SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                 FORM 10-QSB/A-1

                [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended March 31, 1997

               [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                         Commission file number 33-96716

                      ESSEX HOSPITALITY ASSOCIATES IV L.P.

               (Exact name of registrant as specified in charter)

                                    NEW YORK
         (State or other jurisdiction of incorporation or organization)

                                   16-1485632
                      (I.R.S. Employer Identification No.)

                               100 CORPORATE WOODS
                            ROCHESTER, NEW YORK 14623
                     (Address of principal executive office)

       Registrant's telephone number, including area code: (716) 272-2300

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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
                                ---                              ---

As of September 19, 1997, a total of 2,416 Limited Partnership Units were
outstanding.

                                                                            


<PAGE>



                                     PART 1
                                     ------

                              FINANCIAL INFORMATION
                              ---------------------

ITEM 1.   FINANCIAL STATEMENTS
--------------------------------------------------
<TABLE>
<CAPTION>


                      Essex Hospitality Associates IV L.P.
                                 Balance Sheets
                             March 31, 1997 and 1996



           ASSETS                                         1997              1996
           ------                                         ----              ----
<S>                                                 <C>               <C>  

Investments in real estate, at cost:
     Land                                             $  2,492,194       2,610,289
     Land improvements                                     271,348               0
     Buildings                                           4,961,877               0
     Furniture, fixtures and equipment                   1,339,793               0
     Construction in progress                            1,967,458       2,847,238
                                                       -----------     -----------
                                                        11,032,670       5,457,527
     Less accumulated depreciation                        (346,659)              0
                                                       -----------     -----------
        Net investments in real estate                  10,686,011       5,457,527
                                                       -----------     -----------

Cash and cash equivalents                                2,159,933       1,354,265

Deferred costs:
     Debt issuance                                         780,755         534,600
     Franchise                                             128,000         128,000
     Other                                                  60,766          68,087
                                                       -----------     -----------
                                                           969,521         730,687
     Less accumulated amortization                        (222,284)        (29,371)
                                                       -----------     -----------
                                                           747,237         701,316
                                                       -----------     -----------

Due from affiliate                                         110,000               0

Other assets                                               158,426           4,237
                                                       -----------     -----------

     Total assets                                     $ 13,861,607       7,517,345
                                                      ============     ===========

                 Liabiliities and Partners' Capital
                 ----------------------------------

Liabilities
     Accounts payable and accrued expenses            $    117,995          20,970
     Accounts payable - construction                       869,993         493,368
     First mortgage loan payable                         5,000,000               0
     Subordinated notes payable                          5,182,000       3,846,000
     Notes payable                                       1,500,000       1,500,000
                                                       -----------     -----------
        Total liabilities                               12,669,988       5,860,338
                                                       -----------     -----------

     Minority interest - Essex Glenmaura L.P.              566,094       1,045,574
                                                       -----------     -----------

Commitments and contingencies (notes 5 and 6)

Partners' capital                                          791,777         786,142
     Less notes receivable from partners                  (166,252)       (174,709)
                                                       -----------     -----------
       Total partners' capital                             625,525         611,433
                                                       -----------     -----------

Total liabilities and partners' capital               $ 13,861,607       7,517,345
                                                      ============     ===========


</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>



<TABLE>
<CAPTION>


                      Essex Hospitality Associates IV L.P.
                            Statements of Operations
                 For the Quarters ended March 31, 1997 and 1996



                                                        1997          1996
                                                        ----          ----
<S>                                               <C>          <C> 

REVENUE:
--------
    Rooms                                              420,339           0
    Food and beverage                                   56,265           0
    Telephone and other commissions                     32,435           0
                                                     ---------    --------
                                                       509,039           0
                                                     ---------    --------

OPERATING EXPENSES:
-------------------
    Rooms                                              118,381           0
    Food & beverage expenses                            66,572           0
    Commissions expenses                                13,001           0
    Advertising & promotion                             30,191           0
    Repairs & maintenance                               25,622           0
    Utilities                                           39,464           0
    Administrative & general                            47,511       1,094
    Property taxes                                       9,501           0
    Insurance                                           13,506           0
    Franchise fees                                      14,842           0
    Management fees                                     20,563           0
    Partnership management fees                          3,427           0
    Depreciation and amortization                      146,198      10,995
    Miscellaneous                                        9,189       4,295
                                                     ---------    --------
                                                       557,968      16,384
                                                     ---------    --------

