UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549
                       ----------------------------------


                                    FORM 10-Q


    X        QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended February 28, 1997

                                       OR

             TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

             For the transition period from           to          .


                       Commission File Number:    0-15036


               PAINE WEBBER QUALIFIED PLAN PROPERTY FUND FOUR, LP
             (Exact name of registrant as specified in its charter)


      Delaware                                                 04-2841746
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                              Identification No.)


265 Franklin Street, Boston, Massachusetts                         02110
(Address of principal executive offices)                         (Zip Code)


Registrant's telephone number, including area code           (617) 439-8118


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


<PAGE>



              PAINE WEBBER QUALIFIED PLAN PROPERTY FUND FOUR, LP

                                 Balance Sheets
                February 28, 1997 and August 31, 1996(Unaudited)
                                 (In thousands)


                                     Assets
                                                    February 28    August 31
                                                    -----------    ---------

Real estate investments:
   Investment properties held for sale, net           $12,100        $12,100
   Land                                                 1,115          1,115
   Mortgage loans, net                                  7,285          7,285
                                                      -------        -------
                                                       20,500         20,500

Cash and cash equivalents                               1,823          2,060
Interest receivable                                        60             60
Accounts receivable                                        47             14
Deferred expenses, net                                     89             99
Other assets                                               65             68
                                                     --------        -------
                                                     $ 22,584        $22,801
                                                     ========        =======

                        LIABILITIES AND PARTNERS' CAPITAL

Accounts payable - affiliates                        $     32       $     32
Accounts payable and accrued expenses                      49            201
Unearned rental income                                      -             26
Tenant security deposits                                   72             45
Partners' capital                                      22,431         22,497
                                                     --------        -------
                                                     $ 22,584        $22,801
                                                     ========        =======























                             See accompanying notes.


<PAGE>


              PAINE WEBBER QUALIFIED PLAN PROPERTY FUND FOUR, LP

                              STATEMENTS OF INCOME
  For the three and six months ended February 28, 1997 and February 29, 1996
                                 (Unaudited)
                   (In thousands, except per Unit amounts)

                                     Three Months Ended       Six Months Ended
                                       February 28/29,        February 28/29,
                                     ------------------      ------------------
                                      1997      1996          1997        1996
                                      ----      ----          ----        ----

Revenues:
   Interest from mortgage loans   $   179   $   179       $   358     $   517
   Land rent                           27        45            54         144
   Other interest income               23       118            48         156
                                  -------   -------       -------     -------
                                      229       342           460         817

Expenses:
   Management fees                     36        37            71          88
   General and administrative          76       159           171         244
   Amortization of deferred
      expenses                          5         5             9          30
                                  -------   -------       -------     -------
                                      117       201           251         362
                                  -------   -------       -------     -------

Operating income                      112       141           209         455

Income from operations of investment
   properties held for sale, net      150       278           372         520

Gain on sale of land                    -         -             -       1,378
                                  -------   -------       -------     -------
Net income                        $   262   $   419       $   581     $ 2,353
                                  =======   =======       =======     =======

Net income per Limited
  Partnership Unit                  $0.29     $0.47         $0.64     $  2.60
                                    =====     =====         =====     =======

Cash distributions per Limited
  Partnership Unit                  $0.35    $11.27         $0.71     $ 11.83
                                    =====    ======         =====     =======

   The above net income and cash distributions per Limited  Partnership Unit are
based upon the  896,993  Units ($50 per Unit) of  Limited  Partnership  Interest
outstanding during each period.















                             See accompanying notes.


<PAGE>



              STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
  For the six months ended February 28, 1997 and February 29, 1996 (Unaudited)
                                 (In thousands)

                                                         General   Limited
                                                         Partners  Partners
                                                         --------  --------

Balance at August 31, 1995                               $  (18)   $29,265
Net income                                                   24      2,329
Cash distributions                                          (12)   (10,609)
                                                         ------    -------
Balance at February 29, 1996                             $   (6)   $20,985
                                                         ======    =======

Balance at August 31, 1996                               $   11    $22,486
Net income                                                    6        575
Cash distributions                                           (7)      (640)
                                                         ------    -------
Balance at February 28, 1997                             $   10    $22,421
                                                         ======    =======



















                             See accompanying notes.


