<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                For the quarterly period ended September 30, 2003
                                               ------------------
                          Commission File No. 000-50258
                                              ---------


                            Belrose Capital Fund LLC
                            ------------------------
             (Exact name of registrant as specified in its charter)


               Delaware                                04-3613468
               --------                                ----------
        (State of organization)          ( I.R.S. Employer Identification No.)


         The Eaton Vance Building
             255 State Street
          Boston, Massachusetts                          02109
          ---------------------                          -----
(Address of principal executive offices)              (Zip Code)


    Registrant's telephone number:                    617-482-8260
                                                      ------------


                                      None
                                      ----
              (Former Name, Former Address and Former Fiscal Year,
                         if changed since last report)



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the  Securities  and  Exchange Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                                   YES [X]      NO [ ]


Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act).

                                   YES [ ]      NO [X]

<PAGE>

                            BELROSE CAPITAL FUND LLC
                               Index to Form 10-Q

                                                                           Page
PART I   FINANCIAL INFORMATION

Item 1.  Condensed Consolidated Financial Statements                         3

         Condensed Consolidated Statements of Assets and Liabilities
         as of September 30, 2003 (Unaudited) and December 31, 2002          3

         Condensed Consolidated Statements of Operations (Unaudited)
         for the Three Months Ended September 30, 2003 and 2002 and
         for the Nine Months Ended September 30, 2003 and the Period
         from the Start of Business, March 19, 2002, to September 30,
         2002                                                                4

         Condensed Consolidated Statements of Changes in Net Assets
         (Unaudited) for the Nine Months Ended September 30, 2003 and
         for the Period from the Start of Business, March 19, 2002, to
         September 30, 2002                                                  6

         Condensed Consolidated Statements of Cash Flows (Unaudited) for
         the Nine Months Ended September 30, 2003 and for the Period from
         the Start of Business, March 19, 2002, to September 30, 2002        7

         Financial Highlights (Unaudited) for the Nine Months Ended
         September 30, 2003                                                  9

         Notes to Condensed Consolidated Financial Statements as of
         September 30, 2003 (Unaudited)                                     10

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                          16

Item 3.  Quantitative and Qualitative Disclosures About Market Risk         20

Item 4.  Controls and Procedures                                            22

PART II  OTHER INFORMATION

Item 1.  Legal Proceedings                                                  22

Item 2.  Changes in Securities and Use of Proceeds                          22

Item 3.  Defaults Upon Senior Securities                                    22

Item 4.  Submission of Matters to a Vote of Security Holders                22

Item 5.  Other Information                                                  22

Item 6.  Exhibits and Reports on Form 8-K                                   22

SIGNATURES                                                                  24

EXHIBIT INDEX                                                               25

                                        2
<PAGE>

PART I.   FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
--------------------------------------------------------------------------------

BELROSE CAPITAL FUND LLC
Condensed Consolidated Statements of Assets and Liabilities
                                                 September 30,
                                                     2003           December 31,
                                                  (Unaudited)          2002
                                                 -------------      ------------
Assets:
 Investment in Belvedere Capital Fund
  Company LLC (Belvedere Capital)                $1,483,730,463   $1,264,314,536
 Investment in Partnership Preference Units          56,765,736       41,849,305
 Investment in other real estate                    473,304,865      470,597,295
 Short-term investments                               1,091,036                -
                                                 --------------   --------------
Total investments                                $2,014,892,100   $1,776,761,136
 Cash                                                 7,866,909        7,214,141
 Escrow deposits - restricted                         2,589,328        3,239,060
 Dividends and interest receivable                      400,974          440,053
 Other assets                                         3,254,207        3,553,337
                                                 --------------   --------------
Total assets                                     $2,029,003,518   $1,791,207,727
                                                 --------------   --------------

Liabilities:
 Loan payable - Credit Facility                  $  171,300,000   $  155,300,000
 Mortgages payable                                  344,219,483      344,219,483
 Payables for Fund Shares redeemed                       34,674                -
 Open interest rate swap agreements, at value        12,183,246       11,552,842
 Security deposits                                    1,002,540        1,012,016
 Swap interest payable                                  154,544          129,883
 Accrued expenses:
  Interest expense                                    2,297,396        2,438,911
  Property taxes                                      3,672,028        2,575,189
  Other expenses and liabilities                      1,499,024        2,546,403
 Minority interests in controlled subsidiaries       27,575,513       29,431,345
                                                 --------------   --------------
Total liabilities                                $  563,938,448   $  549,206,072
                                                 --------------   --------------

Net assets                                       $1,465,065,070   $1,242,001,655

                                                 --------------   --------------
Shareholders' Capital                            $1,465,065,070   $1,242,001,655
                                                 --------------   --------------

Shares outstanding                                   17,126,971       16,160,271
                                                 --------------   --------------

Net asset value and redemption price per Share   $        85.54   $        76.86

       See notes to unaudited condensed consolidated financial statements

                                       3
<PAGE>

BELROSE CAPITAL FUND LLC
Condensed Consolidated Statements of Operations (Unaudited)
<TABLE>
<CAPTION>

                                                          Three Months      Three Months      Nine Months
                                                             Ended             Ended             Ended         Period Ended
                                                          September 30,     September 30,     September 30,    September 30,
                                                             2003              2002              2003              2002*
                                                          -------------     -------------     -------------    -------------
<S>                                                       <C>               <C>               <C>              <C>
Investment Income:
 Dividends allocated from Belvedere Capital
  (net of foreign taxes of $44,519, $23,870,
  $195,966 and $44,140, respectively)                     $  5,318,515      $  2,506,725      $ 15,125,124     $  3,868,211
 Interest allocated from Belvedere Capital                      44,016            60,388           290,984           92,903
 Expenses allocated from Belvedere Capital                  (2,276,006)       (1,111,602)       (6,320,138)      (1,789,316)
                                                          -------------     -------------     -------------    -------------
 Net investment income allocated from
  Belvedere Capital                                       $  3,086,525      $  1,455,511      $  9,095,970     $  2,171,798
 Rental income                                              16,072,897        10,755,114        48,493,177       21,637,946
 Dividends from Partnership Preference Units                 1,198,456           794,707         3,393,494          919,588
 Interest                                                       24,312            24,277            70,688           48,273
                                                          ------------      ------------      ------------     ------------
Total investment income                                   $ 20,382,190      $ 13,029,609      $ 61,053,329     $ 24,777,605
                                                          ------------      ------------      ------------     ------------

Expenses:
 Investment advisory and administrative fees              $  1,284,136      $    687,489     $   3,652,975     $  1,150,317
 Property management fees                                      640,785           430,815         1,942,519          869,759
 Distribution and servicing fees                               731,562           345,130         2,028,314          560,581
 Interest expense on mortgages                               6,579,654         4,243,268        19,738,536        8,582,544
 Interest expense on Credit Facility                           653,188           594,072         2,133,780        1,002,400
 Interest expense on swap agreements                         1,189,097           682,741         3,371,735        1,136,450
 Property and maintenance expenses                           4,795,722         2,793,259        13,523,760        5,531,643
 Property taxes and insurance                                1,721,795         1,538,125         6,038,108        2,901,026
 Organizational expenses                                             -            16,968                 -          685,324
 Miscellaneous                                                 279,318           234,265           865,029          577,236
                                                          ------------      ------------      ------------     ------------
Total expenses                                            $ 17,875,257      $ 11,566,132      $ 53,294,756     $ 22,997,280

Deduct-
 Reduction of investment advisory
  and administrative fees                                      372,161           177,576         1,022,522          286,880
                                                          ------------      ------------      ------------     ------------
Net expenses                                              $ 17,503,096      $ 11,388,556      $ 52,272,234     $ 22,710,400
                                                          ------------      ------------      ------------     ------------
Net investment income before
 minority interests in net income of
 controlled subsidiaries                                  $  2,879,094      $  1,641,053      $  8,781,095     $  2,067,205
Minority interests in net income
 of controlled subsidiaries                                   (526,835)         (424,481)       (1,500,532)        (863,703)
                                                          -------------     -------------     -------------    -------------
Net investment income                                     $  2,352,259      $  1,216,572      $  7,280,563     $  1,203,502
                                                          -------------     -------------     -------------    -------------

*    For the period from start of  business,  March 19, 2002,  to September  30, 2002.
</TABLE>


       See notes to unaudited condensed consolidated financial statements

                                       4
<PAGE>

BELROSE CAPITAL FUND LLC
Condensed Consolidated Statements of Operations (Unaudited) (Continued)
<TABLE>
<CAPTION>

                                                          Three Months      Three Months      Nine Months
                                                             Ended             Ended             Ended         Period Ended
                                                          September 30,     September 30,     September 30,    September 30,
                                                             2003              2002              2003              2002*
                                                          -------------     -------------     -------------    -------------
<S>                                                       <C>              <C>                <C>              <C>
Realized and Unrealized Gain (Loss)
Net realized gain (loss) -
 Investment transactions from Belvedere
  Capital  (identified cost basis)                        $  1,072,597     $ (11,402,524)     $ (1,848,037)    $ (13,420,785)
                                                          ------------     --------------     -------------    --------------
Net realized gain (loss)                                  $  1,072,597     $ (11,402,524)     $ (1,848,037)    $ (13,420,785)
                                                          ------------     --------------     -------------    --------------

