UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-Q

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

                For the quarterly period ended March 31, 1998 or
            [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                        For the transition period from to

                           Commission file No. 1-13080

                              GROVE PROPERTY TRUST
             (Exact name of registrant as specified in its charter)

           Maryland                               06-1391084
(State or other jurisdiction 
of incorporation or organization)         (I.R.S. Employer Identification No.)

         598 Asylum Avenue, Hartford, Connecticut         06105
         (Address of Principal Executive Offices)      (Zip Code)

                                  (860) 246-1126
                 (Issuers Telephone Number, including area code)


         Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of Each Class:                  Name of Each Exchange on Which Registered:
Common Shares of Beneficial Interest,           American Stock Exchange
     $.01 par value

     Securities registered pursuant to Section 12(g) of the Exchange Act:
     None

     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
during the  preceeding 12 months (or for such shorter period that the registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements  for the past 90 days.  Yes: X No: 
     
The number of Common Shares of Beneficial  Interest  outstanding as of
 May 14, 1998 was 8,453,829.

<PAGE>

                              GROVE PROPERTY TRUST

                                    Form 10-Q
                                      Index

--------------------------------------------------------------------------------

                                                                           Page

Part I:  Financial Information                                                3

Item 1:
Consolidated Financial Statements (unaudited)                                 3

Consolidated Balance Sheets of as of March 31, 1998 and December 31, 1997     3

Consolidated Income Statements for the three months ended March 31, 1998
and 1997                                                                      4

Consolidated Statements of Cash Flows for the three months ended
March 31, 1998 and 1997                                                       5

Notes to Consolidated Financial Statements                                    6

Item 2:
Managements Discussion and Analysis of Financial Condition and
Results of Operations                                                        13

Item 3:
Quantitative and Qualitative Disclosure About Market Risk                    17

Part II:Other Information                                                    17

Item 6:Exhibits and Reports on Form 8-K                                      17

Signatures                                                                   19

Exhibit Index                                                                20

<PAGE>


<TABLE>
<CAPTION>

                                               GROVE PROPERTY TRUST
                                            CONSOLIDATED BALANCE SHEETS
                                                                 
                                                           March 31, 1998             December 31, 1997
                                                           --------------             -----------------
                                                             (Unaudited)                   (Audited)
                                                                          (in thousands)

                                                ASSETS
<S>                                                        <C>                         <C>

Real estate assets:
     Land                                                   $      22,521               $     21,403
     Buildings and improvements                                   132,471                    125,412
     Furniture, fixtures and equipment                              1,150                        952
                                                        ----------------------     ---------------------
                                                                  156,142                    147,767
     Less accumulated depreciation                                 (4,818)                    (3,674)
                                                        ----------------------     ---------------------
       Net real estate assets                                     151,324                    144,093
Cash and cash equivalents                                           1,509                      1,466
Due from affiliates                                                   546                        620
Deferred charges, net of accumulated amortization
     of $162 and $127, respectively                                   825                        849
Other assets                                                        1,749                      1,122
                                                        ---------------------      ---------------------
  Total assets                                              $     155,953               $    148,150
                                                        ======================     =====================


                                 LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
     Mortgage notes payable                                 $      33,405               $     33,457
     Revolving credit facility                                     23,000                     15,601
     Other liabilities                                              1,893                      1,387
     Distributions payable                                          1,948                      1,436
     Security deposits                                              1,963                      2,026
     Due to affiliates                                                 94                         49
                                                        ----------------------     ---------------------
  Total liabilities                                                62,303                     53,956
Minority interests in consolidated partnerships                     1,133                      1,357
Minority interest in Operating Partnership                         24,250                     24,339
Shareholders' equity:
     Preferred shares, $.01 par value per share,
       1,000 shares authorized; no shares
       issued or outstanding
     Common shares, $.01 par value per share,
       13,999,000 shares authorized; 8,453,829 shares
       issued and outstanding                                          84                         84
     Additional paid-in capital                                    68,995                     68,976
     Distributions in excess of earnings                             (812)                      (562)
                                                           ------------------     ----------------------
  Total shareholders' equity                                       68,267                     68,498
                                                           ------------------     ----------------------
  Total liabilities and shareholders' equity                $     155,953               $    148,150
                                                        ======================     =====================

See notes to consolidated  financial statements.