<PAGE>


               PAINE WEBBER QUALIFIED PLAN PROPERTY FUND FOUR, LP

                            STATEMENTS OF CASH FLOWS
  For the six months ended February 28, 1997 and February 29, 1996 (Unaudited)
                Increase (Decrease) in Cash and Cash Equivalents
                                 (In thousands)

                                                             1997        1996
                                                             ----        ----
Cash flows from operating activities:
  Net income                                               $  581     $ 2,353
  Adjustments to reconcile net income
     to net cash provided by operating activities:
   Gain on sale of land                                         -      (1,378)
   Amortization of deferred expenses                           10          30
   Changes in assets and liabilities:
     Interest receivable                                        -          58
     Accounts receivable                                      (33)         15
     Other assets                                               3          20
     Accounts payable affiliates                                -         (12)
     Accounts payable and accrued expenses                   (152)          9
     Unearned rental income                                   (26)          -
     Other liabilities                                          -         (50)
     Tenant security deposits                                  27           -
                                                           ------     -------
        Total adjustments                                    (171)     (1,308)
                                                           ------     -------
        Net cash provided by operating activities             410       1,045
                                                           ------     -------

Cash flows from investing activities:
   Net proceeds from sale of land                               -       3,440
   Proceeds received from repayment of mortgage loan            -       6,188
                                                           ------     -------
        Net cash provided by investing activities               -       9,628
                                                           ------     -------

Cash flows from financing activities:
   Distributions to partners                                 (647)    (10,621)
                                                           ------     -------

Net (decrease) increase in cash and cash equivalents         (237)         52

Cash and cash equivalents, beginning of period              2,060       1,851
                                                           ------     -------

Cash and cash equivalents, end of period                   $1,823     $ 1,903
                                                           ======     =======















                             See accompanying notes.


<PAGE>


              PAINE WEBBER QUALIFIED PLAN PROPERTY FUND FOUR, LP
                          Notes to Financial Statements
                                   (Unaudited)



1. General

   The accompanying  financial  statements,  footnotes and discussion  should be
   read in conjunction with the financial  statements and footnotes contained in
   the  Partnership's  Annual  Report for the year ended August 31, 1996. In the
   opinion of management, the accompanying financial statements,  which have not
   been audited, reflect all adjustments necessary to present fairly the results
   for the interim period.  All of the accounting  adjustments  reflected in the
   accompanying interim financial statements are of a normal recurring nature.

   The accompanying financial statements have been prepared on the accrual basis
   of accounting in accordance  with generally  accepted  accounting  principles
   which require  management to make estimates and  assumptions  that affect the
   reported  amounts of assets and  liabilities  and  disclosures  of contingent
   assets and  liabilities  as of  February  28,  1997 and  August 31,  1996 and
   revenues and  expenses  for the three and six months ended  February 28, 1997
   and February 29, 1996.  Actual  results  could differ from the  estimates and
   assumptions used.

2. Mortgage Loan and Land Investments

   The following are the first  mortgage loans  outstanding  and the cost of the
   related land to the  Partnership at February 28, 1997 and August 31, 1996 (in
   thousands):

                               Amount of Mortgage Loan         Cost of Land
                               -----------------------         ------------
      Property                  2/28/97     8/31/96         2/28/97    8/31/96
      --------                  -------     -------         -------    -------

   Willow Creek Apartments
     Wichita, Kansas           $  3,055   $ 3,055         $  345      $  345

   Park South Apartments
     Charlotte, 
       North Carolina             4,230     4,230            770         770
                               --------   -------         ------     -------
                               $  7,285   $ 7,285         $1,115     $ 1,115
                               ========   =======         ======     =======

   The loans are  secured by first  mortgages  on the  properties,  the  owner's
   leasehold  interest  in the  land and an  assignment  of all  tenant  leases.
   Interest is payable monthly and the principal is due at maturity.  The annual
   interest  rates on the Willow Creek and Park South mortgage loans are 11% and
   9%,  respectively.  The  land  leases  have  terms  of 40  years.  Among  the
   provisions of the lease agreements, the Partnership is entitled to additional
   rent based upon gross  revenues of the  underlying  properties in excess of a
   base amount,  as defined.  During the six months ended February 28, 1996, the
   Partnership  received  additional  rent  under  the  terms of the Park  South
   Apartments  land lease  totalling  $40,000.  No additional  rent was received
   during the six months ended February 28, 1997. The lessees have the option to
   purchase the land for specified  periods of time,  beginning between February
   of 1995 and  December  of 1997,  at a price based on fair  market  value,  as
   defined,  but  not  less  than  the  original  cost to the  Partnership.  The
   Partnership's  investments are structured to share in the appreciation in the
   value  of  the  underlying  real  estate.  Accordingly,   upon  either  sale,
   refinancing,  maturity  of the  mortgage  loan or  exercise  of the option to
   repurchase the land, the  Partnership  will receive a 40% to 50% share of the
   appreciation above a specified base amount.

