<PAGE>
 
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   Form 10-Q

(Mark One)

[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934

For the quarterly period ended September 30, 1998 or

[ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934

For the transition period from__________________to__________________

Commission file number 0-27888

             Wells Real Estate Fund VIII, L.P.
--------------------------------------------------------------
   (Exact name of registrant as specified in its charter)

               Georgia                       58-2126618
-------------------------------         -------------------
(State of other jurisdiction of         (I.R.S. Employer
incorporation or organization)          Identification no.)

 3885 Holcomb Bridge Road, Norcross, Georgia                         30092
-------------------------------------------------------------------------------
(Address of principal executive offices)                           (Zip Code)

Registrant's telephone number, including area code (770) 449-7800


_______________________________________________________________________________
       (Former name, former address and former fiscal year,
       if changed since last report)

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

Yes  X        No
    ---          ---

                                       1
<PAGE>
 
                                   Form 10-Q
                                   ---------

                       Wells Real Estate Fund VIII, L.P.
                       ---------------------------------

                                     INDEX
                                     -----

                                                                        Page No.
                                                                        --------

PART I.   FINANCIAL INFORMATION

             Item 1.  Financial Statements

                       Balance Sheets - September 30, 1998
                       and December 31, 1997 ..............................  3
                                                                             
                       Statements of Income for the Three and Nine           
                       Months Ended September 30, 1998                       
                       and 1997 ...........................................  4
                                                                             
                       Statement of Partners' Capital                        
                       for the Year Ended December 31, 1997,                 
                       and the Nine Months Ended September 30, 1998........  5
                                                                             
                       Statements of Cash Flows for the Nine Months          
                       Ended September 30, 1998 and 1997...................  6
                                                                             
                       Condensed Notes to Financial Statements.............  7
                                                                             
             Item 2.  Management's Discussion and Analysis of                
                       Financial Condition and Results of                    
                       Operations..........................................  8
                                                                             
PART II.  OTHER INFORMATION................................................ 19

                                       2
<PAGE>
 
                       WELLS REAL ESTATE FUND VIII, L.P.
                    (A GEORGIA PUBLIC LIMITED PARTNERSHIP)

                                BALANCE SHEETS

<TABLE>
<CAPTION>
                   Assets                             September 30, 1998              December 31, 1997
                   ------                             ------------------              -----------------       
<S>                                                   <C>                             <C>  
Investment in joint ventures (Note 2)                      $ 25,674,665                 $ 24,501,876        
Cash and cash equivalents                                        41,928                    1,848,493        
Due from affiliates                                             545,923                      548,507        
Deferred project costs                                            2,751                      103,318        
Organization costs, less accumulated                                                                        
  amortization of $18,750 in 1997                                                                           
  and $23,439 in September 1998                                   7,813                       12,500        
Prepaid expenses and other assets                                     0                        7,000        
                                                             ----------                   ----------        
          Total assets                                     $ 26,273,080                 $ 27,021,694           
                                                             ==========                   ==========        
                                                                                
          Liabilities and Partners' Capital                                     
          ---------------------------------                                     
                                                                                
Liabilities:                                                                    
  Partnership distribution payable                         $    573,351                 $    530,714           
                                                             ----------                   ----------           
Partners' capital:                                                                                             
    Limited partners:                                                                                          
      Class A - 2,657,026 units outstanding                  22,980,022                   22,828,363           
     Class B - 546,243 units outstanding                      2,719,707                    3,662,617           
                                                             ----------                   ----------           
                                                                                                               
          Total partners' capital                            25,699,729                   26,490,980           
                                                             ----------                   ----------           
                                                                                                               
          Total liabilities and partners' capital          $ 26,273,080                 $ 27,021,694          
                                                             ==========                   ==========           
</TABLE>

           See accompanying condensed notes to financial statements.

                                       3
<PAGE>
 
                       WELLS REAL ESTATE FUND VIII, L.P.
                    (A GEORGIA PUBLIC LIMITED PARTNERSHIP)

                             STATEMENTS OF INCOME

<TABLE>
<CAPTION>
                                              Three Months Ended                      Nine Months Ended            
                                    --------------------------------------  -------------------------------------
                                    September 30, 1998  September 30, 1997  September 30, 1998  September 30,1997 
                                    ------------------  ------------------  ------------------  -----------------  
<S>                                 <C>                 <C>                 <C>                 <C> 
Revenues:
  Equity earnings of  joint
   ventures (Note 2)                    $ 288,768           $ 365,080            $  950,061         $  723,257   
  Interest income                              36              29,101                16,145            149,399  
                                        ---------           ---------            ----------         ----------  
                                          288,804             394,181               966,206            872,656  
                                        ---------           ---------            ----------         ----------  
                                                                                                                
Expenses:                                                                                                       
  Legal and accounting                        338               1,180                14,848             23,051  
  Computer costs                            2,341               3,069                 6,195              7,413  
  Partnership administration               18,568               6,161                42,773             49,030  
  Amortization of                                                                                               
   organization costs                       1,562               1,562                 4,687              4,687  
                                        ---------           ---------            ----------         ----------  
                                           22,809              11,972                68,503             84,181  
                                        ---------           ---------            ----------         ----------  
  Net income                            $ 265,995           $ 382,209            $  897,703         $  788,475  
                                        =========           =========            ==========         ==========  
                                                                                                                