</TABLE>

<PAGE>



<TABLE>
<CAPTION>


                                             GROVE PROPERTY TRUST
                                      CONSOLIDATED STATEMENTS OF INCOME
                                                 (Unaudited)


                                                                      For the Three Months Ended March 31,
                                                                      ------------------------------------
                                                                         1998                    1997
                                                                         ----                    ----
                                                                       
                                                                      (In thousands, except per share data)

<S>                                                                   <C>                        <C>  

Revenues:
    Rental income                                                       $   7,441                 $  1,177
    Property management  affiliates                                            94                       45
    Other income                                                               38                       60
    Interest income                                                            15                       24
                                                                   -------------------       ------------------
        Total revenues                                                      7,588                    1,306
                                                                   -------------------       ------------------


Expenses:
    Property operating and maintenance                                      2,647                      556
    Real estate taxes                                                         779                      116
    Related party management fees                                                                       22
    Interest expense                                                        1,002                      173
    General and administrative                                                355                       69
    Depreciation and amortization                                           1,179                      240
                                                                   -------------------       ------------------
        Total expenses                                                      5,962                    1,176
                                                                   -------------------       ------------------




            Income before minority interest                                 1,626                      130

            Minority interests in consolidated partnerships                    17                        3

            Minority interest in operating partnership                        422                       30
                                                                   -------------------       ------------------

                Net income                                                 $1,187                    $  97
                                                                   ===================       ==================

Net income per share - basic                                               $0.14                     $0.08
                                                                   ===================       ==================
Net income per share - assuming dilution                                   $0.14                     $0.08
                                                                   ===================       ==================

Weighted average number of common shares outstanding-basic                  8,454                    1,250
Effect of warrants and stock options                                           29
                                                                   ===================       ==================
Weighted average number of shares outstanding-assuming dilution             8,483                    1,250
                                                                   ===================       ==================

See notes to consolidated financial statements.
</TABLE>

<PAGE>


<TABLE>
<CAPTION>


                                              GROVE PROPERTY TRUST
                                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                  (Unaudited)

                                                                         For the Three Months Ended March 31,
                                                                      -------------------------------------------
                                                                                1998                      1997
                                                                                ----                      ----
                                                                                        (In thousands)
<S>                                                                      <C>                    <C>   

Operating Activities:
Net income                                                                $    1,187             $          97
Adjustments to reconcile net income to net cash provided
     by operating activities
         Depreciation and amortization                                         1,179                       240
         Minority interests                                                      439                        33
         Non-cash compensation expense                                            30                        30
Change in other assets                                                          (635)                     (216)
Change in accounts payable, accrued expenses and other
     liabilities                                                                 442                       765
                                                                      ------------------     --------------------
Net cash provided by operating activities                                      2,642                       949
                                                                      ------------------     --------------------

Investing activities:
      Purchase of partnership interests                                         (214)
      Cash acquired on purchase of partnership interests                                                 2,214
      Additions to real estate assets                                         (8,375)                     (20)
                                                                      ------------------     --------------------

                  Net cash (used in) provided by investing activities         (8,589)                    2,194
                                                                      ------------------     --------------------

Financing activities:
      Net proceeds from mortgage payable                                       7,399                    15,084
      Financing costs                                                                                     (648)
      Proceeds from sale of common stock                                                                30,000
      Equity offering costs                                                      (11)                   (2,458)
      Repayment of mortgage payable                                              (52)                  (39,657)
      Repayments from (loans to) affiliates                                       70                      (762)
      Borrowings from affiliates                                                  45
      Dividends and distributions paid                                        (1,461)                     (217)
                                                                      ------------------     --------------------
                  Net cash provided by financing activities                    5,990                    1,342
                                                                      ------------------     --------------------

Net change in cash and cash equivalents                                           43                    4,485

Cash and cash equivalents, beginning of period                                 1,466                      381
                                                                      ------------------     --------------------

Cash and cash equivalents, end of period                                  $    1,509             $      4,866
                                                                      ==================     ====================

Supplemental Information:
     Cash paid for interest                                               $    1,004             $         134
     Mortgage notes payable assumed through property acquisitions                                $      48,048
     Net rental properties contributed in exchange for OP Units                                  $      11,207
     Excess of liabilities over assets assumed on acquisition of
         partnership interests                                                                   $         912

See notes to consolidated financial statements.
</TABLE>

<PAGE>

                                               GROVE PROPERTY TRUST

                                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                  March 31, 1998

1.   FORMATION AND DESCRIPTION OF THE COMPANY 

Grove Property  Trust (the  "Company") was organized in the State of Maryland on
April 4, 1994 as a Real Estate Investment Trust ("REIT").  The Company currently
operates thirty-seven  residential  communities and four retail properties.  The
residential communities are generally mid-priced  multi-family  communities that
are primarily located in the southern New England area.