Change in unrealized appreciation
 (depreciation) -
  Investment in Belvedere Capital
   (identified cost basis)                                $ 29,866,436     $ (96,759,842)     $139,042,412     $(158,899,616)
  Investments in Partnership Preference Units
   (identified cost basis)                                    (289,158)          882,842         6,882,831           987,612
  Investments in other real estate
   (net of minority interests in unrealized
   gain (loss) of controlled subsidiaries of
   $1,186,107, $756,424, $(3,462,083)
   and $946,235, respectively)                              (1,125,102)         (756,424)        2,822,783        (2,744,572)
  Interest rate swap agreements                              4,311,912        (7,761,968)         (630,404)      (10,467,740)
                                                          -------------    --------------     -------------    --------------
Net change in unrealized appreciation
 (depreciation)                                           $ 32,764,088     $(104,395,392)     $148,117,622     $(171,124,316)
                                                          ------------     --------------     ------------     --------------

Net realized and unrealized gain (loss)                   $ 33,836,685     $(115,797,916)     $146,269,585     $(184,545,101)
                                                          ------------     --------------     ------------     --------------

Net increase (decrease) in net assets from
   operations                                             $ 36,188,944     $(114,581,344)     $153,550,148     $(183,341,599)
                                                          ============     ==============     ============     ==============

*    For the period from start of  business,  March 19, 2002,  to September  30, 2002.
</TABLE>

       See notes to unaudited condensed consolidated financial statements

                                       5
<PAGE>

BELROSE CAPITAL FUND LLC
Condensed Consolidated Statements of Changes in Net Assets (Unaudited)

                                              Nine Months
                                                 Ended           Period Ended
                                              September 30,      September 30,
                                                 2003                 2002*
                                          -------------------    -------------
Increase (Decrease) in Net Assets:
 Net investment income                      $    7,280,563       $   1,203,502
 Net realized loss from investment
  transactions                                  (1,848,037)        (13,420,785)
 Net change in unrealized appreciation
  (depreciation) of investments                148,117,622        (171,124,316)
                                            ---------------      --------------
Net increase (decrease) in net assets
 from operations                            $  153,550,148       $(183,341,599)
                                            --------------       --------------

Transactions in Fund Shares -
 Investment securities contributed          $   95,047,136       $ 935,665,736
 Less - Selling commissions                       (325,083)         (4,284,627)
                                            ---------------      --------------
 Net contributions                          $   94,722,053       $ 931,381,109
 Net asset value of Fund Shares issued to
  Shareholders in payment of distributions
  declared                                  $      348,050       $           -
 Net asset value of Fund Shares redeemed       (24,748,822)         (4,028,564)
                                            ---------------      --------------
Net increase in net assets from Fund Share
 transactions                               $   70,321,281       $ 927,352,545
                                            ---------------      --------------

Distributions -
 Distributions to Shareholders              $     (808,014)      $           -
                                            ---------------      --------------
Total distributions                         $     (808,014)      $           -
                                            ---------------      ---------------

Net increase in net assets                  $  223,063,415       $ 744,010,946

Net assets:
 At beginning of period                     $1,242,001,655       $           -
                                            --------------       --------------
 At end of period                           $1,465,065,070       $ 744,010,946
                                            ==============       ==============

* For the period from start of business, March 19, 2002, to September 30, 2002.

       See notes to unaudited condensed consolidated financial statements

                                       6
<PAGE>

BELROSE CAPITAL FUND LLC
Condensed Consolidated Statements of Cash Flows (Unaudited)
<TABLE>
<CAPTION>
                                                                                   Nine Months
                                                                                      Ended            Period Ended
                                                                                  September 30,        September 30,
                                                                                      2003                 2002*
                                                                                  -------------        -------------
<S>                                                                               <C>                  <C>
Cash Flows From (For) Operating Activities -
Net increase (decrease) in net assets from operations                             $ 153,550,148        $(183,341,599)
Adjustments to reconcile net increase (decrease) in net assets from operations
 to net cash flows for operating activities -
  Net investment income allocated from Belvedere Capital                             (9,095,970)          (2,171,798)
  Decrease in escrow deposits                                                           649,732              897,219
  Decrease (increase) in other assets                                                   299,130             (148,657)
  Decrease (increase) in dividends and interest receivable                               39,079             (401,084)
  Increase in interest payable for open swap agreements                                  24,661               96,117
  (Decrease) increase in security deposits, accrued interest and
   other expenses and liabilities                                                    (1,198,370)             678,830
  Increase in accrued property taxes                                                  1,096,839            1,608,133
  Purchases of Partnership Preference Units                                          (8,033,600)         (33,135,680)
  Payments for investments in other real estate                                               -          (64,553,951)
  Cash assumed in connection with acquisition of other
   real estate                                                                                -            3,625,569
  Improvements to rental property                                                    (3,346,868)          (1,241,643)
  Increase in short-term investments                                                 (1,091,036)                   -
  Net decrease (increase) in investment in Belvedere Capital                          1,651,420           (1,087,522)
  Increase in minority interest                                                               -              210,000
  Minority interests in net income of controlled subsidiaries                         1,500,532              863,703
  Net realized loss from investment transactions                                      1,848,037           13,420,785
  Net change in unrealized (appreciation) depreciation of investments              (148,117,622)         171,124,316
                                                                                  --------------      ---------------
Net cash flows for operating activities                                           $ (10,223,888)      $  (93,557,262)
                                                                                  --------------      ---------------

Cash Flows From (For) Financing Activities -
 Proceeds from Credit Facility                                                    $  16,000,000       $  105,500,000
 Payments on behalf of investors (selling commissions)                                 (325,083)          (4,284,627)
 Payments for Fund Shares redeemed                                                   (4,444,014)          (1,250,646)
 Distributions paid to minority shareholders                                                  -             (160,007)
 Distributions paid to Shareholders                                                    (459,964)                   -
 Capital contributed to controlled subsidiaries                                         105,717                    -
                                                                                  --------------      ---------------
Net cash flows from financing activities                                          $  10,876,656       $   99,804,720
                                                                                  --------------      ---------------

Net increase in cash                                                              $     652,768      $     6,247,458

Cash at beginning of period                                                       $   7,214,141      $             -
                                                                                  -------------      ---------------
Cash at end of period                                                             $   7,866,909      $     6,247,458
                                                                                  =============      ===============
</TABLE>
* For the period from start of business, March 19, 2002, to September 30, 2002.

       See notes to unaudited condensed consolidated financial statements

                                       7
<PAGE>

BELROSE CAPITAL FUND LLC
Condensed Consolidated Statements of Cash Flows (Unaudited) (Continued)
<TABLE>
<CAPTION>
                                                                                   Nine Months
                                                                                      Ended            Period Ended
                                                                                  September 30,        September 30,
                                                                                      2003                 2002*
                                                                                  -------------        -------------
<S>                                                                               <C>                  <C>
Supplemental Disclosure and Non-cash Investing and
 Financing Activities -
  Securities contributed by Shareholders, invested in
   Belvedere Capital                                                              $  95,047,136        $ 935,665,736
  Interest paid on loan - Credit Facility                                         $   2,190,433        $     688,310
  Interest paid on mortgages                                                      $  19,428,610        $   7,084,355
  Interest paid on swap agreements                                                $   3,347,074        $   1,040,333
  Market value of securities distributed in payment of
   redemptions                                                                    $  20,270,134        $   2,777,918
  Market value of real property and other assets, net
   of current liabilities, assumed in conjunction with
   acquisition of other real estate                                               $           -        $ 317,807,773
  Mortgage assumed in conjunction with acquisition of
   other real estate                                                              $           -        $ 223,219,483

*    For the period from start of  business,  March 19, 2002,  to September  30, 2002.
</TABLE>

       See notes to unaudited condensed consolidated financial statements

                                       8
<PAGE>

BELROSE CAPITAL FUND LLC as of September 30, 2003
Condensed Consolidated Financial Statements (Continued)

FINANCIAL HIGHLIGHTS (UNAUDITED)

For the Nine Months Ended September 30, 2003
--------------------------------------------------------------------------------
Net asset value - Beginning of period                                  $ 76.860
--------------------------------------------------------------------------------

INCOME (LOSS) FROM OPERATIONS
--------------------------------------------------------------------------------
Net investment income (6)                                              $  0.428
Net realized and unrealized gain                                          8.302
--------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS                                           $  8.730

DISTRIBUTIONS
--------------------------------------------------------------------------------
Distributions to Shareholders                                          $(0.050)
--------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS                                                    $(0.050)
--------------------------------------------------------------------------------

NET ASSET VALUE - END OF PERIOD                                        $85.540
--------------------------------------------------------------------------------

TOTAL RETURN (1)                                                         11.36 %

                                             As a Percentage    As a Percentage
                                             of Average Net     of Average Gross
RATIOS                                         Assets (5)        Assets (2)(5)
--------------------------------------------------------------------------------
Expenses of Consolidated Real Property
 Subsidiaries
  Interest and other borrowing costs (7)        1.55% (8)          1.16% (8)
  Operating expenses (7)                        1.69% (8)          1.27% (8)
Belrose Capital Fund LLC Expenses
  Interest and other borrowing costs (4)        0.54% (8)          0.40% (8)
  Investment advisory and administrative
   fees, servicing fees and other Fund
   operating expenses (3)(4)                    1.13% (8)          0.85% (8)
                                              ----------------------------------
Total expenses                                  4.91% (8)          3.68% (8)

Net investment income                           0.71% (8)          0.53% (8)
--------------------------------------------------------------------------------

SUPPLEMENTAL DATA
--------------------------------------------------------------------------------
Net assets, end of period (000's omitted)                        $  1,465,065
Portfolio Turnover of Tax-Managed Growth Portfolio
 (the Portfolio)                                                           14%
--------------------------------------------------------------------------------

(1)  Returns are  calculated by determining  the percentage  change in net asset
     value with all distributions reinvested. Total return is not computed on an
     annualized basis.

