U.S. SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C. 20549
                              FORM 10-K

              ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                 OF THE SECURITIES EXCHANGE ACT OF 1934

For Year Ended December 31, 1996  Commission File Number  001-12245

                          METROGOLF INCORPORATED
-------------------------------------------------------------------
           (Exact name of registrant as specified in its charter)

          COLORADO                                      84-1288480
-------------------------------------------------------------------
 (State or other jurisdiction       I.R.S. Employer Identification 
No.
 of incorporation or organization)

            1999 Broadway, Suite 2435, Denver, Colorado 80202
-------------------------------------------------------------------
(Address of principal executive offices)              (Zip code)

Registrant's telephone number, including area code   (303) 294-9300
                                                     --------------
Securities registered pursuant to Section 12(b) of the Act:

Common Stock (listed on  the Boston Stock Exchange)
-------------------------------------------------------------------

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

None
-------------------------------------------------------------------


Indicate by check 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.
                                        X       Yes             No
                                     -------            --------

Indicate by check mark if disclosure of delinquent filers pursuant 
to Item 405 of Regulation S-K is not contained herein, and will not 
be contained, to the best of registrant's knowledge, in definitive 
proxy or information statements incorporated by reference in Part 
III of this Form 10-K or any amendment to this Form 10-K. [   ]

The aggregate market value of the voting stock of the Registrant 
held by non-affiliates on March 31, 1997 was $3,676,863.

-------------------------------------------------------------------
                   DOCUMENTS INCORPORATED BY REFERENCE

The Company is incorporating as a part of Item 14, Exhibit Index, a 
Prospectus filed pursuant to rule 424(b) on or about October 16, 
1997.


METROGOLF INCORPORATED
FORM 10-K ANNUAL REPORT
TABLE OF CONTENTS


PART I
ITEM 1. Business

ITEM 2. Properties

ITEM 3. Legal Proceedings

ITEM 4. Submission of Matters to a Vote of Security Holders

PART II

ITEM 5. Market for Registrant's Common Equity and Related 
Stockholder
        Matters

ITEM 6. Selected Financial Data

ITEM 7. Management's Discussion and Analysis of Financial Condition 
        and Results of Operation

ITEM 8. Financial Statements and Supplementary Data

ITEM 9. Changes in and Disagreements With Accountants on Accounting
        and Financial Disclosure

PART III

ITEM 10. Directors and Executive Officers of the Registrant

ITEM 11. Executive Compensation

ITEM 12. Security Ownership of Certain Beneficial Owners and 
Management

ITEM 13. Certain Relationships and Related Transactions

PART IV

ITEM 14. Exhibits, Financial Statement Schedules, and Reports on 
         Form 8-K

SIGNATURES


PART I.

ITEM 1. BUSINESS

General

MetroGolf Incorporated (the "Company") is organized as a 
corporation under the laws of the State of Colorado, and previously 
operated under the name "The Vintage Group (USA) Ltd." See 
"Corporate Information" for a description of the general 
development of the Company. 

The Company acquires, develops and operates golf centers designed 
to provide a wide variety of practice and play opportunities in 
major metropolitan areas. The Company's centers are located in 
areas with high concentrations of office, urban residential and 
hotel development that are convenient to time-constrained golfers. 
The Company's golf centers typically offer: practice facilities; 
instructional programs such as the David Leadbetter Golf Academy at 
Illinois Center Golf; a full-line pro shop; restaurant, bar and 
catering facilities; group meeting areas; and, in some cases, par-3 
or executive-length (shorter than a regulation-length) golf 
courses. The Company's golf centers are designed around a driving 
range with target greens, bunkers and traps to simulate actual golf 
course conditions. The Company's driving ranges, which typically 
include substantially more hitting stations than the industry 
average, are lighted to permit night play and are enclosed or 
sheltered in a climate-controlled environment. 

The Company's strategy is to become the leading owner and operator 
of golf centers in major metropolitan areas. The Company intends to 
accomplish this goal principally by acquiring existing golf 
facilities that have the potential for revenue enhancement through 
expansion of facilities, more efficient management and innovative 
marketing strategies. The Company intends to develop new golf 
centers in attractive markets where existing facilities are not 
suitable for acquisition. The Company has capitalized on the 
national media and industry recognition of its flagship 
development, Illinois Center Golf, and has built a substantial 
pipeline of attractive projects for acquisition and development. 
See "Business Strategy." In addition to Illinois Center Golf, the 
Company currently operates Goose Creek Golf Club ("Goose Creek"), 
an 18-hole golf course in suburban Washington, D.C., Fremont Golf 
Center in Fremont, California, Harborside Golf Center and Palms 
Golf Center, each in San Diego, California and Rocky Point Golf 
Center in Rocky Point, Long Island, New York.

Industry Overview

According to the National Golf Foundation ("NGF"), there were over 
24 million golfers in the United States in 1995. The average age of 
the golf driving range user was 37.1 years old, with an average 
household income of $55,700 per year. Those with household income 
in excess of $75,000 (approximately 35% of all stand-alone range 
users) were the most likely to visit a stand-alone range, visiting 
3.7 times more frequently than those with household income of less 
than $30,000 (19% of all stand-alone range users) and 1.5 times 
more frequently than those with household incomes between $30,000 
and $75,000 (46% of all stand-alone range users). 

The Company estimates that there are currently between 1,900 and 
2,300 stand-alone driving ranges in the United States and that the 
average number of tee stations per range in the industry in 1993 
was 40, with 50% of all stand-alone ranges offering 35 or fewer tee 
stations. Large stand-alone ranges, defined as ranges with more 
than 50 tee stations, accounted for approximately 21% of all 
facilities. The stand-alone range industry is highly fragmented. 
The Company estimates that in 1995 over 90% of stand-alone ranges 
were managed by independent owner operators. The Company believes 
that many of these owner operated ranges are managed by individuals 
who may lack the experience, expertise and financial resources to 
compete effectively in a consolidating industry. 

Driving ranges and golf practice and learning centers, have 
experienced significant growth in recent years. Golf practice and 
learning centers usually consist of a driving range with a minimum 
of 50 tee stations (often covered and heated in areas of colder 
climates), complete practice areas, including putting, chipping and 
sand bunker areas and maintenance facilities. Indoor video and 
other instructional analysis, in conjunction with a national golf 
academy or other golf school, food and beverage services and golf 
equipment retail operations, have become increasingly popular at 
these facilities. Occasionally, such facilities are combined with 
or incorporated into the full-length or executive-length course 
facility types. 

The ownership and operation of golf courses, driving ranges and 
other golf facilities in the United States is highly fragmented, 
with very few companies owning or operating substantial portfolios 
of golf facilities. Over the last 10 years, however, there has been 
an accelerating trend towards consolidation of ownership and 
management of 18-hole golf courses. What had been an industry 
characterized by fragmentation of ownership and management is 
becoming increasingly concentrated. The ownership and operation of 
driving ranges and golf practice and learning centers in the United 
States, however, remains fragmented, with very few companies owning 
or operating substantial golf facility portfolios. The Company 
believes that there are very few companies who currently own and 
operate more than one or two golf practice and learning centers and 
only one that owns and operates more than ten golf practice and 
learning centers in the United States. 

Business Strategy

The Company's strategy is to become the leading owner and operator 
of golf centers in major metropolitan areas. The Company intends to 
accomplish this goal principally by acquiring existing golf 
facilities that have the potential for revenue enhancement through 
expansion of facilities, more efficient management and innovative 
marketing strategies. The Company intends to develop new golf 
centers in attractive markets where existing facilities are not 
suitable for acquisition. The Company's golf centers are designed 
around a driving range with target greens, bunkers and traps to 
simulate actual golf course conditions. The Company's driving 
ranges, which typically include substantially more hitting stations 
than the industry average, are lighted to permit night play and are 
enclosed or sheltered in a climate-controlled environment. The 
Company has capitalized on the national recognition of its flagship 
development, Illinois Center Golf, a golf center and par-3 golf 
course in downtown Chicago, and has built a substantial pipeline of 
attractive projects for acquisition and development. The Company 
intends to incorporate Illinois Center Golf's features into its 
renovation of existing golf facilities and development of new golf 
centers.


  Acquisition of Existing Golf Facilities.  The Company believes 
the ownership and operation of driving ranges and other golf 
facilities is highly fragmented and presents numerous opportunities 
for it to acquire, upgrade and renovate golf centers and driving 
ranges. The Company's acquisition strategy is to target well-
located, stand-alone ranges or golf centers in major metropolitan 
areas, some of which may be under performing. The Company will 
either purchase the land and facilities or enter into long-term 
leases for each project. In determining which facilities may be 
suitable acquisition candidates, management principally considers 
potential for improvement in revenue and operating cash flow 
through capital improvements and efficiencies in management. 
Capital improvements may include increasing the number of tee 
stations, sheltering the hitting stations or enclosing the driving 
range, installing lights to permit night play, adding or expanding 
pro shop and clubhouse facilities and constructing other amenities 
to encourage corporate, executive and business and leisure traveler 
participation. 

 Developments of New Golf Centers.  In desirable locations where 
suitable acquisition opportunities are not available, the Company 
intends to construct new facilities, often as an interim use for 
valuable urban real estate under long-term leases. Such golf 
centers, typically modeled after Illinois Center Golf, will be 
designed to provide a mix of features uniquely focused on the 
demographics and other characteristics of the specific market area. 
The Company's golf centers typically include: instructional 
programs such as the David Leadbetter Golf Academy at Illinois 
Center Golf; enclosed heated hitting areas; putting, sand bunker 
and chipping practice areas; full-line pro shop; restaurant, bar 
and catering facilities; group meeting areas; and, in some cases, 
par-3 or executive-length golf courses. 

 Economies of Scale.  The Company believes that, in the course of 
its acquisition and development activities, it will realize 
efficiencies of management, purchasing and marketing unavailable to 
independent owner-operators who manage the vast majority of stand-
alone golf facilities. It will also spread corporate overhead 
costs, including accounting, insurance, cash management, strategic 
marketing and financial reporting functions, over multiple 
facilities. 

 Marketing Strategy.  The Company believes it will achieve high 
margins from strong demand and high utilization rates for golf 
practice and learning facilities located in areas with few or 
nonexistent locally available alternatives. It will accomplish this 
by providing a unique recreational facility that is user-friendly 
for the novice and intermediate golfer; by including 
internationally recognized golf instruction programs such as the 
David Leadbetter Golf Academy at Illinois Center Golf for golf 
instruction; by designing facilities that provide unique venues for 
corporate and business outings, meetings and other special events; 
and by offering opportunities for major corporate sponsorship and 
advertising. 

Metropolitan Golf Centers

Metropolitan golf centers have several attractive characteristics, 
including: (i) ease of access for time-constrained metropolitan 
area residents and local businesspersons in under-served markets; 
(ii) corporate entertainment facilities and unique membership and 
entertainment opportunities for local and national businesses; 
(iii) special appeal to women, beginning golfers and high-handicap 
golfers because of the learning center and the shorter length golf 
course; and (iv) availability of unique, outdoor recreation 
amenities for the business and leisure traveler patronizing nearby 
hotels. 

 Golf Access to Under-Served Market.  Many major metropolitan areas 
lack sufficient golf facilities to meet the increasing demand for 
tee times. Golfers in densely populated areas frequently must drive 
long distances to play or practice golf. In addition, the busy 
professional may lack sufficient time for recreational activities. 
By locating a multi-use golf facility close to the user's home or 
job in metropolitan residential or business districts, the Company 
provides a convenience for the metropolitan golfer. By offering 
opportunities to play and practice golf requiring only one to two 
hours, including travel time, the Company allows the golfer more 
frequent outings and meets the needs of a larger constituency. The 
metropolitan golf center is not designed to replace the suburban 
country club or daily fee course, but rather to supplement regular 
rounds and offer a high-quality practice medium. 

 Corporate Entertainment Center.  As corporate entertainment 
facilities, metropolitan golf centers offer unique venues with easy 
access for client entertainment and employee benefit functions. As 
highly visible outdoor recreation facilities, metropolitan golf 
centers provide unique and attractive advertising and sponsorship 
opportunities. Each metropolitan golf center has staff members 
dedicated to corporate membership, group outings and consumer 
products sponsorship sales. The presence of a par-3 or executive-
length golf course in many facilities allows the Company to offer 
an enhanced opportunity to increase sales of both individual and 
corporate memberships, host group outings and sponsor special 
events. 

 Preferable Facility for Women and High-handicap Golfers.  Women 
tend to be consumers of golf lessons, specialized golf equipment 
and golf apparel. The highly developed learning and practice 
facilities and upscale retail merchandising of the Company's 
metropolitan golf centers cater to these demands. The executive-
length or par-3 golf course holds specific appeal for women. High-
handicap golfers are also drawn to the shorter courses as a lower 
cost alternative and as a means to improve their golf game before 
playing a full-length course. 

 Travelers' Amenity.  Metropolitan golf centers offer hotels an 
outdoor recreational product for their guests. Both business and 
leisure travelers may take advantage of the proximity of the center 
to their hotel and of special packages that may be offered to hotel 
guests. Hotels may be interested in block purchases and may pay 
sponsorship fees to the metropolitan golf center, thereby 
increasing the visibility of both the hotel and the golf facility. 

Operational Structure

Generally, the Company's golf centers are open seven days per week. 
The Company's revenues are derived from the sale of greens fees, 
range balls, pro shop merchandise (golf clubs, balls, bags, gloves, 
videos, apparel and related accessories) and food and beverages and 
a portion of the revenue generated by instructional programs. Golf 
facilities in general have seasonal attendance due to outdoor 
facilities. See "Management's Discussion and Analysis of Financial 
Condition and Results of Operations  Seasonality." 

An on-site general manager of each center has overall 
administrative responsibility for his or her center's day-to-day 
operation including, as applicable, the driving range, golf course, 
instructional program, short-game practice area, pro shop, 
restaurant, bar, as well as the condition of the facilities. In 
addition, each general manager works with the Company's Chief 
Financial Officer to prepare monthly and annual budgets and 
marketing plans. 

The Company emphasizes recruiting and training skilled personnel. 
The Company seeks general managers with broad and extensive 
business and management skills, preferably from service and 
hospitality industries. General managers, as well as other 
management personnel, are provided performance incentive bonuses. 
The Company encourages each general manager to emphasize customer 
service at his or her center. Employees undergo comprehensive 
training and are required to be courteous, wear standardized 
clothing and display a professional attitude. 

The Company also emphasizes the availability of high-quality, all-
level golf instruction at its golf centers. Currently, the Company 
has an agreement with the internationally recognized David 
Leadbetter Golf Academy for instruction at Illinois Center Golf 
(the "Golf Academy Agreement"). The Company is currently in 
discussions with the David Leadbetter Golf Academy about operating 
the instruction program at other Company golf facilities and 
expects to expand its relationship with the David Leadbetter Golf 
Academy to many of the Company's golf centers. 

By virtue of operating a number of golf centers, the Company 
believes it achieves economies of scale not available to 
independent owner-operators. Typically, the Company can acquire 
artificial turf, range balls, pro shop merchandise and other golf 
center supplies and equipment at lower prices than any individual 
owner-operator. The Company can also purchase insurance coverage at 
a lower premium rate than would be charged for an individual golf 
center. The Company's policies relating to personnel, labor, cash 
management and budgets are formulated at the corporate level and 
required to be observed by each of the Company's golf centers. The 
Company's accounting, legal, insurance and finance functions and 
management information systems are also centralized, which enables 
personnel at each golf center to focus solely on operational 
matters related to the particular golf center. 

The Company advertises in newspapers and on radio and cable 
television and uses direct mailings and other promotions, including 
sponsoring certain charitable events and contests and giving free 
clinics and equipment demonstrations, to increase public awareness 
of its golf centers. Each golf center employs sales and marketing 
employees who coordinate advertising and solicit group events and 
memberships. The compensation of sales and marketing employees is 
predominantly incentive based. Pursuant to the Golf Academy 
Agreement, David Leadbetter Golf Academy is required to market and 
promote the academy located at Illinois Center Golf. 


MetroGolf Management

MetroGolf Management Inc. ("MGMI") is a wholly owned golf 
management company formed to manage Illinois Center Golf and other 
future projects of the Company and its affiliates. The Company, 
through MGMI, manages the operations of Illinois Center Golf,  
Goose Creek, Harborside Golf Center, Fremont Golf Center, Palms 
Golf Center and Rocky Point Golf Center, and plans to similarly 
manage operations of the New York Golf Center and other future 
projects. Generally, all personnel employed at each facility are 
employees of MGMI. The management contracts between each facility 
and MGMI generally include provisions that the facility reimburse 
MGMI for the costs of such employees as are required at each 
facility. 

Competition

On a national basis, the Company faces several major competitors 
with sizable portfolios of golf facilities. However, while these 
companies own or manage large numbers of golf facilities, overall 
golf facilities ownership and management generally remains highly 
fragmented. The ten largest golf course management companies own or 
operate only approximately 3% of the over 14,000 privately owned 
golf courses in the country. The vast majority of the remaining 97% 
of privately owned courses are held by regional multi-course (three 
to five) companies, small ventures and individuals who have limited 
experience in operating a course to maximize profit. These smaller 
operators tend to lack the access to capital and management 
expertise enjoyed by large multi-course owners and operators. Some 
of the multi-facility owners have recently completed public 
offerings to increase their portfolios with opportunities to 
acquire facilities which require professional ownership and 
management to maximize the potential of the chosen facility. The 
trend toward consolidation of 18-hole golf course facilities has 
become very profitable, but increasingly competitive, over the past 
few years. However, the consolidation trend recently evident for 
18-hole golf courses is only in its infancy for the driving range 
and practice and learning center segment of the industry. 

