UNITED STATES
                       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: March 31, 2008
                                         ---------------------------------------

                                       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:       000-50675
                                        ----------------------------------------


                    EXCELLENCY INVESTMENT REALTY TRUST, INC.
--------------------------------------------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)


               Maryland                                  20-8635424
--------------------------------------       -----------------------------------
   (State or Other Jurisdiction of                    (I.R.S. Employer
    Incorporation or Organization)                    Identification No.)


        245 Park Avenue, 39th Floor
                New York, NY                                10167
--------------------------------------------------------------------------------
  (Address of Principal Executive Offices)                (Zip Code)


                                 (212) 792-4040
--------------------------------------------------------------------------------
              (Registrant's Telephone Number, Including Area Code)



--------------------------------------------------------------------------------
   (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 |_|

     Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act).
                                                                  Yes |_| No |X|

     As of June 18, 2008, the issuer had 43,761,537 shares of Common Stock
issued and outstanding.

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, a non-accelerated filer, or a small reporting company:

          Large accelerated filer |_|       Accelerated filer |_|

          Non-accelerated filer |_|         Smaller reporting company |X|

<PAGE>

                          QUARTERLY REPORT ON FORM 10-Q
          OF EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                       FOR THE PERIOD ENDED MARCH 31, 2008

<TABLE>
<CAPTION>
                                      TABLE OF CONTENTS

                                                                                          PAGE
                                                                                          ----
<S>                                                                                        <C>
PART I  -  FINANCIAL INFORMATION

Item 1.    Financial Statements.......................................................      3
               Consolidated Balance Sheets as of March 31, 2008 (Unaudited) and
                  December 31, 2007...................................................      3
               Consolidated Statements of Operations for the Three Months Ended
                  March 31, 2008 and 2007 (Unaudited).................................      4
               Consolidated Statements of Cash Flows for the Three Months Ended
                  March 31, 2008 and 2007 (Unaudited).................................      5
               Consolidated Statement of Changes in Stockholders' Deficit for the
                  Three Months Ended March 31, 2008 (Unaudited).......................      6
               Notes to Consolidated Financial Statements (Unaudited).................      7
Item 2.    Management's Discussion and Analysis of Financial Condition and Results
            of Operations.............................................................     16
Item 3     Quantitative and Qualitative Disclosures About Market Risk.................     29
Item 4T.   Controls and Procedures....................................................     29

PART II  - OTHER INFORMATION

Item 1.    Legal Proceedings..........................................................     30
Item 1A.   Risk Factors...............................................................     30
Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds................     30
Item 3.    Defaults Upon Senior Securities............................................     30
Item 4.    Submission of Matters to a Vote of Security Holders........................     30
Item 5.    Other Information..........................................................     30
Item 6.    Exhibits...................................................................     31

Signatures............................................................................     32
</TABLE>


                                       2
<PAGE>


                         PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS.


            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
                           CONSOLIDATED BALANCE SHEETS
                              As of March 31, 2008
                           And as of December 31, 2007

<TABLE>
<CAPTION>
                                  ASSETS
                                                                                                March 31, 2008    December 31, 2007
                                                                                                 (Unaudited)
<S>                                                                                              <C>               <C>
Real Estate
  Land                                                                                           $    811,402      $    811,402
  Building and improvements                                                                         5,227,119         5,227,119
                                                                                                 ------------      ------------
                                                                                                    6,038,521         6,038,521
Less: accumulated depreciation                                                                      1,352,912         1,318,167
                                                                                                 ------------      ------------
                                                                                                    4,685,609         4,720,354

Cash and cash equivalents                                                                             106,934           241,550
Accounts receivable-tenants, net of allowance of $126,102 and
 $81,733 as of March 31, 2008 and December 31, 2007, respectively                                      51,369            39,317
Deferred financing costs, net of accumulated amortization of
 $32,202 and $28,624 as of March 31, 2008 and December 31, 2007, respectively                         145,319           148,897
Escrow account                                                                                         49,071            84,109
Other assets                                                                                            9,852            11,137
                                                                                                 ------------      ------------
      TOTAL ASSETS                                                                               $  5,048,154      $  5,245,364
                                                                                                 ============      ============


                         LIABILITIES AND STOCKHOLDERS' DEFICIT

Mortgage notes payable                                                                           $  7,981,498      $  8,011,007
Promissory notes payable-related parties                                                            2,169,153         2,292,871
Security deposits                                                                                     129,152           135,151
Accounts payable and accrued expenses                                                                 375,952           356,248
Contingent Liability                                                                                4,071,921         4,071,921
                                                                                                 ------------      ------------
      TOTAL LIABILITIES                                                                            14,727,676        14,867,198
                                                                                                 ------------      ------------


STOCKHOLDERS' DEFICIT:


Preferred stock, $0.001 par value, 1,000,000 shares authorized;
 Series A Convertible Preferred Stock, par value $0.01, 10,000 shares authorized, 10,000
     issued and outstanding. Aggregate liquidation preference of $9,100 ($0.91 per share)                 100               100
 Series B Preferred Stock, par value $0.01, 20,000
     shares authorized, 0 shares issued and outstanding                                                     -                 -
 Common stock, par value $0.01, 200,000,000 shares authorized, 43,761,537 issued and
     outstanding as of March 31, 2008 and December 31, 2007, respectively                             437,615           437,615
Treasury stock, at cost- 34,168 shares                                                                (34,168)          (34,168)
Additional paid-in capital                                                                          2,065,321         2,063,821
Accumulated deficit                                                                               (12,148,390)      (12,089,202)
                                                                                                 ------------      ------------
   TOTAL STOCKHOLDERS' DEFICIT                                                                     (9,679,522)       (9,621,834)
                                                                                                 ------------      ------------
   TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                                   $  5,048,154      $  5,245,364
                                                                                                 ============      ============
</TABLE>



                    See accompanying notes to consolidated financial statements.


                                        3
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                                Three Months Ended      Three Months Ended
                                                                                  March 31, 2008          March 31, 2007



                                                                                   (Unaudited)             (Unaudited)
<S>                                                                               <C>                     <C>
Rental revenue                                                                    $    519,793            $    395,805

Operating expenses:
  Property operating costs                                                             282,290                 265,833
  General and administrative                                                           106,032                 171,998
  Depreciation and amortization                                                         38,323                  38,323

Total operating expenses                                                               426,645                 476,154

Operating income (loss)                                                                 93,148                 (80,349)

Non-operating expenses and income:
  Interest expense                                                                    (152,642)               (159,257)
  Other income                                                                             307                  10,168
  Realized loss from sales of trading securities                                             -                (168,748)
                                                                                  ------------            ------------

Total non-operating expenses                                                          (152,335)               (317,837)

  Net loss                                                                        $    (59,187)           $   (398,186)


Loss per share -- basic and diluted                                               $      (0.00)           $      (0.01)

Weighted average common shares outstanding basic and diluted                        43,761,537              43,658,259
</TABLE>



         See accompanying notes to consolidated financial statements.



                                        4
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                          FOR THE THREE MONTHS PERIODS
                          ENDED MARCH 31, 2008 AND 2007
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                       Three Months            Three Months
                                                                                          Ended                   Ended
                                                                                      March 31, 2008          March 31, 2007

<S>                                                                                  <C>                      <C>
CASH FLOWS FROM OPERATING ACTIVITIES

Net loss                                                                             $   (59,187)             $  (398,186)
Adjustments to reconcile net loss to net
  provided by(used in) operating activities:                                               1,500                        -
  Compensation Expense                                                                         -                  168,748
  Loss on sale of trading securities
  Depreciation and amortization                                                           38,323                   38,221
  Provision for doubtful accounts                                                         44,369                    9,717

Changes in Operating Assets and Liabilities:
  Accounts receivable-tenants                                                            (56,421)                 (13,555)

  Escrow accounts                                                                         35,039                   42,193
  Other assets                                                                             1,284                   48,580
  Security deposits                                                                       (5,999)                 (11,782)
  Accounts payable and accrued expenses                                                   19,704                   19,397

  NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                     18,612                  (96,667)


CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of trading securities                                                                 -                 (117,134)


  NET CASH USED IN INVESTING ACTIVITIES                                                        -                 (117,134)

CASH FLOWS FROM FINANCING ACTIVITIES

  Repayments of promissory notes payable related parties                                (123,719)                 (31,425)
  Repayment of mortgage notes payable                                                    (29,509)                 (27,900)


  NET CASH USED IN FINANCING ACTIVITIES                                                 (153,228)                 (59,325)

DECREASE IN CASH                                                                        (134,616)                (273,126)
CASH- BEGINNING OF YEAR                                                                  241,550                1,070,493

CASH-END OF YEAR                                                                     $   106,934              $   797,367


Cash paid during the period for interest                                             $   147,169              $   159,257
Cash paid during the period for taxes                                                          -                        -


NON-CASH TRANSACTIONS

Conversion of preferred stock into common stock                                                -                    1,460
</TABLE>

         See accompanying notes to consolidated financial statements.

                                        5
<PAGE>

<TABLE>
<CAPTION>
                                    EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                                           (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
                                   CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT
                                     FOR THE PERIODS OF DECEMBER 31, 2006 TO MARCH 31, 2008
                                                           (Unaudited)

                                                                                                                         Additional
                                     Preferred Stock-Series A   Preferred Stock-Series C         Common Stock             Paid-in
                                        Shares     Amount          Shares      Amount        Shares        Amount         Capital
                                        ------     ------          ------      ------        ------        ------         -------
<S>                                      <C>       <C>            <C>          <C>         <C>           <C>            <C>
Balance as of December 31, 2006          11,000    $ 110                       $     -     43,618,537    $   436,185    $ 1,835,359


FIN 46 Consolidation                          -        -                 -           -              -              -        229,882
Conversion of preferred stock            (1,000)     (10)                -           -        143,000          1,430         (1,420)
Issuance of common stock                      -        -                 -           -     30,000,000        300,000              -
Rescission of common stock issued             -        -                 -           -    (30,000,000)      (300,000)             -
Net loss                                      -        -                 -           -              -              -              -
                                        -------    -----           -------     -------   ------------    -----------    -----------
Balance as of December 31, 2007          10,000    $ 100                 -     $     -     43,761,537    $   437,615    $ 2,063,821


Compensation Expense                          -        -                 -           -              -              -          1,500
Net loss                                      -        -                 -           -              -              -              -
                                        -------    -----           -------     -------   ------------    -----------    -----------
Balance as of March 31, 2008             10,000    $ 100                 -     $     -     43,761,537    $   437,615    $ 2,065,321
                                        =======    =====           =======     =======   ============    ===========    ===========





<CAPTION>

                                          Accumulated     Treasury Stock
                                            Deficit       Shares at Cost        Total
                                            -------       --------------        -----

<S>                                      <C>                  <C>           <C>
Balance as of December 31, 2006            (8,130,173)          (34,168)     (5,892,687)

FIN 46 Consolidation                                -                 -         229,882
Conversion of preferred stock                       -                 -               -
Issuance of common stock                            -          (300,000)              -
Rescission of common stock issued                   -           300,000               -
Net loss                                   (3,959,030)                -      (3,959,030)
                                         ------------         ---------     -----------
Balance as of December 31, 2007          $(12,089,203)        $ (34,168)    $(9,621,835)


Compensation Expense                                -                 -           1,500
Net loss                                      (59,187)                -         (59,187)
                                         ------------         ---------     -----------
Balance as of March 31, 2008             $(12,148,390)        $ (34,168)    $(9,679,522)
                                         ============         =========     ===========
</TABLE>




         See accompanying notes to consolidated financial statements.