          Loss from operations before interest         (48,929)    (16,384)

    Interest expense                                  (228,454)    (61,281)
    Interest income                                     27,232       2,717
                                                     ---------    --------
                                                      (201,222)    (58,564)
                                                     ---------    --------

           Loss before minority interest in loss of
              partnership                             (250,151)    (74,948)
                                                     ---------    --------

Minority interest in income/(loss) of partnership      (75,273)      1,063
                                                     ---------    --------

Net income                                            (174,878)    (76,011)
                                                    ==========    ========= 

Net loss - general partners                             (1,749)       (760)
         - limited partners                           (173,129)    (75,251)
                                                     ---------    --------
                                                      (174,878)    (76,011)
                                                    ==========    ========= 

Net loss per limited partner unit                          (77)        (90)
                                                    ==========    ========= 


</TABLE>


See accompanying notes to consolidated financial statements.



<PAGE>






<TABLE>
<CAPTION>


                      Essex Hospitality Associates IV L.P.
                            Statements of Cash Flows
                 For the Quarters ended March 31, 1997 and 1996


                                                                                1997           1996
                                                                                ----           ----
<S>                                                                      <C>            <C> 

Cash flows from operating activities
    Cash received from customers                                               518,958             0
    Cash paid to suppliers                                                    (536,595)       (4,387)
    Interest received                                                           27,232         2,717
    Interest paid                                                             (228,454)      (61,281)
                                                                           -----------     ---------
      Net cash from operating activities                                      (218,859)      (62,951)
                                                                           -----------     ---------

Cash flows from investing activities
    Payments for land and construction in progress                          (1,078,583)   (1,746,881)
    Payments for deposits                                                      (10,757)     (144,966)
                                                                           -----------     ---------
      Net cash used in investing activities                                 (1,089,340)   (1,891,847)
                                                                           -----------     ---------

Cash flows from financing activities
    Partners' capital contributions                                            141,422       694,194
    Payments for syndication costs                                             (16,074)     (137,467)
    Proceeds from notes payable                                                262,000     2,102,000
    Proceeds from 1st mortgage loan                                          5,000,000             0
    Payoff of construction loan                                             (4,294,243)            0
    Payments for debt acquisition costs                                        (98,446)     (211,973)
    Payments for organization costs                                                  0          (548)
    Payments for distributions                                                 (42,212)      (14,529)
                                                                           -----------     ---------
      Net cash from financing activities                                       952,447     2,431,677
                                                                           -----------     ---------

Net increase in cash and cash equivalents                                     (355,752)      476,879

Cash and cash equivalents - beginning of quarter                             2,515,685       877,386
                                                                           -----------     ---------
Cash and cash equivalents - end of quarter                                   2,159,933     1,354,265
                                                                           ===========    ==========


Reconciliation of net income to net cash flows from operating activities:

Net loss                                                                      (174,878)      (76,011)

Adjustments to reconcile net loss to net
  cash used in operating activities:
      Depreciation and amortization                                            146,198        10,995
      Changes in:
        Shortterm assets                                                          (157)        1,002
        Minority interest in net loss of partnership                           (75,273)        1,063
        Accounts payable and other expenses                                   (114,749)            0
                                                                           -----------     ---------
                                                                              (218,859)      (62,951)
                                                                           ===========     =========

</TABLE>

See accompanying notes to consolidated financial statements.


<PAGE>



                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997

1)       ORGANIZATION
         ------------

         Essex  Hospitality  Associates IV L.P. (the  Partnership) is a New York
         limited  partnership  formed  on August  30,  1995 for the  purpose  of
         acquiring  land and  constructing,  owning  and  operating  a series of
         hotels.  The  Partnership  may also  invest in and lend  funds to other
         partnerships  that  own  hotels.   The  Partnership  is  financing  its
         activities  through a public offering of notes and limited  partnership
         units. The Partnership's  general partner is Essex Partners Inc. (Essex
         Partners), a subsidiary of Essex Investment Group, Inc. (Essex).