The Company believes that there are very few companies that 
currently own and operate more than one or two golf practice and 
learning centers and that only Family Golf Centers Inc. ("FGCI") 
owns and operates more than ten golf practice and learning centers 
in the United States.  FGCI recently recapitalized through a public 
secondary offering, is the largest owner and operator of golf 
driving ranges in the nation and is pursuing an aggressive 
development and acquisition strategy that has already tripled the 
number of ranges under its operation since January 1995.  Its 
substantial capital gives it a competitive advantage over the 
Company in attempting to absorb weaker operations and provides it 
with increasing economies of scale.  However, FGCI is largely 
focused on the family golf market and on operations in suburban and 
smaller metropolitan areas, although it has competed, and may in 
the future compete, directly with the Company in certain large 
metropolitan areas.  Other public and private companies, such as 
Golden Bear Golf, Inc.; Michael Jordan Golf Co.; Eagle Quest, 
(Tuition) Limited; Blue Eagle Golf Center, Inc.; Golf Centers of 
America, Inc.; Senior Tour Players Development, Inc. and the 
Professional Golfers' Association of America are pursuing 
opportunities in the golf driving range and practice facility 
segment and may compete directly or indirectly with the Company.  
Several other large and well-financed companies are active in the 
full-length golf course segment; however, none have focused on the 
driving range, golf practice and learning center or executive-
length and par-3 courses segments or on larger metropolitan areas, 
although there can be no assurance that they may not do so in the 
future.

Employees

The Company has nine full-time employees at the corporate level, 
and a variable number of additional full-time and part-time 
employees at the facility level through its wholly owned 
subsidiary, MGMI. Currently, MGMI has approximately 20 full-time 
equivalent employees during the slow season, and 70 full-time 
equivalent employees during the peak season.  In addition, the 
Company utilizes the services of various independent contractors, 
primarily for computer, accounting and finance-related services. 

Corporate Information

On February 21, 1992, Mr. Tourtellotte incorporated and became the 
sole stockholder of The Vintage Group USA, Ltd. On May 26, 1993, 
Mr. Tourtellotte incorporated and became the sole stockholder of 
MetroGolf Illinois Center, Inc. ("IC"). On July 29, 1994, The 
Vintage Group USA, Ltd. changed its name to TVG (Virginia) Inc. 
(subsequently renamed MetroGolf Virginia, Inc. "VA") 
Simultaneously, Mr. Tourtellotte formed the Company under the name 
of The Vintage Group (USA) Ltd. and contributed his common stock of 
VA and IC to the Company in exchange for 100% of its outstanding 
Common Stock. Since such time, the Company has, as the managing 
general partner in Illinois Center Golf Partners, L.P.("ICGP") and 
Goose Creek Golf Partners Limited Partnership ("GCGP"), operated 
Illinois Center Golf and Goose Creek.  On October 21, 1996, the 
Company purchased approximately 94% and 90% of the limited 
partnership interests in ICGP and GCGP, respectively.  On July 1, 
1996, the Company purchased the leasehold interest for the Fremont 
Golf Center. Also on such date, the Company's wholly owned 
subsidiary, MetroGolf (San Diego) Incorporated, began operating 
Harborside Golf Center.  On December 31, 1996, the Company 
purchased the leasehold interest in the Palms Golf Center.  On 
March 1, 1997, the Company assumed management of all operations at 
the Rocky Point Golf Center.

The Company has recently changed its name to MetroGolf Incorporated 
and intends to incorporate the name "MetroGolf" into the names of 
its golf centers. The Company has applied for federal tradename 
protection for the name "MetroGolf Incorporated," but there can be 
no assurance that such protection will be granted. The Company is 
aware of other users of the name "MetroGolf" in some of the markets 
where the Company currently operates golf centers or may operate 
golf centers in the future. The Company does not believe that any 
such user is in direct competition with the Company; however, the 
Company may choose not to use the name "MetroGolf" in certain 
markets if it is inadvisable to do so because there is an existing 
user of the name. 




ITEM 2. PROPERTIES

The Company leases approximately 4,300 square feet of corporate 
office space in Denver, Colorado for rent of approximately $64,400 
per year.




Company Golf Centers

                                                     Date Opened,
                                             No. of   Acquired or
Location                    Type of          Hitting  Commenced
of Facility   Facility Name  Facility         Tees     Management
-----------------------------------------------------------------
Chicago, IL     Illinois    MetroGolf Center  92       July 1994
              Center Golf
Fremont, CA   Fremont Golf  MetroGolf Center  36       July 1996
                Center
San Diego, CA Harborside    MetroGolf Center  80        July 1996
              Golf Center
San Diego, CA Palms Golf    MetroGolf Center  42       Dec. 1996
               Center
Leesburg, VA  Goose Creek   18 hole Course    --       June 1992
Long Island,  Rocky Point   MetroGolf Center  70       March 1997
NY            Golf Center

Illinois Center Golf.  Illinois Center Golf opened in July 1994 on 
an approximately 23-acre parcel in downtown Chicago. This golf 
center features a 9-hole, par-3 golf course; a year-round, lighted, 
92-stall driving range; and a complete, full-service clubhouse and 
learning center. Illinois Center Golf is located in the heart of 
Chicago's financial district adjacent to the Chicago Loop and is 
designed to attract business people, travelers and residents in the 
immediate and surrounding downtown area. There are more than 4,000 
hotel rooms, 3,500 residences, and nine million square feet of 
Class A office space located within two blocks of the facility. The 
Hyatt, Sheraton, Fairmount and Swissotel hotels are located within 
one block of Illinois Center Golf and contribute over 1,000,000 
room nights per year to the site area. In the immediate vicinity, 
there are over 12,000 residents with mean household incomes in 
excess of $70,000. In addition, over 650,000 people are employed 
within a 12-block radius of the site. 

The 9-hole, par-3 course was designed by Dye Designs International, 
Inc. ("Dye Designs") and features many of the trademark elements 
that characterize Dye Designs courses. In particular, the 9th hole 
features an island green which challenges the best golfers. Each 
hole has oversized tee boxes to facilitate tee maintenance and 
offer frequent players varied approaches to each green. The 350-
yard, double-ended driving range has a choice of grass or astroturf 
at either end (with a portion covered and heated for winter use) 
and target fairways and elevated greens at various distances. The 
clubhouse serves as the focal point and includes restaurant, bar 
and catering facilities, a full-line pro shop and a state-of-the-
art teaching center featuring a David Leadbetter Golf Academy with 
its internationally recognized teaching programs. 

Illinois Center Golf generated approximately $1.6 million of 
revenue  in its first full year of operations (1995). Over 580 
individual memberships have been sold (generating both initiation 
fees and recurring monthly fees), and both the course and driving 
range have received significant public usage. Corporate membership 
sales at all levels reflect high interest from the business 
community. Corporate and consumer product sponsorship interest has 
been strong, with several sponsorship programs, including an 
agreement with Pepsico, Inc., having been sold. Additionally, 
arrangements have been made with local hotels, including Swissotel, 
for block purchases of tee times, range usage and other events. 
Illinois Center Golf has been featured on the Today Show, CNN and 
25 local and syndicated television programs and has appeared in 
Sports Illustrated and 180 trade publications and daily newspapers 
(including The Wall Street Journal and The New York Times). The 
extensive media coverage of the Company's Chicago operation attests 
to the innovative nature of its new metropolitan golf centers and 
to the high level of public interest in metropolitan golf and 
indicates the significant market potential for such facilities. 

Illinois Center Golf is located on a property which is leased for 
15 years, terminating in 2009. The lease may be extended by mutual 
agreement between the lessor and lessee. The lease may be 
terminated by the lessor under certain conditions. If the lease is 
terminated prior to the end of the 15-year period, the lessor must 
pay the lessee a termination fee of up to $4.4 million, reduced by 
net earnings from the facility.  Illinois Center Golf was financed 
through a $3.5 million private placement of limited partnership 
units in ICGP. The Company is the owner of 89% of the common stock 
of IC which is the sole general partner of ICGP.  The Company 
purchased approximately 94% of the limited partnership interests in 
ICGP on October 21, 1996 with a combination of cash and convertible 
notes totaling $3.275 million.

Fremont Golf Center.  On July 1, 1996, the Company purchased the 
leasehold interest on an existing driving range and learning center 
facility in Fremont, California for $1,350,000 (plus acquisition 
costs of approximately $123,000). The existing golf facility 
consists of a 36-tee station driving range, two practice putting 
greens, a clubhouse and a maintenance area on approximately 15 
acres of land. The current clubhouse includes a grill room and bar 
area not currently in operation. The driving range has both natural 
and artificial tee areas and lights for nighttime use. 

In addition, the Company has been granted the exclusive right to 
develop an adjacent 35-acre tract of land owned by the City of 
Fremont into a 9-hole executive-length golf course with expanded 
practice facilities and significantly improved clubhouse amenities.  
The Company expects to commence construction of the 9-hole 
executive-length golf course and begin modifications to the 
existing facility in the summer of 1997, with the completion of the 
golf center scheduled for the spring of 1998. The total acquisition 
(including the driving range and learning center) and proposed 
development budget is approximately $3.5 million. 

The new Fremont Golf Center is planned to include an expanded, 80-
station tee area, practice putting green, chipping and short game 
practice and sand bunker areas. Plans call for the clubhouse to be 
redesigned and enhanced to include a full-line pro shop, locker 
rooms and bar area and grill room with an outdoor patio. A 
corporate entertainment and group event area will be located 
adjacent to the patio. The 9-hole executive-length golf course is 
to be designed by Dye Designs and will have many of the trademark 
elements that characterize Dye Designs golf courses. 

The Fremont Golf Center site is an urban, in-fill site in the east 
San Francisco Bay area, located between Oakland and San Jose in the 
heart of the Silicon Valley. An estimated two million people live 
and work in the east Bay area. The site is adjacent to Fremont's 
Central Park, which serves as a regional park for the east Bay area 
and frequently experiences weekend crowds in excess of 50,000 
people. The site provides a significant opportunity because of the 
limited availability of golfing options in the Fremont area. The 
Company believes, based on its market research in the area, that 
there is significant undercapacity of golf facilities in the area. 

The development budget for the new 9-hole executive-length golf 
course, and modifications to the existing facility, is anticipated 
to be approximately $2 million over a one-year development period. 
The Company intends to fund the development through a combination 
of equity and debt.  The debt is to be provided by a commercial 
bank, specialized golf lending institution or private lender. 

Harborside Golf Center.  On July 1, 1996, the Company commenced 
operating the Harborside Golf Center located in downtown San Diego, 
California. The golf center is located on a 4.63 acre site of land 
in close proximity to the San Diego Convention Center and 
International Airport and is adjacent to major hotels, restaurants 
and approximately eight million square feet of commercial office 
space. The facility includes a driving range which has 80 tee 
stations, double-tiered and double-ended. There are 20 additional 
grass practice tees, a putting green, chipping green and sand 
bunker area. Multiple target greens and sand traps are located on 
the driving range. The clubhouse covers approximately 10,000 square 
feet and includes a pro shop, a sports bar/cafe and computerized 
video swing analysis. 

Palms Golf Center. On December 31, 1996, the Company purchased the 
leasehold interest and related improvement on an approximately 2 
year old 13-acre facility fronting on Interstate 5 approximately 10 
miles south of downtown San Diego.  The Palms Golf Center features 
a 42 grass and mat tee station practice range; a 9-hole pitch-and-
putt golf course; an approximately 10,000 square foot putting 
green, complete with chipping, short game and sand bunker areas; 
and an approximately 2,000 square foot clubhouse that is complete 
with a pro shop and snack bar.  The facility is lighted for evening 
use.  As consideration for the acquisition, the Company paid 
$71,584 in cash, issued $137,500 worth of Common Stock and executed 
an $87,500 promissory note bearing interest at the rate of 8% per 
annum that provides for payment of all principal and accrued 
interest on April 21, 1997.  The Company acquired its interest in 
the property subject to approximately $460,000 of existing 
indebtedness.

Rocky Point Golf Center.  On March 1, 1997, the Company assumed the 
management of all operations of Rocky Point Golf Center located in 
Rocky Point, Long Island, New York.  The center offers golfers 70 
250 yard hitting stations which are covered and heated for cold and 
rainy weather play.  The double deck range offers a lighted landing 
area for night play with seven target greens.  An approximately 
2,500 square foot grass putting green, complete with sand bunkers 
and chipping areas, accommodates short game practice.  Rocky Point 
Golf Center also offers a full line pro shop and PGA accredited 
instruction, including a full offering of lessons for individuals, 
couples or groups.

Goose Creek.  Goose Creek is a 20-year-old daily fee course located 
in Leesburg, Virginia that was purchased by GCGP in June 1992. The 
golf course is 6,800 yards in length and has a 5,000 square-foot 
clubhouse. The club is located seven miles from Dulles 
International Airport in the northern Virginia suburbs of 
Washington, D.C. and logs in excess of 40,000 rounds annually at 
current fees of as much as $30 per round. The facility has been 
remodeled and repositioned in the market by the Company as a 
higher-end, country club-type experience for daily fee golfers. 
Since its acquisition in 1992, greens fees have been increased by 
as much as 40%. In 1995, Goose Creek generated over $1.4 million in 
total revenue. Goose Creek was purchased by GCGP for slightly more 
than $4.3 million. Approximately $975,000 of equity was raised for 
the purchase through a private limited partnership offering in 
GCGP. The balance of the funds was provided by a mortgage loan and 
$400,000 carryback financing from the seller.  The Company owns 
100% of the issued and outstanding stock of VA which is the 
managing general partner of GCGP.  The Company purchased 
approximately 90% of the limited partnership interests in GCGP on 
October 21, 1996 for a combination of cash and convertible notes 
totaling $1.365 million.


Future Projects


 New York Golf Center.  The Company has fully negotiated a lease 
(the "Port Authority Lease") with the Port Authority of New York 
and New Jersey (the "Port Authority") to develop a driving range 
and learning center on top of the Port Authority Bus Terminal in 
midtown Manhattan, New York City. Construction is scheduled to 
commence mid-1997, with the opening scheduled for mid-1998. The 
proposed development budget is approximately $5.5 million. The 
facility is planned to consist of a three-level facility occupying 
a portion of the roof of the Port Authority Bus Terminal 
(approximately three acres) and includes a 54-tee station area, a 
practice putting green, a sand bunker practice area, a greenside 
chipping area, a video instruction center, locker rooms, a David 
Leadbetter Golf Academy and a club facility. The driving range will 
include covered, heated tee stations. The golf instruction center, 
video instruction center, golf practice areas and locker rooms will 
be located in the clubhouse, together with a sports bar/cafe, 
outdoor patio, corporate entertainment and group event area, pro 
shop and offices. The Company is currently in discussions with the 
David Leadbetter Golf Academy about operating the golf instruction 
program at the New York Golf Center. 

The Port Authority Bus Terminal site provides a development 
opportunity that the Company believes is unparalleled in the golf 
industry. In this midtown Manhattan location at 42nd Street and 8th 
Avenue, approximately 200,000 daily commuters pass through the Port 
Authority Bus Terminal, and approximately 60,000 daily transit 
riders use the Times Square subway exit at 42nd Street. Peak 
pedestrian traffic counts at the corner of 42nd Street and 7th 
Avenue show an average of approximately 45,000 people per day and 
are among the highest in all of Manhattan. Demographics show that 
over 1.1 million employees work in the New York City midtown area, 
and 525,000 permanent residents live in the same area. In addition, 
over 20 million tourists visit New York City on an annual basis. 
The site is adjacent to the Times Square Business Improvement 
District, which includes 12,600 hotel rooms and accommodates 1.7 
million visitors annually. Several leading entertainment and 
service industry companies, including Disney Enterprises, Inc.; 
Viacom Inc./MTV Networks Inc.; Sony Corp.; Virgin Records Inc.; and 
American Multi-Cinema Inc. have recently announced or are 
considering projects near the Port Authority Bus Terminal site. 
Because of the interest in the area, several large corporations 
have expressed interest in sponsorship and advertising 
opportunities associated with the facility. 

The Company has received conditional approval of the structural 
feasibility report for the project. Upon the Company's completion 
of certain design and engineering studies to the satisfaction of 
the Port Authority staff, the Port Authority Lease will be 
submitted to the Port Authority Board of Commissioners for its 
final approval and the Port Authority's execution. Although the 
Company believes that such studies will be approved and the Port 
Authority Lease will be executed in mid-1997, there can be no 
assurance as to such approval or lease execution. 

For the purpose of developing the Port Authority site, the Company 
has formed a limited liability company that is owned by the 
Company's wholly owned subsidiary, MetroGolf New York, Inc. 
("MGNY"), and several individual investors (the "Class B Members") 
who assisted in the project presentation, concept development and 
negotiations with the Port Authority. The Operating Agreement for 
the limited liability company provides for distribution of cash to 
the members (i) first, in return of capital contributed, plus a 15% 
per annum cumulative compounded deferred return thereon (it is 
anticipated that the Class B Members will provide 5% of the 
contributed capital); (ii) second, 75% to MGNY and 25% to the Class 
B Members until MGNY  has received a 30% internal rate of return on 
its investment; and (iii) third, 70% to MGNY and 30% to the Class B 
Members. MGNY is to be paid a development fee of $250,000 for 
development services during construction and management fee of 5% 
per annum of gross revenues upon completion for delivery of 
management services. The Company may offer to acquire the Class B 
Members' current interests which could result in 100% Company 
ownership of the New York Golf Center; however, there can be no 
assurance upon what terms, if any, such acquisition may occur.


ITEM 3. LEGAL PROCEEDINGS

The Company knows of no material litigation or proceeding pending, 
threatened or contemplated to which the Company is or may become a 
party.


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


      None


PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED 
	STOCKHOLDER MATTERS

	The principal United States market for the Company's common 
stock is the National Association of Securities Dealers, Inc. 
Automated Quotation Systems SmallCap Market (the "NASDAQ Small 
Cap").  The high and low sales prices for the common stock from 
inception of trading (October 16, 1996) to December 31 1996 was 
$6.50 and $5.25 per share, respectively.

As of March 31, 1997 there were 79 record holders of the Company's 
common stock.

No dividends have been paid on the Company's common stock for the 
years ended December 31, 1996, 1995 and 1994.


