<PAGE>
 
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                         UNITED STATES SECURITIES AND
                              EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
 
                               ----------------
 
                                   FORM 10-Q
 
                               ----------------
 
(Mark One)
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
  (X)
EXCHANGE ACT OF 1934
 
                 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1997
 
                                      OR
 
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
  (  )
    EXCHANGE ACT OF 1934
                      FOR THE TRANSITION PERIOD FROM TO
 
                          COMMISSION FILE NO. 1-10272
 
                               ----------------
 
                        SECURITY CAPITAL PACIFIC TRUST
            (Exact name of registrant as specified in its charter)
 
                               ----------------
 
               MARYLAND                              74-6056896
    (State or other jurisdiction of               (I.R.S. Employer
    incorporation or organization)               Identification No.)
 
 
  7777 MARKET CENTER AVENUE, EL PASO,                   79912
                 TEXAS                                (Zip Code)
    (Address of principal executive
               offices)
 
                                (915) 877-3900
             (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 for the past 90 days. Yes   X No
 
  The number of shares outstanding of the Registrant's common stock as of May
7, 1997 was: 76,660,790
 
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<PAGE>
 
                         SECURITY CAPITAL PACIFIC TRUST
 
                                     INDEX
 
<TABLE>
<CAPTION>
                                                                           PAGE
                                                                          NUMBER
                                                                          ------
 <C>        <S>                                                           <C>
 PART I.     Condensed Financial Information
    Item 1.  Financial Statements
             Condensed Balance Sheets--March 31, 1997 (unaudited) and
             December 31, 1996........................................       3
             Condensed Statements of Earnings--Three months ended
             March 31, 1997 and 1996 (unaudited)......................       4
             Condensed Statement of Shareholders' Equity--Three months
             ended March 31, 1997 (unaudited).........................       5
             Condensed Statements of Cash Flows--Three months ended
             March 31, 1997 and 1996 (unaudited)......................       6
             Notes to Condensed Financial Statements (unaudited)......       7
             Independent Auditors' Review Report......................      15
    Item 2.  Management's Discussion and Analysis of Financial
             Condition and Results of Operations......................      16
 PART II.    Other Information
    Item 4.  Submission of Matters to a Vote of Securities Holders....      27
    Item 5.  Other Information........................................      27
    Item 6.  Exhibits and Reports on Form 8-K.........................      27
</TABLE>
 
                                       2
<PAGE>
 
                         SECURITY CAPITAL PACIFIC TRUST
 
                            CONDENSED BALANCE SHEETS
 
                       (IN THOUSANDS, EXCEPT SHARE DATA)
 
<TABLE>
<CAPTION>
                                                        MARCH 31,   DECEMBER 31,
                                                          1997          1996
                                                       -----------  ------------
                                                       (UNAUDITED)
<S>                                                    <C>          <C>
                        ASSETS
                        ------
Real estate........................................... $2,233,866    $2,153,363
Less accumulated depreciation.........................    100,041        97,574
                                                       ----------    ----------
                                                        2,133,825     2,055,789
Homestead Notes.......................................    191,829       176,304
Other mortgage notes receivable.......................     13,537        13,525
                                                       ----------    ----------
    Net investments...................................  2,339,191     2,245,618
Cash and cash equivalents.............................      7,941         5,601
Accounts receivable and accrued interest..............      8,487         4,157
Restricted cash in tax-deferred exchange escrow.......     59,000            42
Other assets..........................................     27,358        27,014
                                                       ----------    ----------
    Total assets...................................... $2,441,977    $2,282,432
                                                       ==========    ==========
         LIABILITIES AND SHAREHOLDERS' EQUITY
         ------------------------------------
Liabilities:
  Credit facilities................................... $  193,865    $  110,200
  Long-Term Debt......................................    630,000       580,000
  Mortgages payable...................................    230,578       217,188
  Distributions payable...............................        --         24,537
  Accounts payable....................................     25,368        22,782
  Accrued expenses and other liabilities..............     55,207        60,217
                                                       ----------    ----------
    Total liabilities.................................  1,135,018     1,014,924
                                                       ----------    ----------
Shareholders' equity:
  Series A Preferred Shares (6,080,019 convertible
   shares in 1997 and 6,494,967 in 1996; stated
   liquidation preference of $25 per share)...........    152,000       162,374
  Series B Preferred Shares (4,200,000 shares issued;
   stated liquidation
   preference of $25 per share).......................    105,000       105,000
  Common Shares (shares issued--76,075,971 in 1997 and
   75,510,986 in 1996)................................     76,076        75,511
  Additional paid-in capital..........................    928,330       918,434
  Unrealized holding gain on Homestead Notes..........     73,886        74,923
  Distributions in excess of net earnings.............    (28,333)      (68,734)
                                                       ----------    ----------
    Total shareholders' equity........................  1,306,959     1,267,508
                                                       ----------    ----------
    Total liabilities and shareholders' equity........ $2,441,977    $2,282,432
                                                       ==========    ==========
</TABLE>
 
     The accompanying notes are an integral part of the condensed financial
                                  statements.
 
                                       3
<PAGE>
 
                         SECURITY CAPITAL PACIFIC TRUST
 
                        CONDENSED STATEMENT OF EARNINGS
 
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
 
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                 THREE MONTHS
                                                                ENDED MARCH 31,
                                                                ---------------
                                                                 1997    1996
                                                                ------- -------
<S>                                                             <C>     <C>
Revenues:
  Rental revenues.............................................. $79,950 $75,809
  Interest income on Homestead Notes...........................   3,174     --
  Other interest income........................................     370     547
                                                                ------- -------
                                                                 83,494  76,356
                                                                ------- -------
Expenses:
  Rental expenses..............................................  20,357  20,086
  Real estate taxes............................................   7,268   7,103
  Property management fees paid to affiliates..................   2,950   3,108
  Depreciation.................................................  12,049  10,618
  Interest.....................................................  13,961   6,520
  REIT management fee paid to affiliate........................   4,617   5,555
  General and administrative...................................     272     276
  Other........................................................   1,744     170
                                                                ------- -------
                                                                 63,218  53,436
                                                                ------- -------
Earnings from operations.......................................  20,276  22,920
Gain on disposition of investments, net........................  25,335   2,923
                                                                ------- -------
Net earnings...................................................  45,611  25,843
Less Preferred Share dividends.................................   5,035   6,388
                                                                ------- -------
Net earnings attributable to common shares..................... $40,576 $19,455
                                                                ======= =======
Weighted-average Common Shares outstanding.....................  75,872  72,211
                                                                ======= =======
Per Common Share amounts:
  Primary...................................................... $  0.53 $  0.27
                                                                ======= =======
  Fully diluted................................................ $  0.51 $   --
                                                                ======= =======
Distributions paid............................................. $ 0.325 $ 0.310
                                                                ======= =======
</TABLE>
 
     The accompanying notes are an integral part of the condensed financial
                                  statements.
 
                                       4
<PAGE>
 
                         SECURITY CAPITAL PACIFIC TRUST
 
                  CONDENSED STATEMENT OF SHAREHOLDERS' EQUITY
 
                       THREE MONTHS ENDED MARCH 31, 1997
 
                        (IN THOUSANDS EXCEPT SHARE DATA)
 
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                SHARES OF BENEFICIAL
                             INTEREST, $1.00 PAR VALUE
                          --------------------------------
                           SERIES A    SERIES B
                           PREFERRED   PREFERRED
                           SHARES AT   SHARES AT   COMMON
                           AGGREGATE   AGGREGATE   SHARES  ADDITIONAL UNREALIZED DISTRIBUTIONS
                          LIQUIDATION LIQUIDATION  AT PAR   PAID-IN    HOLDING   IN EXCESS OF
                          PREFERENCE  PREFERENCE   VALUE    CAPITAL     GAINS    NET EARNINGS    TOTAL
                          ----------- ----------- -------- ---------- ---------- ------------- ----------
<S>                       <C>         <C>         <C>      <C>        <C>        <C>           <C>
Balances at January 1,
 1997...................   $162,374    $ 105,000  $ 75,511 $ 918,434   $74,923     $(68,734)   $1,267,508
 Net earnings...........        --           --        --        --        --        45,611        45,611
 Shareholder
  Distributions.........        --           --        --        --        --        (5,210)       (5,210)
 Conversion of 414,948
  Series A Preferred
  Shares into 558,875
  Common Shares.........    (10,374)         --        559     9,815       --           --            --
 Change in unrealized
  holding gain on
  Homestead Notes.......        --           --        --        --     (1,037)         --         (1,037)
 Exercise of warrants...        --           --          6        81       --           --             87
                           --------    ---------  -------- ---------   -------     --------    ----------
Balances at March 31,
 1997...................   $152,000    $ 105,000  $ 76,076 $ 928,330   $73,886     $(28,333)   $1,306,959
                           ========    =========  ======== =========   =======     ========    ==========
</TABLE>
 
 
     The accompanying notes are an integral part of the condensed financial
                                  statements.
 