   The Willow Creek mortgage loan became prepayable in November 1995. Management
   believes that there is the potential for a near term prepayment of this loan.
   As a result of these circumstances, based on an expected short-term maturity,
   the estimated fair value of the Willow Creek mortgage loan  approximated  its
   carrying  value as of February 28, 1997 since the estimated fair value of the
   collateral property exceeds the principal balance of the loan. The fair value
   of the Park South loan, which does not become prepayable until December 1997,
   has been estimated using discounted cash flow analysis and also  approximated
   the loan's carrying value as of February 28, 1997.

   The mortgage  loan  secured by The Corner at Seven  Corners  Shopping  Center
   became  prepayable  in February  1995.  On December  16,  1994,  the borrower
   notified  the  Partnership  of its intent to prepay the loan and exercise the
   option to purchase the land during 1995.  On November 22, 1995,  the borrower
   of The Corner at Seven Corners loan prepaid the Partnership's first leasehold
   mortgage loan and purchased the Partnership's interest in the underlying land
   for total consideration of $9,628,000.  The principal balance of the mortgage
   loan was  $6,188,000  plus  interest  accrued  through  November  22, 1995 of
   $43,000. The Partnership's cost basis in the land was $2,062,000. Pursuant to
   the ground lease, the Partnership  received  $1,378,000 in excess of its land
   investment  as its  share  of the  appreciation  in  value  of the  operating
   investment  property above a specified base amount.  Such amount was recorded
   as a gain in the  Partnership's  financial  statements  for the quarter ended
   November 30, 1995.  The net proceeds from this  prepayment  transaction  were
   distributed to the Limited Partners as part of a special distribution paid on
   January  31,  1996 in the  amount of  approximately  $9,598,000,  or $214 per
   original $1,000 investment.

3. Investment Properties Held for Sale

   Martin Sunnyvale Research and Development Center
   ------------------------------------------------

      The Partnership foreclosed under the terms of the mortgage loan secured by
   the Martin  Sunnyvale  Research and Development  Center on July 12, 1991. The
   borrower had  defaulted on the payment  terms of the loan due to  significant
   lease turnover during 1991. The property contains 39,000 rentable square feet
   and is located in Sunnyvale,  California.  The combined carrying value of the
   original  land  and  loan  investments,   of  $5,100,000,   was  adjusted  to
   management's estimate of the fair value of the property as of the date of the
   foreclosure,  of $3,400,000,  and reclassified to investment  properties held
   for sale.  Subsequent to the date of the  foreclosure  and through August 31,
   1994, the  Partnership had recorded  provisions for possible  investment loss
   totalling  $900,000 to write down the carrying value of the Martin  Sunnyvale
   investment  property  to  $2,500,000  to reflect  additional  declines in its
   estimated  fair value,  net of selling  expenses.  During  fiscal 1996,  real
   estate  values for R&D office  properties  in Northern  California  recovered
   somewhat as a result of the  resurgence in the growth of the high  technology
   industries.  As a result of lower market vacancy levels and increasing rental
   rates,  the estimated fair value of the Martin  Sunnyvale  property  improved
   significantly  during  fiscal 1996 to an amount which  exceeds the cost basis
   established for the property in fiscal 1991 of $3,400,000.  Accordingly,  the
   Partnership  adjusted  the  valuation  account  with  respect  to the  Martin
   Sunnyvale  property and recognized a recovery of possible  investment loss of
   $900,000  effective in the fourth  quarter of fiscal 1996. The carrying value
   of the  investment,  of $3,400,000,  is included in the balance of investment
   properties  held for sale on the  accompanying  balance sheets as of February
   28, 1997 and August 31, 1996.