ITEM 6. SELECTED FINANCIAL DATA

                                                       Inception
                      Years Ended Dec. 31,            to Dec. 31,
                    1996      1995      1994     1993     1992
-----------------------------------------------------------------
Total revenues  $1,080,936  $335,303  $291,237  $106,313 $76,250
Total operating
 expenses        2,498,972   882,709   565,811   109,176  47,655
Operating income
 (loss)         (1,418,036) (547,406) (274,574)   (2,863) 28,595
Other income 
 (expense)        (526,757)   35,122    13,630        88  (1,263)
Equity in loss 
  of affiliates     (2,278)     (770)     (309)   (1,392) (1,010)
Minority interest 
 in (income) loss
 of consolidated
 subsidiaries       13,807   (19,058)   (3,560)       -         -
Net income 
   (loss)      ($1,933,264)$(532,112)$(264,813) $(4,167)  $26,322
Net income
 (loss)
 applicable to
 common
 stockholders  ($2,077,592)$(687,164)$(315,490) $(4,167)  $26,322

Net income 
 (loss) per
 common share       $(1.79)    $(.78)    $(.36)     ($0)     $.03

                                      December 31,
                 ------------------------------------------------
                 1996       1995       1994       1993       1992
Total assets  $16,703,910  $979,679  $812,725   $206,388   $8,218
Long-term 
   obligations  4,133,342    23,151    26,287     21,595        -

The Company acquired several operating properties during 1996.  See 
Note 1 to the financial statements contained in Item 8.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction 
with the Company's financial statements and the notes thereto 
appearing elsewhere in this report.  This report contains forward-
looking statements, and actual results could differ materially from 
those projected in the forward-looking statements.

Overview

On October 21, 1996, the Company completed the sale of 1,175,000 
shares of its common stock in an IPO registered on Form S-1.  The 
Company received net proceeds of approximately $5.46 million after 
paying offering costs of approximately $1.59 million.  The 
Company's strategy is to increase revenues and net income by 
increasing the number of golf centers it owns, leases or manages by 
(i) identifying and acquiring existing golf facilities that have 
the potential for revenue enhancement through better management and 
improved or expanded facilities, including the addition of enclosed 
hitting areas, full-line pro shops and other amenities, (ii) 
developing new golf centers in locations where suitable acquisition 
opportunities are not available, and (iii) seeking to realize 
economies of scale through centralized purchasing, accounting, 
management information and cash management systems. Consistent with 
this strategy, the Company acquired 94% and 90% of the limited 
partnership interests in ICGP and GCGP, respectively, on October 
21, 1996.  The Company acquired Fremont Golf Center on July 1, 1996 
and Palms Golf Center on December 31, 1996.  The Company also 
commenced operating the Harborside Golf Center on July 1, 1996.  In 
addition, the Company is actively pursuing acquisition or 
development projects in major cities, including Atlanta, Denver, 
Los Angeles, St. Louis, San Diego, San Francisco, Seattle and 
Toronto. Consummation of any acquisition or development of these or 
any other future sites is subject to the satisfaction of various 
conditions, including the satisfactory completion of due diligence 
by the Company and the negotiation of definitive agreements. As 
consideration for any future acquisition or development, the 
Company may pay cash, incur indebtedness or issue debt or equity 
securities. Such acquisitions or developments could result in 
material changes in the Company's financial condition and operating 
results; however, there can be no assurance as to the occurrence of 
any of these acquisitions or developments or, if they occur, as to 
the timing of the consummation of any acquisitions or developments. 

Results of Operations

Prior to July 1, 1996, the Company derived its revenue from two 
major sources: development or acquisition fees and management fees.  
On July 1, 1996 the Company commenced operations at Fremont and 
Harborside.  The Company commenced operations at Palms on September 
1, 1996.  The Company commenced operations at Illinois Center and 
Goose Creek on October 22, 1996.  Prior to the commencement of 
operations, management fees are generated by three subsidiaries of 
the Company: IC and VA, as managing general partners of ICGP and 
GCGP, and MGMI as property manager of Illinois Center Golf, Goose 
Creek, Harborside Golf Center, Fremont Golf Center and Palms Golf 
Center. The Company initially used outside management companies to 
manage its golf centers. In September 1995, the operations 
management subcontract for Illinois Center Golf was terminated. In 
March 1996, the Company terminated the third-party management 
contract for Goose Creek. All Company properties are, and in the 
future are expected to be, managed by MGMI. 

Year Ended December 31, 1996, as Compared to Year Ended December 
31, 1995

Total revenues increased 322%, to approximately $1,081,000 for the 
year ended December 31, 1996, from approximately $335,000 for the 
year ended December 31, 1995.  In 1996, the Company earned 
approximately $890,000 from golf course and learning center 
operations, approximately $181,000 from management fees and $10,000 
from consulting fees.  In 1995, the Company earned approximately 
$190,000 from management fees, $120,000 from an acquisition fee and 
$25,000 from consulting fees

Operating expenses increased 283%, to approximately $2,499,000 for 
the year ended December 31, 1996, from approximately $882,700 for 
the year ended December 31, 1995.  Operating costs increased to 
$709,130 from $0 due to the addition of operating properties in 
1996 and the acquisition of ICGP and GCGP during the fourth quarter 
of 1996.  Salaries increased to $634,584 in 1996 from $343,827 for 
the year ended December 31, 1995 due to salary increases and the 
addition of corporate personnel.  In addition, other general and 
administrative expenses for the year ended December 31, 1996 
increased to $956,701 from $519,583 in 1995 due to property 
acquisitions during 1996.

Depreciation expense increased to approximately $199,000 in 1996 
from approximately $19,300 in 1995 due to the acquisition of 
Fremont in July 1996 and ICGP and GCGP in the fourth quarter of 
1996.

Interest expense increased to $567,253 in 1996 from $25,994 in 1995 
primarily due to placement of $2,025,000 of convertible 
subordinated notes ("PP Notes") in the second quarter of 1996 and 
the ICGP and GCGP Notes in the fourth quarter of 1996.

Interest income decreased to $40,496 in 1996 from $61,116  in 1995 
as a result of the interest-bearing notes receivable being 
consolidated as a result of the acquisition of GCGP and ICGP.

 Year Ended December 31, 1995, as Compared to Year Ended December 
31, 1994

Total revenues for 1995 increased 15.1%, to approximately $335,000 
from approximately $291,000 for 1994.  In 1995, the Company earned 
approximately $190,000 from management fees, $120,000 from an 
acquisition fee and $25,000 from consulting fees. In 1994, the 
Company earned approximately $160,000 from management fees, 
$125,000 from development fees and $6,000 from consulting fees. 
Each of these are discussed in more detail below. 

VA, a wholly owned subsidiary, is the managing general partner of 
GCGP, which is the owner of Goose Creek. VA earned a fee of 
approximately $51,000 annually for managing GCGP. The Company 
earned management fees of $51,000 for 1995, which increased by 5% 
from the prior year in accordance with a contractual inflation 
adjustment. 

IC, an 89% owned subsidiary, is the managing general partner of 
ICGP, which is the owner of Illinois Center Golf. IC earned a fee 
of approximately $60,000 annually for managing ICGP. The Company 
earned management fees of $60,000 for 1995 and $35,000 for 1994 as 
IC began earning its management fee beginning June 1, 1994. 

MGMI, a 51% owned subsidiary during 1995 (now wholly owned), earned 
management fees of approximately $79,000 and $76,000 in 1995 and 
1994, respectively, as the facility manager of Illinois Center 
Golf. 

In 1995, the Company did not earn any development fees. In 1995, 
the Company earned a fee of $120,000 for assigning its rights to 
purchase a golf course in South Carolina. In addition, the Company 
earned a $25,000 fee in 1995 from the purchaser of a promissory 
note held by the former owner of Goose Creek for negotiating the 
purchase of the promissory note at a substantial discount. In 1994, 
the Company earned a development fee of $125,000 upon completion of 
the Illinois Center Golf facility. Each of these sources of revenue 
are considered nonrecurring. 

Operating expenses increased to approximately $883,000 in 1995 from 
approximately $566,000 in 1994. Although salaries decreased to 
$344,000 in 1995 from $374,000 in 1994, other general and 
administrative expenses increased to $520,000 in 1995 from $181,000 
in 1994. The primary reasons for the increase in general and 
administrative expenses were an increase in legal and accounting 
fees in 1995 associated with preparation of various securities 
offering documents and the initial audit of the Company in 1995. In 
addition, the Company paid a commission of $25,000 from the fees it 
earned for assigning its rights to purchase the South Carolina 
property and paid subcontract property management fees of $45,000. 
These costs were not incurred in 1994. The Company also leased new 
office space in September of 1994; accordingly, rent expense is 
approximately $17,000 higher in 1995 than in 1994. 

Depreciation expense increased to $19,000 in 1995 from $10,800 in 
1994. 

Interest income increased to $61,100 in 1995 from $15,500  in 1994 
as a result of interest-bearing loans to ICGP and GCGP, starting in 
September 1994 and November 1995, as well as interest-bearing loans 
to its sole Common Stock holder. 

Interest expense increased to $26,000 in 1995 from $1,800  in 1994, 
primarily due to the Company's borrowings under its line of credit, 
which were primarily used to make loans to ICGP and GCGP. 

The equity in loss of affiliates represents the Company's 
proportional share of the losses of ICGP and GCGP, which had larger 
losses in 1995  than in 1994. 

Liquidity and Capital Resources

At December 31, 1996, the Company had a working capital deficit of 
approximately $7,530,700, as compared to a working capital deficit 
of $506,000 at December 31, 1995. The increase in working capital 
deficit is primarily due to the current portion of long term debt 
resulting from property acquisitions.  Increases in accounts 
payable and accrued salaries resulting from continued losses from 
operations, costs associated with the placement of the PP Notes in 
May 1996 and negative cash flow contributed to the increase in 
working capital deficit.  The Company has approximately $6,111,000 
of current liabilities relating to debts that come due within the 
next 12 months.  Of these $861,750 are convertible subordinated 
notes that are convertible into common stock of the Company at 50 
percent of the market value of the Company's common stock.  Because 
of the conversion discount, the Company believes that most, if not 
all, of these notes will be converted by the noteholders prior to 
the maturity date of June 1, 1997.  $4,505,556 of these current 
liabilities are mortgages on existing operating properties and are 
fully collateralized by such properties.  The Company is currently 
negotiating to refinance or extend each of these mortgages and 
expects to receive new mortgages with maturity dates that extend 
beyond 12 months.  In addition, the Company is currently offering 
for sale in a private placement $5,000,000 in convertible 
subordinated notes ("the Notes").  The Company intends to use the 
proceeds for additional acquisitions which should further increase 
the Company's cash flow from operations and for current working 
capital needs.  The Company believes that these funds will be 
sufficient to meet its liquidity needs for the next year.

The cash used in operating activities increased to approximately 
$1,213,000 in 1996 from $221,700 in 1995.  The primary reason for 
the increase has been the increase in the net loss to $1,933,300 in 
1996 from $532,100 in 1995.  Cash raised in debt and equity 
financing in 1996 and 1995 was primarily used to pay for business 
acquisitions, redeem the Company's preferred stock and fund 
operating losses.  In addition, the Company used accounts payable 
as a source of financing.  Trade accounts payable increased 
$294,000 in 1996 and $260,000 in 1995.

Since its inception, the Company has been funded primarily through 
loans, capital contributions and the sale of preferred stock.  In 
May 1996, the Company successfully completed the sale of $2,025,000 
of PP Notes, resulting in net proceeds of approximately $1,757,100.  
Some of the proceeds from the PP Notes were used to pay off the 
Company's line of credit.  In October, 1996, the Company 
successfully completed the sale of 1,125,000 shares of common 
stock.  Some of the proceeds from the sale were utilized to redeem 
the preferred stock and to acquire ICGP and GCGP.  After these 
transactions, the Company's primary liabilities are debt associated 
with the operating properties.  The Company intends to refinance 
the current portion of the long term debt which matures in 1997.  
The Company is currently offering a convertible debt placement with 
a $500,000 minimum and $6,000,000 maximum.  The working capital 
provided from the sale of the common stock and the convertible 
debt, in the opinion of management, is sufficient to fund the 
Company's day-to-day operations through the end of 1997.

Fremont Golf Center  The Company has signed a lease agreement with 
the City of Fremont to develop an 35-acre tract of land into a 9-
hole executive-length golf course with expanded practice facilities 
and significantly improved clubhouse amenities.  The Company 
expects to commence construction of the 9-hole executive-length 
golf course and begin modifications to the existing facility in the 
summer of 1997, with the completion of the golf center scheduled 
for the spring of 1998.  The development budget for the new 9-hole 
executive-length golf course, and modifications to the existing 
facility, is anticipated to be approximately $2 million over a one-
year development period. The Company intends to fund the 
development through a combination of equity and debt, to be 
provided by a commercial bank, specialized golf lending institution 
or private lender. 

New York Golf Center The Company has fully negotiated a lease (the 
"Port Authority Lease") with the Port Authority of New York and New 
Jersey (the "Port Authority") to develop a driving range and 
learning center on top of the Port Authority Bus Terminal in 
midtown Manhattan, New York City. Construction is scheduled to 
commence mid-1997, with the opening scheduled for mid-1998. The 
proposed development budget is approximately $5.5 million. The 
facility is planned to consist of a three-level facility occupying 
a portion of the roof of the Port Authority Bus Terminal 
(approximately three acres) and includes a 54-tee station area, a 
practice putting green, a sand bunker practice area, a greenside 
chipping area, a video instruction center, locker rooms, a David 
Leadbetter Golf Academy and a club facility. The driving range will 
include covered, heated tee stations. The golf instruction center, 
video instruction center, golf practice areas and locker rooms will 
be located in the clubhouse, together with a sports bar/cafe, 
outdoor patio, corporate entertainment and group event area, pro 
shop and offices. The Company is currently in discussions with the 
David Leadbetter Golf Academy about operating the golf instruction 
program at the New York Golf Center.  The total expected cost of 
the New York Golf Center is expected to be approximately $5.5 
million.  The Company expects to utilize debt and equity financing 
from banks and institutional or private lenders to fund such 
amount. 

At December 31, 1996, the Company had a deferred tax asset of 
$961,000 that had a 100% valuation allowance recorded to reflect 
management's evaluation that it is more likely than not that all of 
the deferred tax asset will not be realized. 


Seasonality

Historically, the second and third quarters have accounted for a 
greater portion of the Company's revenue and operating income than 
have the first and fourth quarters of the year. This is primarily 
due to an outdoor playing season limited by inclement weather. 
Although most of the Company's facilities are designed to be all-
weather, portions of the facilities tend to be vulnerable to 
weather conditions. Also, golfers are less inclined to practice 
when weather conditions limit their ability to play golf on outdoor 
courses. This seasonal pattern, as well as the timing of new golf 
facility acquisitions, developments and openings, may cause the 
Company's results of operations to vary significantly from quarter 
to quarter. Accordingly, period-to-period comparisons are not 
necessarily meaningful and should not be relied upon as indications 
of future results. 



Trends

The Company plans to acquire or develop additional golf centers. As 
such additional golf centers are acquired or developed, total 
revenue should continue to increase. The Company is making capital 
improvements at the Fremont Golf Center and Goose Creek and has 
recently strengthened the on-site management teams at these golf 
centers with an increased emphasis on sales and marketing. The 
Company believes that, as its current golf centers mature, revenues 
and operating income from such centers should increase due to 
customer awareness, programs marketing the golf centers to various 
special interest groups, expanded ties to local businesses and 
golfing communities and marketing programs developed by the 
Company. Such increases may be partially offset by initial losses 
from pre-opening costs (and initial operating losses) associated 
with new golf centers. 


                                          MetroGolf Incorporated
                                                and Subsidiaries
Item 8.  Financial Statements and 
         Financial Statement Schedule         Contents


Report on Independent Certified Public Accountants

Consolidated and Combined Financial Statements

     Balance Sheets

     Statements of Operations

     Statements of Stockholders' Equity (Deficit)

     Statements of Cash Flows

     Summary of Accounting Policies

     Notes to Financial Statements

Report of Independent Certified Public Accountants
 on Supplemental Schedule

     Schedule II - Valuation and Qualifying Accounts






Report of Independent Certified Public Accountants


Board of Directors
MetroGolf Incorporated 
Denver, Colorado

We have audited the accompanying consolidated balance sheets of 
MetroGolf Incorporated and subsidiaries (the "Company") as of 
December 31, 1996 and 1995 and the related consolidated statements 
of operations, stockholders' equity and cash flows for the years 
ended December 31, 1996 and 1995 and the related combined statement 
of operations, stockholders' equity and cash flows for the year 
ended December 31, 1994.  These consolidated and combined financial 
statements are the responsibility of the Company's management.  Our 
responsibility is to express an opinion on these financial 
statements based on our audits.

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

In our opinion, the consolidated and combined financial statements 
referred to above present fairly, in all material respects, the 
financial position of MetroGolf Incorporated and subsidiaries at 
December 31, 1996 and 1995, and the results of their operations and 
their cash flows for the years ended December 31, 1996, 1995 and 
1994 in conformity with generally accepted accounting principles.



BDO Seidman, LLP
Denver, Colorado

March 21, 1997

<TABLE>
<CAPTION>
                                           MetroGolf Incorporated
                                                 and Subsidiaries

                                      Consolidated Balance Sheets

December 31,                        1996              1995


Assets (Note 8)
<S>                          <C>                <C>

Current:
Cash and cash equivalents    $     904,146      $          324
Restricted cash (Note 6)                 -             222,700
Management fee receivable,
 related parties (Note 11)               -              83,256
Inventories                        157,577                   -
Other current assets               100,206              15,452
                             ----------------------------------
Total current assets             1,161,929             321,732


Property and equipment less
 accumulated depreciation
of $205,342 and $24,025
(Note 3)                        13,524,145              63,952

Other:
Excess of cost over net
 assets acquired (Note 2)        1,537,239                   -
Debt issue costs                   133,939                   -
Loan fees                          106,205                   -
Organization costs                  89,744                   -
                             ----------------------------------
                                 1,867,127                   -
Less accumulated amortization       97,825                   -
                               --------------------------------
                                 1,769,302                   -
Notes receivable, related
parties (Note 4)                         -             514,728
Other receivable                    82,372                   -
Deferred acquisitions costs         78,791              59,467
Deferred offering costs             15,000                   -
Other assets                        72,371              19,800
                             ----------------------------------
Total other assets               2,017,836             593,995
                             ----------------------------------
                             $  16,703,910      $      979,679
                             ==================================
<FN>
See accompanying summary of accounting policies and notes to 
consolidated 
and combined financial statements.