                                       5
<PAGE>
 
                         SECURITY CAPITAL PACIFIC TRUST
 
                       CONDENSED STATEMENTS OF CASH FLOWS
 
                                 (IN THOUSANDS)
 
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                          THREE MONTHS ENDED
                                                               MARCH 31,
                                                          --------------------
                                                            1997       1996
                                                          ---------  ---------
<S>                                                       <C>        <C>
Operating Activities
  Net earnings........................................... $  45,611  $  25,843
  Adjustments to reconcile net earnings to net cash flow
   provided by operating activities:
    Depreciation and amortization........................    12,466     11,036
    Gain on disposition of investments, net..............   (25,335)    (2,923)
    Provision for possible loss on investments...........     1,500        --
  Change in accounts payable.............................    (1,321)    (8,658)
  Change in accrued expenses and other liabilities.......    (5,010)    (8,297)
  Change in other operating assets.......................    (5,186)      (829)
                                                          ---------  ---------
      Net cash flow provided by operating activities.....    22,725     16,172
                                                          ---------  ---------
Investing activities:
  Real estate investments................................  (177,877)  (101,323)
  Change in tax-deferred exchange escrow.................   (58,958)       --
  Funding of Homestead Notes.............................   (16,250)       --
  Advances on other mortgage notes receivable............      (100)       --
  Principal repayments on other mortgage notes
   receivable............................................        88      1,081
  Gross proceeds from dispositions.......................   142,137     39,548
  Closing costs related to dispositions..................    (3,075)      (401)
                                                          ---------  ---------
      Net cash flow used in investing activities.........  (114,035)   (61,095)
                                                          ---------  ---------
Financing activities:
  Proceeds from Long-Term Debt...........................    50,000    150,000
  Debt issuance costs incurred...........................      (218)    (1,598)
  Prepayment of mortgages payable due to community
   dispositions..........................................    (9,534)       --
  Regularly scheduled principal payments on mortgages
   payable...............................................      (603)      (484)
  Proceeds from credit facilities........................   248,808     63,135
  Principal payments on credit facilities................  (165,143)  (155,886)
  Cash distributions paid on Common Shares...............   (24,712)   (22,437)
  Cash dividends paid on Preferred Shares................    (5,035)    (6,388)
  Proceeds from exercise of warrants.....................        87        --
                                                          ---------  ---------
      Net cash flow provided by financing activities.....    93,650     26,342
                                                          ---------  ---------
Net increase (decrease) in cash and cash equivalents.....     2,340    (18,581)
Cash and cash equivalents at beginning of period.........     5,601     26,919
                                                          ---------  ---------
Cash and cash equivalents at end of period............... $   7,941  $   8,338
                                                          =========  =========
Non-cash investing and financing activities:
  Assumption of mortgages payable upon purchase of
   multifamily communities...............................    23,527        --
  Series A Preferred Shares converted to Common Shares...    10,374        --
  Fair market value adjustment related to Homestead
   Notes.................................................     1,037        --
</TABLE>
 
     The accompanying notes are an integral part of the condensed financial
                                  statements.
 
                                       6
<PAGE>
 
                         SECURITY CAPITAL PACIFIC TRUST
 
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
 
                            MARCH 31, 1997 AND 1996
 
                                  (UNAUDITED)
 
(1) GENERAL
 
  The condensed financial statements of SECURITY CAPITAL PACIFIC TRUST ("PTR")
are unaudited and certain information and footnote disclosures normally
included in financial statements have been omitted. While management of PTR
believes that the disclosures presented are adequate, these interim financial
statements should be read in conjunction with the financial statements and
notes included in PTR's 1996 Annual Report on Form 10-K.
 
  In the opinion of management, the accompanying unaudited financial statements
contain all adjustments necessary for a fair presentation of PTR's financial
statements for the interim periods presented. The results of operations for the
three month periods ended March 31, 1997 and 1996 are not necessarily
indicative of the results to be expected for the entire year.
 
  The accounts of PTR and its majority-owned subsidiaries are consolidated in
the accompanying condensed financial statements. All significant intercompany
accounts and transactions have been eliminated in consolidation.
 
  The preparation of these financial statements in conformity with generally
accepted accounting principles required management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent liabilities at the dates of the financial statements
and the reported amounts of revenues and expenses during the reporting periods.
Actual amounts realized or paid could differ from those estimates.
 
 Reclassifications
 
  Certain of the 1996 amounts have been reclassified to conform to the 1997
presentation.
 
 Per Share Data
 
  Primary earnings per share is computed based on the weighted average number
of common shares of beneficial interest, par value $1.00 per share ("Common
Share(s)"), outstanding. Fully diluted earnings per Common Share is calculated
from the weighted average Common Shares outstanding plus the Common Shares that
would be outstanding assuming conversion of the weighted average number of
outstanding cumulative convertible Series A Preferred Shares of Beneficial
Interest, par value $1.00 per share ("Series A Preferred Shares"), outstanding
Trustee options and certain warrants exercisable by third parties. For purposes
of the fully diluted earnings per share calculation, dividends on the Series A
Preferred Shares are added back to net earnings attributable to Common Shares.
Primary earnings per share and fully diluted earnings per share were
approximately the same for the three months ended March 31, 1996.
 
  PTR will adopt Statement of Financial Accounting Standards ("SFAS") No. 128,
Earnings per Share, which changes the method used to compute earnings per share
in the fourth quarter of 1997. The impact of SFAS No. 128 on the calculation of
PTR's earnings per share is not expected to be material.
 
                                       7
<PAGE>
 
                        SECURITY CAPITAL PACIFIC TRUST
 
             NOTES TO CONDENSED FINANCIAL STATEMENTS--(CONTINUED)
 
 
(2) REAL ESTATE
 
 Investments
 
  Equity investments in real estate, at cost, were as follows (dollar amounts
in thousands):
 
<TABLE>
<CAPTION>
                                       MARCH 31, 1997      DECEMBER 31, 1996
                                      -----------------    -----------------
                                      INVESTMENT UNITS     INVESTMENT UNITS
                                      ---------- ------    ---------- ------
<S>                                   <C>        <C>       <C>        <C>
Multifamily:
  Operating communities.............. $1,885,814 40,874    $1,861,561 42,702
  Communities under construction.....    227,325  5,671(1)    186,710  5,479(1)
  Development communities in
   planning:
    Development communities owned....     59,628  3,877(1)     48,504  3,351(1)
    Development communities under
     control.........................    (2)      2,074(1)    (2)      3,737(1)
                                      ---------- ------    ---------- ------
      Total development communities..     59,628  5,951        48,504  7,088
                                      ---------- ------    ---------- ------
Land held for future development.....     35,095    --         30,043    --
                                      ---------- ------    ---------- ------
      Total multifamily..............  2,207,862 52,496     2,126,818 55,269
                                      ---------- ------    ---------- ------
Non-multifamily......................     26,004               26,545
                                      ----------           ----------
      Total real estate.............. $2,233,866           $2,153,363
                                      ==========           ==========
</TABLE>
--------
(1) Unit information is based on management's estimates and has not been
    audited or reviewed by PTR's independent auditors.
(2) PTR's investment as of March 31, 1997 and December 31, 1996 for
    developments under control was $1.9 million and $1.6 million,
    respectively, and is reflected in the "Other assets" caption of PTR's
    balance sheets.
 
  The change in investments in real estate, at cost, consisted of the
following (in thousands):
 
<TABLE>
      <S>                                                            <C>
      Balance at January 1, 1997.................................... $2,153,363
        Multifamily:
          Acquisition and renovation expenditures...................    146,801
          Development expenditures, excluding land
           acquisitions.............................................     52,883
          Acquisition and improvement of land
           held for current or future development...................      4,095
          Recurring capital expenditures............................      1,533
          Dispositions..............................................   (122,769)
          Provisions for possible loss on investments...............     (1,500)
                                                                     ----------
        Net multifamily activity subtotal...........................  2,234,406
        Non-multifamily disposition.................................       (540)
                                                                     ----------
      Balance at March 31, 1997..................................... $2,233,866
                                                                     ==========
</TABLE>
 
  At March 31, 1997, PTR had contingent contracts or letters of intent,
subject to PTR's final due diligence and approval of all entitlements, to
acquire land for the development of an estimated 4,621 multifamily units with
an aggregate estimated development cost of approximately $411.9 million. At
the same date, PTR also had
 
                                       8
<PAGE>
 
                        SECURITY CAPITAL PACIFIC TRUST
 
             NOTES TO CONDENSED FINANCIAL STATEMENTS--(CONTINUED)
 
contingent contracts or letters of intent, subject to final due diligence, for
the acquisition of 897 additional operating multifamily units with a total
expected investment of $79.7 million, including planned renovations.
 
  At March 31, 1997, PTR had unfunded development commitments for developments
under construction of $132.0 million.
 
 Gains and Provision for Possible Loss on Investments
 
  Each year, REIT Management formulates operating and capital plans based on
an ongoing active review of PTR's portfolio. Based in part upon the market
research provided by Security Capital Real Estate Research Group Incorporated,
and in an effort to optimize its portfolio composition, PTR may from time to
time seek to dispose of assets that in management's view no longer meet PTR's
long-term investment objectives. The proceeds from these selected dispositions
are redeployed, typically through tax-deferred exchanges, into assets that in
PTR's view offer better long-term cash flow growth prospects. As a result of
this asset optimization strategy, PTR disposed of 12 multifamily communities
and one industrial building during the first quarter of 1997, representing
gross proceeds of $142.1 million, and disposed of four multifamily communities
during the first quarter of 1996, representing gross proceeds of $39.5
million. As of March 31, 1997, PTR held a portion of the 1997 disposition
proceeds aggregating $59 million in an interest bearing escrow account,
pending acquisition of other multifamily communities to complete the tax-
deferred exchange. For federal income tax purposes, the majority of the 1997
and 1996 dispositions were structured as tax-deferred exchanges which deferred
gain recognition. For financial reporting purposes, however, the transactions
qualified for profit recognition and aggregate gains of $25.3 million and $2.9
million were recorded for the three months ended March 31, 1997 and 1996,
respectively.
 