      During fiscal 1994,  the  Partnership  was notified by a California  state
   water agency of a potential  environmental problem at Martin Sunnyvale.  As a
   result of governmental  required testing,  management  learned that there has
   been a  contamination  of the  underground  soil and water at the  site.  The
   environmental  testing  was paid for by one of the  parties  identified  as a
   potential contaminator.  Management believes that this contamination occurred
   prior to the Partnership's initial mortgage loan and ground lease investments
   in the property,  which were made in 1985. The California  state water agency
   has issued a site cleanup order  identifying two companies which had occupied
   the  Martin  Sunnyvale  property  prior  to  the  Partnership's   investment.
   Management  has engaged  local counsel to monitor all legal actions to insure
   that the Partnership's rights are fully protected.  Management will seek full
   indemnification from the parties identified as being potentially responsible.
   This matter is not expected to have any long-term  impact on the market value
   of the operating investment property.

   Bell Forge Square Shopping Center
   ---------------------------------

      On October 4, 1991, the Partnership received a deed in lieu of foreclosure
   on the mortgage loan secured by the Bell Forge Square  Shopping  Center.  The
   property,  which was 90% occupied as of February  28,  1997,  is comprised of
   126,890  leasable  square feet and is located in  Nashville,  Tennessee.  The
   Managing  General  Partner  estimated  that the fair value of the  investment
   property,  net of  selling  expenses,  at the  date  title  to the  mortgaged
   property was transferred was approximately  equal to the combined cost of the
   land and the face amount of the  Partnership's  mortgage  loan.  The combined
   value of the land and the face amount of the mortgage  loan,  of  $9,000,000,
   was reclassified to investment  properties held for sale. During fiscal 1992,
   the  Partnership  had recorded a provision  for possible  investment  loss of
   $600,000 to write down the carrying value of the Bell Forge Square investment
   property to reflect a decline in its  estimated  fair  value,  net of selling
   expenses, as of August 31, 1992. During fiscal 1993, the Partnership recorded
   an  adjustment  to reduce the  valuation  allowance by $300,000 to reflect an
   increase in the estimated fair value of the Bell Forge Square  property as of
   August 31, 1993.  The resulting net carrying  value of $8,700,000 is included
   in the balance of  investment  properties  held for sale on the  accompanying
   balance sheets at February 28, 1997 and August 31, 1996.
<PAGE>
      The Partnership  recognizes income from the investment properties held for
   sale equal to its share of the excess of the properties'  gross revenues over
   property operating expenses (including capital improvement costs),  taxes and
   insurance.  Combined  summarized  operating  results of the Martin  Sunnyvale
   Research and Development Center and Bell Forge Square Shopping Center for the
   three and six months  ended  February  28, 1997 and  February 29, 1996 are as
   follows (in thousands):

                                     Three Months Ended     Six  Months Ended
                                        February 28/29,       February 28/29,
                                     ------------------     -------------------
                                      1997      1996          1997        1996
                                      ----      ----          ----        ----

   Revenues:
     Rental income               $    358     $   361      $   743     $  721
     Other income                      77          92          166        150
                                 --------     ---------    --------    ------
                                      435         453          909        871
   Expenses:
     Property operating expenses      236          57          448        184
     Property taxes and insurance      49         118           89        167
                                 --------     -------      -------     ------
                                      285         175          537        351
                                 ---------    -------      -------     ------

   Income from operations, net   $    150     $   278      $   372     $  520
                                 ========     =======      =======     ======

4. Related Party Transactions

   The  Adviser  earned  basic  management  fees of $71,000  and $88,000 for the
   six-month   periods   ended   February   28,  1997  and  February  29,  1996,
   respectively.  Accounts  payable - affiliates  at both  February 28, 1997 and
   August  31,  1996  consists  of  management  fees of  $32,000  payable to the
   Adviser.

   Included  in general and  administrative  expenses  for the six months  ended
   February 28, 1997 and February 29, 1996 is $94,000 and $91,000, respectively,
   representing  reimbursements  to an affiliate of the Managing General Partner
   for  providing  certain  financial,  accounting  and  investor  communication
   services to the Partnership.

   Also included in general and administrative expenses for the six months ended
   February 28, 1997 and  February 29, 1996 is $3,000 and $5,000,  respectively,
   representing  fees earned by an affiliate,  Mitchell  Hutchins  Institutional
   Investors, Inc., for managing the Partnership's cash assets.



