures in May of 1997. The Company had no
sales of real estate in 1996.

         Mortgage  Assets  -  Prospective  yield  income  decreased  due  to the
decrease  in the  mortgage  asset  balance as a result of (i)  amortization  and
redemptions  in 1996  and the  first  quarter  of 1997  and (ii) the sale of the
entire  mortgage  asset  portfolio  in June 1997.  Interest  expense on mortgage
assets decreased due to lower short-term borrowing as well as the full repayment
in June 1997.

         Administrative Expenses,  Acquisition Related Expenses and Other Income
Administrative  expenses increased by $608,000 for the six months ended June 30,
1997  primarily  as a result  of an  increase  in  expense  accruals  for  stock
appreciation  rights of $672,000  due to an increases  in the  Company's  common
stock price.  The increases were  mitigated by a decrease in management  fees of
$39,000 as the management contract was terminated on April 30,1997.  Acquisition
related  expenses of $6,215,000  relates to (i) the acquisition of the Company's
Manager and Property Manager for $5,250,000 (see Note 6), (ii) $802,700 paid its
three  principal  executive  officers  who are also  owners of the  Manager  and
Property  Manager in connection  with the  acquisition of the Winton  Properties
(see  Note 6) and  (iii)  $162,000  in  other  expenses  related  to the  Winton
Properties.  Other income  increased  by $186,000 due to interest  earned on the
Company's  cash  balance  which was  higher  during the first six months of 1997
compared with the same period in 1996.

         Income from Mortgage  Redemption  and Sales - As discussed  above,  the
Company has, from time to time,  redeemed or sold mortgage assets. In June 1997,
the  Company  sold  all of  its  remaining  mortgage  assets  for  approximately
$13,350,000 and a gain of  $10,970,000.  As a result of the sale, the Company no
longer owns any mortgage assets and will not realize any additional cash flow or
income from mortgage  assets.  The Company plans to use the proceeds to purchase
additional apartment communities that are under evaluation.

         The  Company  expects  net  income  for future  periods  will  decrease
substantially  because  of the  additional  depreciation  expense  from  the new
apartment communities and the absence of income from mortgage assets.
                                       17
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          For the Quarters and Six Months Ended June 30, 1997 and 1996

         Funds From Operations - The Company believes that funds from operations
("FFO") is one of the appropriate measures of performance of an equity REIT. FFO
is generally  defined as net income plus  certain  non-cash  charges  (primarily
depreciation  and  amortization),  less  gains  from  sales of assets  and after
adjustments for unconsolidated partnerships and joint ventures. As a result, FFO
provides  a view of a REIT's  performance  without  regard to  depreciation  and
amortization  and gains on sales of assets.  The Company has made the  following
adjustments in calculating  FFO, as modified:  (i) income from  redemptions  and
sales of mortgage assets is excluded as the Company  considers such income to be
similar  in nature to gains  from sales of real  estate;  certain  non-recurring
charges  are added back as the charges  relate to a defined and limited  period;
and (iii) while the stock options that carry dividend equivalent rights ("DERs")
are  anti-dilutive,  they are included in the FFO per share  calculation  as the
Company believes the options are likely to be exercised by their expiration date
of December  16, 1998  because the  exercise  price is  substantially  below the
current stock price.

         As not all  REITs  and  financial  analysts  calculate  FFO in the same
manner,  FFO as  reported  herein  may not be  comparable  to  similarly  titled
measures as reported by other REITs. FFO, as modified,  should not be considered
as an  alternative  to net  income  (determined  in  accordance  with  generally
accepted  accounting   principles)  as  an  indication  of  Company's  financial
performance  or  to  cash  flow  through  operating  activities  (determined  in
accordance with generally accepted accounting principles) as FFO excludes income
from sales and  redemptions  of mortgage  assets that are  included in cash flow
through operating activities and (ii) FFO is not adjusted for changes in accrual
as is cash flow from operating activities.  FFO is not necessarily indicative of
available  cash flow to fund all of the Company's  needs.  The Company  believes
that in order to facilitate a clear understanding of the consolidated historical
operating  results of the Company,  FFO should be considered in conjunction with
net income as presented in the consolidated financial statements.