  As part of PTR's asset optimization strategy, 18 multifamily communities
were held for disposition as of March 31, 1997. The aggregate carrying value
of properties held for disposition was approximately $144.0 million at March
31, 1997, net of a provision for possible loss of $1.5 million on certain
communities. A substantial aggregate gain is expected upon the disposition of
the remaining communities, although generally accepted accounting principles
disallows recognition of anticipated gains. Each community's carrying value is
less than or equal to its estimated fair market value, net of estimated costs
to sell. Such communities are not depreciated during the period for which they
are determined to be held for disposition. Subject to normal closing risks,
PTR expects to complete the disposition of all communities during 1997 and
redeploy the net proceeds from such dispositions, where appropriate, through
tax-deferred exchanges into the acquisition of multifamily communities. The
property level earnings, after interest and depreciation, from communities
held for disposition at March 31, 1997 which are included in PTR's earnings
from operations for the three months ended March 31, 1997 and 1996 were $3.0
million and $2.8 million, respectively.
 
(3) HOMESTEAD NOTES
 
  In addition to multifamily investment activity, PTR had developed and
operated extended-stay lodging facilities under the Homestead Village(R) name
since 1992. On October 17, 1996, PTR contributed its Homestead Village(R)
properties to Homestead Village Incorporated ("Homestead"), a newly formed
company, in exchange for Homestead securities. As of the contribution date,
the Homestead Village(R) properties constituted approximately 7.1% of PTR's
total assets, at cost. The Homestead Village(R) properties generated
approximately 7.2% of PTR's Net Operating Income for the three month period
ended March 31, 1996.
 
  During the three month period ended March 31, 1997, PTR funded an additional
$16.3 million under its $198.8 million commitment to provide development
funding to Homestead in the form of convertible mortgage notes ("Homestead
Notes"), resulting in a total amount funded of $117.4 million as of March 31,
1997.
 
                                       9
<PAGE>
 
                        SECURITY CAPITAL PACIFIC TRUST
 
             NOTES TO CONDENSED FINANCIAL STATEMENTS--(CONTINUED)
 
 
  Following is a reconciliation of the Homestead Notes' components to the
amount reflected in the accompanying Balance Sheet (in thousands):
 
<TABLE>
<CAPTION>
                                                                        MARCH
                                                                       31, 1997
                                                                       --------
      <S>                                                              <C>
      Face amount of Homestead Notes.................................  $130,728
      Original issue discount........................................   (13,290)
                                                                       --------
      Amount funded..................................................   117,438
      Amortization of original issue discount........................       307
      Conversion feature--initial value..............................     9,208
      Unamortized discount on conversion feature.....................    (9,010)
      Fair value adjustment..........................................    73,886
                                                                       --------
      Carrying value and fair value..................................  $191,829
                                                                       ========
</TABLE>
 
  The Homestead Notes are convertible into Homestead common stock after March
31, 1997 on the basis of one share of Homestead common stock for every $11.50
of principal face amount outstanding. Accordingly, fair value was calculated
based upon the conversion value of the Homestead Notes using the trading price
of Homestead common stock at March 31, 1997 of $16.875. The fair value
adjustment is recognized as an unrealized gain in shareholders' equity.
 
  PTR expects to complete the funding of the remaining $81.4 million under its
funding commitment in 1997 and early 1998.
 
(4) BORROWINGS
 
 Credit Facilities
 
  PTR has a $350 million unsecured revolving line of credit with Texas
Commerce Bank, National Association ("TCB"), as agent for a group of financial
institutions (collectively, the "Lenders"). The line matures in August 1998
and may be extended annually for an additional year with the approval of the
Lenders. The line of credit bears interest at the greater of prime (8.5% at
March 31, 1997) or the federal funds rate plus 0.50%, or at PTR's option,
LIBOR (5.6875% at March 31, 1997) plus 1.125% (6.8125% at March 31, 1997). The
spread over LIBOR can vary from LIBOR plus 0.75% to LIBOR plus 1.50% based
upon the rating of PTR's long-term unsecured senior notes ("Long-Term Debt").
Additionally, there is a commitment fee on the average unfunded line of credit
balance. The commitment fee was $75,000 and $110,000 for the three month
period ended March 31, 1997 and 1996, respectively.
 
  A summary of PTR's line of credit borrowings is as follows (dollars in
thousands):
 
<TABLE>
<CAPTION>
                                                   THREE MONTHS ENDED YEAR ENDED
                                                     MARCH 31, 1997      1996
                                                   ------------------ ----------
      <S>                                          <C>                <C>
      Total line of credit.......................       $350,000       $350,000
      Borrowings outstanding at end of period....        133,500         99,750
      Weighted-average daily borrowings..........        151,606        112,248
      Maximum borrowings outstanding at any month
       end.......................................        205,000        188,750
      Weighted-average daily nominal interest
       rate......................................           6.9%           7.3%
      Weighted-average daily effective interest
       rate......................................           8.1%           8.8%
      Weighted-average nominal interest rate at
       end of period.............................           6.7%           6.6%
</TABLE>
 
  On September 9, 1996, PTR entered into a short-term, unsecured, borrowing
agreement with TCB. The loan matures March 18, 1998 and bears interest at an
overnight rate which ranged from 5.94% to 6.50% during the three months ended
March 31, 1997. At March 31, 1997, there was $365,000 outstanding under this
agreement.
 
                                      10
<PAGE>
 
                        SECURITY CAPITAL PACIFIC TRUST
 
             NOTES TO CONDENSED FINANCIAL STATEMENTS--(CONTINUED)
 
 
  On March 10, 1997, PTR borrowed $60 million under a short-term, unsecured,
borrowing agreement with a financial institution. The loan matures on
September 10, 1997, but provides for early repayment at PTR's option on the
10th day of each month during the term. Interest is payable monthly at an
annual rate of LIBOR plus 0.60% (6.2875% at March 31, 1997). On April 4, 1997,
PTR borrowed an additional $40 million under a short-term, unsecured,
borrowing agreement with the same financial institution, having approximately
the same interest rate and repayment terms. The proceeds from both loans were
used to repay borrowings under PTR's line of credit.
 
  The aggregate amount of borrowings outstanding under all of PTR's credit
facilities at March 31, 1997 was $193.9 million.
 
 Long-Term Debt
 
  PTR has issued Long-Term Debt which bear interest at fixed rates, payable
semi-annually. Funds from such issuances were used primarily for acquisition,
development and renovation of multifamily communities and to repay balances on
credit facilities incurred for such purposes. The following table summarizes
the Long-Term Debt as of March 31, 1997:
 
<TABLE>
<CAPTION>
                    ISSUANCE           AVERAGE EFFECTIVE
                      AND                INTEREST RATE,
                  OUTSTANDING          INCLUDING OFFERING          ORIGINAL  PRINCIPAL
                   PRINCIPAL   COUPON    DISCOUNTS AND    MATURITY   LIFE     PAYMENT
DATE OF ISSUANCE     AMOUNT     RATE     ISSUANCE COSTS     DATE   (YEARS)  REQUIREMENT
----------------  -----------  ------  ------------------ -------- -------- -----------
<S>               <C>          <C>     <C>                <C>      <C>      <C>
3/31/97           $ 20 million 7.500%        7.443%        4/1/07   10.00       (1)
3/31/97             30 million 8.050         8.038         4/1/17   20.00       (1)
                  ------------ -----         -----                  -----
Subtotal/Average  $ 50 million 7.905%        7.850%                 16.00
                  ------------ -----         -----                  -----
10/21/96          $ 15 million 6.600%        7.030%       10/15/99   3.00       (1)
10/21/96            20 million 6.950         7.400        10/15/02   6.00       (1)
10/21/96            20 million 7.150         7.500        10/15/03   7.00       (1)
10/21/96            20 million 7.250         7.630        10/15/04   8.00       (1)
10/21/96            20 million 7.300         7.640        10/15/05   9.00       (1)
10/21/96            20 million 7.375         7.685        10/15/06  10.00       (1)
10/21/96            15 million 6.500         6.750        10/15/26  30.00       (2)
                  ------------ -----         -----                  -----
Subtotal/Average  $130 million 7.350%        7.500%                  6.85
                  ------------ -----         -----                  -----
8/6/96            $ 20 million 7.550%        7.680%        8/1/08   12.00       (1)
8/6/96              20 million 7.625         7.730         8/1/09   13.00       (1)
8/6/96              20 million 7.650         7.770         8/1/10   14.00       (1)
8/6/96              20 million 8.100         8.210         8/1/15   19.00       (1)
8/6/96              20 million 8.150         8.250         8/1/16   20.00       (1)
                  ------------ -----         -----                  -----
Subtotal/Average  $100 million 7.840%        7.950%                 15.60
                  ------------ -----         -----                  -----
2/23/96           $ 50 million 7.150%        7.300%       2/15/10   10.50       (3)
2/23/96            100 million 7.900         8.030        2/15/16   18.00       (4)
                  ------------ -----         -----                  -----
Subtotal/Average  $150 million 7.710%        7.840%                 15.50
                  ------------ -----         -----                  -----
2/8/94            $100 million 6.875%        6.978%       2/15/08   10.50       (5)
2/8/94             100 million 7.500         7.653        2/15/14   18.00       (6)
                  ------------ -----         -----                  -----
Subtotal/Average  $200 million 7.240%        7.370%                 14.25
                  ------------ -----         -----                  -----
Grand
 Total/Average    $630 million 7.530%        7.640%                 13.37
                  ============ =====         =====                  =====
</TABLE>
 