                                        6
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 1 - NATURE OF OPERATIONS, ORGANIZATION AND FINANCIAL STATEMENT PRESENTATION

Unaudited Consolidated Financial Statements
-------------------------------------------

The March 31, 2008 consolidated financial statements presented herein are
unaudited, and in the opinion of management, include all adjustments (consisting
only of normal recurring accruals) necessary for a fair presentation of
financial position, results of operations and cash flows. Such financial
statements do not include all of the information and footnote disclosures
normally included in financial statements prepared in accordance with accounting
principles generally accepted in the United States of America. This quarterly
report on Form 10-Q should be read in conjunction with Annual Report on Form
10-KSB for Excellency Investment Realty Trust, Inc. ("Excellency" and "the
Company") for the year ended December 31, 2007. The December 31, 2007
consolidated balance sheet is derived from the audited balance sheet included
therein.

Company Background
------------------

Excellency Investment Realty Trust, Inc. (f/k/a Gift Liquidators, Inc.) and its
predecessor companies were originally incorporated in 1963 as Dorsett
Educational Systems, Inc. ("Dorsett"). From 1963 through the mid-1980's, Dorsett
was in the business of developing and marketing educational material. During
that same period, the stock of Dorsett was publicly traded.

In 1990, Dorsett acquired, in a stock for stock exchange, a privately owned
business that developed, marketed and distributed a diverse line of gift and
novelty products, and changed its name to Laid Back Enterprises, Inc. ("Laid
Back"). From that date, until December 2002, Laid Back continued its
development, marketing and distribution of gift products, seasonal retailing and
closeout liquidation of gift products.

On December 20, 2002, Laid Back's shareholders voted to split-off its gift
inventory liquidation business from its gift design and merchandising business.
Pursuant to a Split-Off Agreement, dated December 20, 2002 (the "Split-Off
Agreement"), Laid Back distributed its gift design and merchandising business to
Max Colclasure and Ronald Hurt in exchange for a substantial portion of the
shares of Laid Back owned by Mr. Colclasure and Mr. Hurt. The shareholders also
voted to approve a change of name from Laid Back to Gift Liquidators, Inc.

Prior to the split-off, Mr. Colclasure and Mr. Hurt owned 64.72% and 6.42% of
the stock of Laid Back, respectively. Minority shareholders owned the remaining
outstanding stock. Subsequently, Mr. Colclasure and Mr. Hurt acquired all of the
remaining outstanding stock of the gift design and merchandising business,
thereafter known as Laid Back, and Mr. Colclasure acquired 25.78% of the gift
inventory liquidation business now known as Gift Liquidators, Inc. (hereinafter,
the "Company"), with the remaining shareholders owning 74.22% of the Company.

Pursuant to the Split-Off Agreement, on December 20, 2002, all of the assets,
liabilities and operations were transferred to Laid Back, except for gift
liquidation inventory valued at $400,019, which was retained by the Company. In
addition, all employees of the Company became employees of Laid Back. Since the
Company had no employees, it entered into an Administrative Services Agreement
with Laid Back, dated December 20, 2002 (the "Administrative Services
Agreement"), to share administrative functions and personnel. The administrative
services, for which the Company reimbursed Laid Back, included sales, marketing,
accounting and customer service. In addition, the Company entered into a Tax
Sharing Agreement with Laid Back, dated December 20, 2002 (the "Tax Sharing
Agreement"), pursuant to which the Company shared certain tax responsibilities
with Laid Back.

During the third quarter of 2005, the Company's management determined that it
would no longer pursue its interests in the gift liquidation business.

                                        7
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 1 - NATURE OF OPERATIONS, ORGANIZATION AND FINANCIAL STATEMENT PRESENTATION
(Continued)

As of September 28, 2005 (the "Closing Date"), the Company entered into a
Preferred Stock Purchase Agreement with David Mladen, pursuant to which Mr.
Mladen purchased 11,000 shares of the Company's Series A Convertible Preferred
Stock, $0.01 par value per share ("Series A Preferred Stock"), for an aggregate
purchase price of $10,000 (the "Preferred Stock Purchase Transaction"). As of
the Closing Date, each share of the Company's Series A Preferred Stock was
convertible at any time, at the holder's option, into 5 shares of the Company's
common stock, $0.01 par value per share ("Common Stock"), subject to adjustment
for stock dividends, stock splits, reclassifications, and similar events.

In addition, as of the Closing Date, two of the Company's former stockholders,
including Mr. Colclasure, a former officer and director of the Company, sold an
aggregate of 33,761 shares of the Company's Common Stock to Mr. Mladen, which
amount represented 28.6% of the Company's issued and outstanding Common Stock,
for an aggregate purchase price of $325,000 (the "Common Stock Purchase
Transaction").

Further, as of the Closing Date, the Company's existing officers and directors
resigned, and Mr. Mladen was appointed as the Company's sole officer and
director.

As a result of the Preferred Stock Purchase Transaction and the Common Stock
Purchase Transaction (jointly, the "Purchase Transactions"), as of the Closing
Date, Mr. Mladen owned and/or controlled approximately 51% of the Company's
voting power. By virtue of (i) the percentage of the Company's Common Stock Mr.
Mladen acquired, (ii) the number of shares of Common Stock Mr. Mladen would
receive upon conversion of the shares of Preferred Stock he purchased, (iii) the
resignation of all of the Company's officers and directors, and (iv) the
appointment of Mr. Mladen as the Company's sole officer and director, there was
deemed to have been a "change in control" of the Company as of the Closing Date.

As of the Closing Date, the Company:

     o    terminated its Administrative Services Agreement with Laid Back;

     o    terminated its Tax Sharing Agreement with Laid Back; and

     o    entered into an Asset Sale Agreement with Laid Back (the "Asset Sale
          Agreement").

Pursuant to the Asset Sale Agreement, effective as of the Closing Date, the
Company sold all of its non-cash assets, including certain inventory, to Laid
Back, in exchange for the cancellation of the Company's indebtedness to Laid
Back in the aggregate amount of $50,485. As a result of the above transactions,
the Company became a "shell company", as defined by Securities Act Rule 405 and
Exchange Act Rule 12b-2 as a company other than an asset-backed issuer, with (a)
no or nominal operations, and (b) either (i) no or nominal assets; (ii) assets
consisting solely of cash and cash equivalents; or (iii) assets consisting of
any amount of cash and cash equivalents and other nominal assets.


FIN 46R, which amended FIN 46, "Consolidation of Variable Interest Entities," an
interpretation of Accounting Research Bulletin No. 51, "Consolidated Financial
Statements," requires an existing unconsolidated variable interest entity to be
consolidated by its primary beneficiary if the entity does not effectively
disperse risk among all parties involved or if other parties do not have
significant capital to finance activities without subordinated financial support
from the primary beneficiary. White Knight Management, LLC is now considered a
VIE and the Company its primary beneficiary both as of March 31, 2008 and
December 31, 2007. The Company has determined that restatement and evaluation of
the consolidation of White Knight Management was not necessary as of March 31,
2007 due to immateriality.

                                        8
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 2 - BASIS OF PRESENTATION AND CHANGES IN OR NEW ACCOUNTING POLICIES

Principles of Consolidation
---------------------------

The accompanying consolidated financial statements include the accounts of
Excellency Investment Realty Trust, Inc., its controlled subsidiaries comprised
of certain Limited Partnerships (see Note 1), and Eternal Enterprise, Inc.
(wholly owned in the aggregate by the Limited Partnerships) (hereinafter
collectively referred to as the "Company"). As noted above, the historical
financial statements as presented reflect the operations of Eternal as a result
of the Reverse Merger. The Company records minority interest for the non-owned
portions of consolidated subsidiaries, however, these subsidiaries have not
generated any income to warrant the recording of such minority interests through
March 31, 2008. All significant inter-company transactions and accounts have
been eliminated in the consolidated financial statements.

The accompanying consolidated financial statements include accounts of White
Knight Management, LLC. in which the Company has a controlling financial
interest with the exception of comparative March 31, 2007 information as
management has determined the effect to be immaterial. The usual condition for a
controlling financial interest is ownership of a majority of the voting
interests of an entity. However, a controlling financial interest may also exist
in entities, such a special purpose entity ("SPE"), through arrangements that do
not involve voting interest. The Company has determined that White Knight
Management, LLC is a VIE and that the Company is the primary beneficiary as of
March 31, 2008 and December 31, 2007.

Going Concern
-------------

The Company has suffered recurring losses from operations. During the three
months ended March 31, 2008, the Company had a net loss of ($59,187) and has a
net accumulated deficit of $12,148,390 as of March 31, 2008, all of which raise
substantial doubt about the Company's ability to continue as a going concern.
Management does plan to raise capital through any combination of debt and equity
financing. However, the Company has no assurance that sufficient cash flow will
be generated in the future to meet its operating requirements. As a result of
the above, the accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.