2.   ACQUISITIONS  AND CONSOLIDATION TRANSACTIONS
 On March 14, 1997, the Company completed a series of transactions (the
     "Consolidation Transactions") that included the following:

     The  Company   formed  an  operating   partnership   (the   "Operating
     Partnership" or the "OP") to serve as the vehicle for the  consolidation of
     ownership and control of the Company's operations and assets.

Pursuant  to  an  exchange  offer,  the  Operating  Partnership  purchased  from
non-affiliated limited partners substantially all of the outstanding partnership
interests  of  twenty  additional  properties,  including  one  retail  property
("Property  Partnerships")  in exchange  for  1,205,324  partnership  units (the
"Common  Units" or "OP  Units")  of the  Operating  Partnership,  or, in certain
circumstances,  cash. Common Units are generally  exchangeable for the Company's
Common Shares on a one-for-one basis.

          Immediately   prior   to  the   consummation   of  the   Consolidation
     Transactions,  the Company  declared a stock  dividend  aggregating  26,250
     Common  Shares  and  concurrently  effected  a stock  split  of  1.125 to 1
     (collectively  the "Stock  Split"),  thereby  issuing on a pro rata basis a
     total of 95,102  additional  Common Shares to the holders of the issued and
     outstanding Common Shares just prior to the Consolidation Transactions. All
     amounts based  onoutstanding  Common Shares were retroactively  adjusted to
     reflect the Stock Split.

          The Company  issued  3,333,333  Common Shares to new equity  investors
     (the "New Equity Investment") in exchange for $30.0 million  (approximately
     $27.5 million after costs of issuance).
   
        Pursuant  to a  contribution  agreement  among  the  Company,  certain
     companies  and   individuals   affiliated  with  the  Company  (the  "Grove
     Companies") and the Operating Partnership,  substantially all of the assets
     and operations, the management services division of Grove Property Services
     Limited  Partnership  and the Grove  Companies'  interests  in the Property
     Partnerships were also transferred to the Operating Partnership.

          In exchange for the above,  the Grove Companies  received an aggregate
     of 909,115 Common Units in the Operating  Partnership and a cash payment of
     $178,000 from the Company, and the Company received 620,102 Common Units in
     the Operating  Partnership.  Additionally,  the Company  contributed to the
     Operating Partnership the net proceeds received from the aforementioned new
     equity  investment in exchange for 3,333,333  additional  Common Units.

          In  connection  with the  Consolidation  Transactions,  the  Operating
     Partnership  entered into a three-year  secured  revolving  acquisition and
     working  capital  credit  facility of up to $25.0  million  (the  "original
     Revolving Credit Facility") and a $15.1 million ten-year term mortgage loan
     (the "Mortgage Loan").

          On June 1,  1997, the Company  acquired two related party  residential
     apartment complexes (Four Winds and Brooksyde) In addition, the Company
     acquired an interest in Windsor  Arbor  Limited  Partnership,  the owner of
     River's Bend Apartments ("Windsor Arbor").
<PAGE>

          Upon  consummation  of the June 1, 1997  transactions,  the  Operating
     Partnership  issued an aggregate of 420,183  Common Units valued at $10 per
     unit. The Company also assumed mortgage debt on Four Winds and Brooksyde in
     the aggregate remaining principal amount of $6.2 million. To complete these
     transactions,  the Company borrowed $1.8 million under its Revolving Credit
     Facility.

          On July 2,  1997,  the  Company  acquired  certain  condominium  units
     representing a portion of the condominium  units in the Greenfield  Village
     complex located in Rocky Hill,  Connecticut  from an unrelated  party.  The
     Company paid approximately  $4.3 million,  with proceeds from the Revolving
     Credit Facility, in the aggregate, for these units.

