SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549
                          ----------------------

                                FORM 10-KSB

[x] Annual Report pursuant to Section 13 or 15(d) of the Securities
    Exchange Act of 1934

For the fiscal year ended June 30, 2002

[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
    Exchange Act of 1934

Commission file number 0-6877


                       SANTA FE FINANCIAL CORPORATION
                       ------------------------------
                (Name of Small Business Issuer in Its Charter)

            Nevada                                      95-2452529
   ------------------------------                    ------------------
  (State or Other Jurisdiction of                    (IRS Employer
   Incorporation or Organization)                    Identification No.)


  820 Moraga Drive, Los Angeles, California               90049
  -----------------------------------------             ----------
  (Address of Principal Executive Offices)              (Zip Code)

                               (310) 889-2500
              ----------------------------------------------------
              (Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Exchange Act: None

Securities registered pursuant to Section 12(g) of the Exchange Act:

                          $.10 Par Value Common Stock
                          ---------------------------
                                (Title of Class)

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

    Check if there is no disclosure of delinquent filers pursuant to Item 405
of Regulation S-B contained in this form, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendments to
this Form 10-KSB.  [X]

    The issuer's revenues for the year ended June 30, 2002 were $2,499,857.

                                                                 Page 1 of 46
<PAGE>



The aggregate market value of the common equity held by non-affiliates of
issuer computed by reference to the price at which the stock sold on September
10, 2002 was $5,479,744.

The number of shares outstanding of issuer's $.10 Par Value Common Stock, as
of September 13, 2002, was 1,178,210.

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




                     DOCUMENTS INCORPORATED BY REFERENCE: None


                            TABLE OF CONTENTS

PART I                                                              PAGE

    Item  1.  Description of Business.                                3

    Item  2.  Description of Property.                                4

    Item  3.  Legal Proceedings.                                      7

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

PART II

    Item  5.  Market For Common Equity and Related                    8
              Stockholder Matters.

    Item  6.  Management's Discussion and Analysis of Financial       9
              Condition and Results of Operations.

    Item  7.  Financial Statements and Supplementary Data.            15

    Item  8.  Changes in and Disagreements with Accountants on        30
              Accounting and Financial Disclosure.

PART III

    Item  9.  Directors, Executive Officers, Promoters and            30
              Control Persons; Compliance with Section 16(a)
              of The Exchange Act.

    Item 10.  Executive Compensation.                                 32

    Item 11.  Security Ownership of Certain Beneficial Owners and     33
              Management.

    Item 12.  Certain Relationships and Related Party Transactions.   35

    Item 13.  Exhibits, Financial Statement Schedules, and            36
              Reports on Form 8-K.

SIGNATURES                                                            45


                                                                Page 2 of 46
<PAGE>


                                   PART I

Item 1.  Description of Business.

BUSINESS DEVELOPMENT

Santa Fe Financial Corporation ("Santa Fe" or the "Company") was incorporated
under the name of Tri Financial Corporation in the State of Nevada on July 25,
1967 as a wholly owned subsidiary of Crateo, Inc, a public company.  On
October 31, 1969, Crateo issued a one-for-one stock dividend of all of its
shares of Tri Financial to its common shareholders.  On September 17, 1970,
the name of the Corporation was changed to Santa Fe Financial Corporation.

Since 1988, the Company's principal source of revenue has been, and continues
to be, derived from the management of its 68.8% owned subsidiary, Portsmouth
Square, Inc. ("Portsmouth").  Portsmouth has a 49.8% limited partnership
interest in the Justice Investors limited partnership ("Justice Investors")
and also serves as one of the two general partners.  The other general
partner, Evon Garage Corporation ("Evon"), acts as the managing general
partner; however, the overseeing of operations and all significant partnership
decisions require the active participation and approval of both general
partners.  The Company and Evon jointly consult and determine the amount of
partnership reserves and the amount of cash to be distributed to the limited
partners.  There are approximately 94 limited partners in Justice Investors.
Other than its role as a general and limited partner of Justice Investors,
Portsmouth has no other operations at this time.

Pursuant to the terms of the partnership agreement, voting rights of the
partners are determined according to the partners' entitlement to share in the
net profit and loss of the partnership.  The Company is not entitled to any
additional voting rights by virtue of its position as a general partner.
The partnership agreement also provides that no portion of the partnership
real property can be sold without the written consent of the general and
limited partners entitled to more than 72% of the net profit.

The Company owns a controlling 55.4% equity interest in Intergroup Woodland
Village, Inc. ("Woodland Village"), which owns a 27-unit multi-family
apartment complex located in Los Angeles, California. The Company also owns
owns a 3-unit apartment building located in Los Angeles, California, through
its 100% owned subsidiary, 614 Acanto Properties, Inc. ("Acanto").


BUSINESS OF ISSUER

The Company's principal business is to purchase and manage real estate
operations.  The real estate properties include the land, improvements and
leaseholds at 750 Kearny Street, San Francisco, California commonly known as
the Holiday Inn Financial District/Chinatown ("Holiday").  The interest in
this property is held by the Justice Investors partnership.  The most
significant income source is a lease between the partnership and Felcor
Lodging Trust, Inc. ("Felcor", NYSE: FCH) for the hotel portion of the
property.  The partnership also derives income from its lease of the garage
portion of the property to Evon.  Santa Fe and Portsmouth jointly oversee
their interest in the operations of the hotel and the parking garage as part
of its effort to improve revenues.

The Company's operations also include a controlling interest in a 27-unit
multi-family apartment complex and a 3-unit apartment building located in Los
Angeles, California.  The Company also derives income from the investment of
its cash and securities assets.  The Company has invested in income-producing
instruments, equity and debt securities and will consider other investments if
                                                              Page 3 of 46
<PAGE>

such an investment will offer growth or profit potential.  For further
information on the Company's investments see Item 2 Investment Policies, Item
6 Management's Discussion and Analysis of Financial Condition and Results of
Operations and the Notes to Consolidated Financial Statements.


COMPETITION

The hotel is part of Holiday Inn's worldwide reservation system.  It was
designed to Holiday Inn's specifications to serve both business people and
tourists and caters to both individuals and tour groups.  It also handles
conferences and business meetings, having meeting and dining facilities for
groups of up to 400 people.  The hotel traditionally enjoyed a favorable year-
round occupancy rate.  In November 2001, an Omni Hotel opened in the Financial
District of San Francisco.  The Omni is a more upscale facility providing
greater amenities to its guests, especially the business traveler.  At least
one other hotel is scheduled to open within the next year.  With the impact
that the terrorist attacks of September 11, 2001 had on airline travel,
tourism and the general economy, newer and more upscale properties, such as
the Omni, have lowered room rates in an effort to capture a greater market
share.  Management believes that the hotel and garage are now in a very
challenging market, with many competitors better positioned to attract the
business traveler and tourists.  The Company will continue to work with the
managing general partner to find ways to improve the physical condition and
amenities of the hotel, influence the marketing efforts of the lessee, and to
seek other ways for the property to remain competitive.

All of the multi-family apartment buildings owned by the Company are in areas
where there is substantial competition.  However, management believes that the
properties are generally in a competitive position in their respective
communities.  The Company intends to continue upgrading and improving the
physical condition of its existing properties and to consider selling existing
properties and re-investing in properties that may require renovation but that
offer greater appreciation potential.


EMPLOYEES

As of June 30, 2002, the Company had two full-time employees.  The employees
are not part of any collective bargaining agreement, and the Company believes
that its employee relations are satisfactory.


Item 2. Description of Property.

PROPERTIES

As of June 30, 2002, Santa Fe's investments in real property consisted of a
San Francisco hotel and two Los Angeles, California apartment buildings.

San Francisco, California Hotel.

The San Francisco hotel property owned by Justice Investors is located near
the Financial District, one block from the Transamerica Pyramid.  Embarcadero
Center is within walking distance.  Chinatown is directly across the bridge
that runs from the hotel to Portsmouth Square Park.  The hotel is a 31-story,
steel and concrete, A-frame building that contains 566 guest rooms situated on
22 floors.  One floor houses the Chinese Culture Center pursuant to a long-
term, nominal rent lease, and three floors are devoted to a reservation desk,
lobby shops, dining room, coffee shop, hotel support facilities, a fitness
center, a guest business center, meeting and banquet

                                                               Page 4 of 46
<PAGE>

rooms and offices.  Other features of the Holiday Inn include a rooftop
swimming pool, 5-storied underground garage and pedestrian bridge across
Kearny Street connecting the hotel and the Chinese Culture Center with
Portsmouth Square Park in Chinatown.  The bridge, built and owned by the
partnership, is included in the lease to the Chinese Culture Center.

On March 15, 1995, Justice Investors entered into an amended and restated
lease with an effective date of January 1, 1995.  That lease was assumed by
Felcor, effective July 28, 1998.  The initial term of the new lease is for a
10-year term expiring on December 31, 2004. The lessee also has an option to
renew the lease for one additional term of five years which would extend the
lease to December 31, 2009.  The lease requires the lessee to pay an annual
rent of the greater of twenty percent (20%) of gross room revenues or
$2,500,000 plus fifty percent (50%) of total revenues from the demised
premises less operating expenses, base rent and capital requirements. Under
the terms of the lease, the lessee is responsible for all maintenance and
repairs to the property, certain capital improvements, taxes and insurance.
In the opinion of management the property is adequately covered by insurance.

The garage lease between the partnership and Evon provides for a monthly
rental of sixty percent (60%) of gross parking revenues with a minimum rent of
$21,750 per month.  That lease expires in November 2010.  The lessee is
responsible for insurance, repairs and maintenance, utilities and all taxes
assessed against the improvements to the leased premises.  The garage is
operated by Ampco Parking pursuant to a sublease agreement with Evon.


Los Angeles, California Apartment Buildings

The property owned by the Company's 55.4% subsidiary Woodland Village, is a
27-unit apartment complex located Los Angeles, California. The Company's
equity interest in Woodland Village was acquired on December 31, 1997 at a
cost of $858,600.  For the year ended June 30, 2002, real estate property
taxes were approximately $44,960.  Depreciation is recorded on the
straight-line method based upon an estimated useful life of 40 years. As of
June 30, 2002, the outstanding mortgage balance was $1,905,942.  The mortgage
carries an interest rate of 7.73% and matures in October 2029.  In addition to
the mortgage, as part of the initial purchase of the property, Woodland
Village obtained two 5-year interest only loans of $201,928 and $162,563 from
the Company and the Company's parent, The InterGroup Corporation
("InterGroup"), respectively.  Both notes mature in September 2004.  The
$201,928 note was eliminated in consolidation.

The second Los Angeles property, Acanto, is a two-story apartment building
with 3 units.  The property was acquired on February 1, 2002 at an initial
cost of $785,390.  For the period ended June 30, 2002, real estate property
taxes were approximately $4,258.  Depreciation is recorded on the straight-
line method, based upon an estimated useful life of 40 years.  The outstanding
mortgage balance was approximately $460,798 at June 30, 2002 and the maturity
date of the mortgage is February 2032.  The interest rate is 6.45% for the
first 60 months.  Beginning February 2005, the interest rate will be adjusted
to 2.6% in excess of the rate of the savings, borrowings and advances of the
Federal Home Loan Bank of San Francisco to Eleventh District members.  The
interest rate cannot exceed 11.95% or fall below 6.45%

Woodland Village and Acanto lease units in the apartment buildings on a short-
term basis, with no lease extending beyond one year.  The effective rental
rate per rental unit of Woodland Village and Acanto was approximately $13,377
and $20,488, respectively.   As of June 30, 2002, Woodland Village and Acanto
were 93% and 10% occupied, respectively.  In the opinion of management the
properties are adequately covered by insurance.

                                                                Page 5 of 46
<PAGE>

INVESTMENT POLICIES

The most significant real estate investment of the Company is the San
Francisco hotel through its control of Portsmouth.  The Company will continue
to explore ways to increase the value of Justice Investors and to improve
operations of the hotel.  The Company has also invested in multifamily
residential properties through its controlling interest in Woodland Village
and its 100% owned subsidiary Acanto.

The Company may also look for new real estate investment opportunities in
hotels, apartments, office buildings and shopping centers.  The acquisition of
any new real estate investments will depend on the Company's ability to find
suitable investment opportunities and the availability of sufficient financing
to acquire such investments.  To help fund any such acquisition, the Company
plans to borrow funds to leverage its investment capital.  The amount of this
mortgage debt will depend on a number of factors including, but not limited
to, the availability of financing and the sufficiency of the project's
projected cash flows to support the operations and debt service.