Accounts Receivable - Tenants
-----------------------------

Tenant receivables are reported net of an allowance for doubtful accounts.
Management's estimate of the allowance is based on historical collection
experience and a review of the current status of specific tenant accounts
receivable. The Company fully reserves for moved-out balances. After a six month
period, the Company charges-off the moved out balances for the previous six
months against accounts receivable. As of March 31, 2008, and December 31, 2007,
the Company has recorded an allowance for doubtful accounts of $126,102 and
$81,733, respectively.

Reclassification of Prior Periods
---------------------------------

Certain accounts and balances related to prior periods have been changed to
reflect current period presentation.

Contingent Liabilities
----------------------

The Company has previously accounted for registration rights agreements as a
separate freestanding instrument and accounted for liquidated damages provision
as a derivative liability in accordance with SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities," Emerging Issue Task Force
("EITF") 00-19, "Accounting for Derivative Financial Instruments Indexed to and
Potentially Settled in a Company's Own Stock," and EITF 05-04, "The Effect of a
Liquidating Damages Clause in a Free Standing Financial Instrument Subject to
EITF 00-19." Accordingly the liability was recorded at estimated fair value
based on an estimate of the probability and costs of cash penalties being
incurred and is revalued at each balance sheet date with changes in value
recorded as other non operating income or expenses.

                                        9
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 2 - BASIS OF PRESENTATION AND CHANGES IN OR NEW ACCOUNTING POLICIES
(continued)

As of January 1,2007, the Company adopted EITF 00-19-2 which called for
registration rights agreement penalties to be assessed pursuant to FASB
Statement Number 5. After determining loss was probable, the Company, with the
assistance of a valuation expert, assessed the probability of an effective
registration statement and determined that based upon a probability analysis the
contingent liability was $4,071,921 as of December 31, 2007. The Company had not
anticipated an effective registration by March 31, 2008, and therefore the
amount is unchanged at March 31, 2008.

Loss Per Common Share
---------------------

Net loss per common share is based on the weighted average number of shares of
common stock outstanding during the applicable period. Basic loss per share is
computed by dividing loss available to common stockholders by the weighted
average number of common shares outstanding during the period. The common stock
equivalents for the Company's preferred stock and treasury shares were not
included in the computation of diluted loss per share because would have diluted
earnings per share that had a basic earnings per share of 0.00.

For the three month period ended March 31, 2008 and 2007, common stock
equivalents of 1,573,000 and 1,573,000, respectively, were not included in the
calculation of diluted loss per share as their effect would further dilute
earnings per share that had a basic earnings per share of 0.00.

Recent Accounting Pronouncements and Interpretations
----------------------------------------------------

In September 2006, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standard ("SFAS") No. 157, "Fair Value
Measurement," which provides enhanced guidance for using fair value to measure
assets and liabilities. SFAS No. 157 provides a common definition of fair value
and establishes a framework to make the measurement of fair value in generally
accepted accounting principles more consistent and comparable. SFAS No. 157 also
requires expanded disclosures to provide information about the extent to which
fair value is used to measure assets and liabilities, the methods and
assumptions used to measure fair value, and the effect of fair value measure on
earnings. SFAS No. 157 is effective for financial statements issued in fiscal
years beginning after November 15, 2007, and to interim periods within those
fiscal years. The Company is currently in the process of evaluating the effect,
if any, the adoption of SFAS No. 157 will have on its consolidated results of
operations, financial position, or cash flows.

In December 2006, the FASB issue Staff Position ("FSP")EITF-00-19-2, "Accounting
for Registration Payment Arrangement." This FSP specifies that the contingent
obligation to make future payments or otherwise transfer consideration under a
registration payment arrangement, whether issued as a separate agreement or
included as a provision of a financial instrument or other agreement, should be
separately recognized and measured in accordance with FASB Statement No. 5,
"Accounting for Contingencies." The guidance was effective for fiscal years
beginning December 15, 2006. We have adopted this pronouncement and reflected
the change in our previously classified derivative accordingly.

In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for
Financial Assets and Financial Liabilities-including an amendment of FASB
Statement No. 115." FAS 159 became effective for the Company on January 1, 2008.
This standard permits companies to choose to measure many financial instruments
and certain other items at fair value and report unrealized gains and losses in
earnings. Such accounting is optional and is generally to be applied instrument
by instrument. The Company does not anticipate that election, if any, of this
fair-value option will have a material effect on the consolidated results of
operations, financial position or cash flows.

In December 2007, the FASB issued SFAS No. 141R, "Business Combinations, and
SFAS No.160, "Non-Controlling Interest in Consolidated Financial Statements."
SFAS No.141R requires an acquirer to measure the identifiable assets acquired,
the liabilities assumed, and any non-controlling interest in the acquire at
their fair values on the acquisition date, with goodwill being the excess value
over the net identifiable assets acquired. SFAS No. 160 clarifies that a
non-controlling interest in a subsidiary should be reported as equity in the
consolidated financial statements. The calculation of earnings per share will
continue to be based on income amounts attributable to the parent. SFAS No.141R
and SFAS No.160 are effective for financial statements issued for fiscal years
beginning after December 15, 2008. Early adoption is prohibited. We have not yet
determined the effect on our consolidated financial statements, if any, upon
adoption of SFAS No.141R or SFAS No.160.

                                       10
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 2 - BASIS OF PRESENTATION AND CHANGES IN OR NEW ACCOUNTING POLICIES
(continued)

The implementation of the above pronouncements is not expected to have a
material effect on the Company's consolidated financial statements or
disclosures.

NOTE 3 - NOTES PAYABLE

Promissory Notes Payable - Related Parties
------------------------------------------
On November 4, 2005 (the "Loan Date"), the Pre-Acquisition Eternal Stockholders
of Eternal Enterprise, Inc., which were comprised of David Mladen, the Company's
majority shareholder and the then sole officer and director, and Mr. Mladen's
son, daughter-in-law, daughter, and son-in-law, exchanged, in the aggregate,
100% of the issued and outstanding shares of common stock of Eternal, for (i)
limited partnership interests representing 20% of the total partnership
interests in each of the Limited Partnerships, and (ii) unsecured promissory
notes payable to the Pre-Acquisition Eternal Stockholders in the aggregate
principal amount of $2,610,006 (the "LP Notes"), pursuant to Contribution
Agreements between the Pre-Acquisition Eternal Stockholders and the Limited
Partnerships. In consideration for the Company's ownership of 80% of the total
partnership interests of each of the Limited Partnerships, the Company agreed to
assume the LP Notes.

The interest rate on the LP Notes is 7% per annum. The entire balance of
principal and interest of the LP Notes is due and payable on November 4, 2010.
The LP Notes may be prepaid without penalty. All payments shall be applied first
toward the payment of interest and the balance towards the reduction of
principal.

As of March 31, 2008, and December 31, 2007, the LP Notes payable were
$2,169,153 and 2,292,871, respectively.

Mortgage Notes Payable
----------------------

On December 27, 2005, the Company borrowed an aggregate of $8,224,000 from
Astoria Federal Mortgage Corp. ("Astoria"), in connection with the refinancing
of the Properties, evidenced by eight notes payable (the "Mortgage Notes"). The
initial interest rate on the Mortgage Note of 5.625% will remain in effect for
eighty four (84) months. Thereafter, the Mortgage Notes bear interest at a rate
equal to the five (5) year "Fixed Rate Advance" as determined by the Federal
Home Bank of New York, plus two and one half percent (2.5%), rounded to the
nearest one-eighth of one percent (0.125%) and the interest rate will be
adjusted every sixty (60) months. The loans are repayable in monthly
installments of principal and interest (which total $47,343), due on the first
day of each month, commencing February 1, 2006. The principal and interest
payments are based on a 360 month amortization. The Mortgage Notes mature on
January 1, 2018, at which time the entire unpaid principal balance, plus accrued
interest thereon, shall be due.

The Mortgage Notes are collateralized by each respective Property. David Mladen,
the Company's majority stockholder and an officer and director, has guaranteed
up to 5% of the outstanding balance of the principal with interest for the life
of the loan. The Company incurred approximately $178,000 of deferred financing
costs related to these loans, which is being amortized over the life of the
mortgage notes payable (twelve years). Amortization expense was $3,578 and
$3,578 for the three months ended March 31, 2008 and 2007, respectively.

The following sets forth the amounts outstanding on each of the Notes as of
March 31, 2008, and the initial required monthly principal and interest
payments:

                                       11
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 3 - NOTES PAYABLE (continued)


<TABLE>
<CAPTION>
                                                  Mortgage Note       Initial Monthly Principal
              Location of Property                   Amount             and Interest Payment
------------------------------------------------------------------------------------------------

<S>                                                <C>                        <C>
270 Laurel Street, Hartford, CT                    $1,941,026                 $   11,513
117-145 S. Marsha Street, Hartford, CT              1,389,774                      8,243
154-160A Collins Street, Hartford, CT               1,265,549                      7,506
243 &255 Laurel Street, Hartford, CT                1,094,739                      6,496
21 Evergreen Avenue, Hartford, CT                     683,241                      4,052
360 Laurel Street, Hartford, CT                       574,543                      3,407
252 Laurel Street, Hartford CT                        566,780                      3,363
56 Webster Street, Hartford, CT                       465,846                      2,763

------------------------------------------------------------------------------------------------
Total                                              $7,981,498                 $   47,343
=================================================================================================
</TABLE>


In connection with the refinance described above, the Company defeased its
existing mortgage with Credit Suisse First Boston Mortgage Capital, LLC. The
Company incurred approximately $654,000 in costs associated with the defeasance.
Additionally, the Company wrote-off the remaining deferred financing costs
related to the mortgage totaling approximately $110,000. The remaining funds
have been used to purchase all of the limited partnership interests of our
subsidiary Limited Partnerships owned by Goran Mladen, the son of the Company's
sole officer and director and majority stockholder, and for working capital
purposes.

Principal payment maturities on the mortgage outstanding at March 31, 2008 are:

            Fiscal Year         Amount
          -------------------------------------

               2008                 91,053
               2009                127,521
               2010                134,881
               2011                142,667
               2012                150,903
            Thereafter           7,334,473
          -------------------------------------
            Total               $7,981,498
          =====================================

NOTE 4 - ESCROW ACCOUNT

As of March 31, 2008, and December 31, 2007, the Company maintained an escrow
account with Astoria Federal Mortgage Corp. in the amount of $49,070 and $84,109
for the payment of real estate taxes and property insurance.