(2)  Average  Gross Assets is defined as the average  daily amount of all assets
     of Belrose Capital Fund LLC (Belrose Capital)  (including Belrose Capital's
     interest in  Belvedere  Capital Fund  Company LLC  (Belvedere  Capital) and
     Belrose  Capital's  ratable  share  of  the  assets  of  its  directly  and
     indirectly controlled subsidiaries),  without reduction by any liabilities.
     For this  purpose,  the assets of  Belrose  Realty  Corporation's  (Belrose
     Realty) controlled  subsidiaries are reduced by the proportionate interests
     therein of investors other than Belrose Realty.

(3)  Includes Belrose Capital's share of Belvedere Capital's allocated expenses,
     including those expenses allocated from the Portfolio.

(4)  Includes  the  expenses of Belrose  Capital and  Belrose  Realty.  Does not
     include expenses of the real estate subsidiaries  majority-owned by Belrose
     Realty.

(5)  For the purpose of calculating  ratios,  the income and expenses of Belrose
     Realty's controlled  subsidiaries are reduced by the proportionate interest
     therein of investors other than Belrose Realty.

(6)  Calculated using average shares outstanding.

(7)  Includes Belrose Realty's  proportional  share of expenses  incurred by its
     majority-owned subsidiaries.

(8)  Annualized.

       See notes to unaudited condensed consolidated financial statements

                                       9
<PAGE>

BELROSE CAPITAL FUND LLC as of September 30, 2003
Notes to Condensed Consolidated Financial Statements (Unaudited)

1    Basis of Presentation

The condensed  consolidated interim financial statements of Belrose Capital Fund
LLC (Belrose  Capital) and its subsidiaries  (collectively,  the Fund) have been
prepared by the Fund,  without audit, in accordance  with accounting  principles
generally  accepted  in the  United  States of  America  for  interim  financial
information and with the  instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, certain information and footnote disclosures normally included
in annual financial statements prepared in accordance with accounting principles
generally  accepted  in the United  States of  America  have been  condensed  or
omitted as permitted by such rules and regulations. All adjustments,  consisting
of normal recurring  adjustments,  have been included.  Management believes that
the disclosures are adequate to present fairly the financial  position,  results
of  operations,  cash flows and  financial  highlights  at the dates and for the
periods  presented.  It is suggested that these interim financial  statements be
read in conjunction with the financial statements and the notes thereto included
in the Fund's registration statement on Form 10. Results for interim periods are
not necessarily indicative of those to be expected for the full fiscal year.

The balance  sheet at December  31, 2002 has been  derived from the December 31,
2002 audited  financial  statements but does not include all of the  information
and footnotes required by accounting principles generally accepted in the United
States  of  America  for  complete  financial  statements  as  permitted  by the
instructions to Form 10-Q and Article 10 of Regulation S-X.

Certain  amounts  in  the  prior  period's  condensed   consolidated   financial
statements   have  been   reclassified   to  conform  with  the  current  period
presentation.

2    Estate Freeze

Shareholders  in Belrose  Capital are entitled to  restructure  their Fund Share
interests under what is termed an Estate Freeze  Election.  Under this election,
Fund Shares are  divided  into  Preferred  Shares and Common  Shares.  Preferred
Shares have a preferential  right over the corresponding  Common Shares equal to
(i) 95% of the original  capital  contribution  made in respect of the undivided
Shares from which the Preferred Shares and Common Shares were derived, plus (ii)
an annuity priority return equal to 7.75% of the Preferred Shares'  preferential
interest in the original capital  contribution of the undivided Fund Shares. The
associated  Common  Shares are  entitled  to the  remaining  5% of the  original
capital  contribution  in  respect of the  undivided  Shares,  plus any  returns
thereon in excess of the fixed  annual  priority of the  Preferred  Shares.  The
existence of restructured Fund Shares does not adversely affect Shareholders who
do not make an election nor do the  restructured  Fund Shares have  preferential
rights  to Fund  Shares  that  have  not  been  restructured.  Shareholders  who
subdivide  Fund  Shares  under  this  election   sacrifice  certain  rights  and
privileges  that they would  otherwise  have with  respect to the Fund Shares so
divided,  including  redemption  rights and voting and consent rights.  Upon the
twentieth anniversary of the issuance of the associated undivided Fund Shares to
the original  holders  thereof,  Preferred and Common Shares will  automatically
convert into full and  fractional  undivided  Fund  Shares.  The  allocation  of
Belrose  Capital's net asset value per Share of $85.54 as of September 30, 2003,
between Preferred and Common shares that have been restructured is as follows:

                                                     Per Share Value At
                                                     September 30, 2003
                                          --------------------------------------
                                           Preferred                     Common
          Date of Contribution             Shares                        Shares
--------------------------------------------------------------------------------
           February 19, 2003               $ 73.43                       $ 12.11

                                       10
<PAGE>

3    Investment Transactions

The following table summarizes the Fund's  investment  transactions for the nine
months ended September 30, 2003 and the period from the start of business, March
19, 2002, to September 30, 2002:
<TABLE>
<CAPTION>

                                                 Nine Months Ended          Period Ended
       Investment Transaction                    September 30, 2003      September 30, 2002
-----------------------------------------------------------------------------------------------
<S>                                               <C>                     <C>
Increases in investment in Belvedere Capital      $  95,047,136           $ 944,429,716
Decreases in investment in Belvedere Capital      $  21,921,554           $  10,454,376
Purchases of Partnership Preference Units (1)     $   8,033,600           $  33,135,680
Acquisitions of other real estate (2)             $           -           $  64,553,951
</TABLE>

(1)  Purchases  of  Partnership  Preference  Units  during the nine months ended
     September  30,  2003 and the period from the start of  business,  March 19,
     2002,  to  September  30,  2002,  represent  Partnership  Preference  Units
     purchased  from other  funds  sponsored  by Eaton Vance  Management  (Eaton
     Vance).

(2)  Acquisitions of other real estate  investments  represent Real Estate Joint
     Ventures purchased from other funds sponsored by Eaton Vance for the period
     from the start of business, March 19, 2002, to September 30, 2002.

4    Indirect Investment in Portfolio

The following  table  summarizes  the Fund's  investment in  Tax-Managed  Growth
Portfolio (the Portfolio)  through Belvedere Capital Fund Company LLC (Belvedere
Capital),  for the nine months ended  September 30, 2003 and for the period from
the  start of  business,  March 19,  2002,  to  September  30,  2002,  including
allocations of income and expenses for the respective periods then ended:

<TABLE>
<CAPTION>

                                                                               Nine Months Ended         Period Ended
                                                                               September 30, 2003     September 30, 2002
--------------------------------------------------------------------------------------------------------------------------
<S>                                                                             <C>                     <C>
Belvedere Capital's interest in the Portfolio (1)                               $  9,775,572,306        $  8,043,904,602
The Fund's investment in Belvedere Capital (2)                                  $  1,483,730,463        $    763,826,737
Income allocated to Belvedere Capital from the Portfolio                        $    102,346,416        $     64,163,061
Income allocated to the Fund from Belvedere Capital                             $     15,416,108        $      3,961,114
Expenses allocated to Belvedere Capital from the Portfolio                      $     31,352,609        $     22,903,987
Expenses allocated to the Fund from Belvedere Capital                           $      6,320,138        $      1,789,316
Realized loss allocated to Belvedere Capital from the Portfolio                 $    (10,803,952)       $   (549,816,840)
Realized loss allocated to the Fund from Belvedere Capital                      $     (1,848,037)       $    (13,420,785)
Change in unrealized appreciation (depreciation) allocated to Belvedere
 Capital from the Portfolio                                                     $    898,392,188        $ (2,273,134,307)
Change in unrealized appreciation (depreciation) allocated to the Fund
 from Belvedere Capital                                                         $    139,042,412        $   (158,899,616)
--------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)  As of  September  30,  2003 and  2002,  the  value of  Belvedere  Capital's
     interest in the Portfolio represents 62.1% and 58.6% of the Portfolio's net
     assets, respectively.

(2)  As of  September  30, 2003 and 2002,  the Fund's  investment  in  Belvedere
     Capital  represents  15.2%  and 9.5% of  Belvedere  Capital's  net  assets,
     respectively.

A summary of the  Portfolio's  Statement of Assets and  Liabilities at September
30, 2003,  December 31, 2002 and September 30, 2002 and its  operations  for the
nine months ended  September  30, 2003,  for the period from the Fund's start of
business,  March 19,  2002,  to  December  31,  2002 and for the period from the
Fund's start of business, March 19, 2002, to September 30, 2002 follows:

                                       11
<PAGE>
                              September 30,     December 31,     September 30,
                                 2003             2002               2002
                             --------------------------------------------------
Investments, at value        $15,720,495,292   $14,544,149,182  $13,713,440,772
Other assets                      22,166,551        70,073,039       59,906,476
--------------------------------------------------------------------------------
Total assets                 $15,742,661,843   $14,614,222,221  $13,773,347,248
Total liabilities                    241,245        42,700,633       35,785,860
--------------------------------------------------------------------------------
Net assets                   $15,742,420,598   $14,571,521,588  $13,737,561,388
================================================================================
Dividends and interest       $   166,725,898   $   169,418,860  $   111,766,495
--------------------------------------------------------------------------------
Investment adviser fee       $    49,370,631   $    54,761,871  $    38,570,943
Other expenses                     1,730,334         2,016,295        1,395,167
--------------------------------------------------------------------------------
Total expenses               $    51,100,965   $    56,778,166  $    39,966,110
--------------------------------------------------------------------------------
Net investment income        $   115,624,933   $   112,640,694  $    71,800,385
Net realized losses              (17,942,587)     (344,617,301)    (388,526,801)