         The  Partnership  has acquired  land in order to construct  and operate
         hotels.  In  December  1995,  land was  purchased  in  Solon,  Ohio and
         Warwick,  Rhode Island in anticipation of the construction of a Hampton
         Inn  and  Suites  hotel  and a  Homewood  Suites  hotel,  respectively.
         Construction  was  delayed  at both  sites as a result of  higher  than
         projected  construction  costs and a change in market  conditions.  The
         Solon  site is now under  construction  for a Hampton  Inn hotel  while
         plans for the Warwick site have not yet been resolved.

         In January 1996,  the  Partnership  acquired a 54% limited  partnership
         interest in Essex  Glenmaura L.P.  (Glenmaura)  through the purchase of
         12.5 limited  partnership units for $1,250,000.  The purchase price was
         equal  to the  prorata  portion  of the fair  value  of the net  assets
         acquired.  Glenmaura  owns and operates a Courtyard  by Marriott  hotel
         near Scranton,  Pennsylvania.  Construction  of the hotel was completed
         during 1996 and operations began on September 4, 1996.

         The  following is a general  description  of the  allocation of income,
         loss, and distributions.  For a more comprehensive  description see the
         Partnership Agreement:

                  Allocation of income from  operations will be allocated 99% to
                  the limited  partners and 1% to the general  partner until the
                  amount allocated to the limited partners equals the cumulative
                  annual  return  of 8% of  their  contribution.  Any  remaining
                  income  from  operations  is  allocated  80%  to  the  limited
                  partners and 20% to the general partner. Income on the sale of
                  any or  all of the  hotels  is  allocated  99% to the  limited
                  partners until each limited partner has been allocated  income
                  in an  amount  equal  to his  or her  pro  rata  share  of the
                  nondeductible syndication expenses and sales commission and 1%
                  to the general partner. Thereafter,  income on the sale of any
                  or all the hotels is  allocated  in the same  manner as income
                  from operations.

                  Allocations of losses from operations will be allocated 80% to
                  the limited  partners  and 20% to the  general  partner in the
                  amounts  sufficient  to offset all income which was  allocated
                  80% to the limited partners. Thereafter,  operating losses are
                  allocated  99% to the limited  partners  and 1% to the general
                  partner.  Loss on the sale of any or all of the hotels will be
                  first allocated in the same manner as losses from  operations,
                  except that the allocation of such loss would be made prior to
                  allocations  of income from  operations.  All other losses are
                  allocated  99% to the limited  partners  and 1% to the general
                  partner.

                  Cash distributions will initially be made 99% to the limited
                  partners and 1% to


<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997

(1)      ORGANIZATION (continued)
         ------------------------

                  the general partner.  After the limited partners have received
                  a  cumulative  annual  return  of  8% of  their  contribution,
                  additional  distributions  may then be made 80% to the limited
                  partners and 20% to the general partner.  Distributions of the
                  net proceeds of sale or  refinancing of any or all hotels will
                  be  made 1% to the  general  partner  and  99% to the  limited
                  partners  prorata in accordance  with the number of units held
                  by each  limited  partner  until  the  limited  partners  have
                  received  distributions from sale or refinance of hotels equal
                  to $1,000 per unit.  Thereafter,  distributions  shall next be
                  made 1% to the general partner and 99% to the limited partners
                  until each limited partner has received any unpaid  cumulative
                  return   accrued   through  the  date  of  the   distribution.
                  Additional  distributions will then be made 20% to the general
                  partner and 80% to the limited partners.

         Essex  Partners and its affiliates  are receiving  substantial  fees in
         connection  with the offering of notes and limited  partnership  units.
         Additional   fees  will  be  paid  to  them  in  connection   with  the
         acquisition,  development and operation of the hotels and management of
         the Partnership (see note 5).

         In  accordance  with  the  Partnership  agreement,  the  ratio of gross
         proceeds from the offering of limited  partnership units to total gross
         proceeds  from the public  offering  of notes and  limited  partnership
         units prior to the termination of the offering may not be less than .15
         to 1. At March 31, 1997, that ratio was .31 to 1.

(2)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         ------------------------------------------

         BASIS OF ACCOUNTING

         The  financial  statements  of the  Partnership  were  prepared  on the
         accrual  basis of  accounting in  conformity  with  generally  accepted
         accounting principles.