<PAGE>



              PAINE WEBBER QUALIFIED PLAN PROPERTY FUND FOUR, LP

                      MANAGEMENT'S DISCUSSION AND ANALYSIS
               OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Liquidity and Capital Resources
-------------------------------

      The  Partnership's  wholly-owned,  39,000  square  foot  Martin  Sunnyvale
Research and  Development  Center  remained 100% leased as of February 28, 1997.
During the first quarter of fiscal 1997, the largest tenant at Martin  Sunnyvale
vacated  17,784  square feet when its lease expired at the beginning of November
1996.  However, a replacement tenant executed a five-year lease through November
2001 for the entire 17,784 square foot space at an average  rental rate which is
40% higher than the previous tenant had been paying. This transaction  completed
the successful re-leasing of the three tenant spaces at the property.  The other
two spaces were re-leased  during fiscal 1996 at rental rates 40% and 60% higher
than the  previous  leases.  As a result of the  significant  increase in rental
income,  the  market  value  of the  Martin  Sunnyvale  property  has  increased
substantially.  Accordingly, management believes that it would be appropriate to
begin to market the  property  for sale and  interviewed  several  regional  and
national  real  estate  brokers  during  the  second  quarter  of  fiscal  1997.
Subsequent to the quarter-end, management contracted with a national real estate
firm with a strong  background  in selling R&D  buildings in the Silicon  Valley
area to market the property for sale. There are no assurances,  however,  that a
sale transaction will be completed in the near term.

      As previously reported, the Partnership was notified by a California state
water  agency in fiscal  1994 of a  potential  environmental  problem  at Martin
Sunnyvale. As a result of governmental required testing, management learned that
there has been a contamination  of the  underground  soil and water at the site.
The state water agency has issued a final report  identifying  two tenants which
had occupied the  property  prior to 1985 and may have caused the  environmental
problem. Both prior tenants are Fortune 500 companies and both have been ordered
at their own expense to perform the necessary testing, cleanup and documentation
as required  by the  California  state water  agency.  The  Partnership  will be
required to monitor the efforts of these two firms.  The  environmental  testing
was paid  for by one of the  parties  identified  as a  potential  contaminator.
Management has engaged local counsel to monitor all legal actions to insure that
the Partnership's rights are fully protected. In addition,  management will seek
full  indemnification  from the parties  identified as being  responsible.  This
matter is not expected to have any  long-term  impact on the market value of the
Partnership's operating property.

      At the Partnership's other wholly-owned commercial investment,  Bell Forge
Square Shopping Center in Nashville,  Tennessee,  occupancy  remained at 90% for
the  second  consecutive  quarter.  During the first  quarter,  two  tenants,  a
furniture  store and a pet store,  occupying 10% of the center's  rentable area,
vacated  their  spaces  prior to the  termination  of their  leases.  The former
furniture  store  tenant  remains  current  on its  rental  obligations  to date
although it seeks to  terminate  its lease as soon as a new tenant can be found.
The former pet store tenant which has ceased  operations and stopped paying rent
during the first quarter of fiscal 1997 has been issued a court order to pay its
rental  obligation.  Although the  Partnership is pursuing its rights under this
court judgment to recover the rent due under the lease agreement,  management is
not  optimistic  about the  likelihood  of collection  given the poor  financial
condition  of the former pet store  tenant.  The  property's  leasing team is in
final negotiations with a restaurant tenant for a new lease for the vacant space
formerly  occupied by the pet store  which  would  cover a  five-year  term at a
rental rate 19% higher than the previous tenant's. The restaurant would fund all
of its own tenant  improvements and working capital  requirements.  Three retail
leases at Bell Forge Square are due to expire  through the end of calendar 1997.
The property management team expects all of these tenants to renew their leases.
As  previously  reported,  although  Discovery  Zone,  which  occupies 9% of the
center's net rentable  area,  has filed for  protection  under Chapter 11 of the
U.S. Bankruptcy Code, it continues to pay its post-petition rent and operate its
store at Bell Forge Square.  While there are likely to be some store closings as
part of the company's  bankruptcy  reorganization  plan, it is uncertain at this
time whether the Bell Forge Square  location  would be affected by such actions.
During the  quarter  ended  February  28,  1997,  management  decided to explore
potential  opportunities  to  sell  the  Bell  Forge  Square  property  and  has
contracted  with a regional  real estate  broker to market the property for sale
under a 90-day  agreement.  At the present  time,  real estate values for retail
shopping centers in certain markets are being adversely  impacted by the effects
of certain  consolidations  and bankruptcies among retailers which have resulted
in an oversupply  of space and by the  generally  flat rate of growth in overall
retail sales. Nonetheless, since market conditions in Nashville remain generally
strong,  there may be  favorable  opportunities  to  complete a sale of the Bell
Forge Square property in the near term.