Net loss allocated to General                                                                                   
 Partners                               $       0           $       0            $        0         $        0  
                                                                                                                
Net income allocated to                                                                                         
 Class A Limited Partners               $ 592,469           $ 630,233            $1,794,965         $1,381,646  
                                                                                                                
Net loss allocated to Class                                                                                     
 B Limited Partners                     $(326,474)          $(248,024)           $ (897,262)        $ (593,171) 
                                                                                                                
Net income per Class A                                                                                          
 Limited Partner Unit                   $    0.22           $    0.24            $     0.67         $     0.52  
                                                                                                                
Net loss per Class B Limited                                                                                    
 Partner Unit                           $   (0.60)          $   (0.44)           $    (1.62)        $    (1.05) 
                                                                                                                
Cash distribution per Class A                                                                                   
 Limited Partner Unit                   $    0.22           $    0.19            $     0.64         $     0.42   
</TABLE>

           See accompanying condensed notes to financial statements.

                                       4
<PAGE>
 
                       WELLS REAL ESTATE FUND VIII, L.P.
                    (A GEORGIA PUBLIC LIMITED PARTNERSHIP)

                        STATEMENTS OF PARTNERS' CAPITAL
          FOR THE YEAR ENDED DECEMBER 31, 1997 AND  NINE MONTHS ENDED
                              SEPTEMBER 30, 1998



<TABLE>
<CAPTION>
                                                             LIMITED PARTNERS                                 TOTAL
                                             -------------------------------------------------
                                                      CLASS A                  CLASS B          GENERAL     PARTNERS'
                                                      -------                  -------         
                                  ORIGINAL     UNITS        AMOUNTS      UNITS      AMOUNTS     PARTNERS     CAPITAL
                                  --------     -----        -------      -----      -------     --------     -------   
<S>                               <C>        <C>          <C>         <C>          <C>        <C>          <C> 
BALANCE,
   DECEMBER 31, 1996                 $ 100   2,622,636    $22,367,784   581,633    $4,662,896         $0   $27,030,780
 
   Net income (loss)                     0           0      1,947,536         0      (844,969)         0     1,102,567
   Partnership distributions             0           0     (1,633,767)        0             0          0    (1,633,767)
   Class B conversion elections          0      22,044        155,310   (22,044)     (155,310)         0             0
   Return of capital                  (100)     (1,000)        (8,500)        0             0          0        (8,600)
                                     -----   ---------    -----------   -------    ----------         --   -----------
BALANCE,
   DECEMBER 31, 1997                     0   2,643,680     22,828,363   559,589     3,662,617          0    26,490,980
 
   Net income (loss)                     0           0      1,794,965         0      (897,262)         0       897,703
   Partnership distributions             0           0     (1,688,954)        0             0          0    (1,688,954)
   Class B conversion elections          0      13,346         45,648   (13,346)      (45,648)         0             0
                                     -----   ---------    -----------   -------    ----------         --   -----------
BALANCE,
   SEPTEMBER 30, 1998                $   0   2,657,026    $22,980,022   546,243    $2,719,707         $0   $25,699,729
                                     =====   =========    ===========   =======    ==========         ==   ===========
</TABLE>

           See accompanying condensed notes to financial statements.
                                        

                                       5
<PAGE>
 
                       WELLS REAL ESTATE FUND VIII, L.P.
                     (A GEORGIA PUBLIC LIMITED PARTNERSHIP)

                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                        For the Nine Months Ended
                                                                        -------------------------                         
                                                           September 30, 1998                  September 30, 1997
                                                           ------------------                  ------------------        
<S>                                                        <C>                                 <C> 
Cash flow from operating activities:
Net income                                                   $   897,703                          $    788,475
  Adjustments to reconcile net income to net                                             
   cash used in operating activities:                                                    
    Equity in income of joint ventures                          (950,061)                             (723,257)
    Amortization of organization costs                             4,687                                 4,687
  Changes in assets and liabilities:                                                     
   Prepaid expenses and other assets                               7,000                                90,000
   Accounts payable                                                    0                                (5,482)
   Due to affiliates                                                   0                              (152,501)
                                                             -----------                          ------------
          Net cash (used in) provided by                                                 
          operating activities                                   (40,671)                                1,922
                                                             -----------                          ------------ 
                                                                                         
Cash flows from investing activities:                                                    
  Distributions received from joint ventures                   1,731,211                               751,034
  Investment in joint ventures                                (1,850,788)                          (10,675,811)
                                                             -----------                          ------------
           Net cash used in investing activities                (119,577)                           (9,924,777)
                                                             -----------                          ------------
                                                                                         
Cash flows from financing activities:                                                   
  Distributions to partners from accumulated earnings         (1,646,317)                             (923,767)
  Return of original limited  partner investment                       0                                (8,500)
                                                             -----------                          ------------
  Net cash used in financing activities                       (1,646,317)                             (932,267)
                                                             -----------                          ------------
                                                                                         