         PRINCIPLES OF CONSOLIDATION

         The  consolidated  financial  statements  include  the  accounts of the
         Partnership and Glenmaura.  All significant  intercompany  transactions
         and balances have been eliminated in consolidation.

         INVESTMENT IN REAL ESTATE

         Investment in real estate is stated at cost.  Investment in real estate
         is   reviewed   for   possible   impairment   when  events  or  changed
         circumstances   may   affect  the   underlying   basis  of  the  asset.
         Depreciation is calculated using the straight-line method for buildings
         and accelerated methods for land improvements,  furniture, fixtures and
         equipment  over the following  estimated  useful lives of the assets as
         each hotel commences operations:





<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997

(2)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
         ------------------------------------------------------


               Buildings                               39 years
               Land improvements                       15 years
               Furniture, fixtures and equipment       5 - 7 years


         CASH AND CASH EQUIVALENTS

         Cash investments with maturities of three months or less at the time of
         purchase are considered to be cash equivalents.

         DEFERRED COSTS

         Costs of issuing the subordinated  notes payable will be amortized on a
         straight-line basis over the term of the notes.

         Franchise fees paid for the right to own and operate the hotels will be
         amortized  on a  straight-line  basis  over the term of each  franchise
         agreement, as each hotel commences operations.

         SYNDICATION COSTS

         Selling  commissions and legal,  accounting,  printing and other filing
         costs  totaling  $322,350  related  to  the  offering  of  the  limited
         partnership  units were  charged  against  the  proceeds  of the public
         offering.

         INCOME TAXES

         No provision for income taxes has been provided  since any liability is
         the individual responsibility of the partners.

         RECOGNITION OF REVENUE

         Revenues  are  recognized  as earned  in  accordance  with  contractual
         arrangements for each transaction.

         LIMITED PARTNERSHIP PER UNIT DATA

         Net loss per limited partner unit is calculated by dividing net loss by
         the weighted average number of units  outstanding  during the year. The
         weighted average number of units outstanding was 2,242 during the first
         quarter, 1997.





<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997

(2)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
         ------------------------------------------------------

         USE OF ESTIMATES

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


(3)      DEBT
         ----

         FIRST MORTGAGE LOAN

         On February 28, 1997,  Glenmaura obtained permanent financing from GMAC
         Commercial  Mortgage  Corporation for $5,000,000.  The term of the loan
         will be for four years with a one year  extension  available if certain
         debt service  coverage is attained.  Monthly  payments of interest only
         will be due at 3% over the LIBOR rate for the first year. Principal and
         interest payments are due thereafter. The loan is collateralized by the
         real and personal property and certain other assets.

         NOTES PAYABLE

         Glenmaura has $1,500,000 of unsecured notes requiring  monthly payments
         of  interest  only at 10.5%  through  June 1,  1998,  at which time all
         principal  will be due  unless  Glenmaura  exercises  its two  one-year
         extensions  at extension  fees  ranging  from  one-half to one percent.
         Glenmaura  also has the right to prepay the notes at face value.  Essex
         Partners guarantees payment of principal and interest on the notes.

         SUBORDINATED NOTES PAYABLE

         Subordinated  notes  payable  of the  Partnership  of  $5,182,000  bear
         interest  at a rate of 10.5% per  annum,  payable  monthly,  and mature
         December 31, 2001,  unless  extended by the Partnership to December 31,
         2002 upon  payment to holders of an  extension  fee equal to .5% of the
         principal amount of the subordinated notes  outstanding.  The notes are
         issued as unsecured obligations of the Partnership.













<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997

(3)      DEBT (CONTINUED)
         ----------------

         The aggregate annual principal payments of the debt obligations for the
         nine months ended December 31, 1997 and years subsequent to 1997 are as
         follows:


          1997                                 -0-
          1998                           1,539,129
          1999                              51,449
          2000                              56,836
          2001                          10,034,586
                          ------------------------
                                        11,682,000
                          ========================

         In the first  quarter  1997,  interest  of $37,615 was  capitalized  in
         investments in real estate as the debt was used to finance construction
         of hotels.  Interest of $31,375 was  capitalized  in the first quarter,
         1996.