<CAPTION>
December 31,                        1996              1995

Liabilities and Stockholders' Equity 
<S>                         <C>                 <C>
Current liabilities:
Accounts payable            $    1,380,947      $       380,217
Checks written against
 future deposits                   122,546                    -
Accrued real estate taxes          479,507                    -
Accrued liabilities                379,785               11,446
Accrued salaries                         -              145,784
Deferred revenue                   218,633                    -
Note payable, officer 
(Note 7)                                 -               26,827
Lines of credit (Note 6)                 -              246,937
Current portion of capital
lease obligations (Note 9)          87,772                    -
Current portion of 
long-term debt (Note 8)          6,023,401               16,489
                            ------------------------------------
Total current liabilities        8,692,591              827,700
                            ------------------------------------

Long-term liabilities:
Long-term debt, less 
current portion (Note 8)         3,864,198               23,151
Capital lease obligations,
less current portion 
(Note 9)                           269,144                    -
                            ------------------------------------
Total long-term liabilities      4,133,342               23,151
                            ------------------------------------
Investments in affiliates
 (Note 5)                                -                3,689
                            ------------------------------------
Minority interest in 
consolidated subsidiaries          319,024               24,178
                            ------------------------------------
Total liabilities               13,144,957              878,718
                            ------------------------------------

Commitment and 
contingencies (Note 10)

Stockholders' equity 
(Note 12):
Preferred stock - $1 par 
value; 1,000,000 shares
authorized; 0 and 45,500
 shares issued and 
outstanding; liquidation 
value of $25 per share 
plus dividends in arrears 
of $0 and  $205,729 (in the
aggregate $0 and $1,343,229)             -               45,500
Additional paid-in capital               -              940,609
Common stock-no par value;
9,000,000 shares authorized;
2,233,775 and 680,782 shares
issued and outstanding           6,792,487              (96,770)
Notes receivable,
stockholder (Note 4)               (82,511)            (120,300)
Accumulated deficit             (3,151,023)            (668,078)
                            ------------------------------------

Total stockholders' equity       3,558,953              100,961
                            ------------------------------------
                            $   16,703,910      $       979,679
                            ====================================

<FN>
See accompanying summary of accounting policies and notes to 
consolidated 
and combined financial statements.
</TABLE>

<TABLE>
<CAPTION>
                                           MetroGolf Incorporated
                                                 and Subsidiaries

               Consolidated and Combined Statements of Operations



                                For the Years Ended December 31,
                                    1996        1995       1994

<S>                         <C>          <C>         <C>         

Revenues:
Green fees & driving range  $  487,366   $       -   $        -
Membership                     129,380           -            -
Merchandise                    135,662           -            -
Food and beverage               45,044           -            -
Instruction                     63,717           -            -
Management fees, related 
party (Notes 5 and 11)         180,509     190,303      159,691
Administration                  29,258           -            -
Acquisition fee                      -     120,000            -
Development fees, related
 party (Note 11)                     -           -      125,000
Consulting fees                 10,000      25,000        6,546
                            ------------------------------------
Total revenues               1,080,936     335,303      291,237
                            ------------------------------------

Operating expenses:
Range and course operation     560,641           -            -
Food and beverage               63,167           -            -
Membership                      42,833           -            -
Instruction expense             42,489           -            -
Salaries                       634,584     343,827      373,779
General and administrative     956,701     519,583      181,201
Depreciation and 
amortization                   198,557      19,299       10,831
                            ------------------------------------
Total operating expenses     2,498,972     882,709      565,811
                            ------------------------------------
Loss from operations        (1,418,036)   (547,406)    (274,574)
                            ------------------------------------

Other income (expenses):
Interest income                 40,496      61,116       15,472
Interest expense              (567,253)    (25,994)      (1,842)
                            ------------------------------------
Total other income (expense)  (526,757)     35,122       13,630
                            ------------------------------------

Equity in loss of 
affiliates (Note 5)             (2,278)       (770)        (309)
                            ------------------------------------

Minority interest in 
(income) loss of 
consolidated subsidiaries       13,807     (19,058)      (3,560)
                            ------------------------------------

Net loss                    (1,933,264)   (532,112)    (264,813)

Dividend requirements on
preferred stock                144,328     155,052       50,677
                            ------------------------------------

Loss applicable to 
common stock               $(2,077,592) $ (687,164) $  (315,490)

Net loss per common share  $     (1.79) $    (0.78) $     (0.36)
                           -------------------------------------

Weighted average number of
common shares outstanding    1,163,471      877,142     877,142
                            -------------------------------------
<FN>
See accompanying summary of accounting policies and notes to 
consolidated and combined financial statements.
</TABLE>

<TABLE>
<CAPTION>

                                           MetroGolf Incorporated
                                                 and Subsidiaries

            Consolidated and Combined Statements of Stockholders'
                                                 Equity (Deficit)


For the Years Ended December 31, 1996, 1995 and 1994


                                         Additional                        
Notes Rec-   
                          Preferred Stk   Paid-In       Common 
Stock        eivable   Accumulated
                          Shares  Amount  Capital      Shares    
Amount    Stkholder    Deficit

<S>                       <C>     <C>    <C>       <C>        <C>        
<C>        <C>        -

Balance, January 1, 1994        - $    - $       -       587  $      
190 $(119,625) $     18,387
Issuance of IC's common
stock for cash                  -      -         -        65      
15,000         -             -
Business reorganization
as of July 29, 1994             -      -         -      (652)    
(15,190)        -              -
Issuance of common stock
in connection with 
business reorganization         -      -         -   680,782      
13,690         -             -
Reclassification of VA's
and IC's subchapter S
income and losses from
accumulated deficit to
common stock                    -      -         -         -    
(110,460)        -       110,460
Issuance of preferred 
stock for cash in
private offering, net
of stock issuance costs
of $150,895                37,500 37,500   749,105         -           
-         -             -
Change in notes 
receivable, stockholder         -      -         -         -           
-    54,822             -
Combined net loss               -      -         -         -           
-         -      (264,813)
                          -----------------------------------------
------------------------------
Balance, December 31, 1994 37,500 37,500   749,105   680,782     
(96,770)  (64,803)     (135,966)
Issuance of preferred 
stock for cash              8,000  8,000   191,504         -           
-         -             -
Change in notes 
receivable, stockholder         -      -         -         -           
-   (55,497)            -
Net loss                        -      -         -         -           
-         -      (532,112)
                          -----------------------------------------
------------------------------
Balance, December 31, 1995 45,500 45,500   940,609   680,782     
(96,770) (120,300)     (668,078)
Increase in ownership of
subsidiary for
no consideration                                                                           
8,642
Discount on debt                -      -         -         -     
243,600         -             -
Issuance of common stock,
net of offering costs
of $1,589,436                   -      -         - 1,175,000   
5,460,564         -             -
Conversion of convertible
subordinated notes net of
debt issue costs of
$71,050                         -      -         -   356,168   
1,047,475         -             -
Redemption of
preferred stock           (45,500)(45,500)(940,609)        -           
-         -      (558,323)
Issuance of underwriter
warrants                        -       -        -         -         
118         -             -
Issuance of common stock
in connection with 
purchase of
Palms Golf Center               -       -        -    21,825     
137,500         -             -
Change in notes
receivable, stockholder         -       -        -         -           
-    37,789             -
Net loss                        -       -        -         -           
-         -    (1,933,264)
                          -----------------------------------------
------------------------------
Balance, December 31, 1996      - $     -$       - 2,233,775  
$6,792,487 $ (82,511) $ (3,151,023)
                          
===================================================================
====
<FN>
See accompanying summary of accounting policies and notes to 
consolidated and combined financial 
statements.

</TABLE>

<TABLE>
<CAPTION>
MetroGolf Incorporated
and Subsidiaries

Consolidated and Combined Statements of Cash Flows


Increase (Decrease) in Cash and Cash Equivalents


                                For the Years Ended December 31,
                                    1996        1995       1994

<S>                         <C>          <C>         <C>         

Operating activities:
Net loss                    $(1,933,264) $ (532,112) $  (264,813)
Adjustments to reconcile
net loss to net cash (used
in) operating activities:
Depreciation                    181,317      19,299       10,831
Amortization                     17,240           -            -
Interest expense                244,188           -            -
Salary expense                        -           -      125,000
Write off of deferred 
offering costs                        -       5,000            -
Deferred revenue                      -           -     (125,000)
Equity in loss of affiliates      2,278         770          309
Minority interest in income 
(loss) of consolidated 
subsidiaries                    (13,807)     19,058        3,560
Changes in operating assets 
and liabilities net of 
business acquisitions:
Management fee receivable,
related party                    17,165     (42,193)     (41,063)
Commission advances to 
officer                               -      13,500      (13,500)
Inventories                     (63,412)          -            -
Other current assets             19,786       2,967      (17,837)
Accounts payable                293,997     259,804      103,916
Accrued real estate taxes        52,857           -            -
Accrued salaries               (145,784)     76,079       69,705
Accrued liabilities              70,697     (43,861)      45,307
Deferred revenue                 43,753           -            -
                            -------------------------------------

Net cash (used in) 
operating activities         (1,212,989)   (221,689)    (103,585)
                            -------------------------------------

Investing activities:
Payments for business 
acquisitions                 (2,929,584)          -            -
Restricted cash                 222,700     (22,700)    (200,000)
Payments for notes
receivable, related parties    (252,398)   (239,004)    (166,099)
Proceeds from notes 
receivable, stockholder          37,789           -            -
Payments for notes 
receivable, stockholder               -     (55,497)    (189,803)
Purchase of furniture
and equipment                  (110,719)    (38,807)      (8,437)
Payments for deferred 
acquisition costs              (190,951)    (59,467)           -
Other assets                   (126,092)     (1,000)     (18,800)
                            -------------------------------------

Net cash used in 
investing activities         (3,349,255)   (416,475)    (583,139)
                            -------------------------------------

Financing activities:
Checks written against
future deposits                 122,546           -            -
Proceeds from (payments)
on lines of credit             (206,937)    208,074       38,863
Proceeds from convertible 
subordinated notes payable    2,025,000           -            -
Proceeds from long-term debt          -      22,971       10,000
Proceeds from notes 
payable, officer                      -      48,827            -
Payments for long-term debt     (91,518)    (14,665)      (4,557)
Payments on note 
payable, officer                (26,827)    (22,000)           -
Payments for debt 
issue costs                    (257,448)          -            -
Payments for deferred 
offering costs                  (15,000)          -       (5,000)
Proceeds from issuance 
of common stock, net 
of offering costs             5,460,564           -       15,000
Proceeds from issuance 
of preferred stock, net 
of stock issuance costs               -     199,504      786,605
Payments for redemption 
of preferred stock           (1,544,432)          -            -
Proceeds from issuance 
of warrants                         118           -            -
                            -------------------------------------

Net cash provided by 
financing activities          5,466,066     442,711      840,911
                            -------------------------------------

Increase (decrease) in 
cash and cash equivalents       903,822    (195,453)     154,187

Cash and cash equivalents,
beginning of year                   324     195,777       41,590
                            -------------------------------------

Cash and cash equivalents,
end of year                 $   904,146  $      324  $   195,777
                            =====================================

See accompanying summary of accounting policies and notes to 
consolidated
and combined financial statements.
</TABLE>
                                           MetroGolf Incorporated
                                                 and Subsidiaries

                                   SUMMARY OF ACCOUNTING POLICIES
Organization and Business
-------------------------
MetroGolf Incorporated (the "Company"), a Colorado corporation, was 
incorporated on July 29, 1994 by its sole common stockholder.  The 
Company was formed for the purpose of acquiring and consolidating 
its stockholder's ownership of two pre-existing corporations, as 
described below and, therefore, it is a continuation of these pre-
existing corporations.  The Company acquires, develops and manages 
urban golf centers and other golf facilities.

On July 29, 1994, the Company acquired all of the issued and 
outstanding common stock of MetroGolf Virginia, Inc. ("VA"), a 
Colorado corporation incorporated on February 21, 1992.  Prior to 
the formation of the Company, VA was the primary operating entity 
in the business of golf course management, development and 
acquisition.  VA is the managing general partner of Goose Creek 
Golf Partners Limited Partnership ("Goose Creek"), a Virginia 
Limited Partnership formed on June 1, 1992.  Also on July 29, 1994, 
the Company acquired 90 percent of the issued and outstanding 
common stock of MetroGolf Illinois Center, Inc. ("IC"), a Colorado 
corporation incorporated on May 26, 1993.  IC is the managing 
partner of Illinois Center Golf Partners, L.P. ("Illinois Center"), 
an Illinois Limited Partnership formed on May 28, 1993.  The 
Company issued 680,782 shares of its common stock to an individual 
for 100 percent of his interest in VA and 90 percent of his 
interest in IC.  This exchange of ownership with entities under 
common control has been accounted for at historical cost in a 
manner similar to that of a pooling of interest.  As of December 
31, 1996 and 1995, the Company held 89 percent of the issued and 
outstanding common stock of IC.  Prior to the July 29, 1994 
business reorganization, VA and IC were entities under common 
control and management.

On March 30, 1994, the Company formed and acquired 51 percent of 
the issued and outstanding common stock of MetroGolf Management, 
Inc. ("MGM"), a Colorado corporation.  MGM provides golf management 
services to Illinois Center.  During April 1996, the Company 
acquired the remaining 49 percent of MGM for no consideration.

On May 24, 1995, the Company formed and acquired 100 percent of the 
issued and outstanding common stock of MetroGolf New York, Inc. 
("NY"), a New York corporation.  NY is the 100 percent Class A 
member of Vintage New York Golf L.L.C., a limited liability company 
formed to develop and operate an urban golf center facility.

On June 27, 1996, the Company formed and acquired 100 percent of 
the issued and outstanding common stock of MetroGolf (San Diego), 
Inc. ("SD"), a Colorado corporation.

On October 21, 1996, the Company purchased 93.6 percent of the 
limited partnership interests in Illinois Center and 89.7 percent 
of the limited partnership interests in Goose Creek (see Note 2).

Principles of Consolidation
---------------------------
The accompanying consolidated financial statements include the 
accounts of the Company and its wholly owned and majority-owned 
subsidiaries as of December 31, 1996 and 1995 and for the years 
then ended.  All significant intercompany accounts and transactions 
have been eliminated in consolidation.

Combined Financial Statements
-----------------------------
The combined statement of operations, stockholders' equity and cash 
flows include the accounts of the Company for the period from July 
29, 1994 (inception) to December 31, 1994, the accounts of VA and 
IC for the year ended December 31, 1994 and the accounts of MGM for 
the period from March 30, 1994 (inception) to December 31, 1994.  
All significant intercompany accounts and transactions have been 
eliminated in combination.

Cash and Cash Equivalents
-------------------------
The Company considers all money market accounts and highly liquid 
debt instruments purchased with original maturities of three months 
or less to be cash equivalents.

Property and Equipment
----------------------
Property and equipment are stated at cost and are depreciated and 
amortized on a straight-line method over the estimated useful lives 
of the assets which range from 3 to 37 years or over the term of 
the lease, whichever is shorter.  Equipment under capital leases is 
stated at cost and is amortized over the estimated useful life of 
the equipment or over the term of the lease, whichever is shorter.  
Upon sale or other retirement of property and equipment, the costs 
and accumulated depreciation or amortization are removed from the 
related accounts and any gain or loss is reflected in operations.

Deferred Offering Costs
-----------------------
Deferred offering costs include professional fees directly related 
to the Company's proposed private offering.  If the offering is 
successful, costs incurred will be offset against the proceeds of 
the offering.  If the offering is unsuccessful, such costs will be 
expensed.

Deferred Acquisition Costs
--------------------------
Deferred acquisition costs include professional fees and other 
direct costs related to evaluation of prospective property 
acquisitions.  If the acquisitions are completed, these costs are 
included as property costs.  If a prospective property is not 
acquired, the costs are expensed.

Debt Issue Costs and Loan Fees
------------------------------
Debt issue costs are being amortized using the straight-line method 
over the term of the convertible subordinated notes payable (see 
Note 8).  Loan fees are recorded at cost and are amortized using 
the straight-line method over the term of Illinois Center's long-
term debt with Textron (see Note 8).

Excess Cost Over Net Assets Acquired
------------------------------------
The excess of costs over net assets acquired, which relates to the 
acquisitions discussed at Note 2, is being amortized over a 20 year 
period for Goose Creek and a 13 year period for Illinois Center 
using the straight-line method.  Permanent impairments are 
evaluated periodically based upon expected future cash flows in 
accordance with Statement of Financial Accounting Standards No. 
121, "Accounting for the Impairment of Long-Lived Assets".  The 
adoption of this standard did not have an effect on the financial 
statements for the year ended December 31, 1996.

Investment in Affiliates
------------------------
The Company recorded its investments in limited partnerships using 
the equity method of accounting prior to the Company acquiring a 
majority interest in Goose Creek and Illinois Center (see Note 2).  
Under such method, the Company's share of net income (loss) is 
included as a separate item in the statement of operations.

Revenue Recognition
-------------------
Green fees, driving range fees, golf cart rental, merchandise and 
food and beverage revenue are recognized as revenue immediately 
upon sale to the customer.  Instruction revenue is recognized when 
the lessons are provided.  Membership fees are recognized as 
revenue ratably over the life of the membership, usually 12 months.

