-


                   U. S. 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 MARCH 31, 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: 0-17151


                         PAINE WEBBER/CMJ PROPERTIES, LP
             (Exact name of registrant as specified in its charter)


      Delaware                                                   04-2780288
      --------                                                   ----------
(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/CMJ PROPERTIES, LP

                                 BALANCE SHEETS
                March 31, 1997 and December 31, 1996 (Unaudited)
                            (In thousands of dollars)

                                     ASSETS
                                                      March 31     December 31
                                                      --------     -----------

Investments in local limited partnerships,
 at equity                                             $    41      $   92
Cash and cash equivalents                                  312         323
                                                       -------      ------
                                                       $   353      $  415
                                                       =======      ======

                        LIABILITIES AND PARTNERS' CAPITAL

Accounts payable - affiliates                          $   182      $  132
Accrued expenses                                            21          21
Partners' capital                                          150         262
                                                       -------      ------
                                                       $   353      $  415
                                                       =======      ======


                            STATEMENTS OF OPERATIONS
         For the three months ended March 31, 1997 and 1996 (Unaudited)
               (In thousands of dollars, except per Unit amounts)


                                                        1997           1996
                                                        ----           ----
Revenues:
   Interest income                                    $    4        $     4
                                                      ------        -------
                                                           4              4
Expenses:
   Management fees                                        50             50
   General and administrative                             15             15
                                                      ------        -------
                                                          65             65
                                                      ------        -------

Operating loss                                           (61)           (61)

Partnership's share of local
  limited partnerships' income  (losses)                 (51)            67
                                                      ------        -------
Net income (loss)                                     $ (112)       $     6
                                                      ======        =======

Net income (loss) per Limited
  Partnership Unit                                   $(12.68)       $  0.64
                                                     =======        =======

Cash distributions per Limited
  Partnership Unit                                   $     -        $  5.00
                                                     =======        =======

The above net income (loss) and cash distributions per Limited  Partnership Unit
are based upon the 8,745 Limited Partnership Units outstanding for each period.


                             See accompanying notes.

<PAGE>


                         PAINE WEBBER/CMJ PROPERTIES, LP

              STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
         For the three months ended March 31, 1997 and 1996 (Unaudited)
                            (In thousands of dollars)

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

Balance at December 31, 1995                             $ (72)      $  536
Cash distributions                                           -          (44)
Net income                                                   -            6
                                                         -----       ------
Balance at March 31, 1996                                $ (72)      $  498
                                                         =====       ======

Balance at December 31, 1996                             $ (74)      $  336
Net loss                                                    (1)        (111)
                                                         -----       ------
Balance at March 31, 1997                                $ (75)      $  225
                                                         =====       ======





                            STATEMENTS OF CASH FLOWS
         For the three months ended March 31, 1997 and 1996 (Unaudited)
                Increase (Decrease) in Cash and Cash Equivalents
                            (In thousands of dollars)

                                                          1997        1996
                                                          ----        ----
Cash flows from operating activities:
   Net income (loss)                                   $   (112)    $     6
   Adjustments to reconcile net income (loss)
     to net cash used in operating activities:
      Partnership's share of local limited
         partnerships' income (losses)                       51         (67)
      Changes in assets and liabilities:
         Accounts payable - affiliates                       50          50
         Accrued expenses                                     -          (2)
                                                       --------     -------
            Total adjustments                               101         (19)
                                                       --------     -------
            Net cash used in operating activities           (11)        (13)

Cash flows from financing activities:
   Distributions to partners                                  -         (44)
                                                       -------      -------

Net decrease in cash and cash equivalents                   (11)        (57)

Cash and cash equivalents, beginning of period              323         325
                                                       --------     -------

Cash and cash equivalents, end of period               $    312    $    268
                                                       ========    ========






                             See accompanying notes.


<PAGE>


                         PAINE WEBBER/CMJ PROPERTIES, 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 December 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 March 31, 1997 and December 31, 1996
   and revenues and expenses for the  three-month  periods  ended March 31, 1997
   and 1996.  Actual  results could differ from the  estimates  and  assumptions
   used.

2. Related Party Transactions

         The Adviser earned basic  management fees of $50,000 during each of the
   three-month  periods  ended  March  31,  1997  and  1996.  Accounts  payable-
   affiliates at March 31, 1997 and December 31, 1996 consist of management fees
   payable to the Adviser.

         Included in general and  administrative  expenses for each of the three
   months ended March 31, 1997 and 1996 is $9,000,  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 three
   months  ended  March  31,  1997  is  $100,  representing  fees  earned  by an
   affiliate, Mitchell Hutchins Institutional Investors, Inc., for managing
   the Partnership's cash assets.