Net change in unrealized
 appreciation (depreciation)   1,449,036,078    (3,469,590,930)  (4,282,091,506)
--------------------------------------------------------------------------------
Net increase (decrease) in
 net assets from operations  $ 1,546,718,424   $(3,701,567,537) $(4,598,817,922)
--------------------------------------------------------------------------------

5    Interest Rate Swap Agreements

Belrose  Capital  has  entered  into  current  and  forward  interest  rate swap
agreements in connection  with its real estate  investments  and the  associated
borrowings.  Under such agreements,  Belrose Capital has agreed to make periodic
payments at fixed rates in exchange for payments at floating rates. The notional
or contractual  amounts of these  instruments may not necessarily  represent the
amounts  potentially  subject to risk. The  measurement of the risks  associated
with these  investments is meaningful only when  considered in conjunction  with
all related assets,  liabilities  and  agreements.  As of September 30, 2003 and
December  31,  2002,  Belrose  Capital  has  entered  into  interest  rate  swap
agreements with Merrill Lynch Capital Services, Inc., as listed below.
<TABLE>
<CAPTION>

            Notional                                            Unrealized        Unrealized
             Amount                                            Depreciation      Depreciation
Effective    (000's    Fixed       Floating      Termination   at September 30,   at December 31,
  Date      omitted)   Rate          Rate           Date            2003               2002
--------------------------------------------------------------------------------------------------
  <S>       <C>        <C>       <C>                <C>           <C>               <C>
  03/02     $35,136    5.660%    LIBOR + 0.38%      03/07         $3,282,579        $ 3,478,871
  03/07      31,588    7.140%    LIBOR + 0.38%      07/09          1,212,616          1,134,349
  05/02      32,966    5.159%    LIBOR + 0.38%      03/07          2,519,232          2,591,755
  03/07      32,966    6.874%    LIBOR + 0.38%      11/10          1,426,791          1,309,376
  07/02      29,588    4.540%    LIBOR + 0.38%      03/07          1,639,445          1,580,735
  03/07      29,588    6.500%    LIBOR + 0.38%      07/09            743,637            683,659
  10/02      36,631    3.550%    LIBOR + 0.38%      03/07            798,814            480,992
  03/07      36,631    5.480%    LIBOR + 0.38%      11/09            117,998             67,648
  12/02       7,865    3.685%    LIBOR + 0.38%      03/07            207,544            146,897
  03/07       7,865    5.727%    LIBOR + 0.38%      07/09             89,916             78,560
  02/03       8,034    3.320%    LIBOR + 0.38%      03/07            112,468                  -
  03/07       8,034    5.480%    LIBOR + 0.38%      07/09             32,206                  -
--------------------------------------------------------------------------------------------------
Total                                                            $12,183,246        $11,552,842
--------------------------------------------------------------------------------------------------
</TABLE>

On October 1, 2003, new interest rate swap  agreements  were entered into to fix
the cost of a portion of Belrose Capital's  borrowings under the Credit Facility
(as defined in Note 6 below) established on July 15, 2003. At the same time, all
interest rate swap agreements outstanding on September 30, 2003 were terminated,
resulting in realized  losses of  $12,175,577.  The table below  identifies  the
terms of the interest rate swap agreements effective on October 1, 2003.

             Notional                              Initial
              Amount                               Optional        Final
Effective     (000's     Fixed       Floating     Termination    Termination
  Date       omitted)    Rate          Rate          Date           Date
--------------------------------------------------------------------------------
  10/03      $31,588     4.180%    LIBOR + 0.30%     7/09           6/10
  10/03       37,943     4.160%    LIBOR + 0.30%    11/09           6/10
  10/03       83,307     4.045%    LIBOR + 0.30%      -             6/10

                                       12
<PAGE>

6    Debt

Credit Facility - On July 15, 2003, Belrose Capital refinanced its then existing
credit  facility with Merrill Lynch Mortgage  Capital,  Inc. with two new credit
arrangements  (collectively,  the Credit  Facility)  totaling  $225,000,000.  On
November 4, 2003, the Credit Facility was increased to $234,000,000.  The Credit
Facility  has a seven-year  maturity  and will expire on June 25, 2010.  Belrose
Capital's  obligations  under the Credit Facility are secured by a pledge of its
assets,  excluding the assets of Bel Apartment Properties Trust (Bel Apartment),
Katahdin Property Trust, LLC (Katahdin) and Bel Communities  Property Trust (Bel
Communities).

The credit arrangement with DrKW Holdings, Inc. (DrKW) was for $168,000,000, and
was increased to $177,000,000  as of November 4, 2003.  This credit  arrangement
accrues  interest  at a rate of  one-month  LIBOR plus  0.30% per  annum.  As of
September 30, 2003, outstanding borrowings under this credit arrangement totaled
$168,000,000.   As  of  November  4,  2003,   outstanding   borrowings   totaled
$177,000,000.

The  credit  arrangement  with  Merrill  Lynch  Mortgage  Capital  (MLMC) is for
$57,000,000,  and  includes  the  ability  to  issue  letters  of  credit  up to
$10,000,000.  This credit  arrangement  accrues  interest at a rate of one-month
LIBOR plus 0.38% per annum.  A commitment  fee of 0.10% per annum is paid on the
unused commitment amount.  Belrose Capital pays all fees associated with issuing
the letters of credit.  As of September 30, 2003,  outstanding  borrowings under
this  credit  arrangement  totaled  $3,300,000,  as well as  letters  of  credit
outstanding  for  $2,080,452.  The letters of credit were issued as a substitute
for  funding  certain  mortgage  escrow  accounts  required by the lender of Bel
Communities  and Bel  Apartment.  The  letters  of  credit  expire  in 2004  and
automatically  extend for one-year  periods not to extend  beyond June 15, 2010.
Fees paid or accrued  under the terms of the letter of credit  issued  under the
existing Credit Facility totaled $19,550 for the nine months ended September 30,
2003.  As of  November  4,  2003, amounts  outstanding  under  the  MLMC  credit
arrangement totaled $6,300,000.

7    Segment Information

Belrose  Capital  pursues  its  investment   objective  primarily  by  investing
indirectly  in the  Portfolio  through  Belvedere  Capital.  The  Portfolio is a
diversified  investment company that emphasizes  investments in common stocks of
domestic and foreign growth  companies that are considered to be high in quality
and  attractive  in their  long-term  investment  prospects.  Separate  from its
investment in Belvedere  Capital,  Belrose Capital invests in real estate assets
through its subsidiary  Belrose Realty  Corporation  (Belrose  Realty).  Belrose
Realty invests  directly in Partnership  Preference Units and indirectly in real
property  through  controlled  subsidiaries,  Bel  Apartment,  Katahdin  and Bel
Communities.  Belrose Realty did not hold an investment in controlled subsidiary
Bel  Communities  for the period from the start of business,  March 19, 2002, to
September 30, 2002.

Belrose Capital  evaluates  performance of the reportable  segments based on the
net increase (decrease) in net assets from operations of the respective segment,
which  includes net  investment  income  (loss),  net  realized  gain (loss) and
unrealized   appreciation   (depreciation).   The  accounting  policies  of  the
reportable  segments are the same as those for Belrose Capital on a consolidated
basis. No reportable  segments have been aggregated.  Reportable  information by
segment is as follows:

<TABLE>
<CAPTION>

                                                            TAX-MANAGED
FOR THE THREE MONTHS ENDED                                    GROWTH                 REAL
SEPTEMBER 30, 2003                                          PORTFOLIO*               ESTATE                TOTAL
------------------------------------------------------------------------------------------------------------------------
<S>                                                         <C>                   <C>                   <C>
Revenue                                                     $  3,086,525          $ 17,291,184          $  20,377,709
Interest expense on mortgages                                          -            (6,579,654)            (6,579,654)
Interest expense on Credit Facility                                    -              (599,191)              (599,191)
Interest expense on swap agreements                                    -            (1,189,097)            (1,189,097)
Operating expenses                                              (239,468)           (7,992,486)            (8,231,954)
Minority interest in net income of controlled
 subsidiaries                                                          -              (526,835)              (526,835)
------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                       $   2,847,057         $    403,921          $   3,250,978
Net realized gain                                               1,072,597                    -              1,072,597
Change in unrealized appreciation (depreciation)               29,866,436            2,897,652             32,764,088
------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS OF
REPORTABLE SEGMENTS                                         $  33,786,090         $  3,301,573          $  37,087,663
------------------------------------------------------------------------------------------------------------------------

                                       13
<PAGE>

                                                            TAX-MANAGED
FOR THE THREE MONTHS ENDED                                    GROWTH                 REAL
SEPTEMBER 30, 2002                                          PORTFOLIO*               ESTATE                TOTAL
------------------------------------------------------------------------------------------------------------------------
Revenue                                                     $   1,455,511         $ 11,573,150          $  13,028,661
Interest expense on mortgages                                           -           (4,243,268)            (4,243,268)
Interest expense on Credit Facility                                     -             (564,368)              (564,368)
Interest expense on swap agreements                                     -             (682,741)              (682,741)
Operating expenses                                               (112,430)          (5,212,912)            (5,325,342)
Minority interest in net income of controlled
 subsidiaries                                                           -             (424,481)              (424,481)
-------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                       $   1,343,081         $    445,380          $   1,788,461
Net realized loss                                             (11,402,524)                   -            (11,402,524)
Change in unrealized appreciation (depreciation)              (96,759,842)          (7,635,550)          (104,395,392)
-------------------------------------------------------------------------------------------------------------------------
NET DECREASE IN NET ASSETS FROM OPERATIONS OF
REPORTABLE SEGMENTS                                         $(106,819,285)        $ (7,190,170)         $(114,009,455)
-------------------------------------------------------------------------------------------------------------------------