Concentration of Risk
---------------------
The Company's financial instruments that are exposed to 
concentration of credit risk consist primarily of cash and cash 
equivalents.  The Company's cash and cash equivalents are in demand 
deposit accounts placed with federally insured financial 
institutions.  Such deposit accounts at times may exceed federally 
insured limits.  The Company has not experienced any losses on such 
amounts.

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

Financial Instruments
---------------------
The following methods and assumptions were used to estimate the 
fair value of each class of financial instruments for which it is 
practicable to estimate that value:

Receivables from Related Parties

Due to the related party nature and terms of the receivables from 
related parties, the Company cannot estimate the fair market value 
of such financial instruments.

Notes Payable and Long-Term Debt

Substantially all of these notes bear interest at a floating rate 
of interest based upon the lending institutions prime lending rate.  
Accordingly, the fair value approximates their reported carrying 
amount at December 31, 1996 and 1995.

Loss Per Share
--------------
Primary loss per share is computed using the weighted average 
number of common and common equivalent shares outstanding during 
each period.  Pursuant to the requirements of the Securities and 
Exchange Commission (SEC) Staff Accounting Bulletin No. 83 (SAB 
83), common shares issued by the Company during the twelve months 
immediately preceding the initial public offering at a price below 
the initial public offering price plus the number of common 
equivalent shares which result from the grant of common stock 
options and warrants having exercise prices below the initial 
public offering price during the same period have been included in 
the calculation of the shares used in computing loss per share as 
if they were outstanding for all periods presented.

Stock Option Plans
------------------
The Company applied APB Opinion 25, "Accounting for Stock Issued to 
Employees", and the related Interpretation in accounting for all 
stock option plans.  Under APB Opinion 25, no compensation cost has 
been recognized for stock options issued to employees as the 
exercise price of the Company's stock options granted equals or 
exceeds the market price of the underlying common stock on the date 
of grant.

SFAS No. 123, "Accounting for Stock-Based Compensation", requires 
the Company to provide pro forma information regarding net income 
as if compensation cost for the Company's stock options plans had 
been determined in accordance with the fair value based method 
prescribed in SFAS No. 123.  To provide the required pro forma 
information, the Company estimates the fair value of each stock 
option at the grant date by using the Black-Scholes option-pricing 
model.

Reclassifications
-----------------
Certain reclassifications have been made to the 1995 financial 
statements in order for them to conform to the 1996 presentation.  
Such reclassifications have no impact on the Company's financial 
position or results of operations.

Income Taxes
------------
The Company accounts for income taxes under Statement of Financial 
Accounting Standards No. 109 ("SFAS No. 109").  Temporary 
differences are differences between the tax basis of assets and 
liabilities and their reported amounts in the financial statements 
that will result in taxable or deductible amounts in future years.



          NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS



1.     Company Liquidity

The Company has approximately $6,111,173 of current liabilities 
relating to debts that come due within the next 12 months.  Of 
these $861,750 are convertible subordinated notes that are 
convertible into common stock of the Company at 50 percent of the 
market value of the Company's common stock (see Note 8).  Because 
of this conversion discount, the Company believes that most, if not 
all, of these notes will be converted by the noteholders prior to 
the maturity date of June 1, 1997.  $4,505,556 of these current 
liabilities are mortgages on existing operating properties and are 
fully collateralized by such properties.  The Company is currently 
negotiating to refinance or extend each of these mortgages and 
expects to receive new mortgages with maturity dates that extend 
beyond 12 months.  In addition, the Company is currently offering 
for sale in a private placement $5,000,000 in convertible 
subordinated notes ("the Notes").  The Company intends to use the 
proceeds for additional acquisitions which will further increase 
the Company's cash flow from operations and for current working 
capital needs.  The Company believes that these funds will be 
sufficient to meet its liquidity needs for the next 
year.

2.     Acquisitions
MetroGolf Fremont

On July 2, 1996 the Company purchase the leasehold interest on the 
Fremont Park Golf Center ("Fremont"), an existing driving 
range/learning center facility for $1,473,377.  The Company paid 
$650,000 in cash, issued a promissory note to the Seller for 
$700,000 and acquisitions costs of $123,377.  The existing golf 
facility consists of a 35-tee station driving range, two practice 
putting greens, a clubhouse and a maintenance area on approximately 
15 acres of land.  The current clubhouse design will require 
modification to re-incorporate a grill room and bar area with an 
outdoor patio after the acquisition.

The Company plans to expand Fremont to include an 80-station tee 
area, practice putting green, chipping/short game practice and sand 
bunker area.  The clubhouse redesign will also include a pro shop 
and locker rooms.  A corporate entertainment and group area will be 
located adjacent to the patio.

The acquisition was recorded using the purchase method of 
accounting, by which the assets are value at fair market value at 
the date of acquisition. The operating results of this acquisition 
have been included in the accompanying consolidated financial 
statements from the date of acquisition.  The allocation of the 
purchase price was as follows:

Current assets           $   35,000
Property and equipment    1,438,377
                         ----------
Total purchase price     $1,473,377
                         ==========

Acquisition of Goose Creek Golf Partners Limited Partnership

On October 21, 1996 the Company purchased 89.7% of the limited 
partnership interest in Goose Creek for cash of $620,500, 
convertible notes of $570,520 (net or original issue discount of 
$173,980) and acquisition costs of $18,679.  The acquisition was 
recorded using the purchase method of accounting, by which the 
assets are valued at fair market value at the date of acquisition.  
The operating results of this acquisition have been included in the 
accompanying consolidated financial statements from the date of 
acquisition.

The allocation of the purchase price is as follows:

Current assets                          $   88,514
Property and equipment                   5,425,000
Excess of cost over net assets acquired    571,842
Other assets                                32,491
                                        ----------
                                         6,117,847
                                        ----------
Less:
     Current liabilities                 4,115,714
     Long-term liabilities                 665,220
     Minority interest                     127,214
                                        ----------
                                         4,908,148
                                        ----------
Total purchase price                    $1,209,699
                                        ==========

Acquisition of Illinois Center Golf Partners, L.P.

On October 21, 1996, the Company purchased 93.6% of the limited 
partnership interests in Illinois Center for cash of $1,587,500, 
convertible notes of $1,293,152 (net of original issue discount of 
$394,398) and acquisition costs of $20,864.  The acquisition was 
recorded using the purchase method of accounting, by which the 
assets are value at fair market value at the date of acquisition.  
The operating results of this acquisition have been included in the 
accompanying consolidated financial statements from the date of 
acquisition.

The allocation of the purchase price is as follows:

Current assets                           $   77,524
Property and equipment                    5,900,000
Excess of cost over net assets acquired     897,843
Other assets                                172,310
                                         ----------
                                          7,047,677
                                         ----------
Less:
     Current liabilities                  2,034,346
     Long-term liabilities                1,916,002
     Minority interest                      195,813
                                         ----------
                                          4,146,161
                                         ----------
Total purchase price                     $2,901,516
                                         ==========

Acquisition of Palms Golf Center

On December 31, 1996, the Company purchased Palms Golf Center 
("Palms") in downtown San Diego, California for $765,081.  The 
Company issued notes payable to the seller for $547,290, issued 
21,825 shares of common stock of the Company for $137,500, paid 
cash of $71,584 and acquisitions costs of $8,707.  The existing 
golf facility was completed approximately two years ago and 
consists of a 40 tee station driving range, practice putting green, 
chipping, short game and sand bunker areas, a 9-hole pitch and putt 
golf course, a clubhouse and a maintenance area on approximately 13 
acres of land.  The acquisition was recorded using the purchase 
method of accounting, by which the assets are value at the fair 
market value at the date of acquisition.  The operating results of 
this acquisition have been included in the accompanying 
consolidated financial statements from the date of acquisition.  
The allocation of the purchase price is as follows:

Property and equipment     $ 765,081
                           ---------
Total purchase price       $ 765,081
                           =========


Pro Forma Information

The following unaudited pro forma information presents the 
consolidated results of operations of the Company as if the 
acquisition of Fremont, Goose Creek, Illinois Center and Palms had 
occurred at the beginning of each period presented.  The unaudited 
pro forma financial data does not purport to be indicative of the 
results which actually would have been obtained had the purchases 
been effected on the dates indicated or of the results which may be 
obtained in the future.

Years Ended December 31,          1996          1995
---------------------------------------------------------

Revenues                     $  3,505,685    $  3,863,860
Operating expenses              5,134,091       4,962,172
Other expenses                  1,564,130       1,260,816
Minority interest in (loss)       (87,870)        (61,516)
                             -----------------------------
Net loss from continuing 
     operations              $ (3,104,666)   $ (2,297,612)

Net loss per common share
from continuing operations   $      (1.67)   $      (1.33)
                             -----------------------------

3.     Property and Equipment
Property and equipment consisted of the following:

                      December 31,     1996          1995


Land                                $3,669,253     $        -
Buildings and related improvements   4,767,726              -
Land improvements                    4,222,443              -
Furniture, fixtures and equipment      980,313         52,262
Design and development costs            54,037              -
Automobile                              35,715         35,715
                                   --------------------------
                                    13,729,487         87,977
Less accumulated depreciation and 
     amortization                      205,342         24,025
                                   --------------------------
                                   $13,524,145     $   63,952
                                   ==========================

4.	Notes Receivable
Notes Receivable, Related Parties

On September 1, 1994, IC entered into a $500,000 note agreement 
with Illinois Center.  Advances under the agreement accrued 
interest at two percent over Citibank's prime rate.  The note was 
unsecured and due on the earlier of demand or September 1, 1996.  
The balance outstanding on the note was $459,739 as of December 31, 
1995.  As of December 31, 1996, the note eliminates in 
consolidation.

On November 21, 1995, VA entered into a $100,000 note agreement 
with Goose Creek.  Advances under the agreement accrued interest at 
two percent over Citibank's prime rate.  The note was unsecured and 
due on the earlier of demand or November 21, 1996.  The balance 
outstanding on the note was $54,989 as of December 31, 1995.  As of 
December 31, 1996, the note eliminates in consolidation.

Notes Receivable, Stockholder

During 1994, the Company entered into two note agreements and in 
1995 the Company entered into one note agreement with its sole 
common stockholder.  The notes bear interest at eight percent per 
annum and are due on demand.  The balances outstanding on the notes 
are $82,511 and $120,300 as of December 31, 1996 and 1995.

5.     Investments in Affiliates

Investment in Goose Creek

VA is the managing general partner of Goose Creek in which it holds 
a 0.5 percent general partnership interest.  As the managing 
general partner of Goose Creek, VA is responsible for the day-to-
day management and operation of the business and property of Goose 
Creek.  The administrative general partner of Goose Creek, an 
unaffiliated corporation also having a 0.5 percent interest in 
Goose Creek, holds joint authority with VA over annual budgets, 
significant capital expenditures, significant deposits into and 
withdrawals from the Goose Creek reserve account, as defined, and 
replacement of the management company, as hired by Goose Creek.  
The general partners do not have the authority to sell or refinance 
all or any material portion of the property without the consent of 
51 percent of the Class A limited partners.  Both general partners 
contributed their expertise to Goose Creek's formation and other 
consideration in exchange for an interest in Goose Creek.

In addition to its 0.5 percent general partnership interest, VA 
holds a 10.33 percent Class B limited partnership interest in Goose 
Creek.  The Company accounts for its 10.33 percent Class B limited 
partnership interest using the cost method of accounting.  The 
Class B limited partnership interest entitles the Company to share 
in cash distributions and profit or loss allocations, as described 
below, subsequent to the Class A limited partners receiving a 
preferred return of 12 percent on their capital contributions and 
certain other funding requirements.

Goose Creek's partnership agreement allows for cash distributions 
to the general and limited partners from available net cash flow, 
at the discretion of the managing general partner.  Net cash flow 
is defined as the excess of operating cash receipts over operating 
cash disbursements after the funding of reasonable reserves for 
anticipated expenses and capital replacement.

Profits and losses are allocated to the partners in the same 
proportion as net cash flow is distributed subject to the provision 
of Section 704(b) of the Internal Revenue Code of 1986 relating to 
substantial economic effect.  As of December 31, 1995, the Company 
had recorded an investment in Goose Creek of ($3,731).  As of 
December 31, 1996, the investment in Goose Creek eliminates in 
consolidation.

In addition to the above, VA as managing general partner, receives 
an asset management fee from Goose Creek of $45,000 per annum that 
started June 1, 1992 and increased by a factor of five percent per 
annum on June 1st of each year.  The Company is also be entitled to 
receive a fee equal to one percent of the gross proceeds upon any 
disposition of Goose Creek's property.  Asset management fees for 
the years ended December 31, 1996, 1995 and 1994 are $42,228, 
$51,059 and $48,628.  The 1996 amount represents fees earned from 
January 1, 1996 to October 21, 1996, the date of the Company's 
acquisition of the partnership interest in Goose Creek (see Note 
2).  The fees for the remainder of the year eliminate in 
consolidation as of December 31, 1996.

Investment in Illinois Center

IC is the managing general partner of Illinois Center in which it 
holds a 40 percent general partnership interest.  As the managing 
general partner, IC has the responsibility to make all decisions 
affecting the day-to-day business of Illinois Center.  The general 
partner does not have the authority, except under certain 
conditions as provided for in the partnership agreement, to cause 
Illinois Center to secure certain indebtedness of Illinois Center 
with a mortgage, deed of trust or similar lien on the property, nor 
shall the general partner have the authority to sell or transfer 
all or substantially all of the assets of Illinois Center, unless 
the general partner first obtains the majority consent of the 
limited partners.  The general partner contributed $90, its 
agreement to develop and acquire the Illinois Center's ground lease 
and expertise to Illinois Center's formation in exchange for its 
interest in Illinois Center.

Illinois Center's partnership agreement allows for cash 
distributions to the general and limited partners from available 
net cash flow.  Net cash flow is defined for any period as the 
excess, if any, of revenues over expenses.  Net cash flow is to be 
distributed not less frequently than quarterly, commencing after 
the first full calendar quarter following the opening to the public 
of Illinois Center.  Profits and losses are allocated to the 
partners as defined in the partnership agreement.  As of December 
31, 1995, the Company has recorded an investment in Illinois Center 
of $42.  As of December 31, 1996, the investment in Illinois Center 
eliminates in consolidation.

In addition to the above, IC, as managing general partner, is 
entitled to receive an asset management fee from Illinois Center of 
$60,000 per annum increased by a factor of five percent per annum.  
Asset management fees for the years ended December 31, 1996, 1995 
and 1994 were approximately $50,806, $60,000 and $35,000.  The 1996 
amount represents fees earned from January 1, 1996 to October 21, 
1996, the date of the Company's acquisition of the majority 
partnership interest in Illinois Center (see Note 2).  The fees for 
the remainder of the year eliminate in consolidation as of December 
31, 1996.

Prior to October 21, 1996, the Company, as general partner of Goose 
Creek, did not have the authority to sell or refinance all or any 
material portion of the property without the consent of 51 percent 
of the Class A limited partners.  The Company, as general partner 
of Illinois Center, did not have the authority except under certain 
conditions as provided for in the partnership agreement, to cause 
Illinois Center to secure certain indebtedness of Illinois Center 
with a mortgage, deed of trust or similar lien on the property, nor 
did the general partner have the authority to sell or transfer all 
or substantially all of the assets of Illinois Center, unless the 
general partner first obtains the majority consent of the limited 
partners.  Accordingly, the Company had recorded its investments in 
affiliates using the equity method of accounting.  

6.     Lines of Credit
The Company entered into a $225,000 line of credit agreement dated 
December 20, 1994 and a $22,000 line of credit dated November 28, 
1995.  Borrowings under the lines accrued interest at the National 
Prime Lending Rate and were due on March 25, and May 28, 1996, 
respectively.  The $225,000 line was collateralized by the 
Company's note receivable from a related party, a $200,000 money 
market account and was personally guaranteed by the sole common 
stockholder of the Company.  The $225,000 line of credit was paid 
in full during May 1996, and the Company redeemed its $200,000 
money market account.  The $22,000 line of credit was 
collateralized by a $22,700 certificate of deposit.  The $22,000 
line of credit was paid in full during June 1996, and the Company 
redeemed its $22,700 certificate of deposit.  The balance 
outstanding on the lines are $0 and $246,937 as of December 31, 
1996 and 1995.

7.     Note Payable, Officer
During 1995, an officer of the Company advanced funds to the 
Company.  The advances were due on demand and accrued interest at 
two percentage points over Citibank's prime rate.  The balance 
outstanding as of December 31, 1995 including accrued interest was 
$26,827.  The note was paid in full during 1996.

8.     Long-Term Debt
The following is a summary of the Company's long-term debt:

                    December 31,     1996        1995


Note payable with Textron (1)   $ 3,258,266    $        -
Note payable with Textron (2)     1,553,663             -
Convertible debt (3)              1,300,339             -
Convertible subordinated 
    notes (4)                       861,750             -
Note payable, bank (5)              700,000             -
Note payable (6)                    630,720             -
Convertible debt (7)                573,712             -
Notes payable, seller (8)           547,290             -
Convertible notes (9)               380,000             -
Notes payable, other                 81,859        39,640
                                -------------------------
                                  9,887,599        39,640
Less current portion              6,023,401        16,489
                                -------------------------
                                $ 3,864,198    $   23,151
                                =========================


(1)     On June 1, 1992, Goose Creek was advanced $3.6 million 
under a loan agreement whereby Goose Creek may borrow up to $4.2 
million.  The loan agreement bears interest at 10.05 percent and 
has a five-year term which may be extended for an additional five-
year term under certain conditions of the loan agreement.  
Principal and interest payments are due under a seasonal payment 
structure with a balloon payment of principal due on June 1, 1997, 
unless Goose Creek exercises its right to extend the maturity date.  
The loan agreement  allows for subsequent advances in amounts of at 
least $100,000 each until total advances reach $4.2 million, so 
long as no more than one advance occurs in any 12-month period.  
The amount of additional advances are tied to a formula involving 
certain net operating income levels and debt-coverage ratios.  The 
loan is collateralized by all property of Goose Creek and is 
personally guaranteed by the president of the Company.