3.  Local Limited Partnerships

        The Partnership has investments in six local limited  partnerships which
    own  operating  investment  properties,  as discussed  further in the Annual
    Report.  These local  limited  partnerships  are accounted for on the equity
    method.  Under the  equity  method of  accounting  for  limited  partnership
    interests,   the   investments   are  carried  at  cost   adjusted  for  the
    Partnership's share of the local limited partnership's earnings,  losses and
    distributions.  Losses in  excess  of the  investment  in  individual  local
    limited  partnerships are not recognized  currently,  but rather, are offset
    against  future  earnings from such  entities.  Distributions  received from
    investments  in  limited  partnerships  with  carrying  values  of zero  are
    recorded as other income in the Partnership's income statement.


<PAGE>



    Summarized operating results of these local limited partnerships follow:

                     Condensed Combined Summary of Operation
               For the three months ended March 31, 1997 and 1996
                            (In thousands of dollars)

                                                  Three Months Ended
                                                       March 31,
                                                  -------------------
                                                   1997            1996
                                                   ----            ----

   Rental revenues, including  government
      subsidies                                 $  2,518         $ 2,462
   Interest income                                    18              19
                                                --------         -------
                                                   2,536           2,481

   Property operating expenses                     1,477           1,276
   Interest expense                                  703             713
   Depreciation and amortization                     337             323
   Real estate taxes                                 159             165
                                                --------         -------
                                                   2,676           2,477
                                                --------         -------
   Net income (loss)                            $  (140)         $     4
                                                =======          =======

   Net income (loss):
     Partnership's share of combined 
        operations                              $  (129)         $     7
     Local partners' share of 
        combined operations                         (11)              (3)
                                                -------          -------
                                                $  (140)         $     4
                                                =======          =======



               Reconciliation of Partnership's Share of Operations
               For the three months ended March 31, 1997 and 1996
                            (In thousands of dollars)

                                                     Three Months Ended
                                                          March 31,
                                                     ------------------
                                                      1997         1996
                                                      ----         ----

   Partnership's share of combined operations,
     as shown above                                $   (129)     $    7
   Losses in excess of basis not
     recognized by Partnership                          117          102
   Income offset with prior year
     unrecognized losses                                (39)         (42)
                                                   --------      -------
   Partnership's share of local limited
     partnerships' income (losses)                 $    (51)     $    67
                                                   ========      =======





<PAGE>



                         PAINE WEBBER/CMJ PROPERTIES, LP

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

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

     As discussed further in the Annual Report, during 1996 distributions to the
Partnership from the local limited partnerships declined,  causing management to
suspend  distributions  effective  for the fourth  quarter of 1996 until further
notice. In the future,  to the extent there is distributable  cash flow from the
properties  after the  payment  of  Partnership  management  fees and  operating
expenses,  the Partnership will make annual distribution payments each November.
During 1996, the Partnership received distributions totalling $310,000 from four
of the six local limited  partnership  investments:  Holbrook,  Quaker  Meadows,
Colonial Farms and Fawcetts Pond.  Subsequent to March 31, 1997, the Partnership
received  annual  distributions  totalling  $340,000 from three of the six local
limited partnership investments:  Holbrook,  Quaker Meadows and Fawcetts Pond. A
small  distribution from the Colonial Farms partnership is expected prior to the
end of the  second  quarter  of  1997.  The  amounts  received  in 1996 and 1997
represented the cash flow available for distribution as of December 31, 1995 and
1996,  respectively,  as determined by the general partners of the local limited
partnerships  in  accordance  with the  partnership,  financing  and  regulatory
agreements.  Total  distributions from the Partnership's  investments  increased
slightly in the current year due to an increase in distributions from the Quaker
Meadows and Holbrook  partnerships  but remain below the level of  distributions
received  in  1994  and  1995.  Also  subsequent  to the  current  quarter  end,
management of the  Partnership  completed  its detailed  review of each property
with  the  affiliate  of  the  operating  general  partners  which  manages  the
day-to-day   operations  of  the  investment   properties.   Given  the  current
environment of rising property operating and capital  improvement costs, and the
strict  restrictions  on available cash flow from the  properties,  it is highly
unlikely that  management of the  Partnership  will  recommend  making an annual
distribution  to the Limited  Partners for 1997.  Based on current  projections,
management  believes the next likely  distribution would be a distribution to be
made in November 1998 at an annualized rate of 1% on invested capital.