(4)      FRANCHISE FEES
         --------------

         In 1995, the  Partnership  entered into license  agreements with Promus
         Corporation  (Promus)  to operate a Homewood  Suites  hotel in Warwick,
         Rhode  Island and a Hampton  Inn and Suites  hotel in Solon,  Ohio.  An
         initial  franchise  fee of $40,000 was paid for each hotel and the term
         and amortization period of the franchise agreements is twenty years. In
         addition,  for each  hotel,  the  Partnership  will be  required to pay
         Promus a monthly royalty fee of 4% of gross rooms  revenues,  a monthly
         marketing/reservation  fee of 4% of gross  rooms  revenue,  an  initial
         software  license  fee of $3,000 plus $85 per guest room with a monthly
         maintenance  charge of $200 to $400 per  month,  and a  monthly  amount
         equal to any sales tax or similar  tax  imposed  on Promus on  payments
         received under the license  agreement.  During 1996 Promus approved the
         conversion of the Solon, Ohio agreement to a Hampton Inn.

         Promus  requires the  Partnership to establish a capital reserve escrow
         account based on a percentage of gross revenues generated by each hotel
         which  will be used for  product  quality  requirements  of the  hotel.
         Cumulative  funding of the reserve  for the first five years  increases
         from 1% to 5% of gross  revenues and  stabilizes  at 5% for the term of
         the  agreement.   The  Promus  franchise   agreements   impose  certain
         restrictions  on the  transfer  of limited  partnership  units.  Promus
         restricts  the  sale,  pledge  or  transfer  of units in  excess of 25%
         without their consent.

         Glenmaura has a franchise agreement with Marriott  International,  Inc.
         Under the terms of the agreement,  Glenmaura paid an initial  franchise
         fee of  $48,000  in  1995.  The  term and  amortization  period  of the
         franchise  agreement  is twenty  years,  with an option to renew for an
         additional  ten-year  period.  Glenmaura  is  required to pay a monthly
         royalty  fee in an amount  equal to 4% of gross  room  rentals  for the
         first two years of operations and 5% during the


<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997




(4)      FRANCHISE FEES (CONTINUED)
         --------------------------

         remainder of the term of the  agreement,  a marketing fee of 2-3% gross
         revenues,  a reservation  system fee and a property  management  system
         fee. In the first quarter 1997, these fees totaled $40,976.  There were
         no payments made in the first quarter 1996.













<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997

(5)      RELATED PARTY TRANSACTIONS
         --------------------------

         A summary of fees  earned by Essex  Partners  or its  affiliates  since
         inception  through  March 31,  1997 under the terms of the  Partnership
         agreement follows:
<TABLE>
<CAPTION>
                                                                                        1ST QTR         1ST QTR
TYPE OF FEE                   AMOUNT OF FEE                                                1997            1996
-----------                   -------------                                                ----            ----
<S>                        <C>                                                       <C>            <C>

Selling Commission            Up to $80 per limited partnership                         $25,690        $150,200
                              unit and $55 per $1,000 sold

Organization and              3.4% of the gross proceeds of the                          13,700          87,060
Offering Fee                  offering

Acquisition Fee               $110,000 per hotel site                                         0               0

Development Fee               $160,000 per hotel, plus 5% of the                        108,000               0
                              total cost of the hotel in excess of
                              $2.7 million (not to exceed $325,000
                              per hotel)

Offering and                  Up to $40,000 if proceeds of the                                0          16,000
Organization Fee -            offering of limited partnership units
Glenmaura                     is $4,000,000, reduced by any
                              selling commissions paid

Development Fee -             $285,000 (less $171,000 paid prior                              0          85,500
Glenmaura                     to the Partnership's purchase of a
                              controlling interest of Glenmaura)

Property                      4.5% of gross operating revenues                           20,600               0
Management Fee                from the hotels

Partnership                   .75% to 1.25% of gross operating                            3,430               0
Management Fee                revenues from the hotels

Accounting Fee                $800 per month                                              2,400               0

                                                                                       $173,820        $338,760
                                                                                       ========        ========