NOTE 5 - INVESTMENTS IN TRADING SECURITIES

The Company's investments are comprised of equity securities of publicly traded
companies. During 2007, the Company sold its investments for a realized loss of
$168,748. As of March 31, 2008, the Company no longer held any investments.

Between July, 2006, and September, 2006, the Company purchased an aggregate of
4,969 shares of its common stock in the open market, through a brokerage account
held in the name of Excellency Investment Realty Trust I, L.P., a limited
partnership which is owned (i) 81% by the Company, and (ii) 19%, collectively,
by David Mladen, the Company's majority shareholder and sole officer and
director, and his son, daughter-in-law, daughter, and son-in-law. For accounting
purposes, these purchases were treated as treasury stock of which 2,500 of the
purchased shares were resold in the open market. The purchase price of these
shares was between $8.16 and $24.44, and the selling price per share was between

                                       12
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 5 - INVESTMENTS IN TRADING SECURITIES (continued)

$11.66 and $24.26, or an average aggregate sales price of $17.44. The difference
between the purchased price and the sales price of $16,359 was recorded as
additional paid in capital in the accompanying consolidated financial
statements. The Company paid $34,168 or $13.83 per share for these 2,469 shares
of stock, and has recorded the acquisition of these shares as treasury stock
shares at cost in the accompanying consolidated financial statements. As of
March 31, 2008, 2,469 shares of the Company's common stock are held in the
Company's brokerage account. The Company plans to hold and not sell the Treasury
Stock.

NOTE 6 - RELATED PARTY TRANSACTIONS

Property Management
-------------------

Until June 30, 2006, the Company's properties were managed by White Knight
Management, LLC ("White Knight"), a related party owned (i) 99.8% by Goran
Mladen, the son of David Mladen, the Company's majority shareholder and sole
officer and director, and (ii) 0.2% by Gorica Mladen, David Mladen's daughter.
The Properties were managed pursuant to an oral agreement between White Knight
and the Company, according to which White Knight collected the rents for all
eight of the Company's properties and paid the Company's operating expenses. In
consideration for such services, White Knight was entitled to retain a
management fee of approximately 4% of the rent revenues of the Company. For the
three months ended March 31, 2007, the Company did not incur any management
fees. The Company did not incur any management fees in the three months ended
March 31, 2008.

In 2006, White Knight retained amounts of rent in excess of expenses paid
(including management fees) on behalf of the Company totaling $171,767. The
Company has written off such amounts due from White Knight as it has determined
the amounts are not collectible. As of December 31, 2007, White Knight did not
hold any rents.

As of January 1, 2007, the Company has consolidated its financial statements
with White Knight Management, LLC. In accordance with the Financial Accounting
Standards Board ("FASB") Interpretation No. 46R, "Consolidation of Variable
Interest Entities" ("FIN 46R"), an Interpretation of Accounting Research
Bulletin No. 51, a VIE is to be consolidated by a company if that company is
subject to a majority of the risk of loss for the VIE or is entitled to receive
a majority of the VIE's residual returns.

Goran Mladen and Gorica Mladen are employees of Eternal Enterprise, Inc., a
company which is owned 100%, in the aggregate, by limited partnerships that are
81% owned by the Company. Gorica Mladen owns 0.2% of such limited partnerships.

Rent-Free Apartments
--------------------

The Company provided a rent-free apartment to David Mladen, its majority
shareholder and an officer and director. As a result, the Company has recorded
compensation expense to David Mladen in the aggregate amount of $1,500, which
was the fair value of apartment rental.

NOTE 7 - STOCKHOLDERS' DEFICIT

Liquidated Damages
------------------

In connection with David Mladen's purchase of 11,000 shares of the Company's
Series A Preferred Stock (the "Series A Preferred Stock"), the Company entered
into a Registration Rights Agreement with Mr. Mladen (the "Registration Rights
Agreement"), pursuant to which the Company agreed to prepare and, on or prior to
the sixtieth (60th) day following the date of such purchase, file with the
Securities and Exchange Commission ("SEC"), a Resale Registration Statement on
Form SB-2 (the "Resale Registration Statement"), to register all of the shares
of the Company's Common Stock underlying the Series A Preferred Stock (the
"Conversion Shares"). Further, pursuant to the Registration Rights Agreement,

                                       13
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 7 - STOCKHOLDERS' DEFICIT (Continued)

the Company is required to use best efforts to (a) have the SEC declare the
Resale Registration Statement effective within ninety (90) days after filing the
Resale Registration Statement with the SEC (or one hundred and twenty (120) days
in the event any comments on the Registration Statement are received from the
SEC), and (b) maintain the effectiveness of the Resale Registration Statement
until all such common shares have been sold or may be sold without volume
restrictions pursuant to Rule 144(k) of the Securities Act of 1933, as amended.

If the Company (i) fails to file the Resale Registration Statement, or (ii)
fails to have the Registration Statement declared effective within the required
period, or (iii) if effectiveness is not maintained, the Registration Rights
Agreement requires the Company to make payments to Mr. Mladen in an aggregate
amount equal to two percent (2%) per month of $9,000,000 (assuming the sale of

$9,000,000 of the aggregate fair market value of the Conversion Shares)
("Outstanding Principal Amount"), multiplied by the number of months (prorated
for partial months) until the failure is cured.

As of June 30, 2006, the Resale Registration Statement had not been filed. At
that time, Mr. Mladen agreed to waive $1,174,000 of liquidated damages due to
him, and such amount was accounted for as a contribution of capital as of that
date.

On October 24, 2006, the Resale Registration Statement had still not been filed.
At that time, Mr. Mladen agreed to waive an additional $720,000 in liquidated
damages, for the period between July 1, 2006, and October 31, 2006, in
consideration for 43,500 shares of the Company's Series C Preferred Stock.

As of December 31, 2006, $720,000 of these liquidated damages have been issued
as preferred stock and subsequently converted to common stock.

On November 29, 2006, the Company filed a Registration Statement on Form SB-2
(the "Resale Registration Statement") with the Securities and Exchange
Commission (the "Commission") to register (i) 5,000,000 shares of common stock
issuable to Dutchess Private Equities Fund, LP ("Dutchess") in connection with
an Investment Agreement between the Company and Dutchess and (ii) 1,573,000
shares of Common Stock issuable upon conversion of shares of the Company's
Series A Convertible Preferred Stock held by David Mladen, the Company's sole
officer, director and Majority shareholder.

On February 2, 2007, the Company filed a request to withdraw the Registration
Statement with the Commission. Mr. Mladen had agreed to waive the liquidated
damages which were due to him through March 31, 2007, but as a result of the
withdrawal of the Registration Statement the contingent liability increased to
$4,071,921 as of December 31, 2007.

The Company had adopted View C of EITF 05-4, "Effect of Liquidated Damages
Clause on a Freestanding Financial Instrument Subject to EITF 00-19" ("EITF
05-4"). Accordingly, the Company classified as liability instruments, the fair
value of registration rights agreements when such agreements (i) require it to
file, and cause to be declared effective under the Securities Act, a
registration statement with the SEC within contractually fixed time periods, and
(ii) provide for the payment of liquidating damages in the event of its failure
to comply with such agreements.

Previously under View C of EITF 05-4, (i) registration rights with these
characteristics were accounted for as derivative financial instruments at fair
value and (ii) contracts that are (a) indexed to and potentially settled in an
issuer's own stock and (b) permit gross physical or net share settlement with no
net cash settlement alternative were classified as equity instruments.

The Company has adopted EITF 00-19-2 and as a result no longer classifies these
registration rights as a derivative instrument. Due to the probable loss, the
Company, with the help of a valuation specialist, determined the likely
settlement to be $4,071,921 at December 31, 2007. The analysis assumed an
effective registration would not be achieved by March 31, 2008, and as a result
the contingent liability remains unchanged.

                                       14
<PAGE>

            EXCELLENCY INVESTMENT REALTY TRUST, INC. AND SUBSIDIARIES
                   (FORMERLY KNOWN AS GIFT LIQUIDATORS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007


NOTE 7 - STOCKHOLDERS' DEFICIT (Continued)

Series A Preferred Stock
------------------------

As of September 28, 2005, the Company filed a Certificate of Designation of
Series A Convertible Preferred Stock (the "Series A Certificate of Designation")
designating a Series of 11,000 shares of Series A Convertible Preferred Stock,
$0.01 par value per share (the "Series A Preferred Stock"). Pursuant to the
Series A Certificate of Designation, as amended on July 12, 2006, holders of the
Company's Series A Preferred Stock:

     o    shall be entitled to cast one hundred forty three (143) votes per
          share of Series A Preferred Stock upon all matters submitted to a vote
          of the holders of the Company's Common Stock;

     o    shall be entitled to receive dividends when and as declared by the
          Company's Board of Directors; and

     o    shall be entitled to convert each of their shares of Series A
          Preferred Stock into one hundred forty three (143) shares of the
          Company's Common Stock, at any time, and from time to time, for no
          additional consideration.

The shares of Series A Preferred Stock:

     o    shall be not be reissued after they are reacquired by the Company by
          reason of repurchase or otherwise, and all such shares shall be
          returned to the status of undesignated shares of the Company's
          Preferred Stock; and

     o    shall be adjusted in the event of stock splits, stock combinations,
          mergers, reorganizations, or other such events.

On March 6, 2007, David Mladen, the Company's majority stockholder and an
officer and director, converted 1,000 shares of the Company's Series A Preferred
Stock into 143,000 shares of the Company's common stock.

As of March 31, 2008, and December 31, 2007, 10,000 shares of the Company's
Series A Preferred Stock were issued and outstanding, and held by David Mladen,
the Company's majority shareholder and an officer and director.

NOTE 8 - CONTINGENCY

Periodic Filings
----------------

Under a 2005 rule change, OTC Bulletin Board ("OTCBB") issuers that are cited
for filing delinquency three times in a 24-month period and those removed for
failure to file two times in a 24-month period will be ineligible for quotation
by an NASD member. Following removal under this new rule, an issuer's securities
would again become eligible for quotation on the OTCBB when the issuer has filed
periodic reports for one year in a timely manner.

In 2008 the Company has been late in two of its periodic filings with the
Securities and Exchange Commission ("SEC"). Accordingly, the Company may be
ineligible for quotation by an NASD member if it is delinquent one more time in
its periodic filings with the SEC during the applicable 24-month period.

                                       15
<PAGE>

ITEM 1A.   RISK FACTORS.