          On September 1, 1997, the Company  acquired two additional  properties
     from  related  parties.  Heritage  Court in  Glastonbury,  Connecticut  and
     Summit/Birch  Hill in Farmington,  Connecticut.  The Operating  Partnership
     issued  325,836  Common  Units,  assumed $9.8 million in debt and drew down
     $750,000 against its Revolving Credit Facility to acquire these properties.

          On September  30, 1997,  the Company  acquired the  remaining  limited
     partnership interests in Windsor Arbor for $4.9 million.

          On October 31, 1997, the Company  purchased an apartment  complex from
     an unrelated  party in Ellington,  Connecticut  (High  Meadow).  The $4.2
     million  purchase price was paid utilizing  borrowings  under the Revolving
     Credit Facility.

          In  addition,  on October 31,  1997,  the Company  acquired two retail
     properties from related parties.  These  acquisitions,  Cornerblock and the
     Wharf  Building,  are  specialty  retail  properties  located in Edgartown,
     Massachusetts.  Upon  consummation  of the  Cornerblock  and Wharf Building
     transactions,  the  Operating  Partnership  issued an  aggregate of 143,334
     Common Units valued at $10.50 each.  To complete  these  transactions,  the
     Company  borrowed  approximately  $7.0 million under its  Revolving  Credit
     Facility.

          In November 1997, the Company  completed the sale of 4,500,000  Common
     Shares ("the  November  Offering").  The net  proceeds  from the sale after
     underwriting discounts and other costs was approximately $45.2 million. The
     Company  used the  proceeds to pay off its  Revolving  Credit  Facility and
     certain  mortgage notes payable (see notes 5 and 6) and for working capital
     purposes.

          On December 1, 1997, the Company acquired an apartment complex from an
     unrelated   party  in   Ellington,   Connecticut   "Pinney   Brook")   for
     approximately  $950,000  million.  The purchase price was paid from working
     capital.

          On December 31,  1997,  the Company  acquired  four  communities  from
     unrelated   parties  for  approximately   $20.0  million.   The  individual
     communities are Briar Knoll,  Ribbon Mill, Hilltop and Village Arms and are
     located  respectively  in Manchester,  Vernon and Norwich,  Connecticut and
     Acton,  Massachusetts.  The purchase  price was paid  utilizing  borrowings
     under the Revolving Credit Facility and cash on hand.

          On January 23,  1998,  the Company  purchased  an  apartment  complex,
     Tanglewood  Apartments,  located  in West  Warwick,  Rhode  Island  from an
     unrelated  party through the OP. The purchase price of  approximately  $7.0
     million was paid utilizing borrowings under the Revolving Credit Facility.

          On April 1, 1998 the Company  purchased a specialty retail property in
     Freeport,  Maine and an apartment community in Agawam,  Massachusetts.  The
     retail property includes a 25,000 square foot complex and was purchased for
     approximately $7.2 million.  The apartment  community includes 88 units and
     was  purchased  from an  affiliate  of the Company for  approximately  $3.3
     million.  These acquisitions were financed through the assumption of a $3.9
     first mortgage on the retail property,  issuance of 5,814 common units, and
     utilizing borrowings under the original Revolving Credit Facility.

          The Company  intends to  continue  to operate all of its  multi-family
     communities and retail commercial properties as rental properties.
<PAGE>

3.  SIGNIFICANT ACCOUNTING POLICIES 

     Basis of Presentation
          The  financial  statements  are  presented  on a  consolidated  basis.
     Included in the  Company's  financial  statements  are the  accounts of the
     Operating  Partnership and various  property  partnerships.  Properties are
     owned either directly by the Operating Partnership, or are owned by various
     limited  partnerships  or  limited  liability  companies,  that in turn are
     substantially  (89% to 100%) or wholly owned by the Operating  Partnership.
     All significant intercompany transactions are eliminated in consolidation.