         Calculation of FFO, as modified, for the six months ended June 30, 1997
         is as follows (in thousands except per share amounts):
                                       18
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


                                                                   Pro Forma
                                                                   Combined (**)
                                                      Six Months   Six Months
                                                      ----------   -----------
         Net Income                                   $ 10,174     $ 10,242
         Depreciation and amortization                   2,146        3,875
         Certain non-recurring charges (*)               6,953        6,953
         Dividend equivalent rights                        340          340
         Income from redemptions and sales of
               mortgage assets                         (16,650)     (16,650)
         Gain on sale of real estate                      (474)        (474)
                                                      --------     --------
         Funds from operations                        $  2,489     $  4,286
                                                      ========     ========

         Average shares of common stock and
                  common stock equivalents               3,938        5,379
         Effect of assumed exercise of stock options       188          188
                                                      --------     --------
         Assumed number of shares                        4,126        5,567
                                                      ========     ========

         FFO per share                                $   0.60     $   0.77
                                                      ========     ========

         (*) -  Non-recurring  charges relate to stock  appreciation  rights for
         certain   employees,    acquisition-related   expenses   and   contract
         termination expense.

         (**) - The selected  unaudited  pro forma data for the six months ended
June 30, 1997 have been prepared as if the 1997  acquisitions,  described  below
under  "1997  Acquisitions",  had  occurred at January 1, 1997 (See Note 2). The
proforma data are provided for information  purposes only and are not indicative
of the results that would have occurred or which may occur in the future.

         The  Company  expects  its  FFO to  increase  as (i) it  completes  the
construction of its Finisterra  Apartments in September 1997 and (ii) it invests
the proceeds from the sale of the mortgage assets. The above FFO data,  however,
are not  necessarily  indicative  of the FFO amounts for future  periods as they
will depend on the performance of the existing apartment communities and as well
as new communities.
                                       19
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


Liquidity, Capital Resources and Commitments

         Comparison  of Six Months Ended June 30, 1997 and 1996 - Cash  provided
by operations  for the six months ended June 30, 1997 was  $19,919,000  compared
with $7,568,000 for the same period in 1996. The increase was primarily a result
of a  $11,663,000  increase  in income  from  redemptions  and sales of mortgage
assets  ($16,650,000  for the  six  months  ended  June  30,  1997  compared  to
$4,987,000  for the same  period in 1996),  which was  mitigated  by a  $981,000
decrease in prospective yield income on the mortgage assets.

         Cash used in  investing  activities  for the six months  ended June 30,
1997 was  $10,340,000  compared with  $860,000 for the same period in 1996.  The
increase in cash usage of $9,480,000  reflects (i) an increase of $10,208,000 in
investments  in  apartments  primarily as a result of the  acquisitions  made in
1997,  while making no  acquisitions  in 1996, (ii) an increase of $2,361,000 of
construction  expenditures for the Company's  Finisterra apartment community and
(iii) an increase of $2,418,000 in restricted cash related primarily to the 1997
acquisitions of apartment communities.  The increase in cash usage was mitigated
by (i) an increase of  $2,025,000  in the  reduction  in mortgage  assets,  (ii)
$3,178,000 from joint venture distributions and proceeds resulting from the sale
of the  Company's  interest  in such joint  ventures  and (iii) net  increase of
$304,000 in cash provided by other real estate and land held for development.

         Cash provided by financing activities for the six months ended June 30,
1997  was  $5,719,000  compared  with  cash  used  in  financing  activities  of
$3,682,000 for the same period in 1996. The increase of $9,401,000  reflects (i)
an increase in the issuance of real estate notes payable of  $3,000,000  related
to the acquisitions made during 1997, with no similar purchases in 1996, (ii) an
increase of $12,049,000 in proceeds from the Finisterra Apartment's construction
loan and (iii) an increase of $17,000  from the exercise of stock  options.  The
increase  was  mitigated by (i) an increase of $638,000 in payments of dividends
due to the stock issuance in 1997, (iv) an increase in distributions on LP Units
of  $471,000  as the LP Units did not  exist in 1996,  (iii) a  decrease  in the
accrued  construction  cost payable of $3,003,000 for the  Finisterra  Apartment
community, (iv) an increase of $1,048,000 in loan fees related to the properties
acquired in 1997,  (v) an increase  of $481,000 in the  acquisition  of treasury
stock and (vi) a net  increase in payments on real estate  loans and  short-term
borrowing of $24,000.
                                       20
<PAGE>
                           ASR INVESTMENTS CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          For the Quarters and Six Months Ended June 30, 1997 and 1996