Net decrease cash and cash equivalents                        (1,806,565)                          (10,855,122)
                                                                                         
Cash and cash equivalents, beginning of year                   1,848,493                            12,716,219
                                                             -----------                          ------------
                                                                                         
Cash and cash equivalents, end of period                     $    41,928                          $  1,861,097
                                                             ===========                          ============
Supplemental disclosure of noncash                                                     
 investing activities:                                                                
  Deferred project costs applied to joint                                          
    venture property                                         $   100,567                          $    593,983
                                                             ===========                          ============
 </TABLE>

                                       6
<PAGE>
 
                       WELLS REAL ESTATE FUND VIII, L.P.
                    (A Georgia Public Limited Partnership)

                    Condensed Notes to Financial Statement
                                        
                              September 30, 1998

(1)  Summary of Significant Accounting Policies
     ------------------------------------------
 
     (a) General
     -----------
 
     Wells Real Estate Fund VIII, L.P. (the "Partnership") is a Georgia public
     limited partnership having Leo F. Wells, III and Wells Partners, L.P., as
     General Partners. The Partnership was formed on August 15, 1994, for the
     purpose of acquiring, developing, owning, operating, improving, leasing,
     and otherwise managing for investment purposes income producing commercial
     properties.
     
     On January 6, 1995, the Partnership commenced a public offering of up to
     $35,000,000 of limited partnership units ($10.00 per unit) pursuant to a
     Registration Statement on Form S-11 filed under the Securities Act of 1933.
     The Partnership commenced active operations on February 24, 1997, when it
     received and accepted subscriptions for 125,000 units. The offering was
     terminated on January 4, 1997, at which time the Partnership had sold
     2,613,534 Class A Status Units, and 590,735 Class B Status Units, held by a
     total of 1,939 and 302 Limited Partners, respectively, for total Limited
     Partner capital contributions of $32,042,689.

     The Partnership owns interests in the following properties through its
     equity ownership in the following joint ventures: (i) Fund VII and Fund
     VIII Associates, a joint venture between the Partnership and Wells Real
     Estate Fund VII, L.P. (the "Fund VII-Fund VIII Joint Venture"); (ii) Fund
     VI, Fund VII and Fund VIII Associates, a joint venture among the
     Partnership and Wells Real Estate Fund VI, L.P., and Wells Real Estate Fund
     VII, L.P. (the "Fund VI-VII-VIII Joint Venture"); and (iii) Fund VIII and
     Fund IX Associates, a joint venture between the Partnership and Wells Real
     Estate Fund IX, L.P. (the "Fund VIII-Fund IX Joint Venture").

     As of September 30, 1998, the Partnership owned interests in the following
     properties through its ownership in the foregoing joint ventures: (i) a
     single-story retail/office building located in Clayton County, Georgia (the
     "Hannover Center") and (ii) a two-story office building located in
     Gainesville, Florida (the "CH2M Hill") which are owned by the Fund VII-Fund
     VIII Joint Venture; (iii) a four-story office building located in
     Jacksonville, Florida (the "BellSouth Building") and (iv) a retail shopping
     center located in Clemmons, North Carolina (the "Tanglewood Commons") which
     are owned by the Fund VI-VII-VIII Joint Venture; and (v) a four-story
     office building located in Madison, Wisconsin (the "US Cellular Building"),
     (vi) a one-story office building located in Farmers Branch, Texas (the "TCI
     Building"), (vii) a two-story office building located in Orange County,
     California (the "Matsushita Building"), and (viii) a two-story office
     building located in

                                       7
<PAGE>
 
     Boulder County, Colorado (the "Cirrus Logic Building") which are owned by
     the Fund VIII-Fund IX Joint Venture.

     All of the foregoing properties were acquired on an all cash basis. For
     further information regarding these joint ventures and properties, refer to
     the Partnership's Form 10-K for the year ended December 31, 1997.

     (b) Basis of Presentation
     -------------------------

     The financial statements of Wells Real Estate Fund VIII, L.P. (the
     "Partnership") have been prepared in accordance with instructions to Form
     10-Q and do not include all of the information and footnotes required by
     generally accepted accounting principles for complete financial statements.
     These quarterly statements have not been examined by independent
     accountants, but in the opinion of the General Partners, the statements for
     the unaudited interim periods presented include all adjustments, which are
     of a normal and recurring nature, necessary to present a fair presentation
     of the results for such periods. For further information, refer to the
     financial statements and footnotes included in the Partnership's Form 10-K
     for the year ended December 31, 1997.

2)   Investment in Joint Ventures
     ----------------------------

     The Partnership owns interests in six office buildings and two retail
     centers through its ownership in joint ventures. The Partnership does not
     have control over the operations of the joint ventures; however, it does
     exercise significant influence. Accordingly, investment in joint ventures
     is recorded on the equity method. For further information, refer to the
     financial statements and footnotes included in the Partnership's Form 10-K
     for the year ended December 31, 1997.

     ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
     -------------------------------------------------------------------------
     RESULTS OF OPERATION.
     ---------------------

     The following discussion and analysis should be read in conjunction with
     the accompanying financial statements of the Partnership and notes thereto.
     This Report contains forward-looking statements, within the meaning of
     Section 27A of the Securities Act of 1933 and 21E of the Securities
     Exchange Act of 1934, including discussion and analysis of the financial
     condition of the Partnership, anticipated capital expenditures required to
     complete certain projects, amounts of cash distributions anticipated to be
     distributed to Limited Partners in the future and certain other matters.
     Readers of this Report should be aware that there are various factors that
     could cause actual results to differ materially from any forward-looking
     statement made in this Report, which include construction costs which may
     exceed estimates, construction delays, lease-up risks, inability to obtain
     new tenants upon expiration of existing leases, and the potential need to
     fund tenant improvements or other capital expenditures out of operating
     cash flow. 

                                       8
<PAGE>
 
     RESULTS OF OPERATIONS AND CHANGES IN FINANCIAL CONDITIONS
     ---------------------------------------------------------

     (a) General
     -----------

     As of September 30, 1998, the properties owned by the Partnership were 97%
     occupied. Gross revenues of the Partnership were $966,206 for the nine
     months ended September 30, 1998, as compared to $872,656 for the nine
     months ended September 30, 1997. The increase was attributable primarily to
     increased income from joint ventures offset partially by decreased interest
     income earned on funds held by the Partnership prior to the investment in
     joint venture. Expenses of the Partnership decreased to $68,503 for the
     nine months ended September 30, 1998, compared to $84,181 for the same
     period in 1997, as the result of decreased expenses primarily in legal,
     printing and postage. Net income of the Partnership was $897,703 for the
     nine months ended September 30, 1998, as compared to $788,475 for the nine
     months ended September 30, 1997.

     The Partnership's net cash used in operating activities decreased to
     $(40,671) for 1998 as compared to $1,922 for 1997. The decrease is due
     primarily to a decrease in payments to affiliates and prepaid items offset
     by decreased interest earned on funds held by the Partnership prior to
     investment in properties. Net cash used in investing activities decreased
     to $119,577 for 1998 from $9,924,777 in 1997 due primarily to decreased
     investments in joint ventures, offset by increased distributions from joint
     ventures. Net cash used in financing activities increased from 1997 due to
     increased distributions to partners. Cash and cash equivalents decreased
     from $1,861,097 at September 30, 1997 to $41,928 for the same period in
     1998.

     The Partnership's distributions from Investment Income accrued to Class A
     Unit holders for the third quarter of 1998 was $0.22 per Class A Unit as
     compared to distributions of $.19 per Class A Unit for the third quarter of
     1997.

     The General Partners have verified that all operational computer systems
     are year 2000 compliant. This includes systems supporting accounting,
     property management and investor services. Also, as part of this review,
     all building control systems have been verified as compliant. The current
     line of business applications are based on compliant operating systems and
     database servers. All of these products are scheduled for additional
     upgrades before the year 2000. Therefore, it is not anticipated that the
     year 2000 will have significant impact on operations.

     The Partnership expects to continue to meet its short-term liquidity
     requirements generally through net cash provided by operations which the
     Partnership believes will continue to be adequate to meet both operating
     requirements and distributions to limited partners. At this time, given the
     nature of the joint ventures in which the Partnership has invested, there
     are no known improvements or renovations to the properties expected to be
     funded from cash flow from operations.


     Recent Accounting Pronouncements
     --------------------------------

     Statement of Financial Accounting Standards (SFAS) No. 130, "Reporting
     Comprehensive Income", requires certain transactions (e.g., unrealized
     gains/losses on available for sale securities) 

                                       9
<PAGE>
 
     that are not reflected in net income to be displayed as other comprehensive
     income. The Statement also requires an entity to report total comprehensive
     income (i.e., net income plus other comprehensive income) for every period
     in which an income statement is presented. SFAS No. 130 is effective for
     annual and interim periods beginning after December 15, 1997. None of the
     transactions required to be reported in other comprehensive income pertain
     to the Partnership; consequently, adoption of this Statement had no impact
     on the partnership's disclosures.

     Effective April 3, 1998, the American Institute of Certified Public
     Accountants issued Statement of Position (SOP) 98-5, "Reporting on the
     Costs of Start-Up Activities". SOP 98-5 is effective for fiscal years
     beginning after December 15, 1998, and initial application is required to
     be reported as a cumulative effect of change in accounting principle. This
     SOP provides guidance on the financial reporting of start-up costs and
     organization costs. It requires costs of start-up activities and
     organization costs to be expensed as incurred. Adoption of this Statement
     by the Partnership in the first quarter of 1999 may result in the write-off
     of certain capitalized organization costs. Adoption of this Statement is
     not expected to have a material impact on the Partnership's results of
     operations and financial condition.