         We are a smaller reporting company as defined by Rule 12b-2 of the
Securities Exchange Act of 1934 and are not required to provide the information
under this item.

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS.

         The financial and business analysis below provides information which we
believe is relevant to an assessment and understanding of our financial
condition and results of operations. You should read the following discussion of
our financial condition and results of operations in conjunction with the Notes
to the Financial Statements in Item 1 of this Quarterly Report on Form 10-Q, and
our Annual Report on Form 10-KSB for the year ended December 31, 2007 (the
"Annual Report"). In addition to historical information, this discussion
contains statements that may be deemed to be "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. The words
"believes," "estimates," "expects," and "anticipates" and other similar
expressions that are predictions of, or indicate future events and trends, and
which do not relate solely to historical matters identify forward-looking
statements. Such forward-looking statements are subject to risks and
uncertainties, which could cause actual results, performance, or achievements of
ours to differ materially from anticipated future results, performance or
achievements expressed or implied by such forward-looking statements. Factors
that might cause such differences include, but are not limited to, the
following:

          o    Anticipated capital expenditures for replacements and building
               improvements all reflect our best estimates and are subject to
               uncertainties arising from changing economic conditions (such as
               the cost of labor and construction materials), competition and
               local government regulation;

          o    Sources of capital or labor and materials required for
               maintenance, repair, capital expenditure or development are more
               expensive than anticipated;

          o    Occupancy levels and market rents may be adversely affected by
               national and local economic and market conditions including,
               without limitation, new construction of multifamily housing, slow
               employment growth, availability of low interest mortgages for
               single-family home buyers and the potential for geopolitical
               instability, all of which are beyond our control; and

          o    Our inability to derive sufficient revenues from our operations,
               or obtain financing when needed, would have a material adverse
               affect on our company, requiring us to curtail or cease
               operations; and

          o    Additional factors as discussed in Item 1 of our Annual Report,
               under the heading of "Risk Factors."

         Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof. We undertake
no obligation to publicly release any revisions to these forward-looking
statements, which may be made to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.

                                       16
<PAGE>

Overview

         On September 4, 1963, we were incorporated in the State of Oklahoma as
Dorsett Educational Systems, Inc. On December 20, 2002, we changed our name to
Gift Liquidators, Inc.

         As of September 28, 2005 (the "Closing Date"), we entered into a
Preferred Stock Purchase Agreement with David Mladen (the "Preferred Stock
Purchase Agreement"), pursuant to which Mr. Mladen purchased 11,000 shares of
our Series A Convertible Preferred Stock, $0.01 par value per share ("Series A
Preferred Stock"), for an aggregate purchase price of $10,000 (the "Preferred
Stock Purchase Transaction"). As of the Closing Date, each share of our Series A
Preferred Stock was convertible into 5 shares of our common stock, $0.01 par
value per share ("Common Stock"), subject to adjustment for stock dividends,
stock splits, reclassifications, and similar events. Further, as of the Closing
Date, two of our former stockholders, one of whom was an officer and director of
ours, sold an aggregate of 33,761 shares of our Common Stock to Mr. Mladen,
which amount represented 28.6% of our issued and outstanding Common Stock (the
"Common Stock Purchase Transaction," and, together with the Preferred Stock
Purchase Transaction, the "Stock Purchase Transactions").

         In addition, as of the Closing Date, our existing officers and
directors resigned, and Mr. Mladen was appointed as our sole officer and
director.

         At the time of the Preferred Stock Purchase Transaction and the Common
Stock Purchase Transaction, Mr. Mladen was also the majority stockholder and the
sole officer and director of Eternal Enterprise, Inc., a Connecticut Corporation
("Eternal"), which owned the following residential real estate properties
(collectively, the "Properties") in Hartford, Connecticut:

           o   154-160A Collins Street, Hartford, CT;
           o   21 Evergreen Avenue, Hartford, CT;
           o   243 & 255 Laurel Street, Hartford, CT;
           o   252 Laurel Street, Hartford CT;
           o   270 Laurel Street, Hartford, CT;
           o   360 Laurel Street, Hartford, CT;
           o   117-145 S. Marshall Street, Hartford, CT; and
           o   56 Webster Street, Hartford, CT.

         Mr. Mladen entered into the Stock Purchase Transactions with the
specific intention of taking control of our Company, and, subsequently,
combining it with Eternal.

         Between October 26, 2005 and October 31, 2005, we formed eight limited
partnerships as wholly-owned Delaware subsidiaries (the "Limited Partnerships").
At the time of formation, we owned 100% of the partnership interests of each of
the Limited Partnerships.

         As of November 4, 2005, the pre-acquisition stockholders of Eternal,
which consisted of David Mladen and certain of his family members (the
"Pre-Acquisition Eternal Stockholders"), exchanged, in the aggregate, 100% of
the issued and outstanding shares of common stock of Eternal, for (i) limited
partnership interests representing 20% of the total partnership interests of
each of the Limited Partnerships, and (b) promissory notes in the aggregate
principal amount of $2,610,006 (the "LP Notes") (the "Eternal Acquisition"). The
partnership interests of the Limited Partnerships were exchanged for shares of
common stock of Eternal based upon the ratio which the value of each Property
bears to the aggregate value of all of the Properties. As a result of the
Eternal Acquisition, the shares of common stock of Eternal are now 100% owned,
in the aggregate, by the Limited Partnerships.

                                       17
<PAGE>

         In consideration for our ownership of 80% of the total partnership
interests of each of the Limited Partnerships, we agreed to assume the LP Notes.
The interest rate on the LP Notes is 7% per annum. The entire balance of
principal and interest of the LP Notes is due and payable on November 4, 2010.
The LP Notes may be prepaid without penalty. All payments shall be applied first
toward the payment of interest and the balance towards the reduction of
principal.

         Pursuant to the Partnership Agreements of the Limited Partnerships (the
"Partnership Agreements"), among other things, we (i) are the general partner of
each of the Limited Partnerships; and (ii) have the right to compel the limited
partners (i.e., the Pre-Acquisition Eternal Stockholders) to exchange 100% of
their limited partnership interests for shares of common stock of the Company.

         Since, at the effective time of the Eternal Acquisition (and the
Preferred Stock Purchase Transaction and the Common Stock Purchase Transaction,
consummated in anticipation thereof): (i) the Pre-Acquisition Eternal
Stockholders obtained a majority of the shares of common stock of the combined
entity after the combination, (ii) Pre-Acquisition Eternal Stockholders obtained
the ability to elect and appoint a voting majority of the governing board of the
combined entity, and (iii) Eternal's officers and directors replaced ours as
officers and directors of the combined entity, the Eternal Acquisition was
treated as a reverse merger with Eternal as the accounting acquirer for
financial reporting purposes.

         On September 20, 2006, we reincorporated in the State of Maryland by
virtue of our merger with and into Excellency Investment Realty Trust, Inc., our
Maryland subsidiary (the "Maryland Subsidiary"), which had been organized for
that purpose (the "Reincorporation by Merger"). As a result of the
Reincorporation by Merger, among other things:

          o    The surviving company and successor filer is known as Excellency
               Investment Realty Trust, Inc.;

          o    Each share of our issued and outstanding common stock and
               preferred stock was converted into one share of the Maryland
               Subsidiary's common stock and preferred stock, respectively;

          o    The title to all of our property automatically vested in the
               Maryland Subsidiary;

          o    The Maryland Subsidiary assumed all of our liabilities;

          o    Corporate actions of the surviving entity are now governed by the
               Maryland Corporations and Associations Law and by the Maryland
               Subsidiary's Articles of Amendment and Restatement of Articles of
               Incorporation and Bylaws;

          o    David Mladen, who was our sole officer and director, continued to
               serve as the sole officer and director of the surviving entity;

          o    The trading symbol for the surviving entity's common stock, which
               is quoted on the over-the-counter bulletin board of the National
               Association of Securities Dealers, was changed to "EIVR"; and

          o    The total number of shares of stock which the surviving entity is
               authorized to issue has increased to 201,000,000 shares, of which
               200,000,000 shares are common stock, $0.01 par value per share
               and 1,000,000 are preferred stock, par value $0.01.

                                       18
<PAGE>

         While the Reincorporation by Merger resulted in changes to our name and
state of incorporation, as well as the other changes listed above, it did not
result in any material changes to our business, management, assets, liabilities
or net worth.

         We are engaged in the business of acquiring, developing, holding for
investment, operating and selling apartment properties in metropolitan areas on
the east coast of the United States. We intend to qualify as a real estate
investment trust, or REIT, under the Internal Revenue Code of 1986, as amended.

         Through our subsidiaries, we own eight residential real estate
Properties, consisting of an aggregate of 273 apartment units, and comprising a
total of approximately 221,839 square feet, all of which are leased to
residential tenants. Each of the Properties is located in the metropolitan
Hartford area of Connecticut.

         We operate in the real estate industry segment. We do not have any
foreign operations, and our business is not seasonal. See the Consolidated
Financial Statements attached hereto and incorporated by reference herein for
financial information relating to our industry segment.

Trends and Uncertainties

         We are not aware of any material trends or uncertainties, favorable or
unfavorable, other than national economic conditions affecting real estate
generally, that may be reasonably anticipated to have a material impact on
either capital resources or the revenues or income to be derived from the
acquisition and operation of the Properties, other than those identified below.

Increasing Demand For Rental Apartments
---------------------------------------

         Based on certain demographic trends, in particular, the growth of the
"Echo Boomer" generation, we believe we are well-positioned to continue
achieving our objectives. While there is no guarantee that individuals making up
this group will choose renting versus ownership, we believe the increase in this
age group will have a positive demand for the number of rental households. Echo
Boomers are now entering into the age group having the greatest propensity to
rent. The number of individuals between the ages of 18-39 is expected to grow
significantly over the next 20 years.

Strong Demand Due To Interest Rate Environment
----------------------------------------------

         The 40-year historic lows reached on mortgage interest rates in recent
years provided some individuals with the opportunity to purchase homes at
similar costs to renting, particularly when utilizing short-term variable
mortgages. However, with the more recent increases in interest rates, this
attractive alternative may have faded for some and the apartment sector is in a
position to reap the benefits. If a higher interest rate environment continues,
then the number of individuals purchasing homes will typically decline. As
rental apartments directly compete with the single-family home and condominium
sectors of the economy, the demand for new and existing rental apartment
communities may rise when demand for purchasing homes falls. We believe this
will be beneficial for apartment owners as it should translate into greater
demand, higher occupancy rates, fewer concessions needed to attract renters, and
therefore increased profitability of our apartment communities.