The Company also invests from time to time in income producing instruments,
corporate debt and equity securities, mortgage backed securities, securities
issued by REIT's and other companies which invest primarily in real estate,
where financial benefit could inure to its shareholders through income and/or
capital gain.

The Company's securities investments are made under the supervision of a
Securities Investment Committee of the Board of Directors. The Committee
currently has three members and is chaired by the Company's Chairman of the
Board and President, John V. Winfield.  The Committee has delegated authority
to manage the portfolio to the Company's Chairman and President together with
such assistants and management committees he may engage.  The Committee has
established investment guidelines for the Company's investments.  These
guidelines presently include: (i) corporate equity securities should be listed
on the New York or American Stock Exchanges or the Nasdaq NMS Market; (ii)
securities should be priced above $5.00 per share; and (iii) investment in a
particular issuer should not exceed 5% of the market value of the total
portfolio. The investment policies do not require the Company to divest itself
of investments, which initially meet these guidelines but subsequently fail to
meet one or more of the investment criteria.  Non-conforming investments
require the approval of the Securities Investment Committee.  The Committee
has in the past approved non-conforming investments and may in the future
approve non-conforming investments.  The Securities Investment Committee may
modify these guidelines from time to time.

The Company's investment portfolio is diversified with 34 different equity
positions.  Only five individual equity securities comprise more than 5% of
the equity value of the portfolio, with the largest being 14% The amount of
the Company's investment in any particular issuer may increase or decrease,
and additions or deletions to its securities portfolio may occur, at any time.
While it is the internal policy of the Company to limit its initial investment
in any single equity to less than 5% of its total portfolio value, that
investment could eventually exceed 5% as a result of equity appreciation or
reduction of other positions.  Marketable securities are stated at market
value as determined by the most recently traded price of each security at the
balance sheet date.  As of June 30, 2002, the market value of the Company's
marketable securities was $4,726,647.


The Company may also invest, with the approval of the Securities Investment
Committee, in unlisted companies, through private placements.  Those
investments in non-marketable securities are carried at the lower of cost or
estimated fair value on the Company's balance sheet as part of other
investments.

                                                                Page 6 of 46
<PAGE>

The Company may also use exchange traded funds, options and futures to hedge
against certain stock positions and index futures to hedge against market risk
and enhance the performance of the Company's portfolio while reducing the
overall portfolio's risk and volatility.  As part of its investment
strategies, the Company may assume short positions in marketable securities.
Short sales are used by the Company to potentially offset normal market risks
undertaken in the course of its investing activities or to provide additional
return opportunities.  As of June 30, 2002, the Company had obligations for
securities sold (equities short) of $300,720.  The Company has no naked short
positions.

In addition, the Company may utilize margin for its marketable securities
purchases through the use of standard margin agreements with national
brokerage firms.  The use of available leverage is guided by the business
judgment of management and is subject to any internal investment guidelines,
which may be imposed by the Securities Investment Committee.  The margin used
by the Company may fluctuate depending on market conditions.  The use of
leverage could be viewed as risky and the market values of the portfolio may
be subject to large fluctuations.  As of June 30, 2002, the Company had a
margin balance of $92,273 and incurred $276,632 and $872,263 in margin
interest during the fiscal years ended June 30, 2002 and June 30, 2001,
respectively.

On June 28, 2001, the Company, its parent company, The InterGroup Corporation
("InterGroup") and Portsmouth entered into an agreement with an investment
advisory company, for the management of their securities portfolios.  That was
the first time that the Company had relied on an investment advisor to manage
its investments on a discretionary basis.  The results were not acceptable,
and the Company terminated its agreement with the investment advisor on
November 7, 2001.

As Chairman of the Securities Investment Committee, the Company's President
and Chief Executive Officer, John V. Winfield, directs the investment activity
of the Company in public and private markets pursuant to authority granted by
the Board of Directors.  Mr. Winfield also serves as Chief Executive Officer
and Chairman of Portsmouth and InterGroup and oversees the investment activity
of those companies.  Depending on certain market conditions and various risk
factors, the Chief Executive Officer, his family, Portsmouth and InterGroup
may, at times, invest in the same companies in which the Company invests.  The
Company encourages such investments because it places personal resources of
the Chief Executive Officer and his family members, and the resources of
Portsmouth and InterGroup, at risk in connection with investment decisions
made on behalf of the Company.


Item 3.  Legal Proceedings.

None.


Item 4.  Submission of Matters to a Vote of Shareholders.

No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year covered by this Report.


                                                                Page 7 of 46
<PAGE>

                                PART II

Item 5.  Market For Common Equity and Related Stockholder Matters.

MARKET INFORMATION

Santa Fe's common stock trades on the Small-Cap Market tier of The Nasdaq
Stock Market, Inc. ("Nasdaq") under the symbol SFEF.  The following table sets
forth the range of high and low sales prices for Santa Fe's common stock for
each full quarterly period for the fiscal years ended June 30, 2002 and June
30, 2001, as reported by Nasdaq.


Fiscal 2002                             High            Low
-----------                             -----          -----
First Quarter (7/1 to 9/30)            $13.50         $11.25
Second Quarter (10/1 to 12/31)         $12.85         $11.65
Third Quarter (1/1 to 3/31)            $14.00         $10.30
Fourth Quarter (4/1 to 6/30)           $12.40         $11.25

Fiscal 2001                             High            Low
-----------                             -----          -----
First Quarter (7/1 to 9/30)            $12.00         $ 8.75
Second Quarter (10/1 to 12/31)         $14.00         $ 9.00
Third Quarter (1/1 to 3/31)            $13.75         $10.75
Fourth Quarter (4/1 to 6/30)           $13.50         $10.10


As of September 13, 2002 the approximate number of holders of record of the
Company's Common Stock was 511.  Such number of owners was determined from the
Company's shareholders records and does not include beneficial owners of the
Company's Common Stock whose shares are held in the names of various brokers,
clearing agencies or other nominees.  There are approximately 696 beneficial
shareholders of the Company's Common Stock.


DIVIDENDS

On February 1, 2000, the Board of Directors of the Company determined that it
did not foresee the Company paying any cash dividends on its Common Stock in
the immediate future.  Instead, it is the intent of the Company to deploy its
capital in a manner to increase its operating activities.

On December 31, 1997, the Company issued 31,800 shares of 6% cumulative,
convertible voting preferred stock (the "Preferred Stock")in exchange for a
55.4% interest in Woodland  from InterGroup.  As a result of the Company's
two-for-one stock split, the number of Preferred Shares was adjusted to
63,600.  Each share of Preferred Stock has a liquidation preference of $13.50
and is convertible into one share of restricted common stock of the Company at
an exercise price of $13.50 per share, with an eight-year conversion exercise
period.  The preferred stock has voting rights as if converted into common
stock.  During the year ended June 30, 2002 and 2001, the Company paid
dividends of $51,516 and $51,481, respectively.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

Santa Fe has no securities authorized for issuance under equity compensation
plans.


                                                                  Page 8 of 46
<PAGE>


Item 6. Management's Discussion and Analysis of Financial
        Condition and Results of Operations

FORWARD-LOOKING STATEMENTS AND PROJECTIONS

The Company may from time to time make forward-looking statements and
projections concerning future expectations.  When used in this discussion, the
words "estimate," "project," "anticipate" and similar expressions, are
intended to identify forward-looking statements.  Such statements are subject
to certain risks and uncertainties, such as the impact of terrorism and war on
the national and international economies, including tourism and securities
markets, general economic conditions and increased competition in the hotel
industry in the San Francisco area, partnership distributions, securities
markets, litigation and other factors, including natural disasters, and those
discussed below, that could cause actual results to differ materially from
those projected.  Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as to the date hereof.  The
Company undertakes no obligation to publicly release the results of any
revisions to those forward-looking statements, which may be made to reflect
events or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.



RESULTS OF OPERATIONS

The Company's principal sources of revenue continue to be derived from the
investment of its 68.8% owned subsidiary, Portsmouth, in the Justice Investors
limited partnership, rental income from its investments in multi-family real
estate properties and income received from investment of its cash and
securities assets.  The partnership derives most of its income from a lease of
its hotel property to Felcor and from a lease with Evon Garage Corporation.


Fiscal Year Ended June 30, 2002 Compared to Fiscal Year Ended June 30, 2001

The Company had a net loss of $5,055,325 for the year ended June 30, 2002 as
compared to net income of $2,621,641 for the year ended June 30, 2001.  This
was primarily due to the change to net losses from net gains on marketable
securities, the decrease in net equity income of Justice Investors, the
decrease in other income, a reserve for losses on other investments and the
decrease in dividend and interest income.  These were partially offset by a
decrease in margin interest, trading and management expenses.

Net gains/losses on marketable securities changed to net losses of $9,925,394
for the fiscal year ended June 30, 2002 from net gains of $1,992,196 for the
fiscal year ended June 30, 2001.  This was due to the significant decline in
the market value of the Company's investment portfolio during the twelve-month
period.  For the year ended June 30, 2002, the Company had net unrealized
losses of $7,352,254 and net realized losses of $2,573,140.  In the fourth
quarter of 2002, the Company reserved $500,000 for losses in other investments
for potential impairment of value based on the operating results of those
investments.  Gains and losses on marketable securities and other investments
may fluctuate significantly from period to period in the future and could have
a significant impact on the Company's net income.  However, the amount of gain
or loss on marketable securities and other investments for any given period
may have no predictive value and variations in amount from period to period
may have no analytical value.

                                                                  Page 9 of 46
<PAGE>


Dividend and interest income decreased to $169,975 from $703,256 as a result
of the management investing in less income yielding securities.  Margin
interest, trading and management expenses decreased to $541,487 from
$1,152,063, which were primarily due to the maintenance of lower average daily
margin balances during the current period.  Margin interest expense decreased
to $276,632 for the year ended June 30, 2002 from $872,263 for the year ended
June 30, 2001.

As previously discussed, on June 28, 2001, the Company, Portsmouth and
InterGroup entered into an agreement with an investment advisory company, for
the management of their securities portfolios.  That was the first time that
the Company had relied on an investment advisor to manage its investments on a
discretionary basis.  The results were not acceptable, and the Company
terminated its agreement with the investment advisor on November 7, 2001.
During that period of time, the Company's investment portfolio had a
significant concentration in computer software, computer technology, internet
technology and services, telecommunications, and aircraft industry sectors.
The securities in those sectors, especially those traded on The Nasdaq Stock
Market, greatly declined in that quarter and were particularly hard hit by the
events of September 11, 2001.  As a result, the Company had a significant net
decline in the market value of its securities portfolio.

Since the Company resumed management of its securities portfolio on November
8, 2001, it has sought to reposition and diversify its portfolio by individual
securities as well as by industry sectors to mitigate against market risk.
Despite those efforts, the Company's securities portfolio suffered additional
losses, especially during the fourth quarter of the fiscal year ended June 30,
2002, when securities markets further declined in the wake of corporate and
accounting scandals and loss of general investor confidence in the overall
markets.   For a more detailed discussion of the Company's marketable
securities please see the section below.

The decrease in equity in net income of Justice Investors to $2,159,887 from
$3,927,635 was primarily attributable to a 48% decrease in the total hotel and
garage revenue.  This was primarily due to the decrease in both occupancy and
room rates of the hotel during the twelve months period as a result of a slow
down in the San Francisco area economy, increased competition and the
continuing impact that the terrorist attacks of September 11, 2001 have had on
tourism and the hospitality industry in San Francisco.  The decrease in hotel
revenue was partially offset by an increase in other income of approximately
$600,000 to Justice Investors as a result of an arbitration settlement payment
from the hotel lessee during the current period relating to a rent claim.

The decrease in other income to $138,587 from $1,403,552 was primarily due to
the receipt of payment on a judgment for attorneys' fees in the amount of
$1,188,618 in November 2000.

General and administrative expenses increased to $949,195 from $837,704
primarily due to increased insurance costs, shared expenses, professional
fees and accrued wages.

The provision for income taxes changed to a tax benefit of $3,863,845 from an
expense of $2,600,449 due to the loss before taxes and minority interest
incurred during the current year.

Minority interest changed to minority benefit of $597,152 from minority
expense of $783,158 as a result of a net loss generated by the Company's
subsidiary, Portsmouth during the current year.