</TABLE>








<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997

(5)      RELATED PARTY TRANSACTIONS (CONTINUED)
         --------------------------------------

         The above fees are reflected in the accompanying  financial  statements
as follows:
<TABLE>


<S>                                                                          <C>            <C> 

                                                                                 1ST QTR         1ST QTR
Balance Sheet:                                                                      1997            1996
                                                                                    ----            ----
     Investment in real estate                                                  $108,000       $  85,500
     Deferred debt issuance costs                                                 23,320         187,000
     Syndication costs, charged to partner's capital                              16,070          66,160
                                                                                $147,390        $338,660
                                                                                ========        ========
Statements of Operations:

     Management fees to affiliates                                               $20,600               0
     Administrative expense                                                        2,400               0
     Partnership management fees                                                   3,430               0
                                                                                 $26,430              $0
                                                                                ========        ========
</TABLE>

         Organization  and offering fees are allocated to syndication  costs and
         debt issuance  costs based on the pro-rata  share of limited  partner's
         units and notes payable to the total offering.

         In 1995, the Partnership paid a $110,000  acquisition fee in connection
         with the Warwick,  Rhode Island  site.  As it is unlikely  that a hotel
         will be  constructed  on the  Warwick  site,  the  amount of the fee is
         included in due from affiliates at December 31, 1996.


<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997

(5)      RELATED PARTY TRANSACTIONS (continued)
         --------------------------------------

         Under the terms of the  Partnership  agreement,  Essex  Partners or its
         affiliates will also earn other fees as follows:



     TYPE OF FEE                        AMOUNT OF FEE
     -----------                        -------------
Investor Relations Fee    .25% of the gross proceeds of the offering payable
                          annually in 1998 through 2001

Refinancing Fee           1% of the gross proceeds of re-financing any or all
                          of the hotels

Sales Fee                 3% of the gross sale price of any or all of the hotels


         Glenmaura has made a  non-refundable  deposit of $55,000 pursuant to an
         option  to  purchase  a second  parcel  of land  (the  Second  Project)
         adjacent to the Project for purposes of  constructing  a second  hotel.
         The option agreement expired in December of 1996 but is currently being
         renegotiated.  In the event that Essex Partners  elects to proceed with
         the Second Project on behalf of Glenmaura,  Essex Partners will receive
         additional  compensation  related  to the  acquisition  of  the  second
         parcel,  construction  of the Second  Project and  securing  additional
         equity and debt financing to fund such  activities.  Such  compensation
         will  include  an  acquisition  fee equal to $50,000  for its  services
         related to the  acquisition of the second parcel and a development  fee
         up to $150,000  plus 3% of total  construction,  site  development  and
         fixtures,  furniture and equipment costs. In addition,  as compensation
         for arranging construction and permanent financing,  Essex Partners may
         receive  a  financing  fee  equal to 1% of the  gross  proceeds  of the
         financing.

         The  Partnership  will  also be  subject  to a number of  conflicts  of
         interest arising from its relationships  with the general partner,  its
         owners and affiliates and due to other activities and entities in which
         the  general  partner and its  affiliates  have or may have a direct or
         indirect financial interest.

(6)      SUBSEQUENT EVENTS
         -----------------

         In May 1997, the Partnership elected not to proceed with development of
         a hotel on the Warwick,  Rhode Island property and is pursuing the sale
         of the  property.  the disposal is not  expected to have a  significant
         impact on the Partnership's financial statements.

         In June 1997, the Partnership acquired a property in Erie, Pennsylvania
         for $650,000 in anticipation  of constructing a Hampton Inn hotel.  The
         Partnership  is currently  negotiating  with GMAC for a first  mortgage
         loan of approximately $4.5 million.

         On June 9, 1997, the Partnership sold 1.05 limited partnership units of
         Glenmaura  for  $105,000  to  Essex  Partners,   thereby  reducing  the
         Partnership's   investment   interest  to  49.8%.  As  a  result,   the
         Partnership n o longer controls  Glenmaura and will be accounted for on
         the equity method.