      The mortgage loan secured by the Willow Creek Apartments bears interest at
a rate of 11.00%  per  annum.  As  previously  reported,  since  current  market
interest rates for first mortgage loans are  considerably  lower than this rate,
and with the continued  availability  of credit in the capital  markets for real
estate  transactions,  there is a  reasonable  likelihood  of the  Partnership's
mortgage loan investment being prepaid.  The Willow Creek loan became prepayable
in November 1995.  However,  the Willow Creek loan includes a prepayment premium
for any  prepayment  between  November 1995 and October 2000 at rates between 5%
and 1% of the mortgage loan balance.  To date, the  Partnership  has received no
notice  from the  Willow  Creek  borrower  indicating  an intent  to prepay  the
mortgage loan and repurchase the underlying land.

     Occupancy at the Park South  Apartments in Charlotte,  North Carolina,  was
90% for the quarter  ended  February  28,  1997,  down from 92% for the previous
quarter.  Operations of the property  continue to fully support the debt service
and ground lease payments owed to the Partnership  despite a recent weakening in
market  conditions for existing  properties in the greater  Charlotte area. Over
the past  year,  more than  3,900 new  apartment  units  have been  added to the
overall  Charlotte  market.  Approximately  1,500  of  these  new  units  are in
southeast Charlotte, where Park South is located, and 708 of these new units are
in Park  South's  submarket.  In  addition,  a new  rental  community  is  under
construction  within one mile of Park South which will include 400 rental units,
a retail center and a movie theater.  This property's  pre-leasing program began
in late August. In order to remain  competitive with these new units, Park South
currently  offers  reduced  rental  rates  and/or  discounted  move-in  rates to
prospective  tenants.  As an  incentive  to renew  leases,  current  tenants are
offered minimal  increases at the expiration of their leases.  The use of rental
concessions  and renewal  incentives is expected to continue  throughout  fiscal
1997.

      At  February  28,  1997,  the  Partnership  had  available  cash  and cash
equivalents of $1,823,000.  Such cash and cash  equivalents will be used for the
working capital needs of the Partnership,  distributions to the partners and, if
necessary,  for  tenant  improvement  expenses  and other  leasing  costs of the
Partnership's wholly-owned investment properties. The source of future liquidity
and  distributions to the partners is expected to be through cash generated from
the Partnership's  real estate and mortgage loan  investments,  the repayment of
the  mortgage  loans  receivable  and the future  sales or  refinancings  of the
underlying  land and the  investment  properties.  Such sources of liquidity are
expected to be adequate to meet the Partnership's needs on both a short-term and
long-term basis.

Results of Operations
Three Months Ended February 28, 1997
------------------------------------

      The Partnership reported net income of $262,000 for the three months ended
February 28, 1997,  as compared to net income of $419,000 for the same period in
the prior  year.  This  $157,000  decrease  in net income is  attributable  to a
$128,000  reduction in income from operations of investment  properties held for
sale and a $29,000 decline in the Partnership's  operating  income.  Income from
operations of investment  properties  held for sale declined  primarily due to a
$179,000 increase in property operating expenses which was partially offset by a
$69,000 decrease in property taxes and insurance.  Property  operating  expenses
increase  primarily  due to the  capital  improvement  expenditures  and leasing
commissions  related to the new  tenants at the Martin  Sunnyvale  Research  and
Development Center as discussed further above.