                                                               Page 10 or 46
<PAGE>


MARKETABLE SECURITIES

The Company invests from time to time in corporate debt and equity securities,
mortgage backed securities, securities issued by REIT's and other companies,
which invest primarily in real estate.  The following table sets forth the
composition of the Company's investment securities portfolio at the dates
indicated:

                                  At June 30, 2002          At June 30, 2001
                              ----------------          ----------------

                                Market Value               Market Value
                                ------------               ------------
Fixed income:
  Mortgage securities           $    47,072                $    63,708
  Corporate bonds                   401,716                    408,000

Corporate securities:
  Common stocks                   3,408,560                 22,943,266
  Preferred stocks                  561,485                          -

REIT's                              304,277                    319,894

Mutual Funds                              -                    124,875

Options:
  Calls                                   -                     52,650
  Puts                                    -                    499,200

Warrants                              3,537                          -
                                 ----------                  ---------
TOTAL SECURITIES ASSETS         $ 4,726,647                $24,411,593
                                 ==========                 ==========


The following table shows the composition of the Company's investment
securities portfolio by selected industry groups as of June 30, 2002.

                                                             % of Total
                                                              Investment
   Industry Group                      Market Value           Securities
   --------------                      ------------           ----------
   Metal and auto manufacturers          1,899,744               40.19%
   Telecommunication                       653,144               13.82%
   Financial Services                      521,112               11.02%
   Energy                                  509,512               10.78%
   Retail/Wholesale                        365,508                7.73%
   Computer/Technologies                   328,650                6.95%
   Real Estate Investment Trusts           304,277                6.44%
   Utilities                               104,700                2.22%
   Pharmaceutical & Health Care             40,000                0.85%
                                        ----------              -------
                                       $ 4,726,647              100.00%
                                        ==========              =======

The Company's securities investments are made under the supervision of a
Securities Investment Committee of the Board of Directors. The Committee
currently has three members and is chaired by the Company's Chairman of the
Board and President, John V. Winfield.  The Committee has delegated authority
to manage the portfolio to the Company's Chairman and President together with
such assistants and management committees he may engage.  The Committee has
established investment guidelines for the Company's investments.  These
guidelines presently include: (i) corporate equity securities should be listed

                                                                Page 11 of 46
<PAGE>

on the New York or American Stock Exchanges or the Nasdaq NMS Market; (ii)
securities should be priced above $5.00 per share; and (iii) investment in a
particular issuer should not exceed 5% of the market value of the total
portfolio. The investment policies do not require the Company to divest itself
of investments, which initially meet these guidelines but subsequently fail to
meet one or more of the investment criteria.  Non-conforming investments
require the approval of the Securities Investment Committee.  The Committee
has in the past approved non-conforming investments and may in the future
approve non-conforming investments.  The Securities investment Committee may
modify these guidelines at any time from time to time.

The Company's investment portfolio is diversified with 34 different equity
positions.  Only five individual equity securities comprise more than 5% of
the equity value of the portfolio, with the largest being 14% The amount of
the Company's investment in any particular issuer may increase or decrease,
and additions or deletions to its securities portfolio may occur, at any time.
While it is the internal policy of the Company to limit its initial investment
in any single equity to less than 5% of its total portfolio value, that
investment could eventually exceed 5% as a result of equity appreciation or
reduction of other positions.  Marketable securities are stated at market
value as determined by the most recently traded price of each security at the
balance sheet date.

The Company may also invest, with the approval of the Securities Investment
Committee, in unlisted companies, though private placements.  Those
investments in non-marketable securities are carried at the lower of cost or
estimated fair value on the Company's balance sheet as part of other
investments and are reviewed for impairment on a periodic basis.

The Company may also use exchange traded funds, options and futures to hedge
against certain stock positions and index futures to hedge against market risk
and enhance the performance of the Company's portfolio while reducing the
overall portfolio's risk and volatility.  As part of its investment
strategies, the Company may assume short positions in marketable securities.
Short sales are used by the Company to potentially offset normal market risks
undertaken in the course of its investing activities or to provide additional
return opportunities.  As of June 30, 2002, the Company had obligations for
securities sold (equities short) of $300,720.  The Company has no naked short
positions.

In addition, the Company may utilize margin for its marketable securities
purchases through the use of standard margin agreements with national
brokerage firms.  The use of available leverage is guided by the business
judgment of management and is subject to any internal investment guidelines,
which may be imposed by the Securities Investment Committee.  The margin used
by the Company may fluctuate depending on market conditions.  The use of
leverage could be viewed as risky and the market values of the portfolio may
be subject to large fluctuations.  As of June 30, 2002, the Company had a
margin balance of $92,273 and incurred $276,632 and $872,263 in margin
interest during the fiscal years ended June 30, 2002 and June 30, 2001,
respectively.  The Company's use of margin has had mixed results.  During
fiscal 2001 and 2000, the Company's incurred margin interest expenses of
$872,263 and $713,786, respectively, and was able to generate investment
income of $1,543,389 and $2,245,854.  In fiscal 2002, the Company utilized
margin to a far lesser extent, having incurred $276,632 in margin interest
expense for the current year and had a loss on investment transactions of
$10,296,906.

                                                                Page 12 of 46
<PAGE>


The following table shows the net gain or loss on the Company's marketable
securities and the associated margin interest and trading expenses for the
fiscal years ended June 30, 2002, 2001, and 2000:


                            Year Ended        Year Ended         Year Ended
                           June 30, 2002     June 30, 2001     June 30, 2000
                           -------------     -------------     -------------
Net gain (loss) on
  marketable securities    $(9,925,394)        $ 1,992,196       $ 2,399,661
Dividend & Interest
  income                       169,975             703,256           819,101
                            ----------          ----------        ----------
                            (9,755,419)          2,695,452         3,218,762
                            ----------          ----------        ----------

Margin interest               (276,632)           (872,263)         (713,786)
Trading and Management
  expenses                    (264,855)           (279,800)         (259,122)
                            ----------          ----------        ----------
                              (541,487)         (1,152,063)         (972,908)
                            ----------          ----------        ----------

Investment income (loss)  $(10,296,906)        $ 1,543,389       $ 2,245,854
                            ==========          ==========        ==========




FINANCIAL CONDITION AND LIQUIDITY

The Company's cash flows are primarily generated by its subsidiary's interest
in the Justice Investors limited partnership, which derives the majority of
its income from its lease with Felcor and a lease with Evon. In addition to
the monthly limited partnership distributions it receives from Justice
Investors, the Company's subsidiary also receives monthly management fees as a
general partner.  The Company also derives revenue from its investment in
multi-family real estate properties and the investment of its cash and
securities assets.

For the first ten months of the current fiscal year, the Company's subsidiary,
Portsmouth, was receiving a monthly distribution of $209,160 from Justice
Investors as a limited partner.  As a result of the significant decline in
partnership revenues due to the slowdown in the San Francisco area economy,
increased competition and the continuing impact that the terrorist attacks of
September 11, 2001 have had on tourism and the hospitality industry, Justice
Investors cut the monthly distribution to its limited partners by 20%,
effective with the May 2002 distribution.  As a result, Portsmouth's monthly
distribution was reduced by $41,832 to $167,328.  The limited partners have
also been advised that it is unlikely that there will be any year-end special
distributions in December 2002 if hotel occupancy and room rates do not
improve, and further cuts in the monthly distributions may have to be made in
the future.  The general partners will continue to review and analyze the
operations of the hotel to determine an appropriate monthly distribution.  For
the fiscal year ended June 30, 2002, the Company received cash distributions
of $3,262,896 from Justice Investors. That amount reflects a $1,045,800
reduction in the December 2001 special partnership year-end distribution to
$836,640, compared to the December 2000 special distribution of $1,882,440.

                                                                Page 13 of 46
<PAGE>

As of June 30, 2002, the Company had repurchased 97,828 shares of its Common
Stock for an aggregate consideration of $950,837, pursuant to a buy-back
program approved by its Board of Directors.  On July 27, 2001, the Board of
Directors decided to discontinue that buy-back program preserving Company's
cash assets for other corporate purposes.

The events of September 11, 2001, had a dramatic impact on the domestic and
global economies, especially on the tourism and hospitality industry, and also
resulted in a significant decline in securities markets.  Although the Company
has suffered a significant decline in revenues as a result of those events,
increased competition and the continuing difficult securities markets,
management believes that the net cash flow generated from future operating
activities and its capital resources will be adequate to meet its current and
future obligations even with the reduction in partnership distributions.
However, with a reduction in partnership distributions, Portsmouth may
reconsider its dividend policy.

The Company has no off balance sheet arrangements.

The Company's only contractual obligations and commercial commitments are its
mortgages and note payable.  The annual principal payments on the mortgages
and note payable for the five-year period commencing July 1, 2002 are
approximately as follows:

          Year ending June 30,
          --------------------
                   2003                 $   26,489
                   2004                     28,539
                   2005                    193,311
                   2006                     33,127
                   2007                     35,692
                   Thereafter            2,212,146
                                         ---------
                            Total       $2,529,304
                                         =========

IMPACT OF INFLATION

Hotel room rates are typically impacted by supply and demand factors, not
inflation, since rental of a hotel room is usually for a limited number of
nights.  Room rates can be, and usually are, adjusted to account for
inflationary cost increases.  To the extent that Felcor is able to adjust room
rates, there should be minimal impact on partnership revenues due to
inflation.  Partnership revenues are also subject to interest rate risks,
which may be influenced by inflation.  For the two most recent fiscal years,
the impact of inflation on the Company's income is not viewed by management as
material.  The impact of inflation on the Company's multifamily real estate is
also not viewed by management as material.


CRITICAL ACCOUNTING POLICIES

The Company reviews its long-lived assets and other investments for impairment
when circumstances indicate that a potential loss in carrying value may have
occurred.  To the extent that projected future undiscounted cash flows from
the operation of the Company's hotel property and rental properties are less
than the carrying value of the assets, the carrying value of the assets are
reduced to their fair value.  For other investments, the Company reviews the
investment's operating results, financial position and other relevant factors
to determine whether the estimated fair value of the asset is less than the
carrying value of the asset.

                                                                Page 14 of 46
<PAGE>

Marketable securities are stated at market value as determined by the most
recently traded price of each security at the balance sheet date.  Marketable
securities are classified as trading with net change in unrealized gains or
losses included in earnings.

The Company's other accounting policies are straightforward in their
application.




Item 7. Financial Statements

INDEX TO FINANCIAL STATEMENTS                                     PAGE

Report of Independent Accountants                                  16

Consolidated Balance Sheet - June 30, 2002                         17

Consolidated Statements of Operations - For
  Year Ended June 30, 2002 and
  Year Ended June 30, 2001                                         18

Consolidated Statements of Shareholders' Equity - For
  Year Ended June 30, 2002 and
  Year Ended June 30, 2001                                         19

Consolidated Statements of Cash Flows - For
  Year Ended June 30, 2002 and
  Year Ended June 30, 2001                                         20

Notes to Consolidated Financial Statements                         21

                                                                Page 15 of 46
<PAGE>


                   Report of Independent Accountants

To the Board of Directors and
Shareholders of Santa Fe Financial Corporation

In our opinion, based on our audit, the accompanying consolidated balance
sheet and the related consolidated statements of operations, of shareholders'
equity, and of cash flows present fairly, in all material respects, the
financial position of Santa Fe Financial Corporation at June 30, 2002 and the
results of its operations and its cash flows for the years ended June 30,
2002, and June 30, 2001, in conformity with accounting principles generally
accepted in the United States of America.  These financial statements are the
responsibility of the Company's management; our responsibility is to express
an opinion on these financial statements based on our audits.  We conducted
our audits of these statements in accordance with auditing standards generally
accepted in the United States of America, which require that we plan and
perform the audits to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis for our
opinion.