                                       10
<PAGE>
 
     PROPERTY OPERATIONS
     -------------------
 
     As of September 30, 1998, the Partnership owned interests in the following
     operational properties:

     CH2M Hill/Fund VII - Fund VIII Joint Venture
     --------------------------------------------

<TABLE>
<CAPTION>
                                                              Three Months Ended                   Nine Months Ended
                                                      ----------------------------------   ---------------------------------
                                                       Sept. 30, 1998    Sept. 30, 1997     Sept. 30, 1998   Sept. 30, 1997
                                                      ----------------  ----------------   ----------------  ---------------
<S>                                                   <C>               <C>                <C>               <C>
     Revenues:
       Rental income                                   $      143,832     $    132,578        $    420,850     $     397,735
                                                       --------------     ------------        ------------     -------------
      Expenses:
       Depreciation                                            68,946           56,025             182,837           162,157
       Management & leasing expenses                           14,330           21,473              65,019            64,090
       Other operating expenses                                14,902          (25,759)             43,967           (60,032)
                                                       --------------     ------------        ------------     -------------
                                                               98,178           51,739             291,823           166,215
                                                       --------------     ------------        ------------     -------------

     Net income                                        $       45,654     $     80,839        $    129,027     $     231,520
                                                       ==============     ============        ============     =============

     Occupied %                                                   100%              94%                100%               94%

     Partnership's Ownership % in the
     Fund VII-VIII Joint Venture                                 63.3%            62.0%               63.3%             62.0%

     Cash distribution to Partnership                  $       74,018     $     85,609        $    197,514     $     246,334

     Net income allocated to the
       Partnership                                     $       28,892     $     50,157        $     81,197     $     143,649
</TABLE>

     Rental income increased in 1998, as compared to 1997, due to a new tenant
     occupying the remaining space in the building in late March 1998.
     Depreciation, management and leasing expenses increased compared to 1997,
     due primarily to the increased occupancy. Other operating expenses
     increased for the nine months ended September 30, 1998, as compared to the
     same period of 1997, due primarily to a decrease in CAM reimbursements,
     which is the result of a refund to the tenant of property taxes overpaid in
     1997 which was identified during a CAM reconciliation process performed
     after year end. Income and distribution to the Partnership have decreased
     primarily due to refund of taxes to the tenant noted above.

                                       11
<PAGE>
 
BellSouth Building/Fund VI - Fund VII-Fund VIII Joint Venture
-------------------------------------------------------------


<TABLE>
<CAPTION>
                                           Three Months Ended                        Nine Months Ended
                                ----------------------------------------  ----------------------------------------
                                September 30, 1998   September 30, 1997   September 30, 1998   September 30, 1997
                                -------------------  -------------------  -------------------  -------------------
<S>                             <C>                  <C>                  <C>                  <C> 
Revenues:
 Rental income                            $380,278             $350,461           $1,140,832           $1,137,024
 Interest income                             2,096                2,097                6,268                6,114
                                          --------             --------           ----------           ----------
                                           382,374              352,558            1,147,100            1,143,138
                                          --------             --------           ----------           ----------
 
Expenses:
 Depreciation                              110,985              110,889              332,827              332,667
 Management & leasing
  expenses                                  47,414               47,095              142,610              143,554
 Other operating expenses                  121,718               85,739              311,783              312,986
                                          --------             --------           ----------           ----------
                                           280,117              243,723              787,220              789,207
                                          --------             --------           ----------           ----------
 
Net income                                $102,257             $108,835           $  359,880           $  353,931
                                          ========             ========           ==========           ==========
 
Occupied %                                   100.0%               100.0%               100.0%               100.0%
 
Partnership's Ownership %
 in the Fund VI - Fund VII  -
 Fund VIII Joint Venture                      32.3%                32.3%                32.3%                32.3%
 
 
 
Cash distribution to
   Partnership                            $ 71,693             $ 71,099           $  232,220           $  211,619
 
Net income allocated to the
   Partnership                            $ 33,085             $ 33,774           $  116,438           $  105,000
</TABLE>

Net income has increased slightly in 1998 as compared to 1997.  Cash
distributions allocated to the Partnership increased in 1998 as compared to
1997, due primarily to additional funding by the Partnership in early 1997,
which increased the Partnership's ownership interest in the Fund VI - VII - VIII
Joint Venture.

                                       12
<PAGE>
 
The Hannover Center/Fund VII - Fund VIII Joint Venture
------------------------------------------------------

<TABLE>
<CAPTION>
                                                     Three Months Ended                    Nine Months Ended
                                              -------------------------------       --------------------------------
                                              Sept. 30, 1998   Sept. 30, 1997       Sept.  30, 1998   Sept. 30, 1997
                                              --------------   --------------       ---------------   --------------
<S>                                           <C>              <C>                  <C>               <C>
Revenues:
   Rental income                                 $  26,061        $  26,061            $  78,183         $  81,318
                                                 ---------        ---------            ---------         ---------
Expenses:
   Depreciation                                     10,981           10,981               32,944            32,944
   Management & leasing expenses                     2,661            2,775                7,983             7,779
   Other operating expenses                          2,133            4,872               16,422            19,025
                                                 ---------        ---------            ---------         ---------
                                                    15,775           18,628               57,349            59,748
                                                 ---------        ---------            ---------         ---------

Net income                                       $  10,286        $   7,433            $  20,834         $  21,570
                                                 =========        =========            =========         =========

Occupied %                                              50%              50%                  50%               50%

Partnership's Ownership % in the
   Fund VII - VIII Joint Venture                      63.3%            62.0%                63.3%             62.0%

Cash distribution to Partnership                 $ (14,582)       $  10,446            $   3,698         $  28,634

Net income allocated to the
   Partnership                                   $   6,513        $   4,611            $  13,143         $  13,383
</TABLE>

On April 1, 1996, Fund VII-Fund VIII Joint Venture acquired a 1.01 acre tract of
land and a 12,000 square foot combination retail/office building known as the
Hannover Retail Center (the "Hannover Center").