                                                            TAX-MANAGED
FOR THE NINE MONTHS ENDED                                     GROWTH                 REAL
SEPTEMBER 30, 2003                                          PORTFOLIO*               ESTATE                TOTAL
------------------------------------------------------------------------------------------------------------------------
Revenue                                                     $   9,095,970         $ 51,945,066          $  61,041,036
Interest expense on mortgages                                           -          (19,738,536)           (19,738,536)
Interest expense on Credit Facility                                     -           (2,005,753)            (2,005,753)
Interest expense on swap agreements                                     -           (3,371,735)            (3,371,735)
Operating expenses                                               (658,521)         (23,956,756)           (24,615,277)
Minority interest in net income of controlled
 subsidiaries                                                           -           (1,500,532)            (1,500,532)
------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                       $   8,437,449         $  1,371,754          $   9,809,203
Net realized loss                                              (1,848,037)                   -             (1,848,037)
Change in unrealized appreciation (depreciation)              139,042,412            9,075,210            148,117,622
------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS OF
REPORTABLE SEGMENTS                                         $ 145,631,824         $ 10,446,964          $ 156,078,788
------------------------------------------------------------------------------------------------------------------------


                                                            TAX-MANAGED
FOR THE PERIOD ENDED                                          GROWTH                 REAL
SEPTEMBER 30, 2002 (1)                                       PORTFOLIO*               ESTATE                TOTAL
------------------------------------------------------------------------------------------------------------------------
Revenue                                                     $   2,171,798         $ 22,603,756          $  24,775,554
Interest expense on mortgages                                           -           (8,582,544)            (8,582,544)
Interest expense on Credit Facility                                     -             (952,280)              (952,280)
Interest expense on swap agreements                                     -           (1,136,450)            (1,136,450)
Operating expenses                                               (186,367)         (10,235,387)           (10,421,754)
Minority interest in net income of controlled
subsidiaries                                                            -             (863,703)              (863,703)
-----------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                       $   1,985,431         $    833,392          $   2,818,823
Net realized loss                                             (13,420,785)                   -            (13,420,785)
Change in unrealized appreciation (depreciation)             (158,899,616)         (12,224,700)          (171,124,316)
-----------------------------------------------------------------------------------------------------------------------
NET DECREASE IN NET ASSETS FROM OPERATIONS OF
REPORTABLE SEGMENTs                                         $(170,334,970)        $(11,391,308)         $(181,726,278)
-----------------------------------------------------------------------------------------------------------------------
</TABLE>

*    Belrose Capital invests  indirectly in Tax-Managed Growth Portfolio through
     Belvedere Capital.
(1)  For the period from the start of business, March 19, 2002, to September 30,
     2002.

                                       14
<PAGE>

The following tables reconcile the reported segment information to the condensed
consolidated financial statements for the periods indicated:
<TABLE>
<CAPTION>

                                              Three Months       Three Months     Nine Months
                                                  Ended              Ended           Ended          Period Ended
                                              September 30,      September 30,    September 30,     September 30,
                                                   2003              2002            2003             2002 (1)
                                             ---------------------------------------------------------------------

<S>                                           <C>                <C>                <C>            <C>
Revenue:
 Revenue from reportable segments             $ 20,377,709       $  13,028,661      $ 61,041,036   $  24,775,554
 Unallocated revenue                                 4,481                 948            12,293           2,051
                                             ---------------------------------------------------------------------
TOTAL REVENUE                                 $ 20,382,190       $  13,029,609      $ 61,053,329   $  24,777,605
                                             ---------------------------------------------------------------------

Net increase (decrease) in net assets from
 operations:
Net increase (decrease) in net assets
 from operations of reportable segments       $ 37,087,663       $(114,009,455)     $156,078,788   $(181,726,278)
Unallocated revenue                                  4,481                 948            12,293           2,051
Unallocated expenses **                           (903,200)           (572,837)       (2,540,933)     (1,617,372)
                                             ---------------------------------------------------------------------

TOTAL NET INCREASE (DECREASE) IN NET
  ASSETS FROM OPERATIONS                      $ 36,188,944       $(114,581,344)     $153,550,148   $(183,341,599)
                                             ---------------------------------------------------------------------
</TABLE>

**   Unallocated  expenses  include costs of Belrose Capital to operate the Fund
     such as servicing and distribution fees as well as other  miscellaneous and
     administrative costs of Belrose Capital.

(1)  For the period from the start of business, March 19, 2002, to September 30,
     2002.

                                 TAX-MANAGED GROWTH     REAL
AT SEPTEMBER 30, 2003                PORTFOLIO*        ESTATE         TOTAL
--------------------------------------------------------------------------------
Segment assets                     $1,483,730,463   $543,453,053  $2,027,183,516
Segment liabilities                        34,674    548,777,183     548,811,857
--------------------------------------------------------------------------------
NET ASSETS OF REPORTABLE SEGMENTS  $1,483,695,789   $ (5,324,130) $1,478,371,659
--------------------------------------------------------------------------------

AT DECEMBER 31, 2002
--------------------------------------------------------------------------------
Segment assets                     $1,264,314,536   $524,810,142  $1,789,124,678
Segment liabilities                             -    542,037,048     542,037,048
--------------------------------------------------------------------------------
NET ASSETS OF REPORTABLE SEGMENTS  $1,264,314,536   $(17,226,906) $1,247,087,630
--------------------------------------------------------------------------------

*    Belrose Capital invests  indirectly in Tax-Managed Growth Portfolio through
     Belvedere Capital.

                                             September 30,       December 31,
                                                   2003              2002
                                             --------------     ----------------
Net assets:
 Net assets of reportable segments           $1,478,371,659     $1,247,087,630
 Unallocated cash                                   728,967          2,083,049
 Short-term investments                           1,091,036                  -
 Other assets                                             -                  -
 Loan payable - Credit Facility                 (15,026,426)        (7,071,301)
 Other liabilities                                 (100,166)           (97,723)
                                             ---------------    ----------------
Total net assets                             $1,465,065,070     $ 1,242,001,655
                                             ---------------    ----------------

                                       15
<PAGE>

ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.
--------------------------------------------------------------------------------

The information in this report contains  forward-looking  statements  within the
meaning of the federal securities laws. Forward-looking statements typically are
identified by use of terms such as "may," "will," "should,"  "might,"  "expect,"
"anticipate,"  "estimate,"  and similar  words,  although  some  forward-looking
statements are expressed differently. The actual results of Belrose Capital Fund
LLC  (the  Fund)  could   differ   materially   from  those   contained  in  the
forward-looking  statements due to a number of factors.  The Fund  undertakes no
obligation  to update  publicly  any  forward-looking  statements,  whether as a
result of new information,  future events,  or otherwise,  except as required by
applicable  law.  Factors  that could  affect the Fund's  performance  include a
decline in the U.S.  stock markets or in general  economic  conditions,  adverse
developments  affecting the real estate  industry,  or  fluctuations in interest
rates.

The following discussion should be read in conjunction with the Fund's unaudited
condensed consolidated financial statements and related notes in Item 1 above.

RESULTS OF OPERATIONS  FOR THE QUARTER ENDED  SEPTEMBER 30, 2003 COMPARED TO THE
QUARTER ENDED SEPTEMBER 30, 2002
--------------------------------------------------------------------------------

PERFORMANCE  OF THE  FUND.(1)  The Fund's total return was 2.53% for the quarter
ended  September  30, 2003.  This return  reflects an increase in the Fund's net
asset value per share from $83.43 to $85.54 during the period.  For  comparison,
the  Standard  & Poor's  500 Index (the S&P 500),  an  unmanaged  index of large
capitalization  stocks  commonly used as a benchmark for the U.S. equity market,
had a total return of 2.65% over the same period.  The  performance  of the Fund
exceeded that of Tax-Managed  Growth  Portfolio (the Portfolio) by approximately
0.2% during the period.  Last year,  the Fund had a total return  performance of
-16.19%  for the quarter  ended  September  30,  2002.  This return  reflected a
decrease in the Fund's net asset  value per share from  $85.95 to $72.03  during
the period.  For comparison,  the S&P 500 had a total return of -17.27% over the
same  period.  The  performance  of the Fund  trailed  that of the  Portfolio by
approximately 1.1% during that period.

PERFORMANCE OF THE PORTFOLIO.  The total return of the Portfolio for the quarter
ended  September 30, 2003 was 2.35% compared to the 2.65% return achieved by the
S&P 500 over the same  period.  The modest gain posted by the S&P 500 during the
quarter is in sharp contrast to the worst broad market quarterly decline in this
decade that was  experienced  in the  quarter  ended  September  30,  2002.  The
Portfolio's  total return for the quarter ended  September 30, 2002 was -15.11%.
The encouraging  fiscal and monetary  policies,  resilient consumer spending and
positive earnings momentum  experienced through the first half of 2003 continued
during the third quarter and  contributed  to the market's  strength  during the
quarter, extending its gains for the year.

The performance of the Portfolio slightly trailed the performance of the S&P 500
during the quarter  ended  September 30, 2003  primarily due to the  Portfolio's
relatively  more  defensive  tilt  and  its  continued   underweighting  of  the
information  technology  sector.  Unlike  a  year  ago  when  it was  the  worst
performing sector,  information technology was by far the best performing sector
of the market during the quarter ended September 30, 2003.

During the quarter ended September 30, 2003, the Portfolio's  sector  allocation
remained very similar to last year's positioning relative to the market, with no
major  sector or industry  shifts.  Near the end of the  quarter  there was some
pause in the strong  momentum of higher  beta  stocks,  helping the  Portfolio's
relative performance.