The Partnership's operating income decreased mainly due to a $113,000 decline in
revenues which was partially offset by a $84,000 decrease in expenses.  Revenues
declined  mainly  due to a  $95,000  decrease  in other  income  which  resulted
primarily from the additional  interest  income earned on the cash proceeds held
from The Corner at Seven Corners  mortgage loan  repayment and related land sale
on November 22, 1995 pending the special  distribution  to the Limited  Partners
which  was made on  January  31,  1996.  The  Partnership's  operating  expenses
decreased  due to an $83,000  reduction in general and  administrative  expenses
caused by certain  additional  required  professional  fees incurred  during the
three months ended February 29, 1996.


<PAGE>


Six Months Ended February 28, 1997
----------------------------------

      The  Partnership  reported net income of $581,000 for the six months ended
February 28, 1997, as compared to net income of  $2,353,000  for the same period
in the prior year. The decrease in net income is primarily  attributable  to the
gain  recognized  in the prior period on the sale of The Corner at Seven Corners
land, of $1,378,000. In addition, the Partnership's net income declined due to a
decrease in operating income of $246,000.  Operating  income declined  primarily
due to a decrease in revenues of $357,000. Revenues decreased due to declines in
interest earned on mortgage loans of $159,000,  land rent revenue of $90,000 and
other interest  income of $108,000.  Interest  earned on mortgage loans and land
rent  revenue  decreased  as a result of The  Corner at Seven  Corners  mortgage
repayment and related land sale which occurred  during the prior year.  Interest
income  decreased  due to the  inclusion of The Corner at Seven  Corners'  sales
proceeds in the invested cash  balances in the prior period  pending the special
distribution  to the Limited  Partners  which was made on January 31, 1996.  The
decrease in revenues was partially  offset by a reduction in management  fees of
$17,000  and  a  decline  in  amortization  of  deferred  expenses  of  $21,000.
Management fees decreased due to a reduction in adjusted capital  contributions,
upon which such fees are based,  as a result of the capital  distribution  which
followed the sale of The Corner at Seven  Corners  investment.  Amortization  of
deferred  expenses  decreased  due to the  write-off of the  remaining  deferred
acquisition  expenses associated with The Corner at Seven Corners investments at
the time of the November 1995 sale.

      Also  contributing to the decline in net income for the current  six-month
period is a  $148,000  decrease  in income  from the  operations  of  investment
properties held for sale.  Income from operations of investment  properties held
for sale  declined  primarily due to a $264,000  increase in property  operating
expenses which was partially  offset by a $78,000 decrease in property taxes and
insurance  and a $38,000  increase  in  revenues.  Property  operating  expenses
increased  primarily  due to additional  capital  improvement  expenditures  and
leasing  commissions  associated  with  the  three  new  tenants  at the  Martin
Sunnyvale  Research and  Development  Center,  as discussed  further above.  The
increase in revenues is primarily attributable to the 40% to 60% increase in the
lease rental rates on the three new leases at Martin Sunnyvale



<PAGE>


                                     PART II
                                Other Information

Item 1. Legal Proceedings

      As  previously  reported,  in November  1994 a series of  purported  class
actions (the "New York Limited  Partnership  Actions")  were filed in the United
States  District  Court  for  the  Southern  District  of  New  York  concerning
PaineWebber  Incorporated's  sale and sponsorship of various limited partnership
investments,  including  those  offered by the  Partnership.  The lawsuits  were
brought against  PaineWebber  Incorporated and Paine Webber Group Inc. (together
"PaineWebber"),  among others, by allegedly dissatisfied  partnership investors.
In March  1995,  after  the  actions  were  consolidated  under  the title In re
PaineWebber  Limited  Partnership  Litigation,   the  plaintiffs  amended  their
complaint  to assert  claims  against a variety of other  defendants,  including
Fourth Qualified  Properties,  Inc. and Properties  Associates ("PA"), which are
the General  Partners of the Partnership  and affiliates of PaineWebber.  On May
30, 1995, the court certified  class action  treatment of the claims asserted in
the litigation.