         1997  Acquisitions  - In March 1997,  the  Company  acquired a 266-unit
apartment  community  for  $4,450,000  and  obtained  a first  mortgage  loan of
$3,700,000  with a fixed rate of 8.39%.  The  Company  issued  86,500  shares of
common stock for net proceeds of  $1,622,000 to provide for the cash used in the
acquisition.  The  Company  plans  to spend  $700,000  on  numerous  substantive
improvements to the community.

          On April  30,  1997,  the  Company  completed  the  acquisition  of 13
apartment  communities  containing  2,260  units  located in Houston and Dallas,
Texas and  Pullman,  Washington,  and one office  building  located in  Seattle,
Washington  (the  "Winton  Properties").  The sellers  were 15 separate  limited
partnerships in which Don W. Winton was the general partner.  The total purchase
price of the properties was approximately  $83,223,000.  The Company (i) assumed
or refinanced  first mortgage loans totalling  $49,396,000,  (ii) issued 682,095
shares of common stock, (iii) issued operating  partnership units convertible to
943,705  shares of common stock of the Company after one year, and (iv) paid the
sellers  $1,250,000 for  transaction  costs. As a part of the  acquisition,  the
Company issued 70,284 shares of common stock to acquire the entire  interests in
Winton & Associates, the property management company for the Winton Properties.

         In  April  1997,  the  Company  acquired  an  apartment  community  for
$6,000,000 and obtained a first  mortgage loan for $4,400,000  with a fixed rate
of 8.57%.  On May 9, 1997,  the Company  acquired  an  apartment  community  for
$4,059,000 and obtained a first mortgage loan of $2,900,000 with a fixed rate of
8.67%. The Company expects to invest $1,000,000 in capital improvements in these
two communities. The Company issued 187,847 shares of common stock for total net
proceeds of $3,394,000 to pay for the two purchases.

         On May 1, 1997,  the  Company  acquired  the  remaining  interest in La
Privada  Apartments  L.L.C.  for  $8,233,000.  The La  Privada  Apartments  is a
350-unit community in Scottsdale,  Arizona. The Company also sold to its partner
the Company's  entire  interests in the other five joint  ventures for total net
proceeds  of  $2,062,000.  The  Company  obtained a  $3,000,000  loan that bears
interest at LIBOR plus 3%.

         With the above  acquisitions,  the total monthly principal and interest
payments on the real estate mortgage loans are approximately $1,023,000, and the
monthly  deposits to loan escrow  accounts for  property  taxes,  insurance  and
capital replacements are
                                       21
<PAGE>
approximately  $464,000.  The Company estimates that it will spend approximately
$1,674,000  during the remainder of 1997 in capital  replacement and improvement
expenditures.

         Concurrent with the acquisition of the Winton  Properties,  the Company
acquired the entire interests in Pima Mortgage and Pima Realty (collectively the
"Pima Entities") in exchange for 262,008 shares of its common stock. The cost of
the  acquisition of $5,250,000 is assigned to the contracts  between the Company
and the Pima  Entities.  In  addition,  the  Company  paid its  three  principal
executive  officers  who are  also  owners  of the  Pima  Entities  $802,700  in
connection with the acquisition of the Winton Properties.  As the contracts with
the Pima Entities were effectively terminated, the cost of the Pima Entities and
the amounts paid to the executive officers were recorded as acquisition  related
expenses in the second quarter of 1997.

         The Company  anticipates that the above acquisitions will result in (i)
significant increases in the Company's gross income and operating expenses, (ii)
an increase in interest expenses on real estate  mortgages,  (iii) a decrease in
administrative  expenses  resulting  from the  replacement  of  management  fees
previously  paid to the Pima Entities by Company with salaries that are now paid
to the owners of the managers who have become employees of the Company as of May
l, 1997.