The Portfolio's stock selection and underweighting of the  telecommunication and
health care  sectors  were  particularly  beneficial  during the  quarter  ended
September  30,  2003,  but were not  sufficient  to  offset  the  impact  of the
Portfolio's  underweighting of information  technology stocks. Boston Management
and Research (Boston Management),  the Portfolio's investment adviser,  remained
cautious  in  the  information  technology  and  telecommunications  sectors,  a
comparable underweight allocation from the same period a year ago.

PERFORMANCE OF REAL ESTATE  INVESTMENTS.  The Fund's real estate investments are
held  through  Belrose  Realty   Corporation   (Belrose  Realty),  a  controlled
subsidiary of the Fund. Real estate investments include interests in real estate
joint  ventures  (the Real Estate Joint  Ventures)  that are  majority-owned  by
Belrose Realty and a portfolio of income-producing preferred equity interests in
operating  partnerships  (the Partnership  Preference Units) that are affiliated
with real estate investment trusts.  During 2002, the Fund acquired interests in
Real Estate Joint Ventures, which increased the number of properties held by the

------------------------
(1)  Past performance is no guarantee of future results.  Investment  return and
     principal value will fluctuate so that Fund shares,  when redeemed,  may be
     worth more or less than their original  cost.  Comparison to the S&P 500 is
     for reference only. It is not possible to invest directly in an Index.

                                       16
<PAGE>

Fund through  Real Estate Joint  Ventures.  The Fund also  acquired  Partnership
Preference Units during both 2003 and 2002.

During the quarter ended September 30, 2003, real estate operations continued to
be impacted by weak  multifamily  market  fundamentals.  Rental income from real
estate operations increased to $16.1 million for the quarter ended September 30,
2003  compared to $10.8  million for the quarter  ended  September  30, 2002, an
increase of $5.3 million o4 49%. This increase in rental income was  principally
attributable  to the greater number of properties held through Real Estate Joint
Ventures for the quarter ended  September 30, 2003,  offset in part by increased
rent concessions or reduced apartment rental rates and lower occupancy levels at
properties owned by the Real Estate Joint Ventures during the quarter.

Property operating expenses totaled $7.2 million for the quarter ended September
30, 2003 compared to $4.8 million for the quarter  ended  September 30, 2002, an
increase of $2.4 million or 50% (property  operating expenses are before certain
operating  expenses  of Belrose  Realty of  approximately  $0.8  million for the
quarter ended September 30, 2003 and approximately  $0.4 million for the quarter
ended  September 30, 2002).  The increase in operating  expenses was principally
due to the greater  number of Real Estate Joint Ventures held during the quarter
ended September 30, 2003.

Even though the U.S.  economy  showed  signs of  improvement  during the quarter
ended September 30, 2003, significant employment growth has not occurred in most
markets and low interest rates have contributed to continued  development of new
properties.  As a result, Boston Management,  Belrose Realty's manager,  expects
that real estate  operating  results in 2003 for each of the Real  Estate  Joint
Ventures will be modestly below the levels of 2002.

At September 30, 2003,  the  estimated  fair value of the real  properties  held
through  Belrose  Realty  was  $473.3  million  compared  to $300.3  million  at
September 30, 2002,  an increase of $173.0  million or 58%. The increase in real
property  value was  primarily  due to the greater  number of Real Estate  Joint
Ventures  held  during  the  quarter  ended  September  30,  2003.  The Fund saw
unrealized  depreciation  in the  estimated  fair value of its other real estate
investments  (which includes Real Estate Joint Ventures) of  approximately  $1.1
million  during the quarter ended  September 30, 2003 compared to  approximately
$0.8 million in unrealized  depreciation  during the quarter ended September 30,
2002.

Because the Fund acquired additional  Partnership Preference Units over the past
twelve  months,  the estimated fair value of  Partnership  Preference  Units has
increased.  At September 30, 2003, the estimated fair value of Belrose  Realty's
Partnership  Preference Units totaled $56.8 million compared to $34.1 million at
September  30, 2002,  an increase of $22.7 million or 67%. The increase in value
was due principally to the greater number of Partnership  Preference  Units held
at September 30, 2003.  The Fund saw  unrealized  depreciation  in the estimated
fair value of its Partnership  Preference  Units of  approximately  $0.3 million
during the quarter ended September 30, 2003 compared to unrealized  appreciation
of approximately $0.9 million during the quarter ended September 30, 2002.

Dividends  received  from  Partnership  Preference  Units for the quarter  ended
September 30, 2003 totaled $1.2 million compared to $0.8 million for the quarter
ended  September  30, 2002, an increase of $0.4 million or 50%. The increase was
due to a larger  number of  Partnership  Preference  Units being held during the
quarter ended September 30, 2003.

PERFORMANCE OF INTEREST RATE SWAP  AGREEMENTS.  For the quarter ended  September
30, 2003,  interest rate swap agreement values appreciated by approximately $4.3
million  due to an increase  in swap rates  during the  period.  For the quarter
ended  September 30, 2002,  interest  rate swap  agreement  values  decreased by
approximately $7.8 million due to a decline in swap rates.

On October 1, 2003, new interest rate swap  agreements  were entered into to fix
the cost of a portion of Fund borrowings  under the Credit Facility  established
on July 15,  2003.  At the same time,  the Fund made  payments of  approximately
$12.2 million to terminate all interest rate swaps  outstanding  as of September
30, 2003, realizing a loss in that amount on the transactions. The realized loss
approximated the value of the positions on the books of the Fund. See "Liquidity
and Capital  Resources" for a description for the Credit Facility and the Fund's
interest rate swap agreements.

RESULTS OF OPERATIONS  FOR THE NINE MONTHS ENDED  SEPTEMBER 30, 2003 COMPARED TO
THE PERIOD ENDED SEPTEMBER 30, 2002
--------------------------------------------------------------------------------

PERFORMANCE  OF THE FUND. The Fund's total return was 11.36% for the nine months
ended  September  30, 2003.  This return  reflects an increase in the Fund's net
asset  value per share  from  $76.86 to $85.54 and a  distribution  of $0.05 per
share  during the  period.  For  comparison,  the S&P 500 had a total  return of
14.71% over the same period.  The  performance  of the Fund exceeded that of the
Portfolio by approximately 0.6% during the period. Last year, the Fund had a

                                       17

<PAGE>

total return  performance  of -27.97% for the period from the start of business,
March 19, 2002, to September 30, 2002.  This return  reflected a decrease in the
Fund's net asset value per share from $100.00 to $72.03. For comparison, the S&P
500 had a total return of -29.40% over the same period.  The  performance of the
Fund trailed that of the Portfolio by approximately 2.2% for the period from the
start of business, March 19, 2002, to September 30, 2002.

PERFORMANCE  OF THE  PORTFOLIO.  The total return of the  Portfolio for the nine
months  ended  September  30,  2003 was 10.74%  compared  to the  14.71%  return
achieved by the S&P 500 over the same period.  The total return of the Portfolio
for the period from the start of business, March 19, 2002, to September 30, 2002
was -25.77%.

The first  nine  months of 2003  remained  volatile,  but  markets  proved to be
resilient  achieving  impressive  returns.  War angst, a  questionable  economic
recovery and the SARS  outbreak were just a few of the factors  contributing  to
increased  volatility and unsettled investor sentiment during the period.  While
the first nine  months of 2003 also  witnessed  reduced  geopolitical  concerns,
higher consumer confidence and a strong housing market, concerns about inflation
and  unemployment  developed over the summer and early fall of 2003 and kept the
market and various sectors quite volatile.

The Portfolio's  performance trailed the overall market in the first nine months
of 2003,  mostly due to a lower exposure to higher beta and lower quality issues
that were the  strongest  price  performers  during this period.  The  Portfolio
maintained a pro-cyclical  stance  emphasizing  the consumer  discretionary  and
consumer  staples  sectors,  as it did in the first nine months of 2002.  Boston
Management continued to de-emphasize health care investments, a directional move
initiated last year which was positive for the Portfolio's relative returns.

During the first nine months of 2003, Boston  Management  continued to emphasize
industrial  company  investments,  especially  in the  airfreight  logistics and
aerospace defense areas.  Airfreight logistics and aerospace defense investments
have been helpful to the  Portfolio's  longer-term  record,  but detracted  from
results during the nine months ended September 30, 2003.

Lack of earnings visibility reinforced the Portfolio's cautious weighting in the
telecommunications   and   information   technology   sectors.   Both   of   the
aforementioned  sectors were de-emphasized  during the first nine months of last
year as well.  The  Portfolio's  underweight of the  telecommunication  services
sector during the nine months ended  September 30, 2003 continued to be positive
for the Portfolio.  Boston  Management  continued to underweight the Portfolio's
investments in the materials and utilities  sectors during the period, a similar
stance to last year's allocation.

PERFORMANCE OF REAL ESTATE INVESTMENTS.  For the nine months ended September 30,
2003,  rental  income from real estate  operations  increased  to $48.5  million
compared to $21.6  million for the period from the start of business,  March 19,
2002,  to September  30, 2002,  an increase of $26.9  million or 125%.  Property
operating expenses totaled $21.5 million for the nine months ended September 30,
2003  compared to $9.3 million for the period from the start of business,  March
19, 2002, to September 30, 2002, an increase of $12.2 million or 131%  (property
operating  expenses are before certain  operating  expenses of Belrose Realty of
approximately  $2.5  million for the nine months  ended  September  30, 2003 and
approximately $0.9 million for the period from the start of business,  March 19,
2002, to September 30, 2002).