                                      11
<PAGE>
 
                        SECURITY CAPITAL PACIFIC TRUST
 
             NOTES TO CONDENSED FINANCIAL STATEMENTS--(CONTINUED)
 
--------
(1) Entire principal amount due at maturity.
(2) The 6.500% notes may be repaid on October 15, 1999 at the option of the
    holders at their full principal amount together with accrued interest.
(3) These notes require aggregate annual principal payments of $6.25 million
    commencing in 2003.
(4) These notes require aggregate annual principal payments of $10 million in
    2011, $12.5 million in 2012, $15 million in 2013, $17.5 million in 2014,
    $20 million in 2015 and $25 million in 2016.
(5) These notes require annual principal payments of $12.5 million commencing
    in 2001.
(6) These notes require aggregate annual principal payments of $10 million in
    2009, $12.5 million in 2010, $15 million in 2011, $17.5 million in 2012,
    $20 million in 2013, and $25 million in 2014.
 
 Mortgages Payable
 
  Mortgages payable at March 31, 1997 consisted of the following (dollar
amounts in thousands):
 
<TABLE>
<CAPTION>
                                                       BALLOON  PRINCIPAL   PRINCIPAL
                          EFFECTIVE SCHEDULED PERIODIC PAYMENT  BALANCE AT  BALANCE AT
                          INTEREST  MATURITY  PAYMENT   DUE AT  MARCH 31,  DECEMBER 31,
COMMUNITY                  RATE(1)    DATE     TERMS   MATURITY    1997        1996
---------                 --------- --------- -------- -------- ---------- ------------
<S>                       <C>       <C>       <C>      <C>      <C>        <C>
Conventional fixed rate:
  Tigua Village.........    9.90%   05/01/97     (2)   $   677   $    681    $    683
  Silvercliff...........    7.66    11/10/97     (2)     7,304      7,359       7,382
  Braeswood Park........    7.51    01/01/98     (2)     6,635      6,727       6,761
  Seahawk...............    8.05    01/10/98     (2)     5,350      5,407       5,427
  La Tierra at the
   Lakes................    7.89    12/01/98     (2)    25,105     25,908      26,019
  Windsail..............     N/A    02/01/99     (2)     4,675        --        4,798
  Clubhouse.............    8.75    12/01/99     (2)     5,501      5,806       5,831
  Greenpointe...........    8.50    03/01/00     (2)     3,410      3,622       3,638
  Mountain Shadow.......    8.50    03/01/00     (2)     3,130      3,326       3,340
  Sunterra..............    8.25    03/01/00     (2)     7,612      8,103       8,138
  Brompton Court........    8.39    09/01/00     (2)    13,340     14,259      14,318
  Marina Lakes..........    8.20    07/19/01     (2)    12,393     13,509         --
  Treat Commons.........    7.50    09/14/01     (2)     6,578      7,163       7,192
  El Dorado.............    7.59    10/01/02     (2)    15,527     16,677      16,718
  Ashton Place..........    7.75    10/01/23     (3)       N/A     47,209      47,342
  Double Tree II........     N/A    05/01/33     (3)       N/A        --        4,750
                                                                 --------    --------
                                                                  165,756     162,337
Tax-exempt fixed
 rate(4):
  Fox Creek.............    8.71    06/01/97     (2)     4,219      4,223       4,236
  Cherry Creek..........    8.11    11/01/01     (2)     2,630      4,000       4,000
  Redwood Shores........    5.53    10/01/08     (2)    16,820     25,220      25,220
  Summertree............    6.65    12/15/18     (5)     4,435      4,435       4,435
                                                                 --------    --------
                                                                   37,878      37,891
Tax-exempt floating
 rate(4):
  River Meadows.........    8.66    10/01/05     (6)    10,000     10,000         --
  Apple Creek...........    7.08    09/01/07     (6)    11,100     11,100      11,100
                                                                 --------    --------
                                                                   21,100      11,100
Combined(7):
  Las Flores............    8.42    06/01/24     (3)       N/A      5,844       5,860
                            ----                                 --------    --------
    Total/Average
     Mortgage Debt......    7.62%                                $230,578    $217,188
                            ====                                 ========    ========
</TABLE>
 
                                      12
<PAGE>
 
                        SECURITY CAPITAL PACIFIC TRUST
 
             NOTES TO CONDENSED FINANCIAL STATEMENTS--(CONTINUED)
 
--------
(1) Represents the effective interest rate, including loan cost amortization
    and other ongoing fees and expenses.
(2) Regular amortization with a balloon payment due at maturity.
(3) Fully amortizing.
(4) Tax-exempt effective interest rates include credit enhancement and other
    bond-related costs, where applicable.
(5) Semi-annual payments are interest only until December 2003 at 5.4%, at
    which time the interest rate is adjusted to the current market rate.
(6) Payments are interest only until maturity and the interest rate is
    adjusted weekly or monthly.
(7) In 1990, the Las Flores apartments were refinanced pursuant to multifamily
    bonds aggregating $6.2 million. The bonds consist of $4.5 million Series A
    tax exempt fixed rate bonds and $1.7 million Series B taxable fixed rate
    bonds. The bonds are guaranteed by the GNMA mortgage-backed securities
    program.
 
  The changes in mortgages payable during the three months ended March 31,
1997 consisted of the following (in thousands):
 
<TABLE>
      <S>                                                             <C>
      Balance at January 1, 1997..................................... $217,188
        Mortgage notes assumed.......................................   23,527
        Principal payments, including prepayments upon community
         dispositions................................................  (10,137)
                                                                      --------
      Balance at March 31, 1997...................................... $230,578
                                                                      ========
</TABLE>
 
 Scheduled Debt Maturities
 
  Approximate principal payments due during each of the calendar years in the
20-year period ending December 31, 2016 and thereafter, as of March 31, 1997,
are as follows (in thousands):
 
<TABLE>
<CAPTION>
                                         CREDIT   LONG-TERM
                                       FACILITIES   DEBT    MORTGAGES   TOTAL
                                       ---------- --------- --------- ----------
      <S>                              <C>        <C>       <C>       <C>
      1997............................  $ 60,365  $     --  $  5,129  $   65,494
      1998............................   133,500        --    40,012     173,512
      1999............................        --    30,000    12,790      42,790
      2000............................        --        --    29,799      29,799
      2001............................        --    12,500    24,807      37,307
      2002............................        --    32,500    17,348      49,848
      2003............................        --    38,750     1,752      40,502
      2004............................        --    38,750     1,903      40,653
      2005............................        --    38,750    12,066      50,816
      2006............................        --    38,750     2,241      40,991
      2007............................        --    38,750    13,528      52,278
      2008............................        --    38,750    18,863      57,613
      2009............................        --    36,250     1,603      37,853
      2010............................        --    38,750     1,732      40,482
      2011............................        --    25,000     1,871      26,871
      2012............................        --    30,000     2,022      32,022
      2013............................        --    35,000     2,185      37,185
      2014............................        --    42,500     2,361      44,861
      2015............................        --    40,000     2,551      42,551
      2016............................        --    45,000     2,756      47,756
      Thereafter......................        --    30,000    33,259      63,259
                                        --------  --------  --------  ----------
        Total.........................  $193,865  $630,000  $230,578  $1,054,443
                                        ========  ========  ========  ==========
</TABLE>
 
                                      13
<PAGE>
 
                        SECURITY CAPITAL PACIFIC TRUST
 
             NOTES TO CONDENSED FINANCIAL STATEMENTS--(CONCLUDED)
 
 
 General
 
  PTR's debt instruments generally contain certain covenants common to the
type of facility or borrowing, including financial covenants establishing
minimum debt service coverage ratios and maximum leverage ratios. PTR was in
compliance with all covenants pertaining to its debt instruments at March 31,
1997.
 
  Interest paid on all borrowings for the three months ended March 31, 1997
was $18.9 million, net of $4.4 million of interest capitalized during
construction. Interest paid on all borrowings for the three months ended March
31, 1996 was $9.2 million, net of $3.5 million of interest capitalized during
construction.
 
  Amortization of loan costs included in interest expense for the three months
ended March 31, 1997 and 1996 was $729,000 and $418,000, respectively.
 
(5) CASH DISTRIBUTIONS
 
  PTR paid the first quarter 1997 distribution of $0.325 per Common Share on
February 20, 1997. On April 22, 1997 the Board of Trustees (the "Board")
declared a cash distribution of $0.325 per Common Share, payable on May 29,
1997, to shareholders of record on May 13, 1997. On March 31, 1997, PTR paid
quarterly dividends of $0.4377 per cumulative convertible Series A Preferred
Share and $0.5625 per cumulative redeemable Series B Preferred Share to
preferred shareholders of record on March 17, 1997.
 