      Occupancy  levels  at all six  properties  in which  the  Partnership  has
invested  remained in the  mid-to-high 90% range for the quarter ended March 31,
1997.  Cash flow from the  properties in which the  Partnership  has invested is
restricted by the Department of Housing and Urban Development  ("HUD") and other
applicable state housing  agencies,  which set rental rates for low-income units
and require  significant  cash  reserves to be  established  for future  capital
improvements.  In addition,  a substantial  amount of the revenues  generated by
these  properties  comes from rental  subsidy  payments made by federal or state
housing  agencies.  These features,  which are  characteristic of all subsidized
low-income housing properties,  significantly limit the pool of potential buyers
for these real estate assets.  Furthermore,  the current  uncertainty  regarding
potential future  reductions in the level of federal  government  assistance for
these programs may further restrict the properties' marketability.  Accordingly,
management   does  not  expect  the  general   partners  of  the  local  limited
partnerships,  which receive management fee revenues from the properties through
an affiliated  management  company,  to attempt to sell any of the properties in
the near term.  As a limited  partner  of the local  limited  partnerships,  the
Partnership does not control  property  disposition  decisions.  The partnership
agreements  state that the  limited  partner may cause the sale of the assets of
the local limited partnerships subsequent to June 30, 1995, but not earlier than
one year after it has given written notice to the operating  general  partner of
its intent to cause such sale,  and only if,  during such one-year  period,  the
operating  general  partner  does  not  cause  the sale of such  assets.  If the
operating  general  partner has not caused the assets of the  partnership  to be
sold within such one-year period, the limited  partner may cause such sale,  but
only after it has offered to sell such assets to the operating  general partner,
and either the  operating  general  partner does not accept such offer within 90
days of receiving  it, or the  operating  general  partner does not complete the
sale in accordance with such offer after accepting the terms.

      All  six of the  Partnership's  operating  investment  properties  receive
rental  subsidy  payments  from the federal  government  under  Section 8 of the
National  Housing  Act.  With  the  exception  of  the  Villages  at  Montpelier
Apartments,  which has only 20% of its units restricted for low-income  housing,
the subsidy  agreements  covering the  operating  investment  properties  do not
expire for another 4-to-6 years. The subsidy agreement  covering the 20% portion
of the Villages at  Montpelier  Apartments  is scheduled to expire in July 1997.
The agreement does not provide for any renewal options,  and the general partner
of  the  local  limited  partnership  which  owns  the  Villages  at  Montpelier
Apartments  does not have any current  plans to apply for an  extension  of this
subsidy  agreement.  Accordingly,  during the second half of 1997 the subsidized
units at the property  are expected to be converted to market rent units.  There
is likely to be at least a temporary  decline in  occupancy  at the  property as
these  units are  re-leased.  Based on  current  market  conditions,  management
believes  that the units  currently  designated  as  low-income  units  could be
re-leased  at market  rates  which  would keep the total  revenues  of the local
limited partnership  relatively  unchanged from the current subsidized level. In
addition,  if the  market for  conventional  multi-family  apartment  properties
remains strong  throughout 1997, the expiration of the rental subsidy  agreement
at  the  Villages  at  Montpelier   Apartments   could  enhance  the  property's
marketability for a potential sale by increasing the pool of interested  buyers.
However,  there are no assurances that such market conditions will remain strong
over this  period,  and the  ability of the  Partnership  to cause a sale of the
property  will  remain  restricted  by  the  terms  of the  limited  partnership
agreement discussed further above. If market conditions were to deteriorate, the
Villages  at  Montpelier   Apartments  could  experience  extended  declines  in
occupancy and revenues upon the expiration of the subsidy agreement.

      For the five properties  which contain 100% low-income  housing units, the
government  subsidy  payments range from 75% to 82% of the total revenues of the
related local limited  partnerships.  At the present time,  certain  legislative
initiatives and governmental  budget negotiations could result in a reduction in
funds  available  for the  various  HUD-administered  housing  programs  and new
limitations on subsidized rent levels.  Such changes could adversely  impact the
net operating  income generated by the local limited  partnerships.  In light of
the  uncertainty  regarding  the near term  prospects for  government  assisted,
low-income housing and the restrictions on the Partnership's  ability to cause a
sale of the operating  properties,  management  does not have any plans,  at the
present  time,  to initiate the sale process  under the terms of the  agreements
described  above.  A decision as to whether to take such actions to initiate the
sale process with respect to any or all of the operating  investment  properties
in the future will be based upon a number of factors  including the availability
of a pool of  qualified  buyers,  an  evaluation  of the future of the  relevant
subsidy  programs,  the  availability  of financing  and an  assessment of local
market conditions.  If, as expected, the regulatory agreement on the Villages at
Montpelier  Apartments  expires in 1997,  the  decision of whether to initiate a
sale process for that property would be based on a more traditional  analysis of
existing market conditions and future appreciation potential.

      At March 31, 1997, the Partnership had available cash and cash equivalents
of  approximately  $312,000,  which it  intends to use for its  working  capital
requirements.  The source of future liquidity and  distributions to the partners
is expected to be from cash generated  from the operations of the  Partnership's
real  estate  investments  and  from  the  proceeds  received  from  the sale or
refinancing  of the  properties  owned by the local limited  partnerships.  Such
sources of liquidity  are expected to be  sufficient  to meet the  Partnership's
needs on both a short-term and long-term basis.