/s/ PricewaterhouseCoopers LLP


Los Angeles, California
September 19, 2002

                                                                 Page 16 of 46
<PAGE>


                       SANTA FE FINANCIAL CORPORATION
                         CONSOLIDATED BALANCE SHEET


As of June 30,                                                  2002
                                                            ------------

Assets
  Cash and cash equivalents                                 $  1,544,656
  Investment in marketable securities                          4,726,647
  Investment in Justice Investors                              6,112,335
  Rental properties                                            4,771,419
  Other investments                                              300,000
  Other assets                                                   284,587
  Deferred income tax assets                                   1,928,268
                                                              ----------
    Total assets                                            $ 19,667,912
                                                              ==========


Liabilities and Shareholders' Equity

Liabilities
  Due to securities broker                                  $     92,273
  Obligations for securities sold                                300,720
  Accounts payable and accrued expenses                          228,945
  Mortgage notes payable                                       2,529,304
                                                              ----------
    Total liabilities                                          3,151,242
                                                              ----------
  Minority interest                                            4,883,349
                                                              ----------

Shareholders' equity:
  6% Cumulative, convertible, redeemable at
    the option of the holder, voting preferred
    stock, par value $.10 per share
    Authorized shares - 1,000,000
    Issued and outstanding - 63,600
    Liquidation preference of $858,600                             6,360
  Common stock, par value $.10 per share
    Authorized shares - 2,000,000
    1,276,038 shares issued and 1,178,210 outstanding            127,604
  Additional paid-in-capital                                   8,807,942
  Retained earnings                                            3,642,252
  Treasury stock, at cost, 97,828 shares                        (950,837)
                                                              ----------
    Total shareholders' equity                                11,633,321
                                                              ----------

    Total liabilities and shareholders' equity              $ 19,667,912
                                                              ==========

See accompanying notes to consolidated financial statements.

                                                                 Page 17 of 46
<PAGE>


                      Santa Fe Financial Corporation
                    Consolidated Statements of Operations


For the year ended June 30,                        2002            2001
                                                ----------      ----------
Revenues
  Equity in net income of Justice
   Investors                                   $ 2,159,887     $ 3,927,635
  Rental income                                    339,970         322,726
  Net (losses) gains on marketable
   securities                                   (9,925,394)      1,992,196
  Reserve for losses on other investments         (500,000)              -
  Dividend and interest income                     169,975         703,256
  Other income                                     138,587       1,403,552
                                                ----------      ----------
                                                (7,616,975)      8,349,365
                                                ----------      ----------
Costs and expenses
  Property operating expense                      (160,591)       (121,698)
  Mortgage interest expense                       (189,592)       (178,436)
  Depreciation expense                             (58,482)        (54,216)
  Margin interest, trading and
   management expenses                            (541,487)     (1,152,063)
  General and administrative                      (949,195)       (837,704)
                                                ----------      ----------
                                                (1,899,347)     (2,344,117)
                                                ----------      ----------
(Loss) income before income taxes
 and minority interest                          (9,516,322)      6,005,248

Income tax benefit (expense)                     3,863,845      (2,600,449)
                                                ----------      ----------
(Loss) income before minority interest          (5,652,477)      3,404,799

Minority interest                                  597,152        (783,158)
                                                ----------      ----------
Net (loss) income                              $(5,055,325)    $ 2,621,641

Preferred stock dividend                           (51,516)        (51,481)
                                                ----------      ----------
(Loss) income available to common
  shareholders                                 $(5,106,841)    $ 2,570,160
                                                ==========      ==========
Basic (loss) earnings per share                $     (4.33)    $      2.17
                                                ==========      ==========
Weighted average number of shares
  outstanding                                    1,178,386       1,186,094
                                                ==========      ==========


See accompanying notes to consolidated financial statements.

                                                                 Page 18 of 46
<PAGE>

<TABLE>
<CAPTION>
                       SANTA FE FINANCIAL CORPORATION
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY


                Preferred Stock     Common Stock
                ---------------   --------------------
                                                         Additional
                                                         paid-in      Retained     Treasury
                Shares   Amount   Shares      Amount     capital      earnings     Stock          Total

                ---------------   --------------------   ----------   ----------   ---------   -----------
<S>             <C>      <C>      <C>         <C>        <C>          <C>          <C>         <C>
Balance at
June 30, 2000   63,600   $6,360   1,276,038   $127,604   $8,807,942   $6,178,933   $(784,734)  $14,336,105


Net income                                                             2,621,641                 2,621,641

Purchase of
treasury stock                                                                      (155,885)     (155,885)

Dividend paid
to preferred
shareholders                                                             (51,481)                  (51,481)

                ---------------   --------------------   ----------   ----------   ---------   -----------
Balance at
June 30, 2001   63,600   $6,360   1,276,038   $127,604   $8,807,942   $8,749,093   $(940,619)  $16,750,380

Net loss                                                              (5,055,325)               (5,055,325)

Purchase of
treasury stock                                                                       (10,218)      (10,218)

Dividend paid
to preferred
shareholders                                                             (51,516)                  (51,516)

                ---------------   --------------------   ----------   ----------   ---------   -----------
Balance at
June 30, 2002   63,600   $6,360   1,276,038   $127,604   $8,807,942   $3,642,252   $(950,837)  $11,633,321
                ===============   ====================   ==========   ==========   =========   ===========

</TABLE>

See accompanying notes to consolidated financial statements.


                                                                Page19 of 46
<PAGE>


                        Santa Fe Financial Corporation
                     Consolidated Statements of Cash Flows


For the year ended June 30,                          2002          2001
                                                  ----------    ----------
Cash flows from operating activities:
  Net (loss) income                              $(5,055,325)  $ 2,621,641
  Adjustments to reconcile net (loss) income
   to net cash used in operating activities:
    Equity in net income of Justice Investors     (2,159,887)   (3,927,635)
    Net unrealized losses (gains) on
     marketable securities                         7,352,254    (1,117,992)
    Reserve for losses on other investments          500,000             -
    Minority interest                               (597,152)      783,159
    Depreciation expense                              58,482        54,216
    Changes in operating assets and liabilities:
      Restricted cash                                 14,732       (14,732)
      Investment in marketable securities         12,332,693     9,244,445
      Other assets                                   (93,189)          478
      Accounts payable and accrued expenses         (906,085)     (149,544)
      Deferred income tax                         (3,845,665)    1,917,397
      Due to securities broker                    (2,242,151)   (7,974,267)
      Obligations for securities sold             (6,155,435)   (5,370,739)
                                                  ----------    ----------
  Net cash used in operating activities             (796,728)   (3,933,573)
                                                  ----------    ----------
Cash flows from investing activities:
  Cash distributions from Justice Investors        3,262,896     4,392,360
  Investment in real estate                         (840,823)            -
  Other investments                                 (500,000)            -
  Purchase of Portsmouth stock                        (1,625)       (1,950)
                                                  ----------    ----------
  Net cash provided by investing activities        1,920,448     4,390,410
                                                  ----------    ----------
Cash flows from financing activities:
  Principal payments on mortgage payable             (21,289)      (18,134)
  Borrowings from mortgage notes payable             462,500             -
  Dividends paid to preferred shareholders           (51,516)      (51,481)
  Dividends paid to minority shareholders           (126,235)     (126,260)
  Purchase of treasury stock                         (10,218)     (155,885)
                                                  ----------    ----------
  Net cash provided by (used in)
   financing activities                              253,242      (351,760)
                                                  ----------    ----------
Net increase in cash and cash
  equivalents                                      1,376,962       105,077

Cash and cash equivalents at beginning of period     167,694        62,617
                                                  ----------    ----------
Cash and cash equivalents at end of period       $ 1,544,656   $   167,694
                                                  ==========    ==========
Supplemental information
  Income taxes paid, net of refunds              $   500,000   $   698,453
                                                  ==========    ==========
  Interest paid                                  $   466,224   $ 1,078,167
                                                  ==========    ==========

See accompanying notes to consolidated financial statements.

                                                               Page 20 of 46
<PAGE>



                           SANTA FE FINANCIAL CORPORATION
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Santa Fe Financial Corporation ("Santa Fe" or the "Company") was incorporated
under the name of Tri Financial Corporation in the State of Nevada on July 25,
1967 as a wholly owned subsidiary of Crateo, Inc, a public company.  On
October 31, 1969, Crateo issued a one-for-one stock dividend of all of its
shares of Tri Financial to its common shareholders.  On September 17, 1970,
the name of the Corporation was changed to Santa Fe Financial Corporation.

Santa Fe Financial Corporation's (the "Company") operations have been
primarily limited to partnership income from its managing a hotel property
through its investment in Justice Investors and income from various investment
activities.  On December 31, 1997, the Company acquired a controlling 55.4%
interest in Intergroup Woodland Village, Inc. ("Woodland Village") from a
related party, The InterGroup Corporation ("InterGroup"), which controls
approximately 57.2% of the voting stock of the Company.  Woodland Village's
major asset is a 27-unit apartment complex located in Los Angeles, California.
On February 1, 2002, the Company acquired a three-unit apartment building in
Los Angeles.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company, its
68.8% owned subsidiary, Portsmouth Square, Inc. ("PSI"), and its 55.4% owned
subsidiary, Woodland Village.  All material intercompany accounts and
transactions have been eliminated in consolidation.


Cash Equivalents

The Company considers all investments purchased with an original maturity of
three months or less to be cash equivalents.

Investment in Marketable Securities

Marketable securities are stated at market value as determined by the most
recently traded price of each security at the balance sheet date.  Marketable
securities are classified as trading securities with all unrealized gains and
losses on the Company's investment portfolio recorded through the statement of
operations.

Due to Securities Broker

Various securities brokers have advanced funds to the Company for the purchase
of marketable securities under standard margin agreements.

Obligations for Securities Sold

Obligation for securities sold represents the fair market value of shares sold
with the promise to deliver that security at some future date and the fair

                                                                Page 21 of 46
<PAGE>

market value of shares underlying the written call options with the obligation
to deliver that security when and if the option is exercised.  The obligation
may be satisfied with current holdings of the same security or by subsequent
purchases of that security.  Unrealized gains and losses from changes in the
obligation are included in the income statement.

Rental Properties

Rental properties are stated at cost.  Depreciation of rental property is
provided on the straight-line method based upon estimated useful lives of 5 to
40 years for buildings and improvements and 5 to 10 years for equipment.
Expenditures for repairs and maintenance are charged to expense as incurred
and major improvements are capitalized.

The Company reviews for the impairment of its rental property assets whenever
events or changes in circumstances indicate that the carrying amount of an
asset may not be recoverable.  If expected future cash flows (undiscounted and
excluding interest costs) are less than the carrying value of the rental
asset, the asset is written down to its fair value.  The estimation of
expected future net cash flows is inherently uncertain and relies to a
considerable extent on assumptions regarding current and future economic and
market conditions, and the availability of capital. If, in future periods,
there are changes in the estimates or assumptions incorporated into the
impairment review analysis, the changes could result in an adjustment to the
carrying amount of the long-lived asset. No impairment losses have been
recorded in 2002 or 2001.

Furniture and Fixtures

Furniture and fixtures are stated at cost.  Depreciation is computed by the
straight-line method over the estimated useful lives of the assets, which
range from 3 to 5 years.

Fair Value of Financial Instruments

The carrying amount of cash and cash equivalents, restricted cash, marketable
securities, other investments, prepaid expenses and other assets, accounts
payable and liabilities approximates fair value.  The fair value of mortgage
notes payable is estimated using discounted cash flows of future payments
based on the borrowing rates available to the Company for debt with similar
terms and maturities.

Treasury Stock

The Company records the acquisition of treasury stock under the cost method.

Revenue Recognition

The major source of the Company's revenue was its 49.8% interest in Justice
Investors, a limited partnership which owns and leases a hotel in San
Francisco, California in which the Company's subsidiary, PSI, is both a
limited and general partner.  PSI and the Company account for the investment
under the equity method.

Rental income is recognized when earned.  Revenue recognition from apartment
rentals commences when an apartment unit is placed in service and occupied by
a rent-paying tenant.

                                                                 Page 22 of 46
<PAGE>


Earnings Per Share

Basic earnings per share is computed by dividing net income available to
common stockholders by the weighted average number of common shares
outstanding.  The computation of diluted earnings per share is similar to the
computation of basic earnings per share except that the weighted-average
number of common shares is increased to include the number of additional
common shares that would have been outstanding if potential dilutive common
shares had been issued.  The Company's only potentially dilutive common shares
are the 6% cumulative, convertible, voting preferred stock.  As of June 30,
2002 and 2001, the conversion price is above the market value of the Company's
common stock, consequently, the preferred stock is not considered dilutive.
Therefore, basic and diluted earnings per share for the year ended June 30,
2002 and 2001 are the same.

Use of Estimates

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from those
estimates.

Income Taxes

Deferred income taxes are determined using the liability method.  A deferred
tax asset or liability is determined based on the difference between the
financial statement and tax basis of assets and liabilities as measured by the
enacted tax rates, which will be in effect when these differences reverse.

Reclassifications

Certain prior year balances have been reclassified to conform to the current
presentation.