(2)     On January 31, 1996, Illinois Center entered into a 
$2,000,000 promissory note with Textron.  Textron advanced 
$1,750,000 to Illinois Center.  Illinois Center may be entitled to 
receive additional advances up to $250,00 from Textron pursuant to 
the terms of the note agreement.  The note bears interest at 10.75% 
and is due on or before December 31, 2002.  Principal and interest 
payments are due under a seasonal payment structure.  The note is 
collateralized by substantially all of the assets of Illinois 
Center and is personally guaranteed by the president of the 
Company.

(3)     On October 21, 1996, in conjunction with proceeds raised 
from the Company's initial public offering ("IPO"), the Company 
acquired 93.6% of the limited partnership interests in Illinois 
Center for $2,901,516; with $1,587,500 paid in cash and the 
issuance of $1,293,152, net of original issue discount of $394,398, 
in convertible notes and acquisition costs of $20,864 (see Note 2).  
Each convertible note is due on June 1, 2005 and bear interest at 
6% per annum.  Interest payments are payable semi-annually on June 
1 and December 1 of each year, commencing on October 21, 1996; 
provided, however, that interest only will be payable for the first 
24 months.  Thereafter, interest will continue to be paid semi-
annually and principal will be amortized evenly over the remaining 
seven years to maturity.  The notes shall be convertible into a 
warrant to  purchase 2,500 shares of common stock of the Company 
for each $25,000 principal amount of convertible notes at an 
exercise price equal to 120% of the IPO price ($6.00).  The 
conversion may take place anytime after November 20, 1997 and prior 
to full payment of principal by the Company.

The market rate on the convertible notes payable has been 
determined to be greater than the stated interest rate which 
results in an original issue discount ("OID") on the face of the 
convertible note payable in the amount of $394,398 based on an 
effective rate of 12%.  The OID is being charged to interest over 
the life of the convertible notes payable under the effective 
interest method.

(4)     On May 30, 1996, the Company completed its offer for sale 
in a private placement $2,025,000 in convertible subordinated notes 
("Notes").  The Notes were offered by Laidlaw Equities, Inc. 
("Laidlaw") on a best efforts basis.  Net proceeds from the 
offering, after paying commissions and offering costs were 
approximately $1,757,122.  The Notes bear interest at 12 percent, 
with interest payable June 1 and December 1 of each year commencing 
on December 1, 1996.  The Notes are due on June 1, 1997.  The 
Notes, including any accrued but unpaid interest, are convertible, 
at the option of the holder, at any time upon the earlier of (i) 
the closing of the Company's IPO or (ii) November 30, 1996, into 
shares of common stock of the Company at either 50 percent of the 
IPO price, if converted simultaneously with the closing of the IPO, 
or 50 percent of the market price, if converted after the IPO.  On 
October 21, 1996, $1,062,500 of the Notes including $56,025 in 
accrued interest, were convertible into 356,168 shares of the 
Company's common stock.

The market interest rate on the convertible subordinated notes 
payable has been determined to be greater than the stated interest 
rate which results in OID on the face amount of the convertible 
subordinated notes payable in the amount of $243,600 based on an 
effective rate of 24%.  The OID is being charged to interest over 
the life of the convertible subordinated notes payable under the 
effective interest method.

(5)     On July 1, 1996, Fremont Center was purchased for 
approximately $1,350,000 (see Note 2).  The Company paid $650,000 
in cash and entered into a $700,000 promissory note with the 
seller.  The note bears interest at 9% per annum and had an 
original maturity date of November 15, 1996.  The note was extended 
to January 15, 1997, for a one time extension fee and a default 
interest rate of 10% from the inception of the note.  On January 
15, 1997 the note was refinanced through March 3, 1997 with a bank 
at an interest rate of 2% over the Norwest Bank prime rate.  The 
note was subsequently extended to June 3, 1997.  All principal and 
accrued interest amounts are due on June 3, 1997.  The note is 
collateralized by all leasehold improvements on the property and a 
$100,000 certificate of deposit issued to the bank on January 15, 
1997.

(6)     On January 31, 1996, Illinois Center purchased its 
clubhouse facility and various items of equipment which were 
previously under operating leases for $1,434,000.  Illinois Center 
paid $850,000 in cash and entered into a $584,000 promissory note.  
The note bears interest at eight percent per annum and is due June 
1, 2005.  Principal and interest payments on the note commence 
January 1, 1998.  The note is collateralized by its clubhouse 
facility and various items of equipment.  The note is subordinate 
to Illinois Center's Textron note payable.

(7)     On October 21, 1996, in conjunction with proceeds raised 
from the Company's IPO, the Company acquired all of the limited 
partnership interests in Goose Creek for $1,209,699; with $620,500 
paid in cash and the issuance of $570,520, net of OID of $173,980, 
in convertible notes and acquisition costs of $18,679 (see Note 2).  
Each convertible note is due on June 1, 2005 and bears interest at 
6% per annum.  Interest payments are payable semi-annually on June 
1 and December 1 of each year, commencing on October 21, 1996; 
provided, however, that interest only will be payable for the first 
24 months.  Thereafter, interest will continue to be paid semi-
annually and principal will be amortized evenly over the remaining 
seven years to maturity.  The notes shall be convertible, in whole 
or in part, into fully paid and nonassessable shares of common 
stock of the Company, at the option of the holder.  The share 
conversion shall be the principal of the note being converted, plus 
accrued and unpaid interest divided by the IPO price ($6.00).  The 
conversion may take place anytime after November 20, 1997 and prior 
to full payment of principal by the Company.

The market rate on the convertible notes payable has been 
determined to be greater that the stated interest rate which 
results in an OID on the face of the convertible note payable in 
the amount of $173,980 based on an effective rate of 12%.  The OID 
is being charged to interest over the life of the convertible notes 
payable under the effective interest method.


(8)     On December 31, 1996, the Company entered into two notes 
payable with the seller of Palms in the amounts of $459,700 and 
$87,500 (see Note 2).  The $459,790 note payable accrues interest 
at 10.5% and is due on July 1, 1997.  The $87,500 note payable 
accrues interest at 8% and is due on April 21, 1997.  Both notes 
are collateralized by all property of Palms.
 
(9)     During August 1995, Goose Creek entered into three 
unsecured convertible note agreements.  The notes accrue interest 
at 8 percent per annum through August 1, 1996.  Thereafter, the 
notes accrue interest at 15 percent per annum.  Interest-only 
payments are due on the first of each month.  The notes are due on 
August 1, 1997.  The note agreements are subordinate to Goose 
Creek's note payable with Textron.  The note agreements contain a 
conversion provision whereby the noteholders may convert no less 
than all of the then outstanding principal and accrued interest 
into limited partnership interests.


Future maturities of long-term debt as of December 31, 1996 are as 
follows:

December 31,

1997        $  6,023,401
1998             277,908
1999             565,430
2000             613,724
2001             666,510
Thereafter     1,740,626
             ------------
             $ 9,887,599
             ============



9.     Capital Lease Obligations
Goose Creek has various lease agreements for irrigation system, 
maintenance equipment and golf carts.  These obligations extend 
through 2001 with unexpired terms ranging from one to five years.


Included in property and equipment in the accompanying balance 
sheet are the following assets held under capital leases:

December 31,1996
Irrigation system               $   330,747
Turf and maintenance equipment       51,688
Golf carts                           38,883
                                ------------
Assets under capital lease          421,318
Less accumulated amortization        25,370
                                ------------
Assets under capital lease, net $   395,948
                                ============

Future minimum lease payments and the present value of the minimum 
lease payments under the capital lease obligations as of December 
31, 1996 are as follows:

Total future minimum lease payments          $  660,839
Less amount representing interest               303,923
                                             -----------
Present value of minimum lease payments         356,916
Current portion of capital lease obligations     87,772
                                             -----------
Long-term portion of 
    capital lease obligations                $  269,144
                                             ===========

As of December 31, 1996, annual maturities of the capital lease 
obligations for each of the next five years and in the aggregate 
are as follows:

1997      $   87,772
1998          26,804
1999          27,628
2000          35,368
2001          40,728
Thereafter   138,616
          ----------
          $  356,916
          ==========


10.     Commitments and Contingencies

Employment Agreements

During 1994, the Company entered into employment agreements with 
its President through December 1996 and with its Executive Vice 
President through September 1997.  The employment agreements set 
forth annual compensation of $180,000 to the President and $120,000 
to the Executive Vice President plus bonuses as the board of 
directors of the Company may from time to time approve.  Effective 
January 1, 1996, both agreements were extended until December 31, 
1998 with annual salaries of $250,000 and $175,000, respectively.

Operating Leases

The Company currently has lease, sublease and ground lease 
agreements obligations for the various golf operating facilities 
which run through the year 2022.  The leases generally call for the 
Company to be responsible for all facility operational expenses and 
be entitled to receive income generated from the facility.  The 
monthly lease payments due to the lessors vary from monthly base 
rental amounts, to percentages of gross monthly revenues or 
available operational proceeds as defined in the lease agreements.  
The leases call for the Company to maintain certain general 
liability insurance levels and provide golf professionals to teach 
lessons to the public.

The Company also leases office space and equipment under 
noncancelable leases with terms that expire at various dates 
through April 2002.

Below is a summary of future minimum lease payments:


1997       $   332,500
1998           175,500
1999           208,500
2000           208,500
2001           247,700
Thereafter   3,845,000
           -----------
Total      $ 5,017,700
           ===========

Rent expense for the years ended December 31, 1996, 1995 and 1994 
totaled approximately $277,000, $25,000 and $8,000.

The Company has contingent payments in conjunction with the ground 
sublease and sublicense agreements for Illinois Center for tax 
contribution and land rent as of December 31, 1996 of approximately 
$479,500 and $438,000.  As of December 31, 1996, Illinois Center 
paid no tax contribution or land rent to the lessor.  As of 
December 31, 1996, Illinois Center has accrued tax contributions of 
approximately $479,500.  As of December 31, 1996, Illinois Center 
was not obligated to pay land rent under the provisions of the 
agreement.


11.     Related Party Transactions

Development Fees

During 1994, the Company earned $125,000 for land acquisition, 
concept planning design and development services provided to 
Illinois Center.  The Company earned no development fees for the 
years ended December 31, 1996 and 1995.

Property Management Agreement

On December 31, 1993, MGM entered into a property management 
agreement with Illinois Center.  The management agreement expires 
on January 1, 1997.  The terms of the management agreement provide 
for a management fee of $5,000 per month plus a membership 
incentive fee of ten percent of the gross proceeds received from 
membership initiation fees and the equivalent on one month's 
membership dues as received by Illinois Center.  The membership 
incentive fee for renewal memberships will be reduced to four 
percent of annual dues for renewal members.  In addition, the 
management agreement provides for annual incentive fee of five 
percent of the amount of annual net operating income in excess of 
$1,600.000.

MGM initially was operated by Club Sports International ("CSI").  
On October 1, 1994, CSI was removed as operator of MGM.  On 
November 17, 1994, Billy Casper Golf Management, Inc. ("BCGM") was 
engaged as the new operator of MGM.  From the period June 1, 1994 
through September 30, 1994, MGM's base fee was split between CSI 
and the Company with CSI receiving $4,000 and the Company receiving 
$1,000.  From October 1, 1994 through November 18, 1994, the 
Company earned the full amount of MGM's fee.  From November 18, 
1994 through November 30, 1995, BCGM earned the entire fee.  During 
1995, BCGM was removed as operator of MGM.  In addition, MGM has 
agreed to waive 80 percent of the deferred $5,000 per month fees 
that it had earned under its contract from the period December 1, 
1993 to May 31, 1994.  For the years ended December 31, 1996, 1995 
and 1994, property management fees, including incentive fees, are 
$57,475, $79,244 and $76,063.  The 1996 amount represents fees 
earned from January 1, 1996 to October 21, 1996.  As of December 
31, 1995, Illinois Center owed MGM $83,256.

During 1996, MGM earned $30,000 in property management fees from 
Goose Creek.


12.     Stockholders' Equity (Deficit)

Preferred Stock Offering

During 1994, the Company offered to sell 50,000 Units in a private 
offering of up to $1.25 million in redeemable preferred stock and 
warrants at $25 per Unit.  Each Unit consists of one share of 
preferred stock and one warrant to purchase 3.58 shares of the 
Company's common stock at an exercise price of $2.23 per share 
subject to antidilution adjustments.  The warrants expire five 
years from the date of issuance.  During 1995, the Company sold 
8,000 shares of preferred stock resulting in net proceeds of 
$199,504 and during 1994, the Company issued 37,500 shares of its 
preferred stock resulting in net proceeds to the Company after 
paying offering costs of $786,605.  As of December 31, 1996 and 
1995, the Company has 163,029 warrants outstanding which expire on 
July 29, 1999.

The underwriter received warrants entitling the underwriter to 
purchase 11,107 shares of common stock at an exercise price of 
$2.23 per share on a fully diluted basis.  At the closing of the 
offering, two directors of the Company received, as compensation, 
16,304 warrants equal to five percent of the number of Units sold 
in the offering entitling them to purchase one percent of the 
outstanding common stock at an exercise price of $2.23 per share on 
a fully diluted basis.  Twenty-five percent of the warrants issued 
to the directors vested on August 28, 1995 and an additional 25 
percent will vest every six months thereafter.  The warrants issued 
to the underwriters and directors expire on July 29, 1999.

Preferred Stock

During August 1995, the Company amended its articles of 
incorporation to increase the authorized shares of preferred stock 
from 100,000 to 1,000,000 shares.  Of the 1,000,000 shares, 100,000 
shares have been designated as redeemable preferred stock.  The 
holders of redeemable preferred stock are entitled to receive, 
when, and if declared by the Board of Directors and out of funds 
legally available for the payment of dividends or if mandatorily 
redeemable as discussed below, dividends at the annual dividend 
rate of 15 percent per annum ($3.75) on each outstanding share of 
preferred stock, commencing upon issuance and thereafter through 
the end of the eighth complete calendar quarter after the date of 
issuance.  Thereafter, the annual dividend rate on the redeemable 
preferred stock is 18 percent per annum ($4.50) on each outstanding 
share of preferred stock.  Dividends on shares of the redeemable 
preferred stock are payable in four equal quarterly installments on 
the last day of March, June, September and December beginning 
September 30, 1994.  The dividends shall accrue and become 
cumulative not compounded from the date of issuance.  Accumulated 
dividends do not bear interest.  Whenever dividends on the 
redeemable preferred stock are in arrears for eight consecutive 
quarters or in an amount equal to at least 12 quarterly dividends, 
the holders of such stock (voting as a class) have the right to 
elect one director of the Company until all cumulative dividends 
have been paid in full.  Dividends in arrears on the outstanding 
preferred shares totalled $205,729 as of December 31, 1995.

Shares of the redeemable preferred stock are redeemable, at the 
Company's election, in whole or in part.  However, if IC declares a 
dividend, the Company is contractually obligated to use those 
proceeds, subject to sufficient legally available funds to redeem, 
in whole or in part, the preferred stock, to the extent such cash 
dividends are not applied to payment of accrued dividends on 
redeemable preferred stock.  The shares are redeemable at $26.25 
per share together with accrued and unpaid dividends, if any.  
Shares of the redeemable preferred stock have a liquidation value 
of $25 per share plus accrued dividends, including cumulative 
dividends.

On November 21, 1996, the Company completed the redemption of its 
45,500 shares of preferred stock at an aggregate cost of 
$1,544,432, including dividends in arrears of $350,057.

Common Stock

During August 1995, the Company amended its articles of 
incorporation to increase the authorized shares of common stock 
from 1,000,000 shares to 9,000,000 shares.

On October 21, 1996, the Company completed the sale of 1,175,000 
shares of its common stock in an IPO registered on Form S-1.  The 
Company received net proceeds of approximately $5,460,600 after 
paying offering costs of $1,589,436.

Simultaneously with the completion of the Company's IPO on October 
21, 1996, $1,062,500 of the Company's convertible subordinated 
notes payable and accrued interest of $56,025 were converted into 
356,168 shares of common stock in accordance with the provisions of 
the convertible subordinated notes (see Note 8).

Underwriters Warrants

On October 16, 1996, the Company sold warrants for $118 to the 
underwriters of the IPO entitling the underwriters to purchase an 
aggregate of 117,500 shares of the Company's common stock ("the 
Representatives' Warrants").  The Representatives' Warrants are 
exercisable for a period of 4 years commencing November 16, 1997 at 
an exercise price per share of 120% of the IPO price ($17.20).  The 
Representatives' Warrants contain anti-dilution provisions 
providing for adjustment of the exercise price and number of shares 
issuable upon exercise upon the occurrence of certain events, 
including stock dividends, stock splits, recapitalizations and 
sales of common stock below the exercise price thereof.

Officers' Warrants

On December 1, 1995, the Company issued warrants to its officers to 
purchase an aggregate of 97,720 shares of common stock at an 
exercise price of $2.23 per share.  Twenty-five percent of the 
warrants vested on December 1, 1995 and an additional 25% will vest 
every six months thereafter.  The warrants expire on December 1, 
2000.

Stock Split

During August 1995, the Company declared a 5.5 to 1.0 forward stock 
split.  During September 1996, the Company declared a 1.535 to 1 
reverse stock split.  All share information herein reflects both 
such stock adjustments.

Stock Option Plan

In connection with the IPO, the Board of Directors adopted the 
Company's stock option plan (the "Stock Option Plan").  The Stock 
Option Plan provides for an initial authorization of 250,000 shares 
of Common Stock for issuance thereunder at exercise prices no less 
than 85% of the fair market value of the common stock at the time 
of grant  The options will vest over a five-year period, except 
that up to 10% of the options may be subject to a shorter vesting 
period at the discretion of the Company's board of directors.  
Options may not be exercised more than three months after an 
employees' termination of employment with the Company unless such 
termination was a result of death, disability or retirement, in 
which case the exercise period is extended to one year.  The 
exercise price may be paid in cash, by tendering shares of the 
common stock (valued at fair market value on the date of exercise) 
if so provided in the applicable stock option agreement, or by a 
combination of such means of payment, as may be determined by the 
Stock Option Committee.  As of December 31, 1996 the Company has 
the following stock options outstanding under this plan.