<PAGE>


                       ESSEX HOSPITALITY ASSOCIATES IV L.P
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                                 March 31, 1997



(6)      SUBSEQUENT EVENTS (CONTINUED)
         -----------------------------


         In July 1997, the Partnership completed construction of the Hampton Inn
         in Solon, Ohio and obtained a first mortgage of $4.5 million with GMAC.
         the  term is for four  years  with a one year  extension  available  if
         certain debt service coverage is attained. Monthly payments of interest
         only  will be due at 3.25%  over the  LIBOR  rate for the  first  year.
         Principal and interest payments are due thereafter.










<PAGE>




ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
------     ---------------------------------------------------------

The Partnership was formed on August 30, 1995. The Partnership's public offering
of mortgage notes, subordinated notes and limited partnership units was declared
effective  on  November  24,  1995.  The   Partnership  is  currently   offering
subordinated notes and limited  partnership units for sale to investors pursuant
to the  Prospectus.  The  mortgage  notes  have  not  been  offered  for sale to
investors as yet.  Gross offering  proceeds of up to  $21,000,000  may be raised
through the public  offering.  Through May 8, 1997, the Partnership has received
gross offering  proceeds of $7,629,000,  including  $5,298,000  from the sale of
subordinated  notes and $2,331,000 from the sale of limited  partnership  units.
Since the effective date, the Partnership has been involved in raising  capital,
the  acquisition  and  construction  of  properties  and the purchase of limited
partnership  units  in  another  partnership.  The two  sites  specified  in the
Prospectus  were  acquired on December  29,  1995, a 2.535 acre site in Warwick,
Rhode Island and a 2.28 acre site in Solon, Ohio.  Limited  partnership units in
another partnership were purchased in the first quarter, 1996.

The Partnership  began  construction of a 100-room Hampton Inn in Solon, Ohio in
late, 1996,  which is expected to open in early summer,  1997. The Solon Hampton
Inn is expected to cost about  $6,900,000,  including the cost of the land, cost
of construction,  cost of furnishings,  construction period interest,  financing
costs  (debt  and  equity)  and all  soft  costs  such as  architectural  costs,
engineering,  franchise fee and working capital.  The General Partner expects to
secure first mortgage financing from institutional lenders, however, no external
financing  source has issued a commitment to lend funds to the  Partnership  for
construction or permanent  financing.  The Partnership  does not have sufficient
funds to  complete  construction  of the  Solon  property.  Although  additional
funding is not assured,  based on the rate funds are being raised, the timing of
construction,   and  the  expected  availability  of  external  financing,   the
Partnership   anticipates   sufficient  funds  will  be  available  to  pay  for
construction and for future property acquisitions when required.

The Partnership also invested $1,250,000 in another partnership, Essex Glenmaura
L.P.  ("Glenmaura")  in two  purchases in the first  quarter of 1996.  Glenmaura
completed   construction   of  a  120-room   Marriott   Courtyard  in  Scranton,
Pennsylvania in September, 1996. The total cost of the project was $8.7 million,
including  the cost of the  land,  cost of  construction,  cost of  furnishings,
construction  period  interest,  financing  costs (debt and equity) and all soft
costs  such as  architectural  costs,  engineering,  franchise  fee and  working
capital. The project was funded with $2,300,000 of partner equity, $1,500,000 of
unsecured  notes and a  $5,000,000  first  mortgage  loan  from GMAC  Commercial
Mortgage Corporation. The term of the first mortgage loan is for four years with
a one year  extension  available  if the  specified  debt  service  coverage  is
attained.  Monthly payments of interest only accrue a 3% over the LIBOR rate for
the first year.  Principal and interest  payments are due thereafter  based on a
twenty-five  year loan  amortization.  Starting  in the second year of the loan,
Glenmaura  will be required to maintain a  replacement  reserve  escrow at 4% of
room revenues.

The  Partnership  had  intended  to build an 80-room  Homewood  Suites  hotel in
Warwick, Rhode Island.  However, the Partnership has learned that additional new
hotels  are  planned  for the  area on the  Partnership's  site  which  would be
directly competitive with the Partnership's hotel. The


<PAGE>



Partnership  has  decided to review the  market  for the  Warwick  area again to
determine  if the market  exists to support the  additional  hotel rooms  before
proceeding with construction. The Partnership expects to have the results of the
market  study within the next month and will be  determining  whether to proceed
with the  Warwick  Homewood  Suites  by the end of the  second  quarter.  If the
Partnership  decides  not to  construct  the  Homewood  Suites in  Warwick,  the
Partnership  intends to sell the Warwick site and specify at least one more site
for development by the Partnership.