Recently Issued Accounting Standards

In October 2001, the Financial Accounting Standards Board ("FASB" or the
"Board") issued FASB Statement No. 144 ("FAS No. 144") Accounting for the
Impairment or Disposal of Long-Lived Assets.  The objectives of FAS No. 144
are to address significant issues relating to the implementation of FASB
Statement No. 121 ("FAS No. 121), Accounting for the Impairment of Long-Lived
Assets and Long-Lived Assets to Be Disposed Of, and to develop a single
accounting model, based on the framework established in FAS No. 121, for long-
lived assets to be disposed of by sale, whether previously held and used or
newly acquired.  FAS No. 144 must be adopted in the first quarter of fiscal
years beginning after December 15, 2001.  The Company does not expect that
the adoption of this statement will have a material impact on the Company's
financial statements.

In July 2001, the FASB issued Statements on Financial Accounting Standards FAS
No. 141 (Business Combination) and FAS No. 142 (Goodwill and Other Intangible
Assets).  FAS No. 141 among other things, eliminates the use of the pooling of
interest method of accounting for business combination.  Under the provision
of FAS No. 142, goodwill will no longer be amortized, but will be subject to a
periodic test for impairment based upon fair value.  FAS No. 141 is effective
for all business combinations initiated after June 30, 2001.  FAS No. 142 must
be adopted in the first quarter of fiscal years beginning after December 15,

                                                               Page 23 of 46
<PAGE>

2001.  The Company does not expect that the adoption of these statements will
have a material impact on the Company's financial statements.


NOTE 2 - INVESTMENT IN JUSTICE INVESTORS

The Company's principal source of revenue is derived from the management of
its 68.8%-owned subsidiary Portsmouth Square, Inc. ("Portsmouth").  Portsmouth
has a 49.8% interest in Justice Investors, a California limited partnership
("Justice Investors") and also serves as one of the two general partners.  The
other general partner, Evon Garage Corporation ("Evon"), serves as the
managing general partner.  As a general and limited partner, Portsmouth has
significant control over the management and operation of the assets of Justice
Investors.  All significant partnership decisions require the active
participation and approval of both general partners.  The Company and Evon
jointly consult and determine the amount of partnership reserves and the
amount of cash to be distributed to the limited partners.

The partnership derives most of its income from a lease of its San Francisco,
California hotel property to Felcor Lodging Trust, Inc. ("Felcor") and from a
lease of the garage portion of the property to Evon.  Santa Fe and Portsmouth
jointly manage and oversee their interest in the operation of the hotel and
the parking garage.

Pursuant to the terms of the partnership agreement, voting rights of the
partners are determined according to the partners' entitlement to share in the
net profit and loss of the partnership.  The Company is not entitled to any
additional voting rights by virtue of its position as a general partner.
The partnership agreement also provides that no portion of the partnership
real property can be sold without the written consent of the general and
limited partners entitled to more than 72% of the net profit.

Condensed financial statements for Justice Investors are as follows:


                            JUSTICE INVESTORS
                         CONDENSED BALANCE SHEET

As of June 30,                                                 2002
                                                            ----------
Assets
Total current assets                                       $   161,181
Property, plant and equipment, net of
  accumulated depreciation of $12,271,100                    4,304,583
Loan fees and deferred lease costs,
  net of accumulated amortization of $225,800                   84,612
                                                            ----------
    Total assets                                           $ 4,550,376
                                                            ==========

Liabilities and partners' capital
Total current liabilities                                  $     4,202
Long term debt                                                 490,432
Partners' capital                                            4,055,742
                                                            ----------
    Total liabilities and partners' capital                $ 4,550,376
                                                            ==========

                                                                 Page 24 of 46
<PAGE>


                                JUSTICE INVESTORS
                        CONDENSED STATEMENTS OF OPERATIONS

For the twelve months ended June 30,           2002            2001
                                            ----------      ----------
Revenues                                   $ 5,180,311     $ 8,759,508
Costs and expenses                            (843,187)       (872,692)
                                            ----------      ----------
Net income                                 $ 4,337,124     $ 7,886,816
                                            ==========      ==========

NOTE 3 - INVESTMENT IN MARKETABLE SECURITIES

The Company's investment portfolio consists primarily of corporate equities.
The Company has also invested in corporate bonds and income producing
securities, which may include interests in real estate based companies and
REITs, where financial benefit could inure to its shareholders through income
and/or capital gain.  The Company may also use exchange traded funds (such as
SPYders), options and futures to hedge concentrated stock positions and index
futures to hedge against market risk and enhance the performance of the
Company's portfolio while reducing the overall portfolio's risk and
volatility.


The Company's current investment portfolio as of June 30, 2002 is composed of
following types of investment securities:
                                                    % of Total
                                Market Value         Portfolio
                                ------------         ---------
Fixed income:
  Mortgage securities           $    47,072             1.00%
  Corporate bonds                   401,716             8.50%

Corporate securities:
  Common stocks                   3,408,560            72.11%
  Preferred stocks                  561,485            11.88%

REIT's                              304,277             6.44%

Warrants                              3,537             0.07%
                                 ----------           -------

TOTAL SECURITIES ASSETS         $ 4,726,647           100.00%
                                 ==========           =======

As part of the investment strategies, the Company may assume short positions
in marketable securities.  Short sales are used by the Company to potentially
offset normal market risks undertaken in the course of its investing
activities or to provide additional return opportunities.  The Company has no
naked short positions.  As of June 30, 2002, the Company had obligations for
securities sold (equities short) of $300,720.

Marketable securities are stated at market value as determined by the most
recently traded price of each security at the balance sheet date.  Marketable
securities are classified as trading with net change in unrealized gains or
losses included in earnings.  Included in the net losses on marketable
securities of $9,925,394 for the year ended June 30, 2002, are net unrealized
losses of $7,352,254 and net realized losses of $2,573,140.

                                                                Page 25 of 46
<PAGE>


NOTE 4 - RENTAL PROPERTIES

The Company owns and operates a 27-unit multi-family apartment complex located
in Los Angeles, California.  On February 1, 2002, the Company purchased a
three-unit apartment building located in Los Angeles, California for $785,390.
To finance the purchase, the Company obtained a $462,500 mortgage note.

Units are leased on a short-term basis, with no lease extending beyond one
year.  At June 30, 2002, rental properties included the following:

  Land                                      $ 2,429,950
  Buildings, improvements and equipment       2,496,455
  Accumulated depreciation on buildings,
    improvements and equipment                 (154,986)
                                              ---------
                                             $4,771,419
                                              =========



NOTE 5 - MORTGAGE NOTES PAYABLE


At June 30, 2002, the balance on mortgage notes payable was $2,529,304.
Included in mortgage notes payable balance are two mortgages in the amounts of
$1,905,942 and $460,798 and a note payable to InterGroup in the amount of
$162,564.  The mortgages are collateralized by trust deeds on the respective
apartment complexes. The interest rate on the $1,905,942 note is 7.73% for the
first 120 months. Principal and interest payments of $13,979 are required
monthly until September 23, 2009, at which point, the monthly payments will be
recalculated based on a new interest rate of 2.15% in excess of the twelve-
month average annual yield of United States Treasury Securities.  The new
interest rate cannot exceed 11.879%.

In February 1, 2002, the Company obtained a $462,500 mortgage note related to
the purchase of the 3-unit apartment building located in Los Angeles,
California.  That note matures in February 2032. The interest rate is 6.45%
for the first 60 months.  Beginning February 2005, the interest rate will be
adjusted to 2.6% in excess of the rate of savings, borrowings and advances of
the Federal Home Loan Bank of San Francisco to Eleventh District Members.  The
interest rate cannot exceed 11.95% or fall below 6.45%

The $162,564 note payable to InterGroup carries an interest rate of 7.75% per
annum with interest only payable at the end of each quarter.  All unpaid
principal and interest under the note are due on September 29, 2004.

The annual principal payments on the mortgages and note payable for the five-
year period commencing July 1, 2002 are approximately as follows:

          Year ending June 30,
          --------------------
                   2003                 $   26,489
                   2004                     28,539
                   2005                    193,311
                   2006                     33,127
                   2007                     35,692
                   Thereafter            2,212,146
                                         ---------
                            Total       $2,529,304
                                         =========

                                                                 Page 26 of 46
<PAGE>


NOTE 6 - INCOME TAXES

The Company and PSI file separate tax returns for both federal and state
purposes.  The provision for income taxes benefit (expense) consists of the
following:

For the year ended June 30,             2002          2001
                                     ----------    ----------
 Federal
   Current                          $    25,290   $(1,428,453)
   Deferred                           3,679,767      (717,196)
                                     ----------    ----------
                                      3,705,057    (2,145,649)
                                     ----------    ----------
 State
   Current                               (7,010)     (330,000)
   Deferred                             165,798      (124,800)
                                     ----------    ----------
                                        158,788      (454,800)
                                     ----------    ----------
                                    $ 3,863,845   $(2,600,449)
                                     ==========    ==========

A reconciliation of the statutory federal income tax rate to the effective tax
rate is as follows:

For the year ended June 30,             2002          2001
                                     ----------    ----------

  Statutory federal tax rate              34.0%         34.0%
  State income taxes, net of
   federal tax benefit                     6.0%          6.0%
  Other                                    0.6%          3.3%
                                         ------        ------
                                          40.6%         43.3%
                                         ======        ======

The components of the Company's deferred tax assets and (liabilities) as of
June 30, 2002 are as follows:

  Deferred tax assets
    Net operating losses carryforwards              $ 1,373,785
    Capital losses carryforwards                        865,924
    Unrealized losses on marketable securities          540,559
                                                     ----------
                                                      2,780,268

  Deferred tax liability
    Deferred gains on real estate sale                 (852,000)
                                                     ----------

  Net deferred tax asset                            $ 1,928,268
                                                     ==========

As of June 30, 2002, the Company had net capital losses available for
carryforward for income tax purposes totaling approximately $2,164,810.  The
carryforward expires in varying amounts through 2006.  As of June 30, 2002,
the Company also had net operating losses available for carryforward of
$1,912,307 for federal income tax and $365,283 for state income tax.  The net
operating loss carryforward expires in varying amounts through 2021.

                                                                Page 27 of 46
<PAGE>


NOTE 7 - SEGMENT INFORMATION

The Company operates in three reportable segments, the operations of its
multi-family residential property, the operation of Justice Investors, and the
investment of its cash and securities assets. These three operating segments,
as presented in the financial statements, reflect how management internally
reviews each segment's performance.  Management also makes operational and
strategic decisions based on this same information.

Information below represents reporting segments for the year ended June 30,
2002 and 2001.  Operating income for rental properties consist of rental
income.  Operating income from Justice Investors consists of the operations of
the hotel and garage included in the equity in net income of Justice
Investors.  Operating income (losses) for investment transactions consist of
net investment gains (losses) and dividend and interest income.
<TABLE>
<CAPTION>
                                 REAL ESTATE
                           -------------------------
YEAR ENDED                    RENTAL       JUSTICE     INVESTMENT
JUNE 30, 2002               PROPERTIES    INVESTORS    TRANSACTIONS     OTHER          TOTAL
                           -----------   -----------   -----------   -----------   ------------
<S>                        <C>           <C>          <C>            <C>           <C>
Operating income (loss)    $   339,970   $ 2,159,887  $(10,255,419)  $         -   $ (7,755,562)
Operating expenses            (160,591)            -      (541,487)            -       (702,078)
                           -----------   -----------   -----------   -----------   ------------
Income(loss) before
  mortgage interest and
  depreciation                 179,379     2,159,887   (10,796,906)            -     (8,457,640)

Mortgage interest expenses    (189,592)            -             -             -       (189,592)
Depreciation                   (58,482)            -             -             -        (58,482)
General and administrative
  expenses                           -             -             -      (949,195)      (949,195)
Other income                         -             -             -       138,587        138,587
Income tax benefit                   -             -             -     3,863,845      3,863,845
Minority interest                    -             -             -       597,152        597,152
                           -----------   -----------   -----------   -----------   ------------
Net income (losses)        $   (68,695)  $ 2,159,887  $(10,796,906)  $ 3,650,389   $ (5,055,325)
                           ===========   ===========   ===========   ===========   ============
Total Assets               $ 4,771,419   $ 6,112,335  $  5,026,647   $ 3,757,511   $ 19,667,912
                           ===========   ===========   ===========   ===========   ============
</TABLE>
<TABLE>
<CAPTION>
                                 REAL ESTATE
                           -------------------------
YEAR ENDED                    RENTAL       JUSTICE     INVESTMENT
JUNE 30, 2001               PROPERTIES    INVESTORS    TRANSACTIONS     OTHER          TOTAL
                           -----------   -----------   -----------   -----------   ------------
<S>                        <C>           <C>           <C>           <C>           <C>
Operating income           $   322,726   $ 3,927,635   $ 2,695,452   $         -   $  6,945,813
Operating expenses            (121,698)            -    (1,152,063)            -     (1,273,761)
                           -----------   -----------   -----------   -----------   ------------
Income before
  mortgage interest and
  depreciation                 201,028     3,927,635     1,543,389             -      5,672,052