(6) SHELF REGISTRATION
 
  On March 27, 1997, PTR filed a $300 million shelf registration with the
Securities and Exchange Commission. These securities can be issued in the form
of Long-Term Debt, Preferred Shares or Common Shares on an as-needed basis,
subject to PTR's ability to effect offerings on satisfactory terms. As of
March 31, 1997, a total of $420 million in shelf-registered securities were
available to be issued.
 
(7) REIT MANAGER AND PROPERTY MANAGER ACQUISITION PROPOSAL
 
  Effective March 1, 1991, PTR entered into a REIT Management agreement with
Security Capital Pacific Incorporated (the "REIT Manager"), to provide REIT
Management services to PTR. The REIT Manager is a subsidiary of Security
Capital Group Incorporated ("Security Capital Group"), which owned
approximately 36% of PTR's outstanding Common Shares as of March 31, 1997.
 
  SCG Realty Services Incorporated (the "Property Manager"), a wholly-owned
subsidiary of Security Capital Group, managed 95.03% and 86.61% (based on
total expected investment) of PTR's operating multifamily communities as of
March 31, 1997, and 1996, respectively. Rates for services performed by SCG
Realty Services are subject to annual approval by PTR's independent Trustees
(who receive an annual review from an independent third party). Management
believes that such rates are consistent with those prevailing in the markets
in which PTR operates.
 
  On May 1, 1997, Security Capital Group filed a Form S-4 Registration
Statement with the Securities and Exchange Commission containing PTR's
preliminary proxy statement and Security Capital Group's preliminary
prospectus (relating to warrants to purchase Class B common stock of Security
Capital Group) relating to a proposed merger transaction whereby PTR would
acquire the operations and businesses of its REIT Manager and Property Manager
in exchange for Common Shares, valued at approximately $75.8 million. The
number of Common Shares issuable to Security Capital Group will depend on the
average market price of the Common Shares over the five-day period prior to
the record date, subject to such average not being more than $27.11475 or less
than $21.63525. As a result of the transaction, PTR would become an internally
managed REIT and Security Capital Group would remain PTR's largest
shareholder. The Board recently approved the proposed merger transaction based
on the recommendation of a special committee comprised of independent
Trustees. The proposed merger transaction requires the approval of two-thirds
of the outstanding Common Shares. PTR's proxy statement, after review and
clearance by the Securities and Exchange Commission, will be mailed to PTR's
common shareholders prior to a shareholder vote.
 
                                      14
<PAGE>
 
                      INDEPENDENT AUDITORS' REVIEW REPORT
 
The Board of Trustees and Shareholders
SECURITY CAPITAL PACIFIC TRUST:
 
  We have reviewed the accompanying condensed balance sheet of SECURITY
CAPITAL PACIFIC TRUST as of March 31, 1997, and the related condensed
statements of earnings, shareholders' equity, and cash flows for the three-
month periods ended March 31, 1997 and 1996. These condensed financial
statements are the responsibility of the Trust's management.
 
  We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
 
  Based on our review, we are not aware of any material modifications that
should be made to the condensed financial statements referred to above for
them to be in conformity with generally accepted accounting principles.
 
  We have previously audited, in accordance with generally accepted auditing
standards, the balance sheet of SECURITY CAPITAL PACIFIC TRUST as of December
31, 1996, and the related statements of earnings, shareholders' equity, and
cash flows for the year then ended (not presented herein); and in our report
dated January 29, 1997, except as to Note 13, which is as of March 10, 1997,
we expressed an unqualified opinion on those financial statements. In our
opinion, the information set forth in the accompanying condensed balance sheet
as of December 31, 1996 is fairly stated, in all material respects, in
relation to the balance sheet from which it has been derived.
 
                                          KPMG Peat Marwick LLP
 
Chicago, Illinois
May 2, 1997
 
                                      15
<PAGE>
 
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
 
  The following information should be read in conjunction with PTR's financial
statements and notes thereto included in Item 1 of this report.
 
  The statements contained in this discussion and elsewhere in this report
that are not historical facts are forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. These forward-looking statements are based on
current expectations, estimates and projections about the industry and markets
in which PTR operates, management's beliefs and assumptions made by
management. Words such as "expects," "anticipates," "intends," "plans,"
"believes," "seeks," "estimates" and variations of such words and similar
expressions are intended to identify such forward-looking statements. These
statements are not guarantees of future performance and involve certain risks,
uncertainties and assumptions which are difficult to predict. Therefore,
actual outcomes and results may differ materially from what is expressed or
forecasted in such forward-looking statements. PTR undertakes no obligation to
update publicly any forward-looking statements, whether as a result of new
information, future events or otherwise. PTR's operating results depend
primarily on income from multifamily communities, which is substantially
influenced by (i) the demand for and supply of multifamily units in PTR's
primary target market and submarkets, (ii) operating expense levels, (iii) the
effectiveness of property-level operations and (iv) the pace and price at
which PTR can acquire and develop additional multifamily communities. Capital
and credit market conditions which affect PTR's cost of capital also influence
operating results.
 
OVERVIEW
 
 General
 
  PTR's results of operations, financial position and liquidity have been
influenced primarily by the operations of and investments made in PTR's
multifamily communities. The term "multifamily" as used herein refers to
garden-style communities and excludes Homestead Village(R) extended-stay
lodging assets, which were contributed to a new publicly traded company,
Homestead, on October 17, 1996, in exchange for Homestead securities.
 
                                      16
<PAGE>
 
 Multifamily Investments
 
  The following table provides an overview of PTR's multifamily portfolio and
related investment activity for the three months ended March 31, 1997 (dollar
amounts in thousands):
 
<TABLE>
      <S>                                                            <C>
      OPERATING COMMUNITIES:
          Communities...............................................        133
          Units.....................................................     40,874
            Total expected investment(1)............................ $1,928,702
      COMMUNITIES UNDER CONSTRUCTION:
        Starts During Period:
          Communities...............................................          1
          Units.....................................................        192
            Total expected investment(1)............................ $    9,383
        Completions During Period:
          Communities...............................................          0
          Units.....................................................          0
            Total expected investment(1)............................ $        0
        Stabilizations During Period:
          Communities...............................................          0
          Units.....................................................          0
            Total expected investment(1)............................ $        0
        Under Construction at End of Period:
          Communities...............................................         18
          Units.....................................................      5,671
            Total expected investment(1)............................ $  359,366
            Investment to date...................................... $  227,325
        Development Expenditures During Period...................... $   52,883
      ACQUISITIONS:
          Communities...............................................          5
          Units.....................................................      1,652
            Total expected investment(1)............................ $  143,746
      DISPOSITIONS(2):
          Communities...............................................         13
          Units.....................................................      3,480
            Gross sales proceeds.................................... $  142,137
            Gains................................................... $   25,335
</TABLE>
--------
(1) For operating communities and acquisitions, represents cost, including
    budgeted renovations, as of period end. For communities under
    construction, represents total budgeted development cost as of period end,
    which includes the cost of land, fees, permits, payments to contractors,
    materials, architectural and engineering fees and interest and property
    taxes to be capitalized during the construction period.
(2) Includes the sale of an industrial building with net proceeds of
    approximately $300,000 and a gain of approximately $3,000.
 
 Current Development Activity
 
  PTR believes that development of multifamily communities from the ground up,
which are built for long-term ownership and designed to meet broad resident
preferences and demographic trends, will continue to provide an important
source of long-term cash flow growth. PTR believes its ability to compete is
significantly enhanced relative to other companies because of the REIT
Manager's depth of development and acquisition personnel and presence in local
markets combined with PTR's access to investment capital. The following table
 
                                      17
<PAGE>
 
summarizes PTR's development communities under construction as of March 31,
1997 (dollar amounts in thousands):
 
<TABLE>
<CAPTION>
                                       NUMBER                TOTAL
                                         OF      PTR       EXPECTED        %
                                       UNITS  INVESTMENT INVESTMENT(1) LEASED(2)
                                       ------ ---------- ------------- ---------
   <S>                                 <C>    <C>        <C>           <C>
   Communities under Construction and
    in
    Lease-Up(3)......................  2,640   $148,129    $161,370      85.53%
   Other Communities Under
    Construction(4)..................  3,031     79,196     197,996
                                       -----   --------    --------
     Total Communities Under
      Construction...................  5,671   $227,325    $359,366
                                       =====   ========    ========
</TABLE>
--------
(1) Represents total budgeted development cost, which includes the cost of
    land, fees, permits, payments to contractors, materials, architectural and
    engineering fees and interest and property taxes to be capitalized during
    the construction period.
(2)  The percentage leased is based on total units completed.
(3) A development community is considered in "lease-up" once the first units
    are delivered.
(4) Lease-up has not yet commenced.
 