          The accompanying  interim  financial  statements have been prepared by
     the Company's  management in accordance with generally accepted  accounting
     principles for interim  financial  information and in conjunction  with the
     rules and  regulations of the Securities  and Exchange  Commission.  In the
     opinion of management,  the interim financial  statements  presented herein
     reflect  all  adjustments  of a  normal  and  recurring  nature  which  are
     necessary to fairly state the interim financial statements.  The results of
     operations for the interim period ended March 31, 1998 are not  necessarily
     indicative of the results that may be expected for the year ending December
     31, 1998. These financial statements should be read in conjunction with the
     Company's  audited  financial  statements and the notes thereto included in
     the Company's  Annual  Report on Form 10-K for the year ended  December 31,
     1997.  Certain  amounts  have  been  reclassified  in  the  1997  financial
     statements in order to conform with the 1998 financial statements.

     Use of Estimates

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

     Cash and Cash Equivalents

          The  Company   considers  all  highly  liquid  debt  instruments  from
     financial institutions with an original maturity of three months or less at
     the time of purchase to be cash equivalents.  The combined account balances
     at each financial  institution  periodically  exceed the Federal Depository
     Insurance  Corporation ("FDIC") insurance coverages and, as a result, there
     is a  concentration  of credit risk related to amounts on deposit in excess
     of FDIC  insurance  coverage.  The  Company  believes  that the risk is not
     significant since its banking is with major financial institutions.

     Real Estate Asset Capitalization and Depreciation

          Interests  owned by certain  principals  of  affiliated  entities  and
     contributed  to the  Operating  Partnership  as part  of the  Consolidation
     Transactions  were recorded at their historical cost due to the controlling
     relationship  between  the  Company  and  the  principals  of the  entities
     previously  owning and  operating  the  Properties.  The value of interests
     contributed by non-principals was recorded based upon the fair market value
     of their  interests.  Subsequent  acquisitions  were recorded in accordance
     with the purchase method of accounting.

          Expenditures  for  long-lived  replacement-type  items  in  stabilized
     properties'  such as  appliances  and  floor  coverings,  are  capitalized.
     Furthermore,  expenditures  for  non-recurring  items under  $1,000 and for
     normal tenant turnover expenses (such as cleaning and painting) and repairs
     and  maintenance are expensed as incurred.  With respect to  re-development
     properties,  the Company generally  capitalizes all re-development  related
     costs incurred throughout the redevelopment stage.

          Depreciation  is  provided  for  building  and land  improvements  and
     buildings using the straight-line method over the estimated useful lives of
     the  assets  (10  to  30  years).  Additionally,  furniture,  fixtures  and
     equipment are  depreciated  using an accelerated  method over the estimated
     useful lives of the assets (5 to 7 years).
<PAGE>

     Long-Lived Assets

          Statement of Financial  Accounting  Standards No. 121, "Accounting for
     the Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed of
     " (FAS No. 121),  requires  long-lived assets to be reviewed for impairment
     when events or circumstances  indicate that an impairment might exist. When
     an  impairment  indicator is present,  assets must be grouped at the lowest
     level  for which  there  are  identifiable  cash  flows.  If the sum of the
     undiscounted cash flows is less than the carrying amounts of the assets, an
     impairment  loss must be  recorded.  The  impairment  loss is  measured  by
     comparing the fair value of the assets with their carrying amount. To date,
     no losses have been  recognized and management  believes that no impairment
     conditions exist.

     Per Share Data

          In 1997, the Financial Accounting Standards Board issued Statement No.
     128,  Earnings  per Share  (Statement  128).  Statement  128 replaced the
     calculation of primary and fully diluted  earnings per share with basic and
     diluted  earnings  per share.  Unlike  primary  earnings  per share,  basic
     earnings per share  excludes  the dilutive  effects of options and warrants
     (see Note 6).  Earnings  per share - assuming  dilution is very  similar to
     fully  diluted  earnings per share.  All earnings per share amounts for all
     periods have been presented and restated to conform to Statement 128.

          Income per common share  information is based on the weighted  average
     number of Common  Shares  outstanding  during each period.  On February 10,
     1997, the Board of Trust Managers of the Company  declared a stock dividend
     aggregating  26,250  Common  Shares and the  concurrent  effectuation  of a
     1.125-for-one  common stock  split.  All shares  outstanding  and per share
     amounts have been restated to reflect these changes in capital structure.