Mortgage interest expenses    (178,436)            -             -             -       (178,436)
Depreciation                   (54,216)            -             -             -        (54,216)
General and administrative
  expenses                           -             -             -      (837,704)      (837,704)
Other income                         -             -             -     1,403,552      1,403,552
Income tax expense                   -             -             -    (2,600,449)    (2,600,449)
Minority interest                    -             -             -      (783,158)      (783,158)
                           -----------   -----------   -----------   -----------   ------------
Net income(losses)         $   (31,624)  $ 3,927,635   $ 1,543,389   $(2,817,759)  $  2,621,641
                           ===========   ===========   ===========   ===========   ============
Total Assets               $ 3,989,078   $ 7,113,519   $24,711,593   $   462,529   $ 36,276,719
                           ===========   ===========   ===========   ===========   ============
</TABLE>

                                                                 Page 28 of 46
<PAGE>

NOTE 8 - SHAREHOLDERS' EQUITY

On December 31, 1997, the Company issued 31,800 shares of 6% cumulative,
convertible voting preferred stock (the "Preferred Stock")in exchange for a
55.4% interest in Woodland Village from InterGroup.  As a result of the
Company's two-for-one stock split, the number of Preferred Shares was adjusted
to 63,600.  Each share of Preferred Stock has a liquidation preference of
$13.50 and is convertible into one share of restricted common stock of the
Company at an exercise price of $13.50 per share, with an eight-year
conversion exercise period.  The preferred stock has voting rights as if
converted into common stock.  For the years ended June 30, 2002 and 2001, the
Company paid preferred stock dividends of $51,516 and $51,481, respectively,
to InterGroup.

NOTE 9 - RELATED PARTY TRANSACTIONS

As of June 30, 2002, InterGroup owned approximately 50.7% of the Company's
outstanding common stock and 100% of the Company's preferred stock for a total
of 53.2% of all outstanding voting stock.  In addition, the Chairman and Chief
Executive Officer of InterGroup, who is also the Company's Chairman and Chief
Executive Officer, owned approximately 4.2% of the Company's outstanding
voting stock as of June 30, 2002.  Effective June 30, 1998, the Company's
Chairman and Chief Executive Officer entered into a voting trust agreement
with InterGroup, giving InterGroup the power to vote the shares that he owns
in the Company.  As a result of that agreement, InterGroup has the power to
vote approximately 57.2% of the voting shares of the Company.

As of June 30, 2002, the Company's subsidiary, Woodland Village, has a note
payable in the amount of $162,563 to InterGroup.  The note carries a 7.75%
interest rate and matures on September 29, 2004.

The Intergroup Corporation allocates corporate expenses to the Company and its
subsidiary based on management's estimate of the pro rata utilization of
resources.  During the years ended June 30, 2002 and 2001, the Company and
Portsmouth made payments to InterGroup of approximately $222,900 and $223,000,
respectively, for administrative costs and reimbursement of direct and
indirect costs associated with the management of the Companies and their
investments, including the partnership asset.

For the years ended June 30, 2002 and 2001, the Company paid preferred stock
dividends of $51,516 and $51,481, respectively, to Intergroup.

All of the Company's Directors serve as directors of InterGroup and all three
of the Company's Directors serve on the Board of Portsmouth.


                                                                 Page 29 of 46
<PAGE>


Item 8. Changes in and Disagreements with Accountants on Accounting and
        Financial Disclosure.

None.


                               PART III

Item 9.  Directors, Executive Officers, Promoters and Control Persons;
         Compliance with Section 16(a) of the Exchange Act.

The following table sets forth certain information with respect to the
Directors and Executive Officers of the Company as of June 30, 2002:
<TABLE>
<CAPTION>

                                  Present
                                  Position           Director
     Name              Age     With the Company        Since       Term to Expire
--------------------------------------------------------------------------------------
<S>                   <C>      <C>                     <C>         <C>
John V. Winfield      55       Chairman, President     1995        2002 Annual Meeting
                               and Chief Executive
                               Officer (1)

William J. Nance      58       Director (1)(2)         1996        2002 Annual Meeting

John C. Love          62       Director (1)(2)         1998        2002 Annual Meeting

Michael G. Zybala     50       Vice President,
                               Secretary, Treasurer
                               and General Counsel     N/A         N/A

---------------------------
</TABLE>
(1)  Member of Securities Investment Committee
(2)  Member of Audit Committee



BUSINESS EXPERIENCE:

The principal occupation and business experience during the last five years
for each of the Directors and Executive Officers of the Company are as
follows:

John V. Winfield - Mr. Winfield was first elected to the Board in May of 1995
and currently serves as the Company's Chairman of the Board, President and
Chief Executive Officer, having been appointed as such in April 1996.  Mr.
Winfield is also the Chairman of the Board, President and Chief Executive
Officer of the Company's subsidiary Portsmouth, having held those positions
since May of 1996.  Mr. Winfield is Chairman of the Board, President and Chief
Executive Officer of InterGroup, a public company, and has held those
positions since 1987.  Mr. Winfield is also a director of Healthy Planet
Products, Inc., a public company ("HPP"), having first been appointed as a
Director in September 1997 and served as its Chairman from August 5, 1998 to
August 13, 2002.  Mr. Winfield also serves as Chairman of the Board of Etz
Lavud, Ltd., a public company.

                                                                Page 30 of 46
<PAGE>


William J. Nance - Mr. Nance was first elected to the Board in May of 1996.
Mr. Nance is also a director of Portsmouth.  Mr. Nance is the President and
CEO of Century Plaza Printers, Inc., a company he founded in 1979.  He has
also served as a consultant in the acquisition and disposition of multi-family
and commercial real estate.  Mr. Nance is a Certified Public Accountant and,
from 1970 to 1976, was employed by Kenneth Leventhol & Company where he was a
Senior Accountant specializing in the area of REITS and restructuring of real
estate companies, mergers and acquisitions, and all phases of real estate
development and financing.  Mr. Nance is a Director of The InterGroup
Corporation, a public company, and has held such position since 1984. Mr.
Nance also serves as a Director of HPP, having first been elected on August 5,
1998.

John C. Love - Mr. Love was appointed a Director of the Company on March 5,
1998.  Mr. Love is an international hospitality and tourism consultant based
in Orinda, California.  He was formerly a partner in the national CPA and
consulting firm of Pannell Kerr Forster.  Mr. Love has extensive experience in
hotel development, acquisition and operations.  He is chairman emeritus of
Golden Gate University in San Francisco.  Mr. Love is also a Director of
Portsmouth, having first been appointed in March 1998, and a Director of
InterGroup, having first been appointed in January 1998.

Michael G. Zybala - Mr. Zybala was appointed as Vice President and Secretary
of the Company on February 20, 1998 and was appointed Treasurer on May 16,
2000.  He is also Vice President, Secretary, Treasurer and General Counsel of
Portsmouth.  Mr. Zybala has served as the Company's General Counsel since 1995
and has represented the Company as its corporate counsel since August 1993.
Mr. Zybala is a Director of HPP and serves as the company's Secretary.  He was
first appointed as a Director of HPP on June 17, 1998 and elected as Secretary
on August 5, 1998.  Mr. Zybala also serves as Assistant Secretary and counsel
of InterGroup and served as its Vice President Operations from January 1999 to
July 15, 2002.

Family Relationships:  There are no family relationships among directors,
executive officers, or persons nominated or chosen by the Company to become
directors or executive officers.

Involvement in Certain Legal Proceedings:  No director or executive officer,
or person nominated or chosen to become a director or executive officer, was
involved in any legal proceeding requiring disclosure.


Compliance with Section 16(a) of the Securities Exchange Act of 1934

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and each beneficial owner of more than ten percent of
the Common Stock of the Company, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission.  Officers, directors
and greater than ten-percent shareholders are required by SEC regulations to
furnish the Company with copies of all Section 16(a) forms they file.

Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that during fiscal 2002 all
filing requirements applicable to its officers, directors, and greater than
ten-percent beneficial owners were complied with.

                                                               Page 31 of 46
<PAGE>


Item 10.   Executive Compensation

The following table provides certain summary information concerning
compensation awarded to, earned by, or paid to the Chief Executive Officer and
any other qualifying Executive Officers and employees who earned more than
$100,000 for all services rendered to the Company and its subsidiary for
fiscal years ended June 30, 2002, 2001 and 2000.


                            SUMMARY COMPENSATION TABLE

                                Annual Compensation
                    ---------------------------------------------
Name and Principal                                             Other Annual
Position                       Year     Salary       Bonus     Compensation
------------------             ----     ------       -----     -------------

John V. Winfield               2002    $230,000(1)    $ 0        $12,000(2)
Chairman, President and        2001    $240,000(1)    $ 0        $12,000(2)
Chief Executive Officer        2000    $240,000(1)    $ 0        $12,000(2)

Michael G. Zybala              2002    $ 88,125(3)          -          -
Vice President, Secretary,     2001    $ 98,271(3)    $11,250          -
Treasurer and General Counsel  2000    $ 97,466(3)    $15,000          -
-----------------------------

(1) Includes salary received from the Company's subsidiary, Portsmouth, in the
amounts of $88,125, $90,000 and $90,000 for the fiscal years 2002, 2001 and
2000 respectively. Does not include total compensation received from Santa
Fe's parent corporation, InterGroup, of $339,109, $339,322 and $331,800 for
fiscal years ended June 30, 2002, 2001 and 2000, respectively.

(2) Amounts shown reflect regular annual director's fees paid by Santa Fe and
Portsmouth, each in the amount of $6,000. During fiscal 2002, 2001 and 2000,
the Company and Portsmouth also paid combined annual premiums of $42,500 and
$42,500, respectively, for a split dollar whole life insurance policy, owned
by, and the beneficiary of which is, a trust for the benefit of Mr. Winfield's
family.  The Company has a secured right to receive, from any proceeds of the
policy, reimbursement of all premiums paid prior to any payments to the
beneficiary.

(3) Approximately $70,500, $87,500 and $84,000 of Mr. Zybala's salary and
bonus was allocated to Portsmouth in fiscal years 2002, 2001 and 2000,
respectively.  Does not include total compensation received from Santa Fe's
parent corporation, InterGroup, of $33,375, $35,677 and $34,999 for fiscal
years ended June 30, 2002, 2001 and 2000, respectively.

As a small business issuer, Santa Fe has no compensation committee. Executive
Officer compensation is set by disinterested members of the Board of
Directors.  Santa Fe has no stock option plan or stock appreciation rights for
its executive officers.  The Company has no pension or long-term incentive
plans.  There are no employment contracts between Santa Fe and any executive
officer, nor are there any termination-of-employment or change-in-control
arrangements.

                              DIRECTOR COMPENSATION

The bylaws of Santa Fe permit directors to be paid a fixed sum for attendance
at each meeting of the Board or a stated salary as director.  Each director is
paid a fee of $1,500 per quarter for a total annual compensation of $6,000.
This policy has been in effect since July 1, 1985.

                                                                 Page 31 of 46
<PAGE>


Item 11.    Security Ownership of Certain Beneficial Owners and Management

(a) Security ownership of Certain Beneficial Owners

The following table sets forth, as of September 13, 2002, certain information
with respect to the beneficial ownership of the Company's voting securities
owned by those persons or groups known by the Company to own more than five
percent of any class of the Company's voting securities.


Name and Address of                 Amount and Nature            Percent of
Beneficial Owner                   of Beneficial Owner (1)        Class (2)
-------------------                ----------------------        ----------
Guinness Peat Group plc ("GPG")          89,858(3)                   7.6%
Allied Mutual Insurance
  Services ("AMI")
Second Floor, 21-26 Garlick Hill
London ECHV 2AU, England

The InterGroup Corporation              660,596(4)                  53.2%
820 Moraga Drive
Los Angeles, CA 90049

John V. Winfield                         49,400                      4.2%
820 Moraga Drive
Los Angeles, CA 90049

The InterGroup Corporation and          709,996(5)                  57.2%
  John V. Winfield as a group
------------------------------

(1) Unless otherwise indicated, and subject to applicable community property
    laws, each person has sole voting and investment power with respect to the
    shares beneficially owned.