Moovies, Inc., a video sales and rental store, signed a nine year, eleven month
lease for 6,020 square feet and occupied the space and opened for business on
June 22, 1996. As of September 30, 1998, the remaining space at the Hannover
Center had been leased.

Rental income decreased for 1998, compared to 1997, due to a correction in
straight line rent made in the first quarter of 1997.  Expenses remained
relatively stable and the decrease in net income was primarily the result of the
aforementioned straight line adjustment.  Distributions decreased for the nine
months ended September 30, 1998 as compared to the same period in 1997 due
primarily to construction being funded by operating cash flow.

                                       13
<PAGE>
 
Tanglewood Commons/Fund VI-VII-VIII Joint Venture
-------------------------------------------------

<TABLE>
<CAPTION>
                                           Three Months Ended         Nine Mths Ended    Eight Mths Ended
                                     ------------------------------  -------------------------------------
                                     Sept. 30, 1998    Sept. 30, 1997     Sept. 30, 1998   Sept. 30, 1997
                                     ---------------  -----------------  ----------------  ---------------
<S>                                  <C>              <C>                <C>               <C> 
Revenues:
  Rental income                            $183,587       $172,682              $548,339         $382,265
  Interest income                             4,345          3,890                14,070           10,275
                                           --------       --------              --------         --------
                                            187,932        176,572               562,409          392,540
                                           --------       --------              --------         --------
 
Expenses:
  Depreciation                               61,235         53,435               182,721          135,686
  Management & leasing expenses              14,953         13,390                44,804           26,727
  Other operating expenses                   19,150         20,740                24,380           72,352
                                           --------       --------              --------         --------
                                             95,338         87,565               251,905          234,765
                                           --------       --------              --------         --------
 
Net income                                 $ 92,594       $ 89,007              $310,504         $157,775
                                           ========       ========              ========         ========
 
Occupied %                                       90%            78%                   90%              78%
 
Partnership's Ownership % in the
   Fund VI - VII - Fund VIII Joint
    Venture                                    32.3%          32.3%                 32.3%            32.3%
 
 
Cash distribution to Partnership           $ 49,401       $ 41,269              $158,693         $ 72,048
 
Net income allocated to the
   Partnership                             $ 29,958       $ 27,705              $100,462         $ 48,607
</TABLE>

On May 31, 1995, the Fund VI-VII-VIII Joint Venture purchased a 14.683 acre
tract of real property located in Clemmons, Forsyth County, North Carolina.
Total cost and expenses to be incurred by the Fund VI-VII-VIII Joint Venture for
the acquisition, development, construction and completion of the shopping center
are anticipated to be approximately $8,700,000.

The Fund VI-VII-VIII Joint Venture developed a large strip shopping center
building containing approximately 67,320 gross square feet which opened on
February 26, 1997, on a 12.48 acre tract.   The remaining 2.2 acre portion of
the property will remain in a vegetative or natural state.

In February 1997, Harris Teeter, Inc., a regional supermarket chain, occupied
its leased space of 46,120 square feet with an initial term of 20 years.  The
annual base rent during the initial term is $488,250.  In addition, Harris
Teeter has agreed to pay percentage rents equal to one percent of the amount by
which Harris Teeter's gross sales exceed $35,000,000 for any lease year.

Since this property commenced operations in February 1997, comparable income and
expense figures for the complete nine months ended September 30, 1998 and 1997
are not available.  Income has increased for the three months ended September
30, 1998, as compared to the same period in 1997, due to increased occupancy at
the shopping center while expenses have increased, due primarily to increased
depreciation.

                                       14
<PAGE>
 
The TCI Building/Fund VIII-Fund IX  Joint Venture
-------------------------------------------------

<TABLE>
<CAPTION>
                                            Three Months Ended                  Nine Months Ended
                               -----------------------------------------  ---------------------------------
                                 Sept. 30, 1998        Sept. 30, 1997      Sept. 30, 1998   Sept. 30, 1997
                               -------------------  --------------------  ----------------  ---------------
<S>                            <C>                  <C>                   <C>               <C>           
Revenues:
 Rental income                      $113,794                 $118,273             $341,383         $345,862
 Interest income                       7,800                        0               22,950                0
                                    --------                 --------             --------         --------
                                     121,594                  118,273              364,333          345,862
                                    --------                 --------             --------         --------
                                                                                                   
Expenses:                                                                                          
 Depreciation                         41,648                   41,648              124,945          124,945
 Management & leasing expenses         4,300                    2,389               12,900           13,196
 Other operating expenses              1,755                    2,167                6,728            6,556
                                    --------                 --------             --------         --------
                                      47,703                   46,204              144,573          144,697
                                    --------                 --------             --------         --------
                                                                                                   