    Grant             Expiration       Exercise        Options
    Date                 Date           Price          Granted
---------------------------------------------------------------
October 16, 1996   October 15, 2006    $6.00            5,000
November 25, 1996  November 24, 2006   $6.00           43,000
November 25, 1996  November 24, 2006   $5.10           35,000
---------------------------------------------------------------
Options outstanding                                    83,000
---------------------------------------------------------------

The options' exercise price was equal to the common stock's market 
price at the date of grant. 

Senior Executive Incentive Stock Option Plan

On September 16, 1996, the Company granted options to each of its 
President and Executive Vice President to purchase 125,000 shares 
of common stock pursuant to the Senior Executive Stock Option Plan 
(the "Executive Option Plan") at an exercise price equal to $6.00.  
None of these options vest prior to March 31, 1997.  Thereafter, 
they vest in accordance with the Executive Option Plan.  The 
options expire on September 16, 2006.

SFAS No. 123, "Accounting for Stock-Based Compensation", requires 
the Company to provide pro forma information regarding net income 
as if compensation for the Company's stock option plans had been 
determined in accordance with the fair value based method 
prescribed in SFAS No. 123.  The Company estimated the fair value 
of each stock option at the grant date by using the Black-Scholes 
option-pricing model with the following weighted-average 
assumptions used for the 1996 and 1995 grants: dividend yield of 
0%; expected volatility of 16% and 20%; risk free interest rate of 
6.6% and 5.4%; and expected life of five years.

The impact of the accounting provisions of SFAS No. 123 is not 
significant to the Company's net loss and net loss per share and 
therefore has not been disclosed.

During the initial phase-in period of SFAS 123, the effects on pro 
forma results are not likely to be representative of the effects on 
pro forma results in future years since options vest over several 
years and additional awards could be made each year.

A summary of the status of the Company's stock option plans and 
outstanding warrants as of December 31, 1996 and 1995 and changes 
during the years ended on those dates is presented below:

                               1996                   1995       
                         -----------------     ------------------
                                  Weighted               Weighted
                                   Average                Average
                                  Exercise               Exercise
                         Shares    Prices      Shares     Price  
-----------------------------------------------------------------
Outstanding, beginning
     of year             114,024   $2.23             -      $   -
          Granted        333,000    5.91       114,024       2.23
          Expired              -       -             -          -
                        -----------------------------------------
Outstanding, end of year 447,024   $4.97       114,024      $2.23
                        -----------------------------------------

Options and warrants
exercisable, end of year  86,516   $2.23        28,506      $2.23
                        -----------------------------------------
Weighted average fair
   value of options and
   warrants granted
   during the year             -   $1.85              -     $0.67
                        -----------------------------------------

The following table summarize information about stock options and 
warrants outstanding at December 31, 1996:

             Options Outstanding             Options Exercisable
            -------------------------------- --------------------
                         Weighted 
                         Average    Weighted             Weighted
Range of       Number    Remaining  Average    Number    Average
Exercise    Outstanding Contractual Exercise Exercisable Exercise
Prices      at 12/31/96    Life      Price   at 12/31/96  Price   
-----------------------------------------------------------------
$2.23-$6.00   447,024       5       $4.97      86,516      $2.23
-----------------------------------------------------------------


13.     Income Taxes
At December 31, 1996, the Company has available net operating loss 
carry forwards of approximately $2,611,000 for tax reporting 
purposes which expire through 2011.  These operating loss carry 
forwards are subject to various limitations imposed by the rules 
and regulations of the Internal Revenue Service.

The Company has deferred tax assets fully reserved as of December 
31, 1996 and 1995.  The tax effect on the components is as follows:

                                               December 31,     
                                            1996          1995

Net operating loss carry forward        $  979,000    $  205,000
Basis differences in investments in
    Goose Creek and Illinois Center        (18,000)            -
Salary accrual                                   -        54,000
Basis difference in property
    and equipment                                -         1,000
                                       --------------------------
                                           961,000       260,000
Valuation allowance                       (961,000)     (260,000)
                                       --------------------------
                                       $         -   $         -
                                       ==========================

A 100 percent valuation allowance has been established to reflect 
management's evaluation that it is more likely than not that all of 
the deferred tax assets will not be realized.  For the years ended 
December 31, 1996 and 1995, the valuation allowance increased by 
$701,000 and $168,000.

VA and IC are Subchapter S Corporation for income tax purposes 
through July 27, 1994.  Under provisions of the Internal Revenue 
Code, the net income or loss of VA and IC are to be included in the 
Federal income tax returns of the individual stockholders.  Since 
VA and IC incurred losses while Subchapter C corporations, no pro 
forma income tax provision is required.

For income tax purposes, the Company has recorded its percentage of 
the taxable losses generated by Goose Creek and Illinois Center as 
both entities are limited partnerships.  The net difference between 
the tax basis and the reported amounts of Goose Creek's and 
Illinois Center's assets and liabilities as of December 31, 1996 is 
$48,000.


14.     Supplemental Data to Statement of Cash Flows

Years Ended December 31,           1996         1995        1994
                              -----------------------------------
Cash payments for interest     $  166,954   $  25,994   $  1,842

Excluded from the consolidated and combined statement of cash flows 
were the effect of certain noncash investing and financing 
activities as follows:

Increase in common stock for
     discount on debt          $  243,600   $       -   $      -

Conversion of convertible
     subordinated notes and 
     accrued interest into
     common stock              $1,047,475   $       -   $      -

Acquisition of limited
     partnership interests in
     Goose Creek and Illinois
     Center with 
     convertible debt          $1,863,672   $       -   $      -

Acquisition of Fremont and
     Palms with debt           $1,247,290   $       -   $      -

Other                          $  179,791   $       -   $120,460
----------------------------------------------------------------


15.     Subsequent Event

Convertible Subordinated Note Offering

The Company is offering for sale in a private placement $5,000,000 
in convertible subordinated notes ("the Notes").  The Notes are 
offered by Prime Charter Ltd. ("Prime") on a best efforts basis.  
The notes will bear interest at 8% and will mature on June 30, 
2004.











Report of Independent Certified Public Accountants


Board of Directors
MetroGolf, Incorporated
Denver, Colorado

The audits referred to in our report dated March 21, 1997 relating 
to the consolidated financial statements of MetroGolf, 
Incorporated, which is contained in Item 8 of this Form 10-K 
included the audits of the financial statement schedule listed in 
the accompanying index.  This financial statement schedule is the 
responsibility of the Company's management.  Our responsibility is 
to express an opinion on this financial statement based on our 
audits.

In our opinion, such schedule presents fairly, in all material 
respects, the information set forth therein.





BDO Seidman, LLP

Denver, Colorado
March 21, 1997

                  SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                                 Additions
                  Balance at     Charged to            Balance at
                  Beginning of    Costs and               End of  
                     Year         Expenses   Deductions    Year   
-----------------------------------------------------------------
Year Ended 
December 31, 1996;
Deferred tax 
asset valuation
allowance         $  260,000   $  701,000   $      -   $ 961,000

Year Ended 
December 31, 1995;
Deferred tax 
asset valuation
allowance         $   92,000   $  168,000   $      -   $ 260,000

Year Ended
December 31, 1994;
Deferred tax
asset valuation
allowance         $        -   $   92,000   $       -   $  92,000
-----------------------------------------------------------------









ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON 
         ACCOUNTING AND FINANCIAL DISCLOSURE

         None.

PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT 


Executive Officers and Directors

The names and ages, along with certain biographical information, of 
the executive officers, Directors, and Director Nominee of the 
Company are as follows: 

Name                        Age            Position
-----------------------------------------------------------------
Charles D. Tourtellotte      42     Chairman of the Board; 
President
J.D. Finley                  39     Executive Vice President;
                                    Chief Financial Officer and
                                    Secretary
Craig M. Sloan               50     Vice President - Operations
James K. Dignan              39     Vice President - Acquisitions
Ernie Banks                  65     Director
Jack F. Lasday               40     Director
Michael S. McGetrick         36     Director
Robert Winsor IV             41     Director

The members of the Board of Directors hold office until the next 
annual meeting of stockholders or until their successors have been 
elected and qualified. Officers are appointed by, and serve at the 
pleasure of, the Board of Directors.  The following is a 
description of the Company's current Directors, executive officers 
and key employees. 

Charles D. Tourtellotte.  Mr. Tourtellotte is the President and 
Chairman of the Board. Mr. Tourtellotte directs the development, 
acquisition and management of the golf assets of the Company and 
the raising of debt and equity capital for the Company's golf 
facilities portfolio. Prior to forming the Company in 1992, Mr. 
Tourtellotte co-founded and served as a director and president of 
Dye Equity Incorporated ("DEI"), the golf course acquisition and 
development subsidiary of Dye Designs, from January 1989 to 
December 1991. Dye Designs is a golf course design and development 
firm headed by Perry Dye, son of renowned golf course architect 
Pete Dye. During his tenure at DEI, Mr. Tourtellotte was 
responsible for acquisition and development of golf and related 
real estate assets and sourced debt, equity, and joint venture 
financing for DEI's and its clients' portfolios. From 1984 to 1989, 
Mr. Tourtellotte served as Senior Vice President of Acquisitions 
for Johnstown American Companies, then one of the nation's largest 
real estate investment and property management firms. Earlier, he 
served as senior acquisition/investment officer at two national 
real estate companies, Consolidated Capital Corporation and Robert 
A. McNeil Corporation. 

J.D. Finley.  Mr. Finley, Executive Vice President and Chief 
Financial Officer, coordinates all financial functions of the 
Company, including management and disbursement of development and 
acquisition funds for the Company and its affiliated entities. Mr. 
Finley also provides due diligence analysis and assistance in 
structuring proposed asset acquisitions and development projects. 
In addition, Mr. Finley assists Mr. Tourtellotte in managing the 
day-to-day affairs of the Company. Prior to joining the Company in 
September 1994, Mr. Finley, a CPA, was a stockholder and director 
of Mitchell Finley and Company, P.C. ("Mitchell Finley"), a Denver-
based certified public accounting firm. A portion of Mr. Finley's 
time while with Mitchell Finley was devoted to servicing the 
Company's account as a tax consultant. Prior to joining Mitchell 
Finley in 1990, Mr. Finley was a stockholder and director of the 
accounting firm of Shenkin Kurtz Baker and Company, P.C. Previous 
to his employment with Shenkin Kurtz Baker and Company, P.C. from 
1985 to 1990, Mr. Finley was a manager with the international 
accounting firm of Deloitte Haskins & Sells (now Deloitte & Touche) 
from 1979 to 1985. 

Craig M. Sloan.  Mr. Sloan is a Class A member of the PGA of 
America with more than 28 years experience in all phases of golf 
facility management.  from 1991 through joining the Company in 
1997, Mr. Sloan was the Vice President/Director of Golf Facilities 
Management of First Golf Corporation headquartered in Tempe, 
Arizona where he headed up the Management Division.  He is the 
former Head Golf Professional of Leisure World Country Club in 
Mesa, Arizona, and the Dobson Ranch Municipal Golf Course in Mesa.  
He was Director of Golf at Apache Wells Resort and Country Club in 
Mesa, Arizona for six years.  Mr. Sloan has served on the Board of 
Directors of the Southwest Section of the PGA of America for 
twenty-one years and as its President for six years.  He is a two-
time winner of the Professional of the Year Award for the Southwest 
Section and a member of the Golf Course Superintendents Association 
and the Club Managers Association of America.

James K. Dignan.  Mr. Dignan, Vice President  Acquisitions, joined 
the Company in July 1993 to facilitate the acquisition and 
development of golf assets for the Company's portfolio. Mr. Dignan 
assists in the acquisition, development and management of 
metropolitan golf facilities for the Company. From 1986 to 1993, 
Mr. Dignan was an Associate Director for Cushman and Wakefield 
where he was responsible for the leasing and management of 
commercial real estate properties for several Fortune 500 
companies. From 1982 to 1986, Mr. Dignan served as Vice President 
for Heliconian, Ltd., a company which specializes in real estate 
investment services. Mr. Dignan was a member of the Professional 
Golfers Association (PGA) for several years. 

Ernie Banks.  Ernie Banks is a Director of the Company and was an 
all-star shortstop and first baseman for the Chicago Cubs Baseball 
Club for 19 years, retiring in 1971. Mr. Banks was elected to the 
Baseball Hall of Fame in 1977. Since 1991, Mr. Banks has been the 
owner and chief executive officer of Ernie Banks International, 
Inc., a sports marketing and promotions firm located in Chicago, 
and Community Relations Director for the Chicago Cubs. 

Jack F. Lasday.  Mr. Lasday is a Director of the Company and Senior 
Vice President - Investments of Prudential Securities. Prior to 
joining Prudential Securities in September 1994, he was a Senior 
Vice President at Rodman & Renshaw, Inc., where he was employed 
from 1982 to 1994. Mr. Lasday is director of Gateway Foundation and 
a member of the Illinois C.P.A. Society and the American Institute 
of Certified Public Accounts. 

Michael S. McGetrick.  Mr. McGetrick is a Director of the Company. 
Mr. McGetrick, a PGA Class A Member, has been the Director of 
Instruction at the Meridian Golf Learning Center in Denver, 
Colorado since 1993. From 1991 to 1993, he was the head teaching 
professional at Cherry Hills Country Club in suburban Denver, 
Colorado. He has also served as head teaching professional at a 
number of other country clubs or golf facilities and coaches a 
number of players on the PGA and LPGA Tours. Mr. McGetrick has 
published several instructional articles in national golf 
magazines. He was named by Golf Magazine as one of the top 100 
teaching professionals in America in 1996. 

Robert Winsor IV.  Mr. Winsor is a Director of the Company.  Mr. 
Winsor is Director and Executive Producer of Broadcast Publicity at 
The CBS Broadcast Group in New York.  In addition to his 
responsibilities with CBS, Mr. Winsor has produced a number of 
corporate sales programs for national and regional companies and 
has produced national satellite media tours that help companies 
deliver their messages or products to targeted areas.  Before 
joining CBS in 1991 to produce news stories, Mr. Winsor worked for 
ABC News in Boston for eight years where he produced over 150 
sports features and profiles.


The following forms were filed late:
J.D. Finley       Form 3 and Form 5 relating to such Form 3 for a 
single transaction.
James Dignan      Form 3 and Form 5 relating to such Form 3 for a 
single transaction.
Ernie Banks       Form 3 and Form 5 relating to such Form 3 for a 
single transaction.
Jack Lasday       Form 3 and Form 5 relating to such Form 3 for a 
single transaction.
Michael McGetrick Form 3 and Form 5 relating to such Form 3 for a 
single transaction.
Robert Winsor IV  Form 3 and Form 5 relating to such Form 3 for a 
single transaction.


ITEM 11. EXECUTIVE COMPENSATION

The following table sets forth the compensation paid or accrued by 
the Company to the Chief Executive Officer and the only other 
officer of the Company who received compensation in excess of 
$100,000 for services rendered to the Company in all capacities 
during the three fiscal years ended December 31, 1996, 1995 and 
1994.


<TABLE>
<CAPTION>
                                       SUMMARY COMPENSATION TABLE
                                       --------------------------
                                                                               
Long-Term 
                                                                             
Compensation
                                                                              
-----------
                                         Annual Compensation                   
Shares of
                             --------------------------------------
--------- Common Stock
                                                                
Other Annual  Underlying      All
Name and Principal         Fiscal Year    Salary     ($)Bonus  
($)Compen-                  Other
Position                                                            
sation   Warrants(#)     Comp.
<S>                        <C>           <C>         <C>      <C>          
<C>          <C>          
Charles D. Tourtellotte    1996          250,000        ---        
---     125,000(3)         ---
Chairman of the Board      1995          180,000        ---        
---      48,860(4)   125,000 (1)
and President              1994          180,000        ---        
---         ---            ---

J.D. Finley                1996          175,000        ---        
---     125,000(3)         ---
Executive Vice President   1995          120,000        ---        
---      48,860(4)         ---
and Chief Financial Officer1994           30,000 (2)    ---        
---         ---            ---
<FN>
(1)     Mr. Tourtellotte is entitled to receive $125,000 of 
compensation upon receipt by the Company 
of the $125,000 contingent portion of its fee in connection with 
the development of Illinois Center 
Golf.  This $125,000 is payable by ICGP upon the complete repayment 
of capital to the limited 
partner investors, plus a preferred return of 15% per annum.  
Because of this financial structure, 
this payment is not expected to be received before 1999, if at all.
(2)	Mr. Finley joined the Company in September 1994.
(3)	See table "Warrant/Option/SAR Grants in Last Fiscal Year" 
below.
(4)	Of these warrants, 36,645 shares are vested as of December 31, 
1996.  The remaining 12,215 
shares will vest on February 28, 1997.
</TABLE>

<TABLE>
<CAPTION>

                              WARRANT/OPTION/SAR GRANTS IN LAST 
FISCAL YEAR

                                                       Individual 
Grants
                         ------------------------------------------
--------------------------------
                                                Percentage of Total
                              Number of          Warrants/Options
                        Securities Underlying  Granted to Employees  
Exercise
                           Warrants/Options            in               
of Base    Expiration
Name                           Granted             Fiscal Year       
Price ($/sh)     Date 
<S>                     <C>                   <C>                    
<C>         <C>
Charles D. Tourtellotte    125,000                   38%                  
$6.00  September 15, 2006
J.D. Finley                125,000                   38%                  
$6.00  September 15, 2006
</TABLE>

None of Mr. Tourtellotte's or Mr. Finley's warrants described above 
are vested and exercisable (subject to an Underwriters' lock-up) as 
of the date hereof.  These warrants vest and are exercisable as 
follows:  the first 20% upon the closing market price of the Common 
Stock exceeding $7.20 per share for a period of five consecutive 
trading days; the next 20% upon the closing market price of the 
Common Stock exceeding $8.40 per share for a period of five 
consecutive trading days; the next 20% upon the closing market 
price of the Common Stock exceeding $9.60 per share for a period of 
five consecutive trading days; the next 20% upon the closing market 
price of the Common Stock exceeding $10.80 per share for a period 
of five consecutive trading days; and the last 20% upon the closing 
market price of the Common Stock exceeding $12.00 per share for a 
period of five consecutive trading days.  The vesting schedule 
described above is referred to herein as the "Executive Option Plan 
Vesting Schedule".

    AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END
                        OPTION/SAR VALUES

                      Number of Securities    Value of Unexercised
                     Underlying Unexercised   In-the-Money Options
                     Unexercised Options at        Options at
                         Dec. 31, 1996            Dec. 31, 1996

                         Exercisable /             Exercisable /
Name                     Unexercisable             Unexercisable
----                     -------------             -------------
Charles Tourtellotte    6,645 / 137,215         $147,312 / $80,354
J.D. Finley            40,228 / 137,215         $161,717 / $80,354


The members of the Company's Board of Directors are not presently 
compensated directly by the Company for their service to the 
Company.  Messrs. Lasday and Banks have received warrants to 
purchase 8,152 shares each of Common Stock at an exercise price of 
$2.23 per share.  The Company has  issued Misters. McGetrick and 
Winsor options to purchase 5,000 shares each of Common Stock under 
the Stock Option Plan, at an exercise price equal $6.00 per share.  
In addition, outside directors will be compensated for their 
reasonable expenses in attending meetings of the Board of 
Directors.

Employment Contracts

 Charles D. Tourtellotte.  Effective January 1, 1996, Mr. 
Tourtellotte entered into a three-year employment agreement to 
serve as President of the Company, which expires December 31, 1998. 
Such agreement provides for an annual salary of $250,000, payable 
semi-monthly in arrears, plus such bonuses as the Board of 
Directors of the Company may from time to time approve. The 
agreement provides for certain athletic club memberships and 
allowances for an automobile, parking and other perquisites as from 
time to time are made available to the Company's executive 
officers. The agreement is terminable by the Company for "Cause," 
which includes conduct which causes material harm to the Company, 
willful and continued absence of employee (other than by reason of 
disability or death), employee's abandonment of his duties and 
responsibilities, conviction of the employee for a felony involving 
moral turpitude or fraud, misappropriation or embezzlement of 
corporate funds. The agreement also has a noncompete clause for a 
period of one-year immediately following the cancellation or 
termination of the agreement for any reason. In the event of 
termination by reason of death or disability and provided the 
Company has not otherwise provided Mr. Tourtellotte with life or 
disability insurance or other benefit plan for such occurrence, the 
Company is required to pay Mr. Tourtellotte or his estate severance 
pay equal to six months' salary. 

 J.D. Finley.  Effective January 1, 1996, Mr. Finley entered into a 
three-year employment agreement to serve as Executive Vice 
President and Chief Financial Officer of the Company, which expires 
December 31, 1998. Such agreement provides a salary to Mr. Finley 
of $175,000 per year, plus such bonuses as the Board of Directors 
of the Company may from time to time approve. The agreement 
provides for payment of monthly dues for membership at a country 
club and an allowance for a cellular phone, parking and other 
perquisites as from time to time are made available by the Company 
to its executive officers. The agreement is terminable by the 
Company for "Cause" as described above. The agreement also has a 
noncompete clause effective for a period of one year immediately 
following the cancellation or termination of the agreement. In the 
event of termination by reason of death or disability and provided 
the Company has not otherwise provided Mr. Finley with life or 
disability insurance or other benefit plan for such occurrence, the 
Company is required to pay Mr. Finley or his estate severance pay 
equal to six months' salary. 

 James K. Dignan.  Effective January 1, 1996, Mr. Dignan entered 
into a three-year employment agreement to serve as Vice President _ 
Acquisitions of the Company, which expires December 31, 1998. The 
agreement provides for a base salary of $66,000 per year, plus such 
bonuses as the Board of Directors of the Company may from time to 
time approve. The agreement is terminable by the Company for 
"Cause" as described above. The agreement also has a noncompete 
clause for a period of one year immediately following the 
cancellation or termination of the agreement for any reason. In the 
event of termination by reason of death or disability and provided 
the Company has not otherwise provided Mr. Dignan with life or 
disability insurance or other benefit plan for such occurrence, the 
Company is required to pay Mr. Dignan or his estate severance pay 
equal to six months' salary. 


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
         MANAGEMENT

The following information is as of March 31, 1997.


           SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

  Title     Name and address        Amount and nature   Percent of
of Class   of beneficial owner   of beneficial ownership  class(1)
-------------------------------------------------------------------
---
Common     Charles Tourtellotte      734,482 shares (2)      27.7%
           MetroGolf Incorporated
           1999 Broadway, #2435
           Denver, CO 80202

Common     Alex Brown & Sons Inc.    661,402 shares          24.9%
           PO Box 1346
           Baltimore MD 21203

Common     Donaldson Lufkin &
           Jenrette Securities Corp  185,100 shares           7.0%
           1 Pershing Plaza
           Jersey City, NJ 07399

Common     Bear Stearns Securities
           Corp                      123,390 shares           4.7%
           Dept C - Cashiers Dept
           One Metrotech Center North
           Brooklyn, NY 11201-3862

(1)   Does not include (i) the 567,875 shares issuable upon 
conversion of the notes and warrants issued in connection with the 
acquisition of the limited partnership interests in ICGP and GCGP, 
(ii) the 117,500 shares issuable upon conversion of the 
Representative's Warrants, (iii) $962,500 aggregate principal 
amount of PP Notes convertible at 50% of then market price, (iv) 
167,000 shares of Common Stock available for future grant under the 
Stock Option Plan, or (v) the stock options for 250,000 ahares 
issued to Messrs. Tourtellotte and Finley under the Executive 
Option Plan which vest according to the Executive Option Vesting 
Schedule.

(2)   Includes 685,622 primary shares and 48,860 vested warrants.

<TABLE>
<CAPTION>
                                      SECURITY OWNERSHIP OF 
MANAGEMENT
                                      -----------------------------
---
                                                                                     
Percentage of
                                Primary       Warrants/Options       
Total              Common
Beneficial Owner              Shares Held    Vested   Unvested      
Holdings        Stock Owned (1)
<S>                           <C>            <C>      <C>          
<C>              <C>
Charles Tourtellotte,            685,622     48,860    125,000       
859,482               29.6%
President
J.D. Finley,                       6,050     52,443    125,000       
183,493                7.0%
Executive Vice President
Craig Sloan                        2,420                               
2,420                0.1%
Vice President - Operations
James Dignan,                                           20,000        
20,000                0.7%
Vice President - Acquisitions
Mike McGetrick, Director                                 5,000         
5,000                0.2%
Robert Winsor, IV, Director                              5,000         
5,000                0.2%
Ernie Banks, Director                         8,152                    
8,152                0.3%
Jack F Lasday, Director                      13,206                   
13,206                0.5%
                              -------------------------------------
------------------------------ 
All Officers and Directors
   as a Group                   694,092      94,155    278,506     
1,096,753               37.8%
                              
===================================================================
<FN>
(1)    Does not include (i) the 567,875 shares issuable upon 
conversion of the notes and warrants issued in connection with the 
acquisition of the limited partnership interests in ICGP and GCGP, 
(ii) the 117,500 shares issuable upon conversion of the 
Representative's Warrants, (iii) $962,500 aggregate principal 
amount of PP Notes convertible at 50% of then market price, or (iv) 
167,000 shares of Common Stock available for future grant under the 
Stock Option Plan.  Includes the stock options issued to Messrs. 
Tourtellotte and Finley under the Executive Option Plan.
</TABLE>

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Charles Tourtellotte, President of the Company is indebted to the 
Company in the amount of $82,511 as of December 31, 1996.  From 
time to time, the Company has made loans to Mr. Tourtellotte 
against deferred compensation or in anticipation, but in advance, 
of Mr. Tourtellotte earning bonus or other extraordinary 
compensation.  Such loans were made for the bona fide business 
purposes of inducing Mr. Tourtellotte to continue to devote 
substantial time to the Company and allowing the Company to 
continue to defer payment of his compensation thus increasing the 
Company's available cash. These loans are evidenced by a note 
agreement. The note bears interest at 8% per annum and is due on 
demand. The total original principal amount of these loans is 
$152,638 and as of December 31, 1996, the outstanding balance on 
the note was $82,511. Mr. Tourtellotte has paid the required 
amounts under the loans when due. Mr. Tourtellotte's employment 
contract also specifies that any unpaid balance on the note must be 
repaid from the $125,000 Mr. Tourtellotte may receive upon receipt 
of the contingent portion of the Company's development fee for 
Illinois Center Golf described under "Executive Compensation."  
This $125,000 is payable by ICGP upon the complete repayment of 
capital to the limited partner investors, plus a preferred return 
of 15% per annum. Because of this financial structure, this payment 
is not expected to be received before 1999, if at all. Any further 
loans to Mr. Tourtellotte will be approved by the Board of 
Directors and will be made only if the aggregate of all outstanding 
loans do not exceed the amount of reasonably anticipated 
compensation owed to him, which may include the balance of the 
$125,000 of deferred compensation referred to above. Mr. 
Tourtellotte has personally guaranteed $5.12 million of 
indebtedness of ICGP and GCGP. 


ITEM 14. EXHIBITS

     (a)     The following documents are filed as part of this 
Annual Report on Form 10-K.

     1.      Financial Statements:  The financial statements of the 
Company are included in item 8 of this report.  See Index to 
Financial Statements on page F-1.

     2.      Financial Statement Schedules:  Financial statement 
schedules required under the related instructions are applicable 
for the years ended December 31, 1996, 1995 and 1994, and are 
therefore included in Item 8.

     3.      Exhibits:  The exhibits which are filed with this 
Report or which are incorporated herein by reference are set forth 
below.

     3.1     Articles of Incorporation, as amended, incorporated 
herein by reference from the Registrant's Offering Statement on 
Form 1-A (File No. 24D-3840)("Form 1-A") with June 3, 1996 
amendment filed as Exhibit 3.1 to Registrant's Form S-1 (Reg. No. 
333-06151) as filed with as filed with the Securities and Exchange 
Commission on June 17, 1996 (together with Amendments 1, 2, and 3 
thereto , the "Form S-1")

     3.2     Bylaws, incorporated herein by reference from the Form 
1-A 

     4       Specimen Common Stock Certificate of MetroGolf 
Incorporated (incorporated by reference to Exhibit 4 to Form S-1)

     4.1     Form of Note Purchase Agreement dated May 8, 1996 
between The Vintage Group USA, Ltd. and the Purchasers of its 12% 
Convertible Subordinated Notes due 1997 (the PP Notes) 
(incorporated by reference to Exhibit 4.2 to Form S-1)

     10.1    Employment Agreement between the Company and Charles 
D. Tourtellotte effective as of January 1, 1996 (incorporated by 
reference to Exhibit 10.1 to Form S-1)

     10.2    Employment Agreement between the Company and J.D. 
Finley effective as of January 1, 1996 (incorporated by reference 
to Exhibit 10.2 to Form S-1)

     10.3    Employment Agreement between the Company and James K. 
Dignan effective as of July 1, 1996 (incorporated by reference to 
Exhibit 10.3 to Form S-1)

     10.4(a) Form of outstanding Warrant Certificates, incorporated 
herein to Form 1-A

     10.4(b) Warrant Agreement, incorporated herein by reference to 
Form 1-A

     10.7    Agreement of Limited Partnership of Illinois Center 
Golf Partners L.P., incorporated herein by reference to Form 1-A

     10.8    Ground Sublease and Sublicense Agreement for Illinois 
Center Golf Facilities between Illinois Center Golf Partners L.P. 
and Illinois Center Plaza Venture, as amended, incorporated herein 
by reference to Form 1-A

     10.9    Agreement of Limited Partnership of Goose Creek Golf 
Partners Limited Partnership, incorporated herein by reference to 
Form 1-A

     10.10   Credit Line Deed of Trust for the benefit of Textron 
Financial Corporation, incorporated herein by reference to Form 1-A

     10.11   Port Authority Letter Agreement, incorporated herein 
by reference to Form 1-A

     10.12   Operating Agreement of Vintage New York Golf L.L.C., 
incorporated herein by reference to Form 1-A

     10.13   Agreement of Purchase and Sale between Robert Selleck 
and Fremont Golf Partnership and The Vintage Group USA Ltd. dated 
as of March 19, 1996 (incorporated by reference to Exhibit 10.13 to 
Form S-1)

     10.14   Letter of Intent relating to Harborside Golf Center 
from The Vintage Group USA Ltd. to Shapery Enterprises dated March 
18, 1996 (incorporated by reference to Exhibit 10.14 to Form S-1)

     10.15   Management Agreement between MetroGolf Management, 
Inc. and Illinois Center Golf, incorporated herein by reference to 
Form 1-A

     10.16   Settlement Agreement relating to 15% interest in 
Illinois Center Golf and Goose Creek, incorporated herein by 
reference to Form 1-A

     10.17   Company's 1996 Stock Option and Stock Bonus Plan 
(incorporated by reference to Exhibit 10.17 to Form S-1)

     10.18   Management Agreement between MetroGolf Management, 
Inc. and the Company dated July 1, 1996 relating to Fremont Golf 
Center (incorporated by reference to Exhibit 10.18 to Form S-1)

     10.19   Management Agreement between MetroGolf Management, 
Inc. and MetroGolf (San Diego) Incorporated dated July 1, 1996 
relating to Harborside Golf Center (incorporated by reference to 
Exhibit 10.19 to Form S-1)

     10.20   Form of Note from the Company to the limited partners 
of ICGP that accept the Offer to Purchase (incorporated by 
reference to Exhibit 10.20 to Form S-1)

     10.21   Form of Warrant from the Company to the limited 
partners of ICGP that accept the Offer to Purchase (incorporated by 
reference to Exhibit 10.21 to Form S-1)

     10.22   Form of Note from the Company to the limited partners 
of GCGP that accept the Offer to Purchase (incorporated by 
reference to Exhibit 10.22 to Form S-1)

     10.23   Company's Senior Executive Incentive Stock Option Plan 
(incorporated by reference to Exhibit 10.23 to Form S-1)

     10.24   Golf Facility Lease by and between The City of Fremont 
California and MetroGolf Incorporated dated April 2, 1997 **

     10.25   Fifth Amendment to Ground Sublease and Sublease 
Agreement for Illinois Center Golf Facilities dated January 31, 
1996 amending Exhibit 10.8 (incorporated by reference to Exhibit 
10.25 to Form S-1)

     11      Statement re Computation of per share earnings

     21      Subsidiaries of the Registrant (incorporated by 
reference to Exhibit 21 to Form S-1)

     27.1    Financial Data Schedules (incorporated by reference to 
Exhibit 27.1 to Form S-1)
             (I)   MetroGolf Incorporated and Subsidiaries
                   Report of Independent Certified Public 
Accountants
              Schedule II - Valuation and Qualifying Accounts

      ** - filed herewith


     (b)     The following  Form 8-K's were filed during the fourth 
quarter of the Company's fiscal year:

     (1)     On November 12, 1996, the Company filed a Form 8-K 
announcing the successful completion of its Initial Public Offering

     (2)     On November  13, 1996, the Company filed a Form 8-K 
incorporating a press release issued October 23, 1996 by the 
Company



MetroGolf Incorporated
Exhibit 11
Statement Re: Computation of Earnings Per Share


Historical weighted average number of shares outstanding is 
summarized as follows:

                               1996     1995 & 1994
                              -------  -------------
Common stock outstanding      982,055      680,782
                             ---------    ---------
Warrants outstanding          288,160      288,160
Less treasury stock that 
could be repurchased with
proceeds of exercised
warrants                     (106,744)     (91,800)
                             ---------    ---------
Assumed exercise of warrants  181,416      196,360
                             ---------    ---------
Historical weighted average
number of common shares
outstanding                 1,163,471      877,142
                            ==========    =========

Primary and Fully Diluted Earnings Per Share

                                  For the Years Ended Dec. 31,
                             1996        1995         1994
Loss applicable to 
common stock           $(2,077,592)   $(687,164)   $(315,490)
                       ============   ==========   ==========
Weighted average 
number of common 
shares outstanding       1,163,471      877,142      877,142
                       ============   ==========   ==========

Primary and Fully 
Diluted Earnings 
Per Share              $    (1.79)    $   (0.78)   $   (0.36)
                       ============   ==========   ==========



SIGNATURES



Pursuant to the requirements of Section 13 or 15(d) of the 
Securities Exchange Act of 1934, the registrant has duly caused 
this report to be signed on its behalf by the undersigned, 
thereunto duly authorized.



MetroGolf Incorporated

By:   /s/ Charles D. Tourtellotte
     ----------------------------
     Charles D. Tourtellotte
     Chairman, Chief Executive Officer, and President

Date:     April 28, 1997
         ----------------

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


                                            MetroGolf Incorporated



DATE:  April 28, 1997      /s/ Charles D. Tourtellotte
      ----------------    -----------------------------
                          Charles D. Tourtellotte
                          Chairman, Chief Executive Officer,
                          President, (Principal Executive Officer),
                          and Director


DATE:  April 28, 1997      /s/ J.D. Finley
      ----------------    -----------------
                          J.D. Finley
                          Exec. Vice President and Chief Financial 
                          Officer (Principal Financial Officer)


DATE:  April 28, 1997      /s/ Jack F. Lasday
      ----------------    --------------------
                          Jack F. Lasday
                          Director


DATE:  April 28, 1997      /s/ Michael McGetrick
      ----------------    -----------------------
                          Michael McGetrick
                          Director