  There are risks associated with PTR's development and construction
activities which include: development and acquisition opportunities explored
may be abandoned; construction costs of a community may exceed original
estimates due to increased material, labor or other expenses, which could make
completion of the community uneconomical; occupancy rates and rents at a newly
completed community are dependent on a number of factors, including market and
general economic conditions, and may not be sufficient to make the community
profitable; financing may not be available on favorable terms for the
development of a community; and construction and lease-up may not be completed
on schedule, resulting in increased debt service expense and construction
costs. Development activities are also subject to risks relating to the
inability to obtain, or delays in obtaining, all necessary land-use, building,
occupancy and other required governmental permits and authorizations. The
occurrence of any of the events described above could adversely affect PTR's
ability to achieve its projected yields on communities under development or
redevelopment.
 
  To mitigate these risks, PTR obtains zoning and municipal approvals prior to
purchasing land. Furthermore, PTR does not take construction risk, but instead
uses qualified third-party general contractors to build its communities, using
guaranteed maximum price contracts. PTR cannot eliminate all development risk,
but believes that the opportunities to better control product and realize
higher returns from development communities compensate for the limited risk.
 
 Recent Acquisitions
 
  In addition to its development activity, during the three month period ended
March 31, 1997, PTR completed the acquisition of five operating multifamily
communities (1,652 units) at a total expected investment of $143.7 million.
 
  Acquisitions entail risks that investments will fail to perform in
accordance with expectations and that judgments with respect to the cost of
improvements to bring an acquired community up to standards established for
the market position intended for that community will prove inaccurate, as well
as general investment risks associated with any new real estate investment.
Although PTR undertakes an evaluation of the physical condition of each new
community before it is acquired, certain defects or necessary repairs may not
be detected until after the community is acquired, which could significantly
increase PTR's total acquisition costs.
 
  These risks are partially mitigated and managed by the extensive market
research and rigorous due diligence process performed in connection with every
community considered. These factors combined with PTR's extensive market
experience throughout its target market and methodical approval process have
proven PTR's ability to select investments that have a high probability of
meeting or exceeding underwritten expectations.
 
                                      18
<PAGE>
 
RESULTS OF OPERATIONS
 
  Net earnings for the three months ended March 31, 1997 and 1996 were $45.6
million and $25.8 million, respectively, an increase of $19.8 million (76.5%).
This increase resulted primarily from increased gains on dispositions of $22.4
million and increased earnings from multifamily communities offset by the
elimination of earnings from Homestead Village properties and higher interest
expense. A discussion of the major components of the increase in net earnings
follows.
 
 Property Operations
 
  The following table summarizes the Net Operating Income generated from
property operations for each period (in thousands):
 
<TABLE>
<CAPTION>
                                                 HOMESTEAD OTHER NON-
                                     MULTIFAMILY  VILLAGE  MULTIFAMILY  TOTAL
                                     ----------- --------- ----------- -------
   <S>                               <C>         <C>       <C>         <C>
   Net Operating Income--Three
    Months Ended March 31, 1997(1)..   $48,812    $   --      $ 563    $49,375
   Net Operating Income--Three
    Months Ended March 31, 1996(1)..    41,582      3,261       669     45,512
                                       -------    -------     -----    -------
     Increase (decrease)............   $ 7,230    $(3,261)    $(106)   $ 3,863
                                       =======    =======     =====    =======
</TABLE>
--------
(1) Net Operating Income is defined as rental revenues less rental expenses,
    real estate taxes and property management fees paid to affiliates.
 
  At March 31, 1997, multifamily investments comprised 99.1% of PTR's total
real estate portfolio, based on total expected investment. The overall $7.2
million increase in Net Operating Income from PTR's multifamily communities
for the three months ended March 31, 1997 as compared to the three months
ended March 31, 1996 was attributable to an $11.1 million increase in rental
revenues partially offset by an $3.9 million increase in rental expenses, real
estate taxes and property management fees paid to affiliates ("Operating
Expenses"). The $11.1 million increase in rental revenues from $68.2 million
for the three months ended March 31, 1996 to $79.3 million for the three
months ended March 31, 1997 was primarily attributable to a net increase in
multifamily units from 38,970 units as of March 31, 1996 to 40,874 units as of
March 31, 1997, combined with increases in rental revenues generated by
existing multifamily communities, increased investments in newer markets such
as California, and dispositions in markets with lower rental rates such as
Tucson and Phoenix. Similarly, the $3.9 million increase in Operating Expenses
from $26.6 million for the three months ended March 31, 1996 to $30.5 million
for the three months ended March 31, 1997 is attributable primarily to
additional units in operation, higher operating costs in new markets and
increases in Operating Expenses associated with existing multifamily
communities. Additional information for these communities is presented below
under "Multifamily Communities Fully Operational Since January 1, 1996".
 
  PTR categorizes operating multifamily communities (which include all
communities not under development) as either "stabilized" or "pre-stabilized."
The term "stabilized" means that renovation, repositioning, new management and
new marketing programs (or development and marketing in the case of newly
developed communities) have been completed for a sufficient period of time
(but in no event longer than 12 months, except for major rehabilitations) to
achieve 93% occupancy at market rents. Prior to being "stabilized," a
community is considered "pre-stabilized." Approximately 73.3% and 86.1% of
PTR's operating multifamily portfolio was classified as stabilized as of March
31, 1997 and 1996, respectively, based on total expected investment.
 
  The $3.3 million in Homestead Village Net Operating Income shown for the
three months ended March 31, 1996 resulted from rental revenues aggregating
$6.9 million offset by Operating Expenses aggregating $3.6 million generated
from 23 properties operating as of March 31, 1996. The decrease in Net
Operating Income related to the Homestead Village properties in the three
months ended March 31, 1997 is entirely due to the contribution of all
properties to Homestead, a newly formed company, on October 17, 1996.
 
                                      19
<PAGE>
 
  The decrease in Net Operating Income on other non-multifamily properties is
due primarily to property dispositions.
 
 Multifamily Communities Fully Operational Since January 1, 1996
 
  The following table illustrates the quarterly performance of PTR's
communities which were fully operational in both periods ("same store
communities") followed by the same store community information by region and
market:
 
<TABLE>
<CAPTION>
                                                               FULLY OPERATIONAL
                                                               COMMUNITIES AS OF
                                                                JANUARY 1, 1996
                                                               -----------------
      <S>                                                  <C> <C>
      Portfolio (dollar amounts in thousands):
        Communities.......................................                91
        Units.............................................            27,607
          Total expected investment(1)....................        $1,102,588
          % of total PTR portfolio(2).....................             48.19%
</TABLE>
 
<TABLE>
<CAPTION>
                                                              THREE MONTHS ENDED
                                                                  MARCH 31,
                                                                1997 VS. 1996
                                                              ------------------
      <S>                                                 <C> <C>
      Operating Performance:
        Collections growth(3)............................            2.19%
        Property Operating Expense growth................            2.42%
        Net Operating Income growth......................            2.04%
</TABLE>
 
<TABLE>
<CAPTION>
                                          THREE MONTHS ENDED THREE MONTHS ENDED
                                            MARCH 31, 1997     MARCH 31, 1996
                                          ------------------ ------------------
      <S>                                 <C>                <C>
      Summary Information (in actual
       dollars):
        Average physical occupancy.......       94.22%             94.54%
        Property operating expense
         ratio(4)........................       38.91%             38.82%
        Average rental rate per unit(5)..       $ 629               $608
        Recurring capital expenditures
         per unit........................       $  38               $ 21
</TABLE>
--------
  See notes following next table.
 
 
                                       20
<PAGE>
 
<TABLE>
<CAPTION>
                         AVERAGE PHYSICAL AVERAGE PHYSICAL COLLECTIONS
                           OCCUPANCY %      OCCUPANCY %      GROWTH
                           THREE MONTHS     THREE MONTHS    MARCH 31,  1/1/96 SAME STORE  TOTAL PTR
                              ENDED            ENDED        1997 VS.   COMMUNITIES  % BY PORTFOLIO %
MARKET DISTRIBUTION       MARCH 31, 1997   MARCH 31, 1996    1996(3)       MARKET(2)     BY MARKET(2)
-------------------      ---------------- ---------------- ----------- ----------------- ------------
<S>                      <C>              <C>              <C>         <C>               <C>
CENTRAL REGION:
  Austin................      92.83%           96.82%          1.65%          3.67%           3.13%
  Dallas................      94.17            95.53           1.45           3.86            3.60
  Denver................      96.29            96.59           2.45           7.57            4.59
  El Paso...............      92.39            92.94          -0.75           7.33            4.07
  Houston...............      95.92            96.60           2.98           8.52            6.74
  San Antonio...........      93.05            93.47          -0.76           9.40            6.34
                              -----            -----          -----         ------          ------
    CENTRAL REGION
     SUBTOTAL...........      94.05%           94.94%          1.04%         40.35%          28.47%
                              -----            -----          -----         ------          ------
NORTHWEST REGION:
  Portland..............      93.82%           94.41%          0.96%          5.73            4.78%
  Salt Lake City........      94.31            95.44           4.41           3.30            4.89
  Seattle...............      96.91            91.04          14.48           5.92            6.27
                              -----            -----          -----         ------          ------
    NORTHWEST REGION
     SUBTOTAL...........      95.07%           93.39%          6.80%         14.95%          15.94%
                              -----            -----          -----         ------          ------
WEST REGION:
  Albuquerque...........      92.86%           90.32%          1.90%          6.41%           5.76%
  Las Vegas.............      95.18            94.64           4.25          10.97            5.29
  Phoenix...............      95.15            95.87           0.02          14.76           12.69
  Northern California ..      91.75            93.35          11.52           3.54           13.94
  Southern California ..      93.61            94.50           2.42           4.17           13.40
  Tucson................      93.86            93.83          -1.27           2.41            1.87
                              -----            -----          -----         ------          ------
    WEST REGION
     SUBTOTAL...........      94.42%           94.36%          2.23%         42.26%          52.95%
                              -----            -----          -----         ------          ------
Other Markets...........      90.26%           95.62%         -3.62%          2.44%           2.64%
                              -----            -----          -----         ------          ------
Totals..................      94.22%           94.54%          2.19%        100.00%         100.00%
                              =====            =====          =====         ======          ======
Same store communities as a
 percentage of total PTR
 portfolio............................................................       48.19%
                                                                            ======
</TABLE>
--------
(1) Represents cost, including budgeted renovations.
(2) Based on total expected investment as of March 31, 1997.
(3) Represents percentage growth in rental revenues, net of vacancies, bad
    debts and concessions.
(4) Represents Operating Expenses as a percentage of rental revenues.
(5) Represents weighted-average monthly "asking rents" during each period.
 