(2) Percentages are calculated on the basis of 1,178,210 shares of Common
    Stock issued and outstanding as of September 13, 2002, plus any securities
    that person has the right to acquire within 60 days pursuant to options,
    warrants, conversion privileges or other rights.

(3) Based on their Statement on Schedule 13D (Amendment No. 6) dated June 13,
    2001, GPG and its wholly-owned subsidiary AMI claim shared power to vote,
    or to direct the vote, and to dispose of, or to direct the disposition of,
    89,858 shares (post stock split) of Santa Fe's Common Stock owned
    beneficially and of record by GPG and through AMI.  Of that amount, 52,858
    shares are beneficially owned by GPG and 37,000 by AMI.

(4) InterGroup is the beneficial owner of 596,996 shares of Common Stock and
    63,600 shares of convertible, voting preferred stock, which shares are
    entitled to vote as if converted to Common Stock.

(5) Pursuant to Voting Trust Agreement dated June 30, 1998, InterGroup has the
    power to vote the 49,400 shares of Common Stock owned by Mr. Winfield.  As
    President, Chairman of the Board and a 53.8% shareholder of InterGroup,
    Mr. Winfield has voting and dispositive power over the shares owned
    of record and beneficially by InterGroup.

                                                                Page 33 of 46
<PAGE>



(b) Security Ownership of Management

The following table sets forth, as of September 13, 2002, certain
information with respect to the beneficial ownership as to each class of the
Company's equity securities beneficially owned by all directors, each of the
named executive officers and directors and executive officers as a group.


Name and Address of                 Amount and Nature            Percent of
Beneficial Owner                   of Beneficial Owner(1)         Class (2)
-------------------                -------------------           ----------

John V. Winfield                        709,996(3)                  57.2%
820 Moraga Drive
Los Angeles, CA 90049

John C. Love                                  0(4)                      *
820 Moraga Drive
Los Angeles, CA 90049

William J. Nance                              0(4)                      *
820 Moraga Drive
Los Angeles, CA 90049

Michael G. Zybala                             0                         *
820 Moraga Drive
Los Angeles, CA 90049

All of the above as a group             709,996                     57.2%
---------------------------
* Ownership does not exceed 1%

(1) Unless otherwise indicated, and subject to applicable community property
    laws, each person has sole voting and investment power with respect to the
    shares beneficially owned.

(2) Percentages are calculated on the basis of 1,178,210 shares of Common
    Stock issued and outstanding as of September 13, 2002, plus any securities
    that person has the right to acquire within 60 days pursuant to options,
    warrants, conversion privileges or other rights.

(3) John V. Winfield is the sole beneficial owner of 49,400 shares of Common
    Stock.  InterGroup is the beneficial owner of 596,996 shares of Common
    Stock and 63,600 shares of convertible, voting preferred stock.  As the
    President, Chairman of the Board and a 53.8% shareholder of InterGroup,
    Mr. Winfield has voting and dispositive power with respect to the shares
    of Santa Fe owned of record and beneficially by InterGroup.

(4) William J. Nance is a 2.9% shareholder of InterGroup as well as a
    Director  thereof.  John C. Love is also a Director of InterGroup and a
    less than 1% shareholder.

                                                               Page 34 of 46
<PAGE>


Security Ownership of Management in Subsidiary

As of September 13, 2002, Santa Fe was the record and beneficial owner of
505,207 shares of the common stock of its 68.8%-owned subsidiary, Portsmouth
Square, Inc. The President and Chairman of the Board of Santa Fe has voting
power with respect to common shares of Portsmouth owned by Santa Fe.  No other
director or executive officer of Santa Fe has a beneficial interest in
Portsmouth's shares.


(c) Changes in Control

There are no arrangements that may result in a change in control of the
Company.

Securities Authorized for Issuance Under Equity Compensation Plans.

Santa Fe has no securities authorized for issuance under any equity
compensation plans.


Item 12. Certain Relationships and Related Transactions

As of September 13, 2002, Santa Fe owned 68.8% of the common stock of
Portsmouth, and InterGroup and John V. Winfield, in the aggregate, owned
approximately 57.2% of the voting stock of Santa Fe.  All of the Company's
Directors serve as directors of InterGroup and all three of the Company's
Directors serve on the Board of Portsmouth.

Certain costs and expenses, primarily salaries, rent and insurance, are
allocated between the Company, its subsidiary, Portsmouth, and InterGroup
based on management's estimate of the utilization of resources.  Effective
June 30, 1998, certain accounting and administrative functions of the Company
and its subsidiaries, were transferred to the Los Angeles, California offices
of InterGroup. During the fiscal years ended June 30, 2002 and 2001, the
Company and Portsmouth made payments to InterGroup in the total amount of
approximately $222,900 and $223,000, respectively, for administrative costs
and reimbursement of direct and indirect costs associated with the management
of the Companies and their investments, including the partnership asset.

In September 1999, the Company's subsidiary, Woodland Village, obtained a 5-
year interest only note in the amount of $162,563 from InterGroup.  The note
carries a 7.75% interest rate and matures on September 29, 2004.

During fiscal 2002, the Company paid $51,516 preferred stock dividends to
Intergroup.

As Chairman of the Securities Investment Committee, the Company's President
and Chief Executive officer, John V. Winfield, directs the investment activity
of the Company in public and private markets pursuant to authority granted by
the Board of Directors.  Mr. Winfield also serves as Chief Executive Officer
and Chairman of Portsmouth and InterGroup and oversees the investment activity
of those companies.  Depending on certain market conditions and various risk
factors, the Chief Executive Officer, his family, Portsmouth and InterGroup
may, at times, invest in the same companies in which the Company invests.  The
Company encourages such investments because it places personal resources of
the Chief Executive Officer and his family members, and the resources of
Portsmouth and InterGroup, at risk in connection with investment decisions
made on behalf of the Company.

                                                                 Page 35 of 46
<PAGE>

In December 1998, Board of Directors authorized the Company to obtain whole
life insurance and split dollar insurance policies covering the Company's
President and Chief Executive Officer, Mr. Winfield.  During fiscal years 2002
and 2001, the Company paid annual premiums of $25,500 for the split dollar
whole life insurance policy, owned by, and the beneficiary of which is, a
trust for the benefit of Mr. Winfield's family.  The Company has a secured
right to receive, from any proceeds of the policy, reimbursement of all
premiums paid prior to any payments to the beneficiary.  During fiscal 2002
and 2001, Portsmouth paid annual premiums of $17,000 for a split dollar policy
also covering Mr. Winfield.

There are no other relationships or related transactions between the Company
and any of its officers, directors, five-percent security holders or their
families which require disclosure.


Item 13.  Exhibits and Reports on Form 8-K

(a) Listing of Exhibits by Table Number
    -----------------------------------

Set forth below is an index of applicable exhibits filed with this report
according to exhibit table number.

           Exhibit                                                 Page
           -------                                                 ----

   3.(i)  Articles of Incorporation                                 ***
     (ii) Bylaws (Amended February 15, 2000)                        ****

   4.     Instruments defining he rights of Security Holders,       *
          including indentures (see Articles of Incorporation
          and Bylaws)

   10.    Material Contracts
          (a) Securities Purchase Agreement dated December 20,      **
              1994 between Santa Fe Financial Corporation and
              The InterGroup Corporation

   21.    Subsidiaries:

          (1) Portsmouth Square, Inc. (68.8%)
              Incorporated on July 6, 1967 in California

          (2) Intergroup Woodland Village, Inc. (55.4%)
              Incorporated on August 5, 1993 in Ohio

          (3) 614 Acanto Properties, Inc. (100%)
              Incorporated on November 7, 2001 in California

   99.1   Certificates Pursuant to 18 U.S.C. Section 1350
          as Adopted Pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2002.



*   All exhibits marked by an asterisk have been previously filed with other
    documents, including Registrant's Form 10 filed on October 27, 1967, and
    subsequent filings on forms 8-K, 10-K and 10-Q which are incorporated
    herein by reference.

                                                                Page 36 of 46
<PAGE>

**  Securities Purchase Agreement dated December 20, 1994 between Santa Fe
    Financial Corporation and The InterGroup Corporation was previously filed
    on March 31, 1995 with Registrant's Form 10-K Annual Report for the year
    ended December 31, 1994 and is incorporated herein by reference.

*** Restated Articles of Incorporation, dated August 12, 1997, were previously
    filed on March 31, 1998 with Registrant's Form 10-KSB Annual Report for
    the year ended December 31, 1997 and is incorporated herein by reference.

**** Amendment to Bylaws are incorporated herein by reference to the Company's
     Form 10-KSB filed with the Commission March 29, 2000.


(b)  Reports on Form 8-K
     -------------------

Registrant filed no reports on Form 8-K during the last quarter of the period
covered by this report.


(c) Financial Statements and Schedules Required by Regulation S-X
    -------------------------------------------------------------

The following financial statements of Justice Investors are included in
Item 13:
                                                              PAGE
                                                              ----

Independent Auditor's Report                                    38

Balance Sheets -- December 31, 2001 and 2000                    39

Statements of Income and Partners' Capital - Years              40
  Ended December 31, 2001 and 2000

Statements of Cash Flows -- Years Ended                         41
  December 31, 2001 and 2000

Notes to Financial Statements -- December 31, 2001 and 2000     42


All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under
the related instructions or are inapplicable and therefore have been omitted.


                                                                Page 37 of 46
<PAGE>


                                    BPM
                           BURR, PILGER & MAYER LLP
                          ACCOUNTANTS AND CONSULTANTS

                       600 CALIFORNIA STREET, SUITE 1300
                           SAN FRANCISCO, CA 94108
                             TEL (415) 421-5757
                             FAX (415) 288-6288



                        Independent Auditors' Report
                        ----------------------------

To the Partners
Justice Investors
San Francisco, California

We have audited the accompanying balance sheets of Justice Investors (a
limited partnership) as of December 31, 2001 and 2000, and the related
statements of income and partners' capital and cash flows for the years then
ended.  These financial statements are the responsibility of the Partnership's
management.  Our responsibility is to express an opinion on these financial
statements based on our audit.

We conducted our audit in accordance with auditing standards generally
accepted in the United States of America.  Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.  An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Justice Investors (a limited
partnership) as of December 31, 2001 and 2000, and the results of its
operations and its cash flows for the years then ended, in conformity with
accounting principles generally accepted in the United States of America.



/s/ Burr, Pilger & Mayer LLP


San Francisco, California
January 23, 2002


                                                                Page 38 of 46
<PAGE>


                           JUSTICE INVESTORS
                        (a limited partnership)

                             BALANCE SHEETS

                       December 31, 2001 and 2000
                       --------------------------
                                                        2001           2000
                                                        ----           ----
                                   ASSETS
                                   ------
Current assets:
  Cash and cash equivalents                         $  245,797     $        -
  Rents receivable                                   1,304,012      2,804,594
  Prepaid expenses                                       1,869          5,106
                                                     ---------      ---------
       Total current assets                          1,551,678      2,809,700
                                                     ---------      ---------
Property and equipment:
  Office equipment (net of accumulated
    depreciation of $5,553 in 2001 and 2000)                 -              -
  Building and improvements on operating
    leases (net of accumulated depreciation of
    $12,096,271 in 2001 and $11,740,344
    in 2000)                                         3,349,731      3,705,658
  Land                                               1,124,128      1,124,128
                                                     ---------      ---------
       Total property and equipment                  4,473,859      4,829,786
                                                     ---------      ---------
Other assets:
 Loan fees (net of accumulated amortization
   of $199,570 in 2001 and $170,005 in 2000)            88,687        118,251
 Deferred lease costs (net of accumulated
   amortization of $10,708 in 2001 and
   $9,231 in 2000)                                      11,447         12,924
                                                     ---------      ---------
       Total other assets                              100,134        131,175
                                                     ---------      ---------
                                                    $6,125,671     $7,770,661
                                                     =========      =========

                    LIABILITIES AND PARTNERS' CAPITAL
                    ---------------------------------

Current liabilities:
  Trade accounts payable and accrued expenses       $   48,521     $  104,393
  Rents received in advance                            206,250              -
  Accrued interest                                       2,349         13,391
  Due to partner                                        15,971              -
                                                     ---------      ---------
       Total current liabilities                       273,091        117,784
Long-term debt                                       1,000,000      2,400,000
                                                     ---------      ---------
       Total liabilities                             1,273,091      2,517,784
                                                     ---------      ---------
Commitment - lease commission.
Partners' capital                                    4,852,580      5,252,877
                                                     ---------      ---------
                                                    $6,125,671     $7,770,661
                                                     =========      =========

The accompanying notes are an integral part of these financial statements.