Net income                          $ 73,891                 $ 72,069             $219,760         $201,165
                                    ========                 ========             ========         ========
                                                                                                   
Occupied %                               100%                     100%                 100%             100%
                                                                                                   
Partnership's Ownership % in the                                                                   
 Fund VIII-Fund IX Joint Venture        54.8%                    50.1%                54.8%            50.1%
                                                                                                   
Cash distribution to Partnership    $ 59,853                 $ 53,815             $174,810         $153,723
                                                                                                   
Net income allocated to the                                                                        
 Partnership                        $ 40,490                 $ 36,104             $117,925         $100,656
</TABLE>

Net income and cash distributions are greater in 1998, as compared to 1997, due
primarily to increased interest income.

The Partnership's ownership in the Fund VIII-Fund IX Joint Venture increased in
1998, as compared to 1997, due to increased interest income and additional
funding by the Partnership which increased the Partnership's ownership interest
in the Fund VIII-Fund IX Joint Venture.

                                       15
<PAGE>
 
The Matsushita Building/Fund VIII-Fund IX  Joint Venture
--------------------------------------------------------

<TABLE>
<CAPTION>
                                                    Three Months Ended                   Nine Months Ended
                                        --------------------  -------------------  ----------------------------------
                                           Sept. 30, 1998        Sept. 30, 1997      Sept. 30, 1998   Sept. 30, 1997
                                        -------------------  --------------------  ----------------  ---------------
<S>                                    <C>                   <C>                   <C>               <C>
Revenues:
   Rental income                               $167,698                 $270,821          $503,094          $493,486
   Interest income                                    0                        0                 0             1,511
                                               --------                 --------          --------          --------
                                                167,698                  270,821           503,094           494,997
                                               --------                 --------          --------          --------
                                                                                                        
Expenses:                                                                                               
   Depreciation                                 53,917                   54,219           161,752           161,452
   Management & leasing expenses                 6,513                   13,496            19,538            25,376
   Other operating expenses                      1,660                      950            11,903             1,943
                                              --------                 --------          --------          --------
                                                62,090                   68,665           193,193           188,771
                                              --------                 --------          --------          --------
Net income                                    $105,608                 $202,156          $309,901          $306,226
                                              ========                 ========          ========          ========
                                                                                                        
Occupied %                                         100%                     100%              100%              100%
                                                                                                        
Partnership's Ownership % in the                                                                        
   Fund VIII-Fund IX Joint Venture                54.8%                    50.1%             54.8%             50.1%
                                                                                                        
Cash distribution to Partnership              $ 92,446                 $ 65,718          $267,845          $101,453
                                                                                                        
Net income allocated to the                                                                             
   Partnership                                $ 57,869                 $101,273          $166,317          $153,365
</TABLE>

On January 10, 1997, Fund VIII-Fund IX Joint Venture acquired a two-story office
building containing approximately 63,417 rentable square feet on a 4.4 acre
tract of land located in the Irvine Spectrum planned business community in
metropolitan Orange County, California for a purchase price of  $7,193,000
excluding acquisition costs.

The entire Matsushita Building is currently under a net lease to Matsushita
Avionics Systems Corporation.  Under the Lease, Matsushita Avionics is
responsible for all utilities, taxes, insurance and other operating expenses
during the term of the Lease.

Rental income and net income have remained relatively constant for 1998, as
compared to 1997.  Rental income decreased for the three months ended September
30, 1998 as compared to the same period in 1997 due to a straight line rent
adjustment in July 1997 reflected in rental income.  Cash distributions have
increased in 1998 as compared to 1997 due primarily to the tenant not paying
rent until May of 1997 and an increase in the Partnership's ownership.

The Partnership's ownership in the Fund VIII-Fund IX Joint Venture increased in
1998, as compared to 1997, due to additional fundings by the Partnership which
increased the Partnership's ownership interest in the Fund VIII-Fund IX Joint
Venture.

                                       16
<PAGE>
 
The Cirrus Logic Building/Fund VIII-Fund IX Joint Venture
---------------------------------------------------------

<TABLE>
<CAPTION>
                                                      Three Months Ended            Nine Months Ended    Seven Mths Ended
                                             -------------------------------------- ------------------  -----------------
                                                Sept. 30, 1998     Sept. 30, 1997     Sept. 30, 1998     Sept. 30, 1997
                                             -------------------  ----------------  ------------------  -----------------
<S>                                          <C>                  <C>               <C>                 <C>
Revenues:
   Rental income                                     $184,539         $197,344             $553,617               $399,835
   Interest income                                          0           21,345                    0                 21,402
                                                     --------         --------             --------               --------
                                                      184,539          218,689              553,617                421,237
                                                     --------         --------             --------               --------
 
Expenses:
   Depreciation                                        72,765           72,874              218,295                158,900
   Management & leasing expenses                       11,293           10,348               29,699                 16,949
   Other operating expenses                            33,455              368               25,406                  7,336
                                                     --------         --------             --------               --------
                                                      117,513           83,590              273,400                183,185
                                                     --------         --------             --------               --------
 