 Homestead Interest and Homestead Notes
 
  Through March 31, 1997, PTR had funded $117.4 million of its $198.8 million
Homestead funding commitment of which $16.3 million was funded during the
three months ended March 31, 1997. This leaves a remaining commitment under
the funding commitment agreement of approximately $81.4 million, which will be
provided to Homestead throughout the remainder of 1997 and early 1998 to fund
developments as needed on development properties contributed by PTR.
 
  During the three months ended March 31, 1997, PTR recorded $3.2 million in
interest income ($2.9 million for purposes of calculating funds from
operations) from the Homestead Notes. PTR deducts from net earnings
 
                                      21
<PAGE>
 
the interest income related to the amortization of discounts and warrant-
related deferred revenue in calculating funds from operations. Homestead
interest income is expected to increase in future periods as PTR continues to
fund Homestead's development activity up to its $198.8 million funding
commitment.
 
  Upon full funding, PTR will have funded $198.8 million in exchange for
Homestead Notes having a face amount of $221.3 million. The Homestead Notes are
convertible into Homestead common stock after March 31, 1997 on the basis of
one share of Homestead common stock for every $11.50 of principal face amount
outstanding, which would result in the ownership of approximately 19.2 million
shares of Homestead common stock at full funding. Under these assumptions and
using the trading price of Homestead common stock at March 31, 1997 of $16.875,
PTR's ownership would result in the following incremental value per PTR Common
Share at March 31, 1997 (in thousands, except per share amounts:)
 
<TABLE>
      <S>                                                              <C>
      Homestead common stock price.................................... $ 16.875
      Conversion price................................................   11.500
                                                                       --------
        Incremental value per share of Homestead common stock......... $  5.375
      Shares of Homestead common stock upon conversion (at full
       funding).......................................................   19,246
                                                                       --------
          Total incremental value from conversion..................... $103,447
      PTR Common Shares outstanding...................................   76,076
                                                                       --------
          Assumed incremental value per PTR Common Share.............. $   1.36
                                                                       ========
</TABLE>
 
  Upon full funding of the Homestead Notes by PTR and Security Capital Atlantic
Incorporated ("ATLANTIC"), PTR's conversion rights would represent a 34.7%
ownership interest in Homestead. This ownership interest assumes no further
equity offerings by Homestead, conversion of all Homestead Notes by PTR and
ATLANTIC and exercise of all outstanding warrants.
 
 Depreciation Expense
 
  The increase in depreciation expense resulted primarily from the increase in
the number of operating communities partially offset by dispositions, including
those related to the contribution of assets to Homestead on October 17, 1996.
 
 Interest Expense
 
  The following table summarizes PTR's interest expense (in thousands):
 
<TABLE>
<CAPTION>
                                                    THREE MONTHS   THREE MONTHS
                                                       ENDED          ENDED
                                                   MARCH 31, 1997 MARCH 31, 1996
                                                   -------------- --------------
      <S>                                          <C>            <C>
      Credit facilities...........................    $ 3,548        $ 2,100
      Long-Term Debt..............................     10,718          4,727
      Mortgages payable...........................      4,122          3,190
      Capitalized interest........................     (4,427)        (3,497)
                                                      -------        -------
        Total interest expense....................    $13,961        $ 6,520
                                                      =======        =======
</TABLE>
 
  Interest expense on PTR's credit facilities increased $1.4 million (69.0%)
resulting primarily from higher average outstanding balances. Average
borrowings on the line of credit were approximately $151.6 million (with an
average effective interest rate of 8.1%) during the three months ended March
31, 1997, as compared to average borrowings of approximately $94.2 million
(with an average effective interest rate of 7.58%) for the same period in 1996.
 
 
                                       22
<PAGE>
 
  Interest expense on PTR's Long-Term Debt increased $6.0 million (126.7%) for
the three month period ended March 31, 1997 as compared to the same period in
1996. The increase is primarily attributable to the issuance of $380 million
of Long-Term Debt during the year ended December 31, 1996.
 
  Mortgage interest expense increased approximately $1.0 million (29.2%) for
the three months ended March 31, 1997 as compared with the same period in
1996. This increase is the result of additional weighted-average debt
outstanding due to mortgage assumptions related to community acquisitions
which were partially offset by prepayments during 1996 and 1997.
 
  The increase in interest costs were partially offset by an increase of
approximately $1.0 million (26.6%) in capitalized interest. The increase in
capitalized interest is attributable to higher levels of multifamily
development activity for the three months ended March 31, 1997 as compared to
the same period in 1996.
 
 REIT Management Fee Paid to Affiliate
 
  The REIT Management fee paid by PTR decreased by approximately 16.9% during
the three months ended March 31, 1997 as compared to the same period in 1996.
This decrease is primarily attributable to an overall increase in the assumed
principal amortization and interest on Long-Term Debt for purposes of the fee
calculation, coupled with the fact that interest income on the Homestead Notes
has been excluded from the calculation of the fee in accordance with the terms
of the agreement. In the future, to the extent that PTR completes additional
Long-Term Debt offerings and nonconvertible preferred share financing and as
additional fundings of the Homestead Notes occur, the REIT Management fee will
continue to decline in proportion to PTR's earnings from operations.
 
  See "Item 1. Financial Statements, Note 7, REIT Manager and Property Manager
Acquisition Proposal" for information regarding a proposed merger transaction
which would result in PTR becoming an internally managed REIT with Security
Capital Group remaining as PTR's largest shareholder.
 
 Gains and Provision for Possible Loss on Investments
 
  As a result of PTR's asset optimization strategy, PTR disposed of 12
multifamily communities and one industrial building during the first quarter
of 1997, representing gross proceeds of $142.1 million. As of March 31, 1997,
PTR held a portion of the 1997 disposition proceeds aggregating $59 million in
an interest bearing escrow account, pending acquisition of other multifamily
communities to complete the tax-deferred exchange. During the first quarter of
1996, PTR disposed of four multifamily communities representing gross proceeds
of $39.5 million. The proceeds from the 1996 and 1997 dispositions have been
or will be redeployed into other multifamily communities that in PTR's view
offer better long-term cash flow growth prospects. For federal income tax
purposes, the majority of the 1997 and 1996 dispositions were structured as
tax-deferred exchanges which deferred gain recognition. For financial
reporting purposes, however, the transactions qualified for profit
recognition, and aggregate gains of $25.3 million and $2.9 million, were
recorded for the three months ended March 31, 1997 and 1996, respectively.
 
  As part of PTR's asset optimization strategy, 18 multifamily communities
were held for disposition as of March 31, 1997. The aggregate carrying value
of properties held for disposition was approximately $144.0 million at March
31, 1997, net of a provision for possible loss of $1.5 million on certain
communities. A substantial aggregate gain is expected upon the disposition of
the remaining communities, although generally accepted accounting principles
disallows recognition of anticipated gains. Subject to normal closing risks,
PTR expects to complete the disposition of these communities during 1997 and
redeploy the net proceeds from such dispositions, where appropriate, through
tax-deferred exchanges, into the acquisition of multifamily communities.
 
 
                                      23
<PAGE>
 
ENVIRONMENTAL MATTERS
 
  PTR is subject to environmental regulations related to the ownership,
operation, development and acquisition of real estate. As part of its due
diligence procedures, PTR has conducted Phase I environmental assessments on
each community prior to acquisition. The cost of complying with environmental
regulations was not material to PTR's results of operations during either
period. PTR is not aware of any environmental condition on any of its
communities that is likely to have a material adverse effect on PTR's
financial position or results of operations.
 
LIQUIDITY AND CAPITAL RESOURCES
 
  PTR considers its liquidity and ability to generate cash from operations and
financings to be adequate and expects it to continue to be adequate to meet
PTR's development, acquisition, operating, debt service, Homestead funding
obligation and shareholder distribution requirements.
 
 Operating Activities
 
  Net cash flow provided by operating activities increased by $6.6 million
(40.5%) for the three months ended March 31, 1997 as compared to the same
period in 1996. This increase was due primarily to reduced cash outlays for
operating liabilities resulting from timing differences.
 