Results of Operations
Three Months Ended March 31, 1997
---------------------------------

     For the quarter ended March 31, 1997, the  Partnership  reported a net loss
of  $112,000,  as  compared  to net income of $6,000 for the same  period in the
prior year. This unfavorable  change in the  Partnership's net operating results
for the first quarter of 1997 resulted from an unfavorable change of $118,000 in
the  Partnership's  share of local limited  partnerships'  income  (losses).  As
discussed  further in the notes to the  financial  statements,  under the equity
method of accounting for limited partnership interests, the Partnership does not
record losses from investment  properties  when losses exceed the  Partnership's
equity method basis in these  properties,  and future income is recognized  only
when it exceeds the previously  unrecorded losses. Five of the Partnership's six
investments  had an  equity  method  basis of zero as of  March  31,  1997.  The
Holbrook  Apartments  Company  (Ramblewood  Apartments)  was the only  remaining
investment  with a positive  equity method  carrying value as of March 31, 1997.
The  Partnership's  share of operations from the Ramblewood  Apartments  changed
from net income of $67,000 for the three-month  period ended March 31, 1996 to a
net loss of $51,000  for the  three-month  period  ended  March 31,  1997.  This
unfavorable  change in the net operating  results of the  Ramblewood  Apartments
partnership  resulted  mainly from the  inclusion  of incentive  management  fee
expense of $146,000 in the results for the first quarter of 1997. The Ramblewood
Apartments  partnership did not recognize incentive management fee expense until
the second quarter in 1996.  Incentive  management  fees, which are based on the
distributable cash of the local limited  partnership,  will fluctuate  depending
upon the amount and timing of the cash distributions.

     Overall,  the  combined  net  operating  results  of the six local  limited
partnerships  changed from net income of $4,000 for the three months ended March
31, 1996 to a net loss of $140,000  for the three  months  ended March 31, 1997.
This  unfavorable  change of  $144,000  resulted  primarily  from an increase in
combined property  operating  expenses which was partially offset by an increase
in combined rental revenues.  Combined  property  operating  expenses  increased
mainly due to the inclusion of incentive  management  fee expense of $221,000 in
the current  three-month  period,  including  the $146,000  from the  Ramblewood
partnership  discussed  further  above.  Incentive  management  fee  expense was
generally  recognized in the second quarter in 1996. Property operating expenses
prior to the effect of the incentive management fees declined by $20,000 for the
current  three-month  period mainly due to additional  snow removal and exterior
painting  costs  incurred at the Villages at  Montpelier  Apartments  during the
three  months ended March 31, 1996.  The increase in combined  rental  income of
slightly more than 2% is primarily  attributable  to an increase in occupancy at
the Villages at Montpelier  Apartments over the same  three-month  period in the
prior year.
<PAGE>


                                     PART II
                                Other Information



Item 1. Legal Proceedings

     As previously  disclosed,  the Partnership's General Partners were named as
defendants  in  a  class  action  lawsuit   against   PaineWebber   Incorporated
("PaineWebber") and a number of its affiliates relating to PaineWebber's sale of
70 direct  investment  offerings,  including  the  offering of  interests in the
various limited partnership investments and REIT stocks, including those offered
by the  Partnership.  In  January  1996,  PaineWebber  signed  a  memorandum  of
understanding  with the plaintiffs in the class action outlining the terms under
which the parties have 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 a 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 PWPI, and the allocation of
the $125 million settlement fund among investors in the various partnerships and
REITs 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  and REITs.  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 proposed  settlement  was held in December  1996,
and in March 1997 the court announced its final approval of the  settlement.  As
part  of  the  settlement   agreement,   PaineWebber  has  agreed  not  to  seek
indemnification  from the related partnerships and real estate investment trusts
at issue in the litigation  (including the  Partnership) for any amounts that it
is  required  to pay  under  the  settlement.  In  addition,  in  December  1996
PaineWebber  agreed to settle the Abbate action discussed  further in the Annual
Report.  Final releases and dismissals  with regard to this action were received
subsequent  to the  quarter  ended  March  31,  1997.  Based  on the  settlement
agreements   discussed  above  covering  all  of  the   outstanding   unitholder
litigation, management does not expect that the resolution of these matters will
have a material impact on the  Partnership's  financial  statements,  taken as a
whole.

Item 2 through 5. NONE

Item 6. Exhibits and Reports on Form 8-K

(a)   Exhibits:   NONE

(b)  Reports on Form 8-K:

     No reports on Form 8-K have been filed by the registrant during the quarter
for which this report is filed.






<PAGE>





                         PAINE WEBBER/CMJ PROPERTIES, 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/CMJ PROPERTIES, LP

                                    By:   PW SHELTER FUND, INC.
                                          Managing General Partner




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



Dated: May 13, 1997