Consolidation with White Knight Management, LLC

         Until June 30, 2006, our Properties were managed by White Knight
Management, LLC ("White Knight"), a related party owned (i) 99% by Goran Mladen,
the son of David Mladen, our majority shareholder and sole officer and director,
and (ii) 1% by Gorica Mladen, David Mladen's daughter. The Properties were

                                       19
<PAGE>

managed pursuant to an oral agreement we had with White Knight, according to
which White Knight collected the rents for all eight of our Properties and paid
our operating expenses. In consideration for such services, White Knight was
entitled to retain a management fee of approximately 4% of our rent revenues.

         Property management Fees were $31,019 for the year ended December 31,
2006. As of December 31, 2006, White Knight had retained amounts of rent in
excess of expenses paid on our behalf totaling $171,767. We wrote off such
amounts due from White Knight, as we determined the amounts were not
collectible.

         Effective July 1, 2006, we discontinued our arrangement with White
Knight and assumed all responsibilities for the management of our Properties.
Therefore, there were no property management fees for the fiscal year ended
December 31, 2007.

         As of December 31, 2007, we have consolidated our financial statements
with White Knight. In accordance with the Financial Accounting Standards Board
("FASB") Interpretation No. 46R, "Consolidation of Variable Interest Entities"
("FIN 46R"), an interpretation of Accounting Research Bulletin No. 51, a
variable-interest entity ("VIE") is to be consolidated by a company if that
company is subject to a majority of the risk of loss for the VIE or is entitled
to receive a majority of the VIE's residual returns.

Mortgage Notes Payable to Astoria Federal Mortgage Corp.

         As a result of the Eternal Acquisition, we are the owner of eight
Properties, all in the metropolitan Hartford, Connecticut area.

         As of December 27, 2005, we borrowed an aggregate of $8,224,000 from
Astoria Federal Mortgage Corp., in connection with the refinancing of the
Properties, evidenced by eight notes payable (the "Mortgage Notes"). The
Mortgage Notes bear interest at a rate equal to the five (5) year "Fixed Rate
Advance" as determined by the Federal Home Bank of New York, plus 2.500%,
rounded to the nearest one-eighth of one percent (0.125%). The initial interest
rate on the Mortgage Notes, of 5.625%, will remain in effect for 84 months.
Thereafter, the interest rate will be adjusted every sixty (60) months. The
loans are repayable in monthly installments of principal and interest, due on
the first day of each month, commencing February 1, 2006. The principal and
interest payments will be based on a 360 month amortization. The Mortgage Notes
mature on January 1, 2018, at which time the entire unpaid principal balance,
plus accrued interest thereon, shall be payable. The Mortgage Notes are secured
against each respective Property. David Mladen, our majority stockholder, and
sole officer and director, has guaranteed up to 5% of the outstanding balance of
the principal with interest for the life of the loan.



                                       20
<PAGE>

         The following sets forth certain material terms of each of the Notes as
of March 31, 2008:

  -----------------------------------------------------------------------------
                                                 Mortgage Note        Monthly
                                                     Amount          Principal
                                                 (as of March           and
                                                    31, 2007)         Interest
  Location of Property                                                Payment
  -----------------------------------------------------------------------------
  154-160A Collins Street, Hartford, CT           $ 1,265,549        $  7,506
  -----------------------------------------------------------------------------
  21 Evergreen Avenue, Hartford, CT               $   683,241        $  4,052
  -----------------------------------------------------------------------------
  243 & 255 Laurel Street, Hartford, CT           $ 1,094,739        $  6,496
  -----------------------------------------------------------------------------
  252 Laurel Street, Hartford CT                  $   566,780        $  3,363
  -----------------------------------------------------------------------------
  270 Laurel Street, Hartford, CT                 $ 1,941,026        $ 11,513
  -----------------------------------------------------------------------------
  360 Laurel Street, Hartford, CT                 $   574,543        $  3,407
  -----------------------------------------------------------------------------
  117-145 S. Marshall Street, Hartford, CT        $ 1,389,774        $  8,243
  -----------------------------------------------------------------------------
  56 Webster Street, Hartford, CT                 $   465,846        $  2,763
  ---------------------------------------------===============-----============
        Total:                                    $ 7,981,498        $ 47,343
  ---------------------------------------------===============-----============

         We used the amounts borrowed from Astoria Federal Mortgage Corp. to
repay the aggregate amount of $5,263,472 of principal and interest we owed under
previous mortgages with Credit Suisse First Boston Mortgage Capital, LLC. In
connection with such refinancing, we incurred approximately $654,083 in
pre-payment penalties in fiscal 2005. The remaining funds have been used to
purchase all of the limited partnership interests of our subsidiary Limited
Partnerships owned by Goran Mladen, the son of our majority stockholder and sole
officer and director, and for general working capital purposes.

Repayment of Promissory Notes Payable - Related Party

         As of November 4, 2005 (the "Loan Date"), the Pre-Acquisition Eternal
Stockholders of Eternal Enterprise, Inc., which were comprised of David Mladen,
our majority shareholder and sole officer and director, and Mr. Mladen's son,
daughter-in-law, daughter, and son-in-law, exchanged, in the aggregate, 100% of
the issued and outstanding shares of common stock of Eternal, for (i) limited
partnership interests representing 20% of the total partnership interests in
each of the Limited Partnerships, and (ii) unsecured promissory notes payable to
the Pre-Acquisition Eternal Stockholders in the aggregate principal amount of
$2,610,006 (the "LP Notes'). In consideration for our ownership of 80% of the
total partnership interests of each of the Limited Partnerships, we agreed to
assume the LP Notes.

         The interest rate on the LP Notes is 7% per annum. The entire balance
of principal and interest of the LP Notes is due and payable on November 4,
2010. The LP Notes may be prepaid without penalty. All payments shall be applied
first toward the payment of interest and the balance towards the reduction of
principal.

         For the three-month period ended March 31, 2008, we paid Mr. Mladen a
total of $123,719 of principal and $34,652 of Interest due under his portion of
the LP Notes. As of March 31, 2008, the total amount due under the LP Notes was
$2,169,153.

Liquidated Damages

         In connection with David Mladen's purchase of 11,000 shares of our
Series A Preferred Stock (the "Preferred Stock") on September 29, 2005, we
entered into a Registration Rights Agreement with Mr. Mladen (the "Registration
Rights Agreement"), pursuant to which we agreed to prepare, and, on or prior to
the sixtieth (60th) day following the date of such purchase, file with the
Securities and Exchange Commission a resale Registration Statement on Form SB-2
(the "Resale Registration Statement"), to register all of the shares of our

                                       21
<PAGE>

Common Stock underlying the Preferred Stock. Further, pursuant to the
Registration Rights Agreement, we are required to use best efforts to (a) have
the SEC declare the Resale Registration Statement effective within ninety (90)
days after filing the Resale Registration Statement with the SEC (or one hundred
and twenty (120) days if we receive any comments on the Registration Statement
from the SEC), and (b) maintain the effectiveness of the Resale Registration
Statement until all such common shares have been sold or may be sold without
volume restrictions pursuant to Rule 144(k) of the Securities Act of 1933, as
amended.

         If we (i) fail to file the Resale Registration Statement, or (ii) fail
to have the Registration Statement declared effective within required period, or
(iii) if effectiveness is not maintained, the Registration Rights Agreement
requires us to make payments to Mr. Mladen in an aggregate amount equal to two
percent (2%) per month of $9,000,000 (assuming the sale of $9,000,000 of the
aggregate fair market value of the Conversion Shares), multiplied by the number
of months (prorated for partial months) until the failure is cured.

         We were not able to file the Resale Registration Statement on or prior
to the required filing date and, as a result, began incurring liquidated damages
equal to $180,000 per month (the "Liquidated Damages").

         As of June 30, 2006, we had still failed to file the Resale
Registration Statement. At that time, Mr. Mladen agreed to waive approximately
$1,174,000 of Liquidated Damages due to him pursuant to the Registration Rights
Agreement. Such amount was accounted for in our financial statements as a
contribution of capital.

         On October 18, 2006, we issued 43,500 shares of our Series C
convertible preferred stock to Mr. Mladen, in consideration for his agreement to
waive an additional $720,000 of Liquidated Damages due to him for the period
between July 1, 2006 and October 31, 2006.

         The Resale Registration Statement was filed on November 29, 2006.
However, on February 2, 2007, we filed a request to withdraw the Registration
Statement with the Commission. Mr. Mladen had agreed to waive the liquidated
damages which were due to him through March 31, 2007, but as a result of the
withdrawal of the Registration Statement the contingent liability increased to
$4,071,921 as of December 31, 2007.

         We had adopted View C of EITF 05-4 "Effect of Liquidated Damages Clause
on a Freestanding Financial Instrument Subject to EITF 00-19" ("EITF 05-4").
Accordingly, we classified as liability instruments the fair value of
registration rights agreements when such agreements (i) require it to file, and
cause to be declared effective under the Securities Act, a registration
statement with the SEC within contractually fixed time periods, and (ii) provide
for the payment of liquidating damages in the event of its failure to comply
with such agreements.

         Previously, under View C of EITF 05-4, (i) registration rights with
these characteristics are accounted for as derivative financial instruments at
fair value and (ii) contracts that are (a) indexed to and potentially settled in
an issuer's own stock and (b) permit gross physical or net share settlement with
no net cash settlement alternative are classified as equity instruments.

         We have adopted EITF 00-19-2 and as a result no longer classify these
registration rights as a derivative instrument. With the help of a valuation
specialist, we determined the likely settlement to be $4,071,921 as of December
31, 2007. The analysis assumed an effective registration would not be achieved
by March 31, 2008 and as a result the contingent liability remains unchanged.