 Investing and Financing Activities
 
  During the three months ended March 31, 1997 and 1996, PTR invested cash of
$177.9 and $101.3 million, respectively, in real estate investments relating
primarily to the significant acquisition and development activity summarized
in "Overview" above. The $177.9 million invested in real estate and $16.3
million in fundings of Homestead Notes during the three months ended March 31,
1997 were financed primarily from $80.1 million in net proceeds from property
dispositions (excluding $59.0 million held in escrow pending tax-deferred
exchanges), and borrowings under PTR's credit facilities which were partially
repaid from proceeds related to PTR's $50 million offering of Long-Term Debt
issued in March 1997. The $101.3 million invested during the three months
ended March 31, 1996 was financed primarily from borrowings under PTR's credit
facilities which were partially repaid from proceeds related to PTR's $150
million offering of Long-Term Debt issued in February 1996. Total mortgage
debt assumed during 1997 in connection with community acquisitions aggregated
$23.5 million.
 
  Other significant financing activity included the payment of $29.7 million
and $28.8 million in Common and Preferred Share distributions for the three
months ended March 31, 1997 and 1996, respectively. The increase is primarily
attributable to a 4.8% increase in the distributions paid per Common Share.
Preferred Share dividends decreased approximately $1.4 million during the
respective periods as a result of conversions of Series A Preferred Shares to
Common Shares.
 
 Borrowings
 
  PTR has a $350 million unsecured revolving line of credit with approximately
$83.5 million of borrowings outstanding as of May 9, 1997. The line of credit
matures August 1998 and may be extended annually for an additional year with
the approval of the Lenders. The aggregate amount of borrowings outstanding
under all of PTR's credit facilities as of May 9, 1997 was $196.6 million.
 
  See "Item 1. Financial Statements, Note 4, Borrowings" for additional
information regarding credit availability, outstanding debt balances, interest
rates, scheduled debt maturities and other terms.
 
 Commitments and Contingencies
 
  At March 31, 1997, PTR had contingent contracts or letters of intent,
subject to PTR's final due diligence and approval of all entitlements, to
acquire land for new development communities with an estimated 4,621
multifamily units at a total development cost of approximately $411.9 million.
At the same date, PTR also had
 
                                      24
<PAGE>
 
contingent contracts or letters of intent, subject to final due diligence, for
the acquisition of 897 additional operating multifamily units with a total
expected investment of $79.7 million, including budgeted renovations. At March
31, 1997, PTR had unfunded development commitments for developments under
construction of $132.0 million. For a description of unfunded commitments in
connection with the Homestead Notes see "--Results of Operations--Homestead
Interest and Homestead Notes."
 
  PTR expects to finance these activities and other future investment and
operating needs with cash on hand, borrowings under its credit facilities and
disposition proceeds from its asset optimization strategy, prior to arranging
long-term capital. The credit facilities will facilitate an efficient response
to market opportunities while minimizing the amount of cash invested in short-
term investments at lower yields. Other sources of future liquidity and
financial flexibility include $420 million in shelf-registered securities which
can be issued in the form of Long-Term Debt, Preferred Shares and Common Shares
on an as-needed basis, subject to PTR's ability to effect offerings on
satisfactory terms. PTR believes that its current conservative ratio of long-
term debt to total long-term undepreciated book capitalization (the sum of
long-term debt and shareholders' equity after adding back accumulated
depreciation) of 37.95% at March 31, 1997, provides considerable flexibility
with respect to its ability to finance its investment activities.
 
  From time to time, PTR utilizes derivative financial instruments as hedges in
anticipation of future debt offerings in order to manage well-defined interest
rate risk. In anticipation of the $50 million Long-Term Debt offering that
closed March 31, 1997, PTR entered into interest rate contracts with notional
amounts aggregating $50 million in 1996. Upon completion of the offering, PTR
terminated the interest rate contracts, realizing a gain of approximately
$819,000 which has been deferred and is being amortized as an offset to
interest expense over the term of the Long-Term Debt that was issued.
 
 Distributions
 
  PTR paid the first quarter 1997 distribution of $0.325 per Common Share on
February 20, 1997. On April 22, 1997 the Board declared a cash distribution of
$0.325 per Common Share, payable on May 29, 1997, to shareholders of record on
May 13, 1997. This is PTR's 85th consecutive Common Share distribution to
shareholders. On March 31, 1997, PTR paid quarterly dividends of $0.4377 per
cumulative convertible Series A Preferred Share and $0.5625 per cumulative
redeemable Series B Preferred Share to preferred shareholders of record on
March 17, 1997.
 
 Funds From Operations
 
  Funds from operations is defined as net earnings computed in accordance with
generally accepted accounting principles, excluding gains (or losses) plus real
estate depreciation and provision for possible loss on investments and
excluding extraordinary items. Management believes that an understanding of
funds from operations will enhance the reader's comprehension of PTR's results
of operations and cash flows presented in the financial statements and other
sections within this document. Funds from operations should not be construed as
a substitute for "net earnings" in evaluating operating results nor as a
substitute for "cash flow" in evaluating liquidity and the funds from
operations measure presented by PTR may not be comparable to similarly titled
measures of other REITs.
 
  In 1996, PTR contributed its Homestead Village assets to Homestead.
Management believes that funds from operations for the three months ended March
31, 1996 should be adjusted to reflect the effects of the Homestead transaction
to provide a more meaningful comparison to the historical 1997 results.
Accordingly, pro forma funds from operations for the three months ended March
31, 1996 has been calculated as if the Homestead transaction had occurred on
January 1, 1996. The funds from operations information is unaudited and the pro
forma funds from operations is not necessarily indicative of what actual funds
from operations would have been if the Homestead transaction had occurred on
January 1, 1996.
 
                                       25
<PAGE>
 
  Funds from operations and pro forma funds from operations (1996) are as
follows (amounts in thousands):
 
<TABLE>
<CAPTION>
                                                              THREE      THREE
                                                             MONTHS     MONTHS
                                                              ENDED      ENDED
                                                            MARCH 31,  MARCH 31,
                                                              1997       1996
                                                            ---------  ---------
<S>                                                         <C>        <C>
Net earnings attributable to Common Shares................. $ 40,576    $19,455
Add (Deduct):
  Real Estate Depreciation.................................   12,049     10,618
  Gain on disposition of investments.......................  (25,335)    (2,923)
  Provision for Possible Loss on Investments...............    1,500        --
  Amortization related to Homestead Notes..................     (245)       --
                                                            --------    -------
Historical funds from operations attributable to Common
 Shares....................................................   28,545     27,150
Add (deduct) pro forma adjustments relating to the
 contribution
 of Homestead Assets:
  Reduction in revenues and operating expenses(1)..........      --      (3,261)
  Increase in interest income(2)...........................      --         823
  Reduction in interest expense(3).........................      --        (166)
  Reduction in capitalized interest(4).....................      --        (575)
  REIT Management fee effect(5)............................      --         641
  Other....................................................      --          22
                                                            --------    -------
    Total pro forma adjustments............................      --      (2,516)
                                                            --------    -------
Funds from operations attributable to Common Shares
 (Pro forma for 1996)...................................... $ 28,545    $24,634
                                                            ========    =======
Weighted-average Common Shares outstanding.................   75,872     72,211
                                                            ========    =======
</TABLE>
--------
(1) Represents the elimination of Homestead's historical revenues and
    operating expenses.
(2) Represents the interest income which would have been recognized on the
    Homestead Notes, assuming that PTR received Homestead common stock in
    exchange for its contribution first, and then Homestead Notes in exchange
    for the balance of its contribution over the respective time periods.
(3) Represents the assumed amount of incremental interest expense which would
    have been incurred as a result of higher line of credit balances due to
    reduced cash flow.
(4) Represents the reclassification of historical interest costs capitalized
    on Homestead developments to interest expense.
(5) Represents the decrease in REIT Management fee that would have resulted
    from the pro forma adjustments.
 
                                      26
<PAGE>
 
                           PART II--OTHER INFORMATION
 
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITIES HOLDERS
 
  None.
 
ITEM 5. OTHER INFORMATION
 
  None.
 
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
 
  (a) EXHIBITS:
 
<TABLE>
     <S>       <C>
     12        --Statement regarding Computation of Ratio of Earnings to Fixed Charges.
     15        --Letter from KPMG Peat Marwick LLP dated May 13, 1997 regarding unaudited
                financial information.
     27        --Financial Data Schedule
</TABLE>
 
  (b) REPORTS ON FORM 8-K:
 
<TABLE>
<CAPTION>
                                                                                  FINANCIAL
            DATE                       ITEM REPORTED                              STATEMENTS
            ----                       -------------                              ----------
      <S>                              <C>                                        <C>
      January 27, 1997                 Item 5                                        No
      February 20, 1997                Item 5, Item 7                                Yes
      March 26, 1997                   Item 5                                        No
</TABLE>
 
                                       27
<PAGE>
 
                                  SIGNATURES
 
  PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
 
                                          Security Capital Pacific Trust
 
                                                /s/ Bryan J. Flanagan
                                          _____________________________________
                                             Bryan J. Flanagan, Senior Vice
                                              President (Principal Financial
                                                         Officer)
 
                                                  /s/ Ash K. Atwood
                                          _____________________________________
                                              Ash K. Atwood, Vice President
                                              (Principal Accounting Officer)
 
Date: May 13, 1997
 
                                      28