      The amended complaint in the New York Limited  Partnership Actions alleged
that, in connection  with the sale of interests in Paine Webber  Qualified  Plan
Property Fund Four, LP, PaineWebber,  Fourth Qualified  Properties,  Inc. and PA
(1) failed to provide adequate disclosure of the risks involved;  (2) made false
and  misleading  representations  about the  safety of the  investments  and the
Partnership's  anticipated  performance;  and (3)  marketed the  Partnership  to
investors for whom such  investments  were not  suitable.  The  plaintiffs,  who
purported  to be suing on behalf of all  persons who  invested  in Paine  Webber
Qualified  Plan Property Fund Four,  LP, also alleged that following the sale of
the partnership interests, PaineWebber, Fourth Qualified Properties, Inc. and PA
misrepresented   financial   information  about  the  Partnership's   value  and
performance.  The amended complaint  alleged that PaineWebber,  Fourth Qualified
Properties,   Inc.  and  PA  violated  the  Racketeer   Influenced  and  Corrupt
Organizations  Act  ("RICO") and the federal  securities  laws.  The  plaintiffs
sought  unspecified  damages,  including  reimbursement for all sums invested by
them in the  partnerships,  as well as disgorgement of all fees and other income
derived  by  PaineWebber  from  the  limited  partnerships.   In  addition,  the
plaintiffs also sought treble damages under RICO.

     In January 1996,  PaineWebber signed a memorandum of understanding with the
plaintiffs in the New York Limited Partnership Actions outlining the terms under
which the  parties  agreed to settle the case.  Pursuant to that  memorandum  of
understanding,  PaineWebber  irrevocably  deposited  $125 million into an escrow
fund under the  supervision of the United States District Court for the Southern
District of New York to be used to resolve the  litigation in accordance  with a
definitive  settlement  agreement  and plan of  allocation.  On July  17,  1996,
PaineWebber and the class plaintiffs submitted a definitive settlement agreement
which  provides for the  complete  resolution  of the class  action  litigation,
including releases in favor of the Partnership and the General Partners, and the
allocation of the $125 million  settlement  fund among  investors in the various
partnerships at issue in the case. As part of the settlement,  PaineWebber  also
agreed to provide class members with certain  financial  guarantees  relating to
some of the  partnerships.  The details of the  settlement  are  described  in a
notice mailed  directly to class members at the direction of the court.  A final
hearing on the  fairness of the  settlement  was held in December  1996,  and in
March 1997 the court issued a final approval of the settlement.

      In February 1996,  approximately  150 plaintiffs  filed an action entitled
Abbate v.  PaineWebber  Inc. in  Sacramento,  California  Superior Court against
PaineWebber   Incorporated  and  various  affiliated   entities  concerning  the
plaintiffs' purchases of various limited partnership interests,  including those
offered by the  Partnership.  The complaint  alleged,  among other things,  that
PaineWebber and its related entities committed fraud and  misrepresentation  and
breached  fiduciary  duties  allegedly  owed to the  plaintiffs  by  selling  or
promoting  limited   partnership   investments  that  were  unsuitable  for  the
plaintiffs and by overstating the benefits,  understating  the risks and failing
to state  material  facts  concerning  the  investments.  The  complaint  sought
compensatory  damages of $15 million plus punitive damages against  PaineWebber.
Mediation  with  respect to the Abbate  action was held in December  1996.  As a
result of such mediation,  a settlement  between  PaineWebber and the plaintiffs
was reached which  provides for the complete  resolution  of such action.  Final
releases and  dismissals  with regard to this action are expected to be received
in April 1997.

      Under certain limited circumstances, pursuant to the Partnership Agreement
and other contractual  obligations,  PaineWebber affiliates could be entitled to
indemnification  for expenses and  liabilities in connection with the litigation
described above. However, PaineWebber has agreed not to seek indemnification for
the amounts it is required to pay in connection  with the  settlement of the New
York Limited  Partnership  Actions.  At the present time,  the General  Partners
believe that the  resolution of these maters will not have a material  impact on
the Partnership's financial statements, taken as a whole.
<PAGE>
Items 2 through 5:  NONE

Item 6. Exhibits and Reports on Form 8-K

(a)  Exhibits:     NONE

(b)  Reports on Form 8-K:

                   NONE





<PAGE>





              PAINE WEBBER QUALIFIED PLAN PROPERTY FUND FOUR, LP




                                   SIGNATURES


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

                              PAINE WEBBER QUALIFIED PLAN PROPERTY
                                         FUND FOUR, LP


                              By:  FOURTH QUALIFIED PROPERTIES, INC.
                                       Managing General Partner



                              By: /s/ Walter V. Arnold
                                  --------------------
                                  Walter V. Arnold
                                  Senior Vice President and Chief
                                  Financial Officer




Dated:  April 14, 1997