                                       22
<PAGE>

Investment Agreement with Dutchess Private Equities

         On August 29, 2006, we entered into an Investment Agreement with
Dutchess Private Equities Fund, L.P. ("Dutchess"), pursuant to which Dutchess
committed to purchase up to $25,000,000 of our Common Stock over the course of
thirty six (36) months. The amount that we will be entitled to request from each
purchase ("Puts") shall be equal to, at our election, either (i) $250,000, or
(ii) 200% of the average daily volume (U.S. market only) of the Common Stock for
the 10 trading days prior to the applicable put notice date, multiplied by the
average of the 3 daily closing bid prices immediately preceding the put date.
The put date shall be the date that Dutchess receives a put notice of a draw
down by us. The purchase price shall be set at 93% of the lowest closing Best
Bid price of the Common Stock during the pricing period. The pricing period
shall be the 5 consecutive trading days immediately after the put notice date.
There are put restrictions applied on days between the put date and the closing
date with respect to that particular Put. During this time, we shall not be
entitled to deliver another put notice. Further, we shall reserve the right to
withdraw that portion of the Put that is below 90% of the lowest closing bid
prices for the 10-trading day period immediately preceding each put notice. As
of the date hereof, we have not requested any Puts under the Investment
Agreement.

         The Investment Agreement with Dutchess terminates either (a) when
Dutchess has purchased an aggregate of Twenty-Five Million dollars ($25,000,000)
in shares of Common Stock of the Company pursuant to the Investment Agreement,
or (b) thirty-six months after the effective date of the Investment Agreement.

         Dutchess is not obligated to purchase any shares of the Common Stock,
unless each of the following conditions are satisfied at the time of purchase:

          o    a registration statement shall have been declared effective and
               shall remain effective and available for the resale of all the
               shares of Common Stock to be purchased by Dutchess;

          o    the Common Stock shall be listed, and shall not have been
               suspended from trading for a period of two (2) consecutive
               trading days, and the Company shall not have been notified of any
               pending or threatened proceeding or other action to suspend the
               trading of its Common Stock;

          o    the Company must have complied with its obligations and must not
               otherwise be in breach of or in default under the Investment
               Agreement, or other related transaction documents;

          o    no injunction shall have been issued and remain in force, or
               action commenced by a governmental authority, which has not been
               stayed or abandoned, prohibiting the purchase or the issuance of
               the shares of the Company's Common Stock to be purchased; and

          o    the issuance of the shares of Common Stock of the Company will
               not violate any shareholder approval requirements of the
               principal market or exchange on which the Common Stock is traded.

         To date, the Company has not delivered any Puts to Dutchess pursuant to
the Investment Agreement, and has no intention to do so in the foreseeable
future.

                                       23
<PAGE>

Results of Operations

         As of March 31, 2008 and 2007 we owned interests in 8 Properties.
Details on the Properties are as follows:

---------------------------------------------------------------
                                                 Occupancy
                                                 Rate as of
                                                 March 31,
Location                     Number of Units       2008
---------------------------------------------------------------
154-160A Collins Street         41 units           97%
Hartford, CT
---------------------------------------------------------------
21 Evergreen Avenue             24 units           96%
Hartford, CT
---------------------------------------------------------------
243 & 255 Laurel Street         34 units           97%
Hartford, CT
---------------------------------------------------------------
252 Laurel Street               18 units           94%
Hartford, CT
---------------------------------------------------------------
270 Laurel Street               77 units           95%
Hartford, CT
---------------------------------------------------------------
360 Laurel Street               18 units           90%
Hartford, CT
---------------------------------------------------------------
117-145 S. Marshall Street      42 units           98%
Hartford, CT
---------------------------------------------------------------
56 Webster Street               16 units           95%
Hartford, CT
---------------------------------------------------------------

Comparison Of Operations For The Three-Months Ended March 31, 2008 To The
Three-Months Ended March 31, 2007

         The following summarizes changes in our operations for the three-month
periods ended March 31, 2008 and 2007. We had a net loss of $59,187 for the
three-month period ended March 31, 2008, compared to a net loss of $398,186 for
the three-month period ended March 31, 2007. The primary reasons for this
reduction in our net loss were an increase of $123,988 in rental revenue, the
discontinuance of our practice of trading equity securities of publicly traded
companies (which resulted in a loss of $168,748 in the first quarter of fiscal
2007), and a decrease of $65,966 in general and administrative expenses.

Rental Revenue

         Revenues increased $123,988, from $395,805 to $519,793, or
approximately 31.3%, in the three-month period ended March 31, 2008, compared to
the same period in the prior year. This increase was primarily related to a
combination of higher occupancy rates and higher rents at our Properties.

Property Operating Costs

         Property operating costs increased $16,457, from $265,833 to $282,290,
or approximately 6.2%, in the first quarter of 2008 as compared to the first
quarter of 2007. The increase was primarily related to increases in utility
costs, including the price of oil.

                                       24
<PAGE>

General and Administrative

         General and administrative expense decreased $65,966, from $171,998 in
the three-month period ended March 31, 2007, to $106,032 in the three-month
period ended March 31, 2008, or approximately 38.4%. The amount decreased
primarily due to a decrease in professional fees we incurred in first quarter of
fiscal 2007, as compared to the first three months of the prior year.

Depreciation And Amortization

         Depreciation and amortization expense in the three-month period ended
March 31, 2008 remained relatively steady at $38,323, as compared to $38,221 in
the first quarter of fiscal 2007.

Realized Loss from Sales of Trading Securities

         In the three-month period ended March 31, 2007, we had a realized loss
on sales of trading securities of $168,748. During fiscal 2007, we discontinued
our practice of trading equity securities of publicly traded companies.
Therefore we did not have a similar loss in the first quarter of fiscal 2008.

Liquidity and Capital Resources

         As of March 31, 2008, our cash and cash equivalents were $106,934. This
represents a decrease of $134,616 from the beginning of our fiscal year. All
cash and cash equivalents are held in money market or checking accounts.

         We have suffered recurring losses from operations. As of March 31,
2008, we had a net stockholders' deficit of $9,679,522. We expect that the
rental income we receive from tenants of our Properties will be our primary
source of funds going forward. In order to acquire additional apartment
properties, and, if necessary, to fund our operations, we may determine to take
out additional loans from financial institutions or raise funds from one or a
combination of debt offerings and equity offerings. Management plans to manage
cash flows carefully. However, we have no assurance that sufficient cash flow
will be generated in the future to meet our operating requirements. This raises
substantial doubt about our ability to continue as a going concern.

Uses of Capital

Net Cash From Operations
------------------------

         During the first quarter of fiscal 2008, $18,612 was provided by
operations, compared to $96,667 used in operations during the first three months
of fiscal 2007. The primary reason for this change was a $338,999 reduction in
our net loss for the three-month period ended March 31, 2008, as compared to the
same period in the previous year.

Net Cash From Investing Activities
----------------------------------

         During the three-month period ended March 31, 2008, no cash was
provided by or used in investing activities, compared to $117,134 used in
investing activities during the first quarter of 2007. The reason for this
change was our discontinuance of our practice of trading equity securities of
publicly traded companies.

                                       25
<PAGE>

Net Cash From Financing Activities
----------------------------------

         During the first quarter of fiscal 2008, we used $153,228 in financing
activities, compared to $59,325 used in financing activities during the
three-month period ended March 31, 2007. The primary reason for this difference
was due to the paydown of the promissory notes payable to David Mladen, our
majority stockholder, officer and director, in the amount of $123,719.

Critical Accounting Policies

Principles of Consolidation
---------------------------

         The consolidated financial statements found in Part I, Item 1 of this
report include the accounts of Excellency Investment Realty Trust, Inc. and its
controlled subsidiaries comprised of certain Limited Partnerships, and Eternal
Enterprise, Inc. The historical financial statements as presented, reflect the
operations of Eternal as a result of the Reverse Merger. We record minority
interest for the non-owned portions of consolidated subsidiaries, however, these
subsidiaries have not generated any income to warrant the recording of such
minority interests through March 31, 2008. All significant inter-company
transactions and accounts have been eliminated in the consolidated financial
statements.

         The consolidated financial statements found in Part I, Item 1 of this
report include accounts of White Knight Management, LLC, in which we have a
controlling financial interest, with the exception of comparative March 31, 2007
information as management has determined the effect to be immaterial. The usual
condition for a controlling financial interest is ownership of a majority of the
voting interests of an entity. However, a controlling financial interest may
also exist in entities, such a special purpose entity ("SPE"), through
arrangements that do not involve voting interest. We have determined that White
Knight Management, LLC is a VIE and that we are the primary beneficiary as of
March 31, 2008 and December 31, 2007.

Going Concern
-------------

         We have suffered recurring losses from operations. During the year
ended December 31, 2007, we had a net loss of $537,911 and net cash used in
operations of $73,990, and as of March 31, 2008 we have a net stockholders'
deficit of $9,679,522, all of which raise substantial doubt about our ability to
continue as a going concern. Management plans to raise capital through any
combination of debt and equity financing. However, we have no assurance that
sufficient cash flow will be generated in the future to meet its operating
requirements. As a result of the above, the consolidated financial statements
found in Part I, Item 1 of this report have been prepared assuming that we will
continue as a going concern. The consolidated financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

Accounts Receivable - Tenants
-----------------------------

         Tenant receivables are reported net of an allowance for doubtful
accounts. Management's estimate of the allowance is based on historical
collection experience and a review of the current status of specific tenant
accounts receivable. We fully reserve for moved-out balances. After a six month
period, we charge-off the moved out balances for the previous six months against
accounts receivable. As of March 31, 2008 and December 31, 2007 we had recorded
an allowance for doubtful accounts of $126,102 and $81,733, respectively.

Reclassification of Prior Periods
---------------------------------

Certain accounts and balances related to prior periods have been changed to
reflect current period presentation.

                                       26
<PAGE>

Contingent Liabilities
----------------------

         We have previously accounted for the registration rights agreements as
a separate freestanding instrument and accounted for the liquidated damages
provision as a derivative liability in accordance with SFAS No. 133, "Accounting
for Derivative Instruments and Hedging Activities," Emerging Issue Task Force
("EITF") 00-19, "Accounting for Derivative Financial Instruments Indexed to and
Potentially Settled in a Company's Own Stock," and EITF 05-04, "The Effect of a
Liquidating Damages Clause in a Free Standing Financial Instrument Subject to
EITF 00-19." Accordingly the liability was recorded at estimated fair value
based on an estimate of the probability and costs of cash penalties being
incurred and is revalued at each balance sheet date with changes in value
recorded as other non-operating income or expenses.