         Cash Balances - At June 30, 1997, the Company had cash of  $17,701,000.
The  Company  intends to use such  funds for  acquiring  apartment  communities,
making capital improvements on existing apartment communities,  paying dividends
and other corporate uses.



Other Information

         Apartment  leases  generally  are  for  terms  of  six  to  12  months.
Management  believes that such short-term  leases lessen the impact of inflation
as a result of the  ability to adjust  rental  rates to market  levels as leases
expire.
                                       22
<PAGE>
                           ASR INVESTMENTS CORPORATION
                          QUARTERLY REPORT ON FORM 10-Q
                       For the Quarter Ended June 30, 1997


                                     PART II

                                OTHER INFORMATION

Item 1.           Legal Proceedings - None
                  -----------------

Item 2.           Changes in Securities - Not applicable
                  ---------------------

Item 3.           Defaults Upon Senior Securities - Not applicable
                  -------------------------------

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

         (a) A special  meeting of the  stockholders  of the Company was held on
April 23, 1997 at 9:00 a.m.,  at the  Viscount  Suite Hotel,  4855 E.  Broadway,
Tucson,  Arizona.  There were 3,147,150 shares outstanding on the date of record
for the special meeting.

         (b) As  described  in the Proxy  Statement  dated March 27,  1997,  the
Company entered into a Master Combination and Contribution Agreement pursuant to
which the  Company  would  acquire up to 13  apartment  communities,  one office
building  and a related  property  management  company as well as the  Company's
manager and property manager.  The proposals were approved and the votes were as
follows:

         Proposal 1a, the approval of the Combination Proposal:

           FOR        AGAINST         ABSTAIN             BROKER NON-VOTE
           ---        -------         -------             ---------------
         829,750      119,500          60,603                1,455,268

         Proposal  1b(i),  the approval of the acquisition of the 14 properties,
related  management  company and other  related  components  of the  Combination
Proposal:

           FOR        AGAINST         ABSTAIN             BROKER NON-VOTE
           ---        -------         -------             ---------------
         760,235      111,174          32,263                1,561,235
                                       23
<PAGE>
         Proposal 1 b(ii), the approval of the components related to the mergers
of the Company's  manager and property  management  company and the amendment to
Section 3.08 of the Bylaws of the Company.

           FOR        AGAINST         ABSTAIN             BROKER NON-VOTE
           ---        -------         -------             ---------------
         747,197      119,081          37,611                1,561,235

         Proposal 2, approval and adoption of the Amendment and  Restatement  of
the Amended and  Restated  Articles of  Incorporation  of the Company to include
additional provisions designed to further protect the Company's status as a real
estate investment trust:

           FOR        AGAINST         ABSTAIN             BROKER NON-VOTE
           ---        -------         -------             ---------------
         2,351,432     76,326          37,363                    0


Item 5.           Other Information - Not applicable
                  -----------------

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

         (a)  Exhibits - 27.1 Financial Data Schedule (For SEC use only)

         (b) Reports on Form 8-K:

         A report on Form 8-K dated  April 30,  1997 and filed on May 15,  1997,
reporting the acquisition of 14 properties and the related  property  management
company  (Winton & Associates),  the Company's  manager (Pima Mortgage L.P.) and
the Company's property manager (Pima Realty Advisors, Inc.).

         A Form  8-K/A-1,  dated  April  30,  1997,  was  filed on June 6 , 1997
amending the Form 8-K filed on May 15, 1997 to include (i) historical summary of
revenues and certain operating expenses for the year ended December 31, 1996 and
the three  months  ended  March  31,  1997,  (ii)  proforma  combined  financial
statements  for the quarter ended March 31, 1997 and the year ended December 31,
1996 and (iii) other  financial  information  and exhibits for the  acquisitions
described in the 8-K.

         A Form 8-K, dated June 4, 1997,  was filed on June 17, 1997,  reporting
the sale of all the Company's mortgage assets.
                                       24
<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.


ASR INVESTMENTS CORPORATION


Mary C. Clements                       Joseph C. Chan
-------------------------              ------------------
Mary C. Clements                       Joseph C. Chan
Controller                             Executive Vice President,
August 13, 1997                        Chief Operating Officer,
                                       Chief Financial and Accounting Officer
                                       August 13, 1997