The  increases in rental income and  operating  expenses  during the period were
principally due to the greater number of Real Estate Joint Ventures held through
Belrose Realty (and the longer period of time for which investments in such Real
Estate Joint Ventures were held) during the nine months ended September 30, 2003
compared to the period from the start of business,  March 19, 2002, to September
30, 2002.  As in 2002,  Real Estate  Joint  Venture  operations  during the nine
months  ended  September  30,  2003 were  affected  by weak  multifamily  market
fundamentals  in most regions with lower  occupancy  levels and  increased  rent
concessions.

At September 30, 2003,  the  estimated  fair value of the real  properties  held
through  Belrose  Realty  was  $473.3  million  compared  to $300.3  million  at
September 30, 2002,  an increase of $173.0  million or 58%. The increase in real
property  value was  primarily  due to the greater  number of Real Estate  Joint
Ventures held at September 30, 2003. The Fund saw unrealized appreciation in the
estimated fair value of its other real estate  investments of approximately $2.8
million  during the nine months ended  September 30, 2003 compared to unrealized
depreciation of  approximately  $2.7 million during the period from the start of
business, March 19, 2002, to September 30, 2002.

Because Belrose Realty acquired Partnership Preference Units over the past year,
the  estimated  fair  value  of the  Fund's  Partnership  Preference  Units  has
increased.  At  September  30,  2003,  the  estimated  fair  value of the Fund's
Partnership  Preference Units totaled $56.8 million compared to $34.1 million at
September  30, 2002, an increase of $22.7 million or 67%. The increase in value,
due  principally to the greater number of Partnership  Preference  Units held at

                                       18
<PAGE>

September 30, 2003,  was also a result of net increases in the per unit value of
the Partnership  Preference Units held by Belrose Realty during the period.  The
Fund saw unrealized  appreciation in the estimated fair value of its Partnership
Preference  Units of  approximately  $6.9  million  during the nine months ended
September 30, 2003 compared to unrealized  appreciation  of  approximately  $1.0
million for the period from the start of business,  March 19, 2002, to September
30, 2002.

Dividends  received from Partnership  Preference Units for the nine months ended
September 30, 2003 totaled $3.4 million  compared to $0.9 million for the period
from the start of business,  March 19, 2002,  to September 30, 2002, an increase
of  $2.5  million.  The  increase  was  primarily  due  to a  larger  number  of
Partnership Preference Units held during the first three quarters of 2003.

PERFORMANCE  OF  INTEREST  RATE  SWAP  AGREEMENTS.  For the  nine  months  ended
September  30,  2003,   interest  rate  swap  agreement  values  depreciated  by
approximately  $0.6  million due to a modest  decline in  short-term  swap rates
during the period. For the period from the start of business, March 19, 2002, to
September 30, 2002,  valuations of interest rate swap agreements  depreciated by
approximately $10.5 million, also due to swap rate declines.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

Effective July 15, 2003, the Fund  refinanced its then existing  credit facility
with  Merrill  Lynch  Mortgage  Capital,   Inc.  by  entering  into  new  credit
arrangements with DrKW Holdings, Inc. (DrKW) and Merrill Lynch Mortgage Capital,
Inc.  (MLMC)  (collectively,  the Credit  Facility)  which together total $225.0
million.  The Credit  Facility  is  secured  by a pledge of the  Fund's  assets,
excluding the assets of Bel Apartment Properties Trust, Katahdin Property Trust,
LLC and Bel  Communities  Property  Trust,  and has a seven-year  maturity.  The
Credit Facility will expire in June 2010.

The Credit  Facility  is  primarily  used to finance  the Fund's  equity in real
estate  investments and will continue to be used for such purpose in the future.
The Credit  Facility  also  provides  for  selling  commissions,  organizational
expenses  and  any  short-term  liquidity  needs  of  the  Fund.  Under  certain
circumstances,  the Fund may  increase  the size of the Credit  Facility and the
amount of outstanding borrowings thereunder for these purposes.

The Credit  Facility  includes a $168.0  million credit  arrangement  with DrKW.
Borrowings  under  the DrKW  credit  arrangement  accrue  interest  at a rate of
one-month  LIBOR plus 0.30% per annum.  As of September  30,  2003,  outstanding
borrowings under the DrKW credit arrangement totaled $168.0 million.

The Credit Facility also includes a $57.0 million credit  arrangement with MLMC,
including up to $10.0 million under letters of credit. Borrowings under the MLMC
credit  arrangement  accrue interest at a rate of one-month LIBOR plus 0.38% per
annum. As of September 30, 2003,  outstanding  borrowings  under the MLMC credit
arrangement  totaled $3.3 million,  with an additional $2.1 million  outstanding
under  a  letter  of  credit.   The  unused  loan   commitment   amount  totaled
approximately  $51.6 million. A commitment fee of 0.10% per annum is paid on the
unused  commitment  amount.  The Fund pays all fees  associated with issuing the
letters of credit.

On November 4, 2003, the total commitment under the Credit Facility increased to
$234.0  million.  Thereafter  the  amount  outstanding  under  the  DrKW  credit
arrangement increased to approximately $177.0 million and the amount outstanding
under the MLMC credit  arrangement  increased to approximately $6.3 million with
an additional $2.1 million outstanding under letters of credit.

The Fund has entered into interest rate swap agreements with respect to its real
estate investments and associated borrowings.  Pursuant to these agreements, the
Fund makes periodic  payments to the counterparty at predetermined  fixed rates,
in exchange for  floating-rate  payments that fluctuate  with  one-month  LIBOR.
During the terms of the outstanding  interest rate swap  agreements,  changes in
the  underlying  values of the  agreements  are recorded as unrealized  gains or
losses.  On October 1, 2003, new interest rate swap agreements were entered into
to fix the cost of Fund borrowings under the Credit Facility established on July
15, 2003. At the same time,  all interest rate swap  agreements  outstanding  on
September 30, 2003 were terminated.  Under the new interest rate swap agreements
the Fund makes periodic  payments to the  counterparty  at  predetermined  fixed
rates, in exchange for  floating-rate  payments at a  predetermined  spread plus
one-month LIBOR.

As of September  30, 2003 and September 30, 2002,  the  unrealized  depreciation
related to the interest rate swap agreements was approximately $12.2 million and
$10.5 million, respectively.

                                       19
<PAGE>

CRITICAL ACCOUNTING POLICIES AND ESTIMATES
------------------------------------------

The Fund's  discussion  and analysis of its  financial  condition and results of
operations  are  based  upon  its  unaudited  condensed  consolidated  financial
statements,  which have been prepared in accordance with  accounting  principles
generally  accepted in the United States of America.  The  preparation  of these
financial  statements  requires  the  Fund  to  make  estimates,  judgments  and
assumptions  that affect the reported amounts of assets,  liabilities,  revenues
and  expenses.  The Fund bases these  estimates,  judgments and  assumptions  on
historical  experience  and on other  various  factors  that are  believed to be
reasonable  under the  circumstances.  Actual  results  may  differ  from  these
estimates under different assumptions or conditions.

The Fund's  critical  accounting  policies  affect the Fund's  more  significant
estimates and assumptions used in valuing the Fund's real estate investments and
interest rate swap agreements.  Prices are not readily available for these types
of investments  and therefore they are fair valued on an ongoing basis by Boston
Management,  in its  capacity as manager of Belrose  Realty,  in the case of the
real estate  investments,  and in its capacity as the Fund's investment adviser,
in the  case  of the  interest  rate  swap  agreements.  The  fair  value  of an
investment  represents  the  amount  at which  Boston  Management  believes  the
investment could be sold in a current transaction between willing parties,  that
is, other than in a forced or liquidation sale.

In  estimating  the fair value of Belrose  Realty's  investment  in  Partnership
Preference  Units,  Boston  Management takes into account all relevant  factors,
data and information,  including information from dealers and similar firms with
knowledge  of  such  issues  and  the  prices  of  comparable  preferred  equity
securities  and  other  fixed or  adjustable  rate  instruments  having  similar
investment  characteristics.  With respect to Belrose Realty's other real estate
investments,  detailed investment valuations are based on independent valuations
that  are  performed  at  least  annually  and  reviewed  periodically.  Interim
valuations reflect results of operations and distributions,  and may be adjusted
if there has been a significant change in economic  circumstances since the most
recent  independent  valuation.  In determining  the fair value of interest rate
swap agreements,  Boston Management may consider, among other things, dealer and
counterparty quotes and pricing models.  Given that the valuation of real estate
investments  and  interest  rate  swap  agreements  includes  many  assumptions,
including but not limited to the assumption that the investment could be sold in
a current transaction  between willing parties,  that is, other than in a forced
or liquidation sale, values may differ from amounts ultimately realized.

The policies for valuing real estate investments involve  significant  judgments
that are based upon, without limitation, general economic conditions, the supply
and demand for  different  types of real  properties,  the  financial  health of
tenants,  the timing of lease  expirations  and  terminations,  fluctuations  in
rental rates and operating costs, exposure to adverse  environmental  conditions
and losses from  casualty  or  condemnation,  interest  rates,  availability  of
financing,  managerial  performance and government  rules and  regulations.  The
valuations of Partnership Preference Units fluctuate over time to reflect, among
other factors, changes in interest rates, changes in perceived riskiness of such
units (including call risk), changes in the perceived riskiness of comparable or
similar  securities  trading in the public market and the  relationship  between
supply and demand for  comparable  or similar  securities  trading in the public
market.