         As of January 1, 2007, we adopted EITF 00-19-2 which called for
registration rights agreement penalties to be assessed pursuant to FASB
statement number 5. After determining loss was probable we, with the assistance
of a valuation expert, assessed the probability of an effective registration
statements and determined that based upon a probability analysis the contingent
liability was $4,071,921 as of December 31, 2007. We had not anticipated an
effective registration by March 31, 2008 and therefore the amount is unchanged
at March 31, 2008.

Loss Per Common Share
---------------------

         Net loss per common share is based on the weighted average number of
shares of common stock outstanding during the applicable period. Basic loss per
share is computing by diving loss available to common stockholders by the
weighted average number of common shares outstanding during the period. The
common stock equivalents for our preferred stock and treasury shares were not
included in the computation of diluted loss per share because to do so would
have been anti-dilutive.

         For the three months period ended March 31, 2008 and 2007, common stock
equivalents of 1,573,000 and 1,573,000 respectively, were not included in the
calculation of diluted loss per share as their effect would be anti-dilutive.

Contractual Obligations and Commercial Commitments

         Our contractual obligations, as of March 31, 2008, were as follows:

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
                                             Payments Due By Period
----------------------------------------------------------------------------------------------------------------
                                                Less than                                           More than
Contractual obligations          Total           1 year          2-3 years           4-5 years       5 years
----------------------------------------------------------------------------------------------------------------
<S>                           <C>               <C>            <C>                 <C>            <C>
   Mortgages                  $ 7,981,498       $ 91,053       $    262,402        $   293,570    $ 7,334,473
----------------------------------------------------------------------------------------------------------------
   Promissory Notes           $ 2,169,153             --       $  2,169,153                 --             --
----------------------------------------------------------------------------------------------------------------
Total                         $10,150,651       $ 91,053       $  2,431,555        $   293,570    $ 7,334,473
----------------------------------------------------------------------------------------------------------------
</TABLE>

Recent Accounting Pronouncements and Interpretations

         In September 2006, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standard ("SFAS") No. 157, "Fair Value
Measurement," which provides enhanced guidance for using fair value to measure
assets and liabilities. SFAS No. 157 provides a common definition of fair value
and establishes a framework to make the measurement of fair value in generally
accepted accounting principles more consistent and comparable. SFAS No. 157 also

                                       27
<PAGE>

requires expanded disclosures to provide information about the extent to which
fair value is used to measure assets and liabilities, the methods and
assumptions used to measure fair value, and the effect of fair value measure on
earnings. SFAS No. 157 is effective for financial statements issued in fiscal
years beginning after November 15, 2007 and to interim periods within those
fiscal years. We are currently in the process of evaluating the effect, if any,
the adoption of SFAS No. 157 will have on our consolidated results of
operations, financial position, or cash flows.

         In December 2006, the FASB issue Staff Position ("FSP") EITF-00-19-2,
"Accounting for Registration Payment Arrangement." This FSP specifies that the
contingent obligation to make future payments or otherwise transfer
consideration under a registration payment arrangement, whether issue as a
separate agreement or included as a provision of a financial instrument or other
agreement, should be separately recognized and measured in accordance with FASB
Statement No. 5, "Accounting for Contingencies." The guidance was effective for
fiscal years beginning December 15, 2006. We have adopted this pronouncement and
reflected the change in our previously classified derivative accordingly.

         In February 2007, the FASB issued SFAS No. 159, The Fair Value Option
for Financial Assets and Financial Liabilities-including an amendment of FASB
Statement No. 115 ("FAS 159"). FAS 159 became effective for us on January 1,
2008. This standard permits companies to choose to measure many financial
instruments and certain other items at fair value and report unrealized gains
and losses in earnings. Such accounting is optional and is generally to be
applied instrument by instrument. We do not anticipate that election, if any, of
this fair-value option will have a material effect on the consolidation results
or operations or financial position.

         In December 2007, the FASB issued SFAS No. 141(R), Business
Combinations, and SFAS No.160, non-controlling Interest in Consolidation
Financial Statements. SFAS No.141(R) requires an acquirer to measure the
identifiable assets acquired, the liabilities assumed, and any non-controlling
interest in the acquire at their fair values on the acquisition date, with
goodwill being the excess value over the net identifiable assets acquired. SFAS
No. 160 clarifies that a non-controlling interest in a subsidiary should be
report as equity in the consolidated financial statement. The calculation of
earnings per share will continue to be based on income amounts attributable to
the parent. SFAS No.141(R) and SFAS No.160 are effective for financial
statements issued for fiscal years beginning after December 15, 2008. Early
adoption is prohibited. We have not yet determined the effect on our
consolidated financial statements, if any, upon adoption of SFAS No.141(R) or
SFAS No.160.

         The implementation of the above pronouncements is not expected to have
a material effect on our consolidated financial statements or disclosures.

Off Balance Sheet Arrangements

         We have no off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that are material to investors.

                                       28
<PAGE>

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

         We are a smaller reporting company as defined by Rule 12b-2 of the
Securities Exchange Act of 1934 and are not required to provide the information
under this item.

Item 4T.   CONTROLS AND PROCEDURES.

         We have not yet been able to implement disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities
Exchange Act of 1934 (the "Exchange Act"), that are designed to ensure that
information required to be disclosed in our Exchange Act reports are recorded,
processed, summarized, and reported within the time periods specified in rules
and forms of the Securities and Exchange Commission, and that such information
is accumulated and communicated to our management, including our Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow timely decisions
regarding required disclosure.

         As of October 8, 2007, we hired Daniel Norensberg as our Chief
Financial Officer. One of his main responsibilities was to help us analyze our
disclosure controls and procedures and recommend and implement improvements to
ensure the integrity of our financial information and systems and compliance
with all applicable securities laws, including, reporting requirements under the
Exchange Act. We believe that between October 8, 2007 and February 29, 2008, Mr.
Norensberg did not adequately serve as our Chief Financial Officer. In addition,
despite numerous attempts to contact Mr. Norensberg, we have not heard from him
since approximately March 1, 2008. This has caused us material hardship in
connection with, among other things, (a) our ability to prepare and timely file
our Annual Report on Form 10-KSB for the fiscal year ended December 31, 2007
(the "Annual Report"), (b) our ability to prepare and timely file this Quarterly
Report on Form 10-Q for the fiscal quarter ended March 31, 2008 ("Quarterly
Report"), and (c) our ability to timely evaluate and report on the effectiveness
of our disclosure controls and procedures in accordance with Section 404 of the
Sarbanes Oxley Act of 2002. We replaced Mr. Norensberg with Carlos D. Carrillo
as our Chief Financial Officer, as of March 24, 2008. However, Mr. Carrillo has
limited experience with SEC disclosure principles and practices.

         Our acting Chief Financial Officer under the direction of the Chief
Executive Officer evaluated our disclosure controls and procedures as defined in
Rule 13a-15(e) of the Securities Exchange Act of 1934 as of March 31, 2008.
Within the 45-day period prior to the filing of that period's report, the acting
Chief Financial Officer concluded that the controls as they existed were
ineffective to ensure the information we disclosed by under the Securities
Exchange Act was recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms. This conclusion was based upon
significant deficiencies that were previously identified and remain uncured.

         Our management has performed additional accounting and financial
analyses and other post-closing procedures including detailed validation work
with regard to all the balance sheet account balances, additional analysis on
income statement amounts and managerial review of all significant account
balances and disclosures in the Annual Report and this Quarterly Report, to
ensure that these reports, and the financial statements forming a part thereof,
are in accordance with accounting principles generally accepted in the United
States of America. Accordingly, management believes that the financial
statements included in this Quarterly Report fairly present, in all material
respects, our financial condition, results of operations, and cash flows for the
periods presented.

         In our Annual Report we included management's assessment that we had a
number of material or significant deficiencies in our internal controls. We have
not yet been able to implement changes to address these deficiencies.

         There have been no changes in our internal controls that have
materially affected, or are reasonably likely to materially affect, our internal
controls over financial reporting during the period covered by this Quarterly
Report.

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<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS.

         During the three-month period ended March 31, 2008, and subsequent
period through the date hereof, we were not a party to any pending legal
proceedings. To the knowledge of management, no federal, state or local
governmental agency is presently contemplating any proceeding against us. No
director, executive officer or affiliate of ours, or owner of record of more
than 5% of our Common Stock is a party adverse to us, or has a material interest
adverse to us in any legal proceeding.

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

         In the three-month period ended March 31, 2008, and subsequent period
through the date hereof, we did not issue any unregistered securities, except as
follows:

         On March 14, 2008, we issued an aggregate of 300,000 shares of our
Common Stock to two investor relations firms in consideration for services.
Subsequently, we determined not to proceed with these investor relations firms
and the shares have been returned to us. However, we have not yet cancelled
these shares.

         We believe that this transaction are exempt from registration under the
Securities Act of 1933, as amended, pursuant to Section 4(2), or Regulation D
promulgated thereunder, as a transaction by an issuer not involving a public
offering.

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES.

         During the three-month period ended March 31, 2008, and subsequent
period through the date hereof, we did not default upon any senior securities.

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

         No matters were submitted to a vote of our security holders during the
three-month period ended March 31, 2008, or subsequent period through the date
hereof, except that:

ITEM 5.    OTHER INFORMATION.

         There was no information we were required to disclose in a report on
Form 8-K during the three-month period ended March 31, 2008, or subsequent
period through the date hereof, that we did not report.



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<PAGE>

ITEM 6.    EXHIBITS.

Exhibit No.                      Description of Exhibit
-----------                      ----------------------

    31.1     Certification of principal executive officer pursuant to Section
             13a-14(a) -- filed herewith

    31.2     Certification of principal financial and accounting officer
             pursuant to Section 13a-14(a) -- filed herewith

    32.1     Certification of principal executive officer pursuant to Section
             1350 -- filed herewith

    32.2     Certification of principal financial and accounting officer
             pursuant to Section 1350 -- filed herewith



                                       31
<PAGE>

                                   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.



                                     EXCELLENCY INVESTMENT REALTY TRUST, INC.


 Dated: June 20, 2008                By:   /s/ David Mladen
                                           -------------------------------------
                                           David Mladen
                                           President and Chief Executive Officer
                                           (principal executive officer)



 Dated: June 20, 2008                By:   /s/ Carlos D. Carrillo
                                           -------------------------------------
                                           Carlos D. Carrillo
                                           Chief Financial Officer
                                           (principal financial and accounting
                                           officer)



                                       32