Net income                                           $ 67,026         $135,099             $280,217               $238,052
                                                     ========         ========             ========               ========
 
Occupied %                                                100%             100%                 100%                   100%
 
Partnership's Ownership % in the
   Fund VIII-Fund IX Joint Venture                       54.8%            50.1%                54.8%                  50.1%
 
Cash distribution to Partnership                     $ 68,041         $ 90,332             $241,730               $153,432
 
Net income allocated to the
   Partnership                                       $ 36,728         $ 67,680             $149,787               $119,205
</TABLE>

On February 20, 1997, the Fund VIII-Fund IX Joint Venture purchased a two-story
partially completed office building in Boulder County, Colorado (the "Cirrus
Logic Building") for $7,029,000 excluding acquisition costs.  Construction of
the 49,460 square foot building was substantially completed in March, 1997.

Cirrus Logic, Inc. has leased the entire building for a fifteen year term
beginning March 17, 1997.  The annual base rental under the term of the Cirrus
Logic lease is $617,656 for the first five years, will be increased by 10% in
the sixth through tenth years and will be increased an additional 10% in years
eleven through fifteen.

Since the Cirrus Logic Building was purchased in February 1997 and was not
completed until March 1997, comparative income and expense figures for the nine
months ended September 30, 1998 and 1997 are not available.  Net income is lower
for the three months ended September 30, 1998 as compared to the same period in
1997 due primarily to a decrease in interest income and an increase in the
property tax accrual.

The Partnership's ownership in the Fund VIII-Fund IX Joint Venture increased in
1998, as compared to 1997, due to additional fundings by the Partnership which
increased the Partnership's ownership in the Fund VIII-Fund IX Joint Venture.

                                       17
<PAGE>
 
The Cellular One Building/Fund VIII-Fund IX Joint Venture
---------------------------------------------------------

<TABLE>
<CAPTION>
                                                            Three Months Ended            Nine Months Ended   Four Months Ended
                                                  -------------------------------------  ------------------  ------------------
                                                      Sept. 30, 1998    Sept. 30, 1997     Sept. 30, 1998      Sept. 30, 1997
                                                  -------------------  ----------------  ------------------  ------------------
<S>                                               <C>                  <C>               <C>                  <C>
Revenues:
   Rental income                                     $320,519              $239,645             $961,557               $279,753
                                                     --------              --------             --------               --------
 
Expenses:
   Depreciation                                       202,625               118,500              509,826                156,500
   Management & leasing expenses                       35,422                24,817              103,973                 24,817
   Other operating expenses                           (18,320)                8,937              (36,868)                19,812
                                                     --------              --------             --------               --------
                                                      219,727               152,254              576,931                201,129
                                                     --------              --------             --------               --------
 
Net income                                           $100,792              $ 87,391             $384,626               $ 78,624
                                                     ========              ========             ========               ========
 
Occupied %                                                100%                   75%                 100%                    75%
 
Partnership's Ownership % in the
   Fund VIII-Fund IX Joint Venture                       54.8%                 50.1%                54.8%                  50.1%
 
Cash distribution to Partnership                     $161,413              $ 59,962             $452,117               $ 74,604
 
Net loss allocated to the
   Partnership                                       $ 55,231              $ 43,779             $204,791               $ 39,393
</TABLE>

In June 1997, Cellular One, a subsidiary of BellSouth Corporation, occupied its
leased space of 76,276 square feet comprising approximately 75% of the building.
The initial term of the lease is 9 years and 11 months beginning in June 1997,
with the option to extend the initial term of the lease for two consecutive five
year periods.  The annual base rent payable during the initial term is $862,500
payable in equal monthly installments of $71,875 during the first five years and
$975,000 payable in equal monthly installments of $81,250 during the last four
years and 11 months of the initial term.  The annual base rent for each extended
term will be at market rental rate.  Cellular One changed its name to US
Cellular in October 1997.  One additional tenant has occupied the remaining 25%
of the building.

Since the building opened June 15, 1997, comparative income and expenses figures
for the nine months ended September 30, 1998 and 1997 are not available.  Other
operating expense decreased for the three months ended September 30, 1998, as
compared to the same period in 1997 due primarily to differences in the 1997
estimate for common area maintenance billing to the tenants.

The Partnership's ownership in the Fund VIII-Fund IX Joint Venture increased in
1998, as compared to 1997, due to additional fundings by the Partnership which
increased the Partnership's ownership in the Fund VIII-Fund IX Joint Venture.

                                       18
<PAGE>
 
PART II - OTHER INFORMATION
---------------------------

     ITEM 6 (b.)  No reports on Form 8-K were filed during the third quarter of
     1998.


                                   SIGNATURES

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

                               WELLS REAL ESTATE FUND VIII, L.P.
                               (Registrant)
     Dated: November 10, 1998  By: /s/ Leo F. Wells, III
                                   ----------------------------------
                               Leo F. Wells, III, as Individual
                               General Partner and as President,
                               Sole Director and Chief Financial
                               Officer of Wells Capital, Inc., the
                               General Partner of Wells Partners, L.P.

                                       19