                                                                Page 39 of 46
<PAGE>


                           JUSTICE INVESTORS
                         (a limited partnership)

                STATEMENTS OF INCOME AND PARTNERS' CAPITAL

                  Years Ended December 31, 2001 and 2000
                  --------------------------------------

                                                       2001           2000
                                                       ----           ----
Rental income:
  Hotel                                            $ 5,206,656   $ 7,684,770
  Garage                                             1,385,425     1,478,668
  Other                                                  2,400         2,400
                                                     ---------     ---------
      Total rental income                            6,594,481     9,165,838
Interest income                                         10,682        27,883
Miscellaneous income                                   629,406             -
                                                     ---------     ---------
      Total revenues                                 7,234,569     9,193,721
                                                     ---------     ---------

Expenses:
  Interest                                              20,268        26,391
  Depreciation and amortization                        386,970       403,693
  Lease commission                                      52,066        76,848
  Property taxes                                        42,493        41,899
  General and administrative:
    Administrative expenses                            197,762       150,000
    Accounting fees                                      2,200         4,886
    Audit and tax preparation                           41,159        45,888
    Business taxes                                           -        27,029
    Bank charges                                         9,985         9,379
    Consultants                                         28,065         9,940
    Franchise taxes                                        800           800
    Insurance expense                                   44,910        40,880
    Legal fees                                          80,614        12,440
    Repairs and maintenance                              5,218             -
    Miscellaneous                                        2,356         2,387
                                                     ---------     ---------
      Total expenses                                   914,866       852,460
                                                     ---------     ---------

      Net income                                     6,319,703     8,341,261

Partners' capital at beginning of
  year                                               5,252,877     5,731,618

Less distributions to partners                      (6,720,000)   (8,820,002)
                                                     ---------     ---------
Partners' capital at end of year                   $ 4,852,580   $ 5,252,877
                                                     =========     =========

The accompanying notes are in integral part of these financial statements.

                                                                 Page 40 of 46
<PAGE>

                                JUSTICE INVESTORS
                              (a limited partnership)
                              -----------------------

                             Statements of Cash Flows
                  for the years ended December 31, 2001 and 2000
                  ----------------------------------------------



                                                        2001          2000
                                                        ----          ----
Cash flows from operating activities:
  Net income                                        $ 6,319,703   $ 8,341,261
  Adjustments to reconcile net income to
     net cash provided by operating
     activities-depreciation and amortization           386,970       403,693
  Changes in operating assets and liabilities:
   Decrease (increase) in rents receivable            1,500,580      (605,696)
   Decrease in prepaid expenses                           3,237           115
   (Increase) decrease in trade accounts
     payable and accrued expenses                       (55,872)       58,874
   Increase (decrease) in rents received in advance     206,250      (206,250)
   Increase in due partner                               15,971             -
   (Decrease) increase in accrued interest              (11,042)        4,099
                                                      ---------     ---------
      Net cash provided by operating activities       8,365,797     7,996,096
                                                      ---------     ---------

Cash flows from financing activities:
  Distributions to partners                          (6,720,000)   (8,820,002)
  Net (payments) proceeds on long-term debt          (1,400,000)      808,453
                                                      ---------     ---------

      Net cash used in financing activities          (8,120,000)   (8,011,549)
                                                      ---------     ---------

      Net increase (decrease) in cash
        and cash equivalents                            245,797       (15,453)

Cash and cash equivalents at beginning of year                -        15,453
                                                      ---------     ---------

Cash and cash equivalents at end of year            $   245,797   $         -
                                                      =========     =========
Supplemental disclosures of cash flows
   information-cash paid during the year for
  Interest                                          $   31,310    $    22,292
                                                      ========      =========
  Franchise taxes                                   $      800    $       800
                                                      ========      =========


The accompanying notes are in integral part of these financial statements.


                                                                  Page 41 of 46
<PAGE>

                            JUSTICE INVESTORS
                             (a limited partnership)
                              ---------------------

                          Notes to Financial Statements

1.  Organization
    ------------
Justice Investors, a Limited Partnership (the Partnership), was formed in 1967
to acquire real property in San Francisco, California, for the development and
lease of hotel and related facilities.  The leases became effective during
1970 upon completion of the hotel and parking garage.  The lease of the hotel
provides for the Partnership to receive certain percentages of hotel revenue,
as defined, to December 31, 2004, with a five-year renewal option.  The
parking garage lease provides for payments of certain percentages of parking
receipts to November 30, 2010.


2.  Summary of Significant Accounting Policies
    ------------------------------------------

Rents Receivable
----------------
Management believes that all rents receivable are fully collectible.
Therefore, no allowance for doubtful accounts was recorded as of December 31,
2001.

Property and Equipment
----------------------
Property and equipment are stated at cost.  Depreciation on the hotel
facilities is computed using the straight line method over a useful life of 40
years.  Building improvements are being depreciated on a straight line basis
over their useful lives ranging from 5 to 39 years.  Office equipment is being
depreciated using the 150% declining balance method with a useful life of 5
years.

Loan Fees and Deferred Lease Costs
----------------------------------
Loan fees are stated at cost and amortized using the straight line method over
10 years.  Deferred lease costs are stated at cost and amortized using the
straight line method over 15 years.

Trade Accounts Payable
----------------------
The Partnership's banking system provides for the daily replenishment of bank
accounts from the line of credit as checks are presented.  Accordingly,
included in trade accounts payable at December 31, 2001 is $59,254,
representing the excess of outstanding checks over cash on deposit at the bank
upon which the checks were drawn.

Income Tax
----------
No income taxes have been provided in the accompanying financial statements
since the Partnership profits and losses are reportable by the partners on
their individual income tax returns.

Statement of Cash Flows
-----------------------
For purposes of the statement of cash flows, cash equivalents include time
deposits, certificates of deposit, and all highly liquid debt instruments with
original maturities of three months or less.

                                                                 Page 42 of 46
<PAGE>

                               JUSTICE INVESTORS
                             (a limited partnership)
                              ---------------------

                     Notes to Financial Statements, Continued

Summary of Significant Accounting Policies, continued
-----------------------------------------------------

Use of Estimates
----------------
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires the use
of estimates and assumptions regarding certain types of assets, liabilities,
revenues, and expenses.  Such estimates primarily relate to unsettled
transactions and events as of the date of the financial statements.
Accordingly, upon settlement, actual results may differ from estimated amounts.


3.  Long-Term Debt
    --------------
The Partnership has a revolving reducing line of credit agreement with a bank
that is collateralized by the first deed of trust on the hotel land and
property and the Partnership's interest in the hotel and garage leases.
Balances accrue interest at either prime rate per annum or at LIBOR plus 2%
per annum to a capped rate of 9.5% on balances up to $4,000,000.  The
outstanding balances under the agreement at December 31, 2001 and 2000 were
$1,000,000 and $2,400,000, respectively.  The balances were accruing interest
at LIBOR plus 2% or 4.75% at December 31, 2001.  The line of credit matures on
December 31, 2004.

Under the terms of the agreement, the line of credit is subject to a declining
maximum credit limit as follows:

    2002                                         5,419,302
    2003                                         4,970,590
    2004                                         4,470,275


4.  Minimum Future Rentals
    ----------------------
Minimum future rentals to be received under non-cancelable leases as of
December 31, 2001 for each of the next five years and in the aggregate are:

                                  Hotel          Garage        Total
                                  -----          ------        -----
    2002                         2,500,000       261,000      2,761,000
    2003                         2,500,000       261,000      2,761,000
    2004                         2,500,000       261,000      2,761,000
    2005                                 -       261,000        261,000
    2006                                 -       261,000        261,000
    Subsequent to 2006                   -     1,022,250      1,022,250
                                ----------     ---------     ----------
                              $  7,500,000   $ 2,327,250   $  9,827,250
                                ==========     =========     ==========

                                                                Page 43 of 46
<PAGE>


                             JUSTICE INVESTORS
                             (a limited partnership)
                              ---------------------

                    Notes to Financial Statements, Continued



5.  Commitment - Lease Commission
    -----------------------------

The Partnership is obligated to pay a lease commission of 1 % of rentals
received to December 31, 2004 plus Holiday Inn lease extension, if any, to
December 31, 2010.


6.  Related Party Transactions
    --------------------------
Expenses were incurred for services rendered by related parties as follows:


                                                       2001           2000
                                                       ----           ----

         General partners                          $  197,762   $   150,000
         Legal services                                80,384        12,440
                                                    ---------    ----------
                                                   $  278,146   $   162,440
                                                    =========    ==========

The garage lessee, the managing general partner, paid the Partnership
$1,385,425 and $1,478,668 during 2001 and 2000, respectively, under the terms
of the rental agreement.  Rents receivable from the garage lessee at December
31, 2001 and 2000 were $115,356 and $117,510, respectively.  Accounts payable
to general partners at December 31, 2001 and 2000 were $47,762 and $30,000,
respectively.


7.  Concentration of Credit Risk
    ----------------------------

Revenue and Receivables
-----------------------
The Partnership earns rental revenues under two leases.  Rents receivable at
December 31, 2001 and 2000 consist of the amounts due under the leases as
follows:

                                                       2001           2000
                                                       ----           ----

         Hotel receivable                         $  1,188,656   $  2,687,082
         Garage receivable                             115,356        117,510
                                                   -----------    -----------
                                                  $  1,304,012   $  2,804,592
                                                   ===========    ===========


                                                                Page 44 of 46
<PAGE>


                                SIGNATURES
                                ----------

   Pursuant to the requirements of Section 13 or 15(d) 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.

                                              SANTA FE FINANCIAL CORPORATION
                                                        (Registrant)

Date: September 27, 2002                      by /s/ John V. Winfield
                                                 ---------------------------
                                                 John V. Winfield, President,
                                                 Chairman of the Board and
                                                 Chief Executive Officer


Date: September 27, 2002                      by /s/ Michael G. Zybala
                                                 ---------------------------
                                                 Michael G. Zybala,
                                                 Vice President and Secretary
                                                 and Treasurer



   Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.



Date: September 27, 2002              /s/ John V. Winfield
      ------------------              ---------------------------------------
                                      John V. Winfield, Chairman of the Board,
                                      President and Chief Executive Officer


Date: September 27, 2002              /s/ John C. Love
      ------------------              ---------------------------------------
                                      John C. Love,
                                      Director


Date: September 27, 2002              /s/ William J. Nance,
      ------------------              ---------------------------------------
                                      William J. Nance,
                                      Director

                                                                 Page 45 of 46
<PAGE>



                             CERTIFICATIONS


I, John V. Winfield, certify that:

1. I have reviewed this annual report on Form 10-KSB of Santa Fe Financial
   Corporation;

2. Based on my knowledge, this annual report does not contain any untrue
   statement of a material fact or omit to state a material fact necessary
   to make the statements made, in the light of the circumstances under which
   such statements are made, not misleading with respect to the period covered
   by this annual report; and

3. Based on my knowledge, the financial statements, and other financial
   information included in this annual report, fairly represent in all
   material aspects the financial condition, results of operations and cash
   flows of the registrant as of, and for, the periods presented in this
   annual report.


Date:  September 27, 2002


/s/ John V. Winfield
------------------------------
John V. Winfield, President
Chief Executive Officer


______________________________________________________________________________



I, Michael G. Zybala, certify that:

1. I have reviewed this annual report on Form 10-KSB of Santa Fe Financial
   Corporation;

2. Based on my knowledge, this annual report does not contain any untrue
   statement of a material fact or omit to state a material fact necessary
   to make the statements made, in the light of the circumstances under which
   such statements are made, not misleading with respect to the period covered
   by this annual report; and

3. Based on my knowledge, the financial statements, and other financial
   information included in this annual report, fairly represent in all
   material aspects the financial condition, results of operations and cash
   flows of the registrant as of, and for, the periods presented in this
   annual report.


Date:  September 27, 2002


/s/ Michael G. Zybala
--------------------------------
Michael G. Zybala, Vice President,
Secretary and Treasurer
(Acting as Principal Accounting
and Financial Officer)


                                                               Page 46 of 46