The value of  interest  rate swap  agreements  may be subject to wide  swings in
valuation  caused  principally by changes in interest rates.  Interest rate swap
agreements  may be difficult to value since such  instruments  may be considered
illiquid. Fluctuations in the value of Partnership Preference Units derived from
changes in general  interest rates can be expected to be offset in part (but not
entirely)  by changes in the value of  interest  rate swap  agreements  or other
interest  rate hedges that may be entered  into by the Fund with  respect to its
borrowings.  Fluctuations in the value of real estate  investments  derived from
other factors besides general interest rate movements (including issuer-specific
and sector-specific credit concerns,  property-specific  concerns and changes in
interest rate spread  relationships)  will not be offset by changes in the value
of  interest  rate swap  agreements  or other  interest  rate hedges that may be
entered into by the Fund.  Changes in the  valuation of  Partnership  Preference
Units not offset by changes in the valuation of interest rate swap agreements or
other  interest  rate hedges that may be entered into by the Fund and changes in
the value of other real estate  investments  will cause the  performance  of the
Fund to deviate from the performance of the Portfolio.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
-------------------------------------------------------------------

The Fund's  primary  exposure to interest  rate risk arises from its real estate
investments  that are financed by the Fund with floating rate  borrowings  under
the Fund's Credit Facility and by fixed-rate  secured  mortgage debt obligations
of the Real Estate Joint  Ventures.  The interest rates on borrowings  under the
Fund's  Credit  Facility  are reset at  regular  intervals  based on a fixed and
predetermined premium to LIBOR for short-term extensions of credit. The Fund has
entered into  interest rate swap  agreements  to fix the cost of its  borrowings
under the Credit Facility and to attempt to mitigate the impact of interest rate

                                       20
<PAGE>

changes on the Fund's net asset value. Under the terms of the interest rate swap
agreements, the Fund makes cash payments at fixed rates in exchange for floating
rate payments that fluctuate with one-month  LIBOR. In the future,  the Fund may
use other interest rate hedging  arrangements (such as caps, floors and collars)
to fix or limit borrowing costs.  The use of interest rate hedging  arrangements
is a specialized activity that can expose the Fund to significant loss.

The value of Partnership  Preference  Units and, to a lesser degree,  other real
estate  investments  is sensitive to interest  rate risk.  Increases in interest
rates  generally  will  have an  adverse  affect  on the  value  of  Partnership
Preference Units and other real estate investments.

The following table summarizes the contractual  maturities and  weighted-average
interest rates  associated  with the Fund's  significant  non-trading  financial
instruments.  The Fund has no market risk sensitive instruments held for trading
purposes.  This information should be read in conjunction with Note 5 and Note 6
to the Fund's unaudited condensed  consolidated  financial  statements in Item 1
above.

<TABLE>
<CAPTION>

                                                     Interest Rate Sensitivity
                                     Cost, Principal (Notional) Amount by Contractual Maturity
                                             For the Twelve Months Ended September 30,

                                                                                                                  Estimated
                                                            2004-2008          Thereafter          Total          Fair Value
<S>                                                         <C>                <C>               <C>              <C>
-----------------------------------------------------------------------------------------------------------------------------------
Rate sensitive liabilities:
-----------------------------------------------------
Long-term debt:
-----------------------------------------------------
Fixed-rate mortgages                                                           $344,219,483      $344,219,483     $398,000,000

Average interest rate                                                                  7.53%             7.53%
-----------------------------------------------------
Variable-rate Credit Facility                                                  $171,300,000      $171,300,000     $171,300,000

Average interest rate                                                                  1.42%             1.42%
------------------------------------------------------------------------------------------------------------------------------------
Rate sensitive derivative financial instruments:
----------------------------------------------------
Pay fixed/receive variable interest rate
swap agreements(1)                                                             $152,838,000      $152,838,000     $         --

Average pay rate(1)                                                                    4.10%             4.10%

Average receive rate(1)                                                                1.42%             1.42%

(1)  The terms disclosed are those of the interest rate swap agreements  entered
     into that are  effective  on  October  1,  2003.  See Note 5 to the  Fund's
     unaudited condensed  consolidated  financial statements in Item 1 above for
     the terms of the interest  rate swap  agreements in effect on September 30,
     2003 and  terminated  on October 1, 2003, as well as the loss realized as a
     result of such terminations.
------------------------------------------------------------------------------------------------------------------------------------
Rate sensitive investments:
----------------------------------------------------
Fixed-rate Partnership Preference Units:
----------------------------------------------------
Essex Portfolio, L.P., 7.875% Series B Cumulative Redeemable
Preferred Units, Callable 2/6/03, Current Yield: 8.15%                         $ 16,616,170      $ 16,616,170     $ 19,324,880

Kilroy Realty, L.P., 8.075% Series A Cumulative Redeemable
Preferred Units, Callable 2/06/03, Current Yield: 8.75%                        $ 15,898,220      $ 15,898,220     $ 18,453,880

Prentiss Properties Acquisition Partners, L.P., 8.30% Series B
Cumulative Redeemable Perpetual Preferred Units, Callable
6/25/03, Current Yield: 8.45%                                                  $ 16,519,510      $ 16,519,510     $ 18,986,976
</TABLE>

                                       21
<PAGE>

ITEM 4.  CONTROLS AND PROCEDURES.
---------------------------------

Eaton  Vance  Management  (Eaton  Vance),  as  the  Fund's  manager,   with  the
participation of the Fund's Chief Executive Officer and Chief Financial Officer,
conducted an evaluation of the effectiveness of the Fund's  disclosure  controls
and procedures  (as defined by Rule 13a-15(e) of the Securities  Exchange Act of
1934, as amended) as of the end of the period  covered by this report.  Based on
that  evaluation,  the  Chief  Executive  Officer  and Chief  Financial  Officer
concluded that the Fund's  disclosure  controls and procedures  were  effective.
There were no changes in the Fund's  internal  control over financial  reporting
that  occurred  during the period  covered by this report  that have  materially
affected,  or are reasonably  likely to materially  affect,  the Fund's internal
control over financial reporting.

As the Fund's manager, the complete and entire management, control and operation
of the Fund are vested in Eaton Vance. The Fund's organizational  structure does
not provide for a board of directors or a board audit  committee.  As such,  the
Fund's Chief Executive  Officer and Chief Financial  Officer intend to report to
Eaton Vance any  significant  deficiency  in the design or operation of internal
control over financial reporting which could adversely affect the Fund's ability
to record, process,  summarize and report financial data, and any fraud, whether
or not  material,  that  involves  management  or  other  employees  who  have a
significant role in the Fund's internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.
---------------------------

Although  in the  ordinary  course of  business,  the Fund,  Belrose  Realty and
Belrose   Realty's   controlled   subsidiaries  may  become  involved  in  legal
proceedings,  the Fund is not aware of any material pending legal proceedings to
which any of them is subject.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
---------------------------------------------------

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
-----------------------------------------

None.

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

No matters were submitted to a vote of security holders during the three months
ended September 30, 2003.

ITEM 5. OTHER INFORMATION.
---------------------------

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K:
------------------------------------------

(a)     The following is a list of all exhibits filed as part of this Form 10-Q:

4.1     Loan and  Security  Agreement between Belrose  Capital Fund LLC and DrKW
        Holdings, Inc., as Lender

4.1(a)  Amendment dated November 4, 2003 to Loan and Security  Agreement between
        Belrose Capital Fund LLC and DrKW Holdings, Inc., as Lender

4.2     Loan  and Security  Agreement  among Belrose  Capital Fund LLC,  Merrill
        Lynch Mortgage Capital, Inc., as Agent, the Lenders referred to  therein
        and Merrill Lynch Capital Services, Inc.

4.2(a)  Amendment  dated  November 4, 2003 to Loan and Security Agreement  among
        Belrose  Capital  Fund LLC, Merrill  Lynch Mortgage  Capital,  Inc.,  as
        Agent,  the Lenders  referred  to  therein  and  Merrill  Lynch  Capital
        Services, Inc

31.1    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
        Section 302 of the Sarbanes-Oxley Act of 2002

31.2    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
        Section 302 of the Sarbanes-Oxley Act of 2002

                                       22
<PAGE>

32.1    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
        Section 906 of the Sarbanes-Oxley Act of 2002

32.2    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
        Section 906 of the Sarbanes-Oxley Act of 2002

(b)     Reports on Form 8-K:

        None.

                                       23
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned duly authorized officer on November 10, 2003.





                               BELROSE CAPITAL FUND LLC



                               /s/ Michelle A. Alexander
                               -------------------------
                               Michelle A. Alexander
                               Chief Financial Officer
                               (Duly Authorized Officer and
                               Principal Financial Officer)

                                       24
<PAGE>

                                  EXHIBIT INDEX
                                  -------------

4.1     Loan and  Security Agreement between Belrose  Capital  Fund LLC and DrKW
        Holdings, Inc., as Lender

4.1(a)  Amendment dated November 4, 2003 to Loan and Security Agreement  between
        Belrose Capital Fund LLC and DrKW Holdings, Inc., as Lender

4.2     Loan  and  Security  Agreement among Belrose Capital  Fund LLC,  Merrill
        Lynch Mortgage Capital, Inc., as Agent, the  Lenders referred to therein
        and Merrill Lynch Capital Services, Inc.

4.2(a)  Amendment  dated November 4, 2003  to Loan and  Security Agreement among
        Belrose  Capital  Fund LLC,  Merrill Lynch  Mortgage Capital,  Inc.,  as
        agent,  the  Lenders  referred  to  therein  and  Merrill Lynch  Capital
        Services, Inc

31.1    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
        Section 302 of the Sarbanes-Oxley Act of 2002

31.2    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
        Section 302 of the Sarbanes-Oxley Act of 2002

32.1    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
        Section 906 of the Sarbanes-Oxley Act of 2002

32.2    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
        Section 906 of the Sarbanes-Oxley Act of 2002

                                       25