The General  Partner is evaluating  other  potential sites to by acquired by the
Partnership,  however,  it  has  not  identified  any  additional  property  for
acquisition.


MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

The following  discussion analyzes the consolidated  financial statements of the
Partnership as of March 31, 1997, which are attached. The consolidated financial
statements  include the accounts of the  Partnership  and Essex  Glenmaura.  All
significant  intercompany  transactions  and balances  have been  eliminated  in
consolidation.

From  April 1, 1996 to March 31,  1997,  the  consolidated  total  assets of the
Partnership  increased  $6,344,000.  The increase was caused by several factors.
Net investment in real estate  increased  $5,228,000,  an increase of $3,978,000
from  construction  of the Courtyard by Marriott  hotel by Essex  Glenmaura,  an
increase of $1,597,000 from  development  activities by the  Partnership,  and a
reduction  from  depreciation  expense of  $347,000.  Cash and cash  equivalents
increased  $806,000 from proceeds of the Partnership's  offering of subordinated
notes and units.  Debt issuance costs  increased  $246,000,  $131,000 from costs
incurred in the  Partnership's  offering of subordinated  notes, and $115,000 of
costs  associated  with  obtaining the first  mortgage  financing for Glenmaura.
Partnership consolidated liabilities increased $6,829,000,  for several reasons.
Subordinated   notes  payable   increased   $1,336,000   from  the  issuance  of
subordinated  notes  payable  in  the  Partnership's  offering.  First  mortgage
financing  increased  5,000,000 which represents the first mortgage  obtained by
Glenmaura in February, 1997. Accounts payable increased $493,000, primarily from
outstanding  construction invoices. The minority interest in Glenmaura decreased
$489,000,  representing  the minority  interest share in the net losses of Essex
Glenmaura  in  1996  and the  first  quarter,  1997.  Limited  partners'  equity
increased only $3,000,  which represents  proceeds of the  Partnership's  public
offering of the Units,  net of syndication  costs and Partners'  Notes, and from
the consolidation of the Partnership's  interest in Glenmaura.  The consolidated
net loss for the Partnership of $186,000 for the first quarter 1997 and $867,000
for 1996 also decreased partners' equity.

The primary  revenue source was room revenues of $420,000 from Essex  Glenmaura,
which is the only hotel in operation.  Other revenue totaled $89,000,  for total
revenues of $509,000.  Operating  expenses for the first quarter,  1997,  before
interest and depreciation,  totaled $428,000,  for income from operations before
interest, depreciation and amortization of $81,000. The largest single operating
expense for the  Partnership  is rooms  expense,  followed by food and  beverage
expenses.  The  Partnership's  consolidated  interest  expense,  net of interest
income was $201,000, representing interest incurred on the notes payable and the
first mortgage loan, and interest on the subordinated


<PAGE>



notes to the extent the  proceeds  were not used for  construction.  Interest of
$38,000 on the  proceeds  of the  subordinated  notes used in  construction  was
capitalized.  Depreciation and amortization expenses totaled $146,000, for a net
loss of  $270,000  before  allocating  $84,000  of the net loss to the  minority
interest  in  Glenmaura.  The  consolidated  net  loss for the  Partnership  was
$186,000.

Glenmaura  is in the  start-up  phase of  operations.  New hotels  require  from
several months to a couple years to establish a stable customer base. During the
start-up  phase,  occupancy is building,  and room rates may be lower to attract
new customers.  When a strong  customer base is  established,  room rates can be
raised to a more competitive level.




<PAGE>





                                     PART II

                                OTHER INFORMATION


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

         a.    EXHIBITS

               None

         b.    REPORTS ON FORM 8-K

               None





                                   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.


                                     ESSEX HOSPITALITY ASSOCIATES IV L.P.
                                        Registrant



Dated:   September 19, 1997          /S/ LORRIE L. LOFASO
                                     --------------------
                                     Essex Hospitality Associates IV L.P.
                                     Essex Partners Inc.
                                     Lorrie L. LoFaso
                                     Vice President and Chief Accounting Officer