     Stock-Based Compensation

          The  Company  has  adopted  Financial  Accounting  Standard  No.  123,
     "Accounting for Stock-Based  Compensation."  This statement  defines a fair
     value based method of accounting  for employee  stock  compensation  plans.
     However, it also allows an entity to continue to measure  compensation cost
     for those  plans in  accordance  with  Accounting  Principles  Board  (APB)
     Opinion No. 25,  "Accounting for Stock Issued to Employees."  Under APB No.
     25,  compensation cost is the excess, if any, of the quoted market price of
     the  stock at the grant  date  over the  amount  the  employee  must pay to
     acquire  the stock.  The Company has elected to continue to account for its
     employee stock compensation plans under APB No. 25. (See Note 6).

     Advertising

          The Company expenses advertising costs as incurred.  Advertising costs
     were  $106,354 and $14,276 in the three  months  ended March 31, 1998,  and
     1997, respectively.

     Deferred Charges

          Deferred charges,  consisting principally of loan costs, are amortized
     on a straight line basis over the term of the related obligation. When term
     loans are retired prior to maturity,  the  unamortized  deferred loan costs
     are written-off and reported as an extraordinary item.
    
    Revenue Recognition

          Rental income attributable to leases is recorded when due from tenants
     and recognized monthly as it is earned,  which is not materially  different
     than the  straight-line  basis. The Company  generally  requires tenants to
     provide a cash  security  deposit equal to one month's rent or pay the last
     month's  rent in advance.  Such  payments  are deferred and are included in
     security deposits on the accompanying consolidated balance sheets.
<PAGE>

4.   MORTGAGE NOTES PAYABLE
 
          Mortgage  notes payable  consist of the following at March 31,1998 (in
     thousands):

       Amortizing first mortgage notes                    $14,321
       Interest only first mortgage notes                  19,084
                                                           ------
                                                          $33,405
                                                          =======

          The amortizing  first mortgage notes have fixed interest rates between
     7.04% and 8.33%. These notes mature between the years 2000 and 2013 and are
     collateralized  by  five  of  the  properties  with  a  carrying  value  of
     approximately $16.4 million as of March 31, 1998. These notes are partially
     guaranteed by certain executive officers and shareholders of the Company.

          There are two  interest  only  first  mortgage  notes.  One note has a
     principal  balance of $4.0 million  requiring  monthly payments of interest
     only  at a  fixed  rate  of  7.00%,  and  matures  in  2007.  This  note is
     collateralized by one property with a carrying value of approximately  $6.3
     million as of March 31,  1998.  The other note has a  principal  balance of
     $15.1  million  requiring  monthly  payments of interest only at a variable
     rate of one month LIBOR plus 1.14% (one month LIBOR was 5.72 % on March 31,
     1998), and matures in 2007. This note is collateralized by eight properties
     with an aggregate carrying value of approximately $20.5 million as of March
     31, 1998.

          The interest  rate on the $15.1  million  variable  rate note has been
     fixed with two interest rate swap contracts  (the "Interest  Swaps") with a
     bank. The Interest Swaps have in effect:  (i) fixed $7.6 million of debt at
     7.67% for the period from October 1, 1997 through  October 1, 2007 and (ii)
     fixed an  additional  $7.6  million  of debt at 7.68% for the  period  from
     October  1, 1997  through  January 4, 2005.  The  Interest  Swaps have been
     pledged as collateral under the related variable note.

          Annual principal payments due as of March 31, 1998, are as follows (in
     thousands):
                                                 Period Ending December 31,
                                                 --------------------------
                                  1998           $     151
                                  1999                 218
                                  2000                 235
                                  2001                 253
                                  2002                 273
                                  Thereafter        32,275
                                                    ------
                                                 $  33,405
                                                 =========

          In December  1997,  the OP entered  into an  agreement  whereby the OP
     effectively  locked the ten year U. S.  treasury bond rate on $20.0 million
     of future  debt at a rate of 5.835%.  The  agreement  is in effect  through
     July, 1998.

          In January 1998, the Company  entered into another  agreement  whereby
     the Company  effectively  locked the ten year U. S.  treasury  bond rate on
     $20.0  million  of  future  debt  at a rate of  5.47%.  The  agreement  was
     effective  through  April 1, 1998.  On April 1,  1998,  the  agreement  was
     modified to extend the rate lock to June 1, 1998 and  increase  the rate to
     5.52%.

          In April 1998, the Company entered into another  agreement whereby the
     Company  effectively  locked the ten year U. S. Treasury bond rate on $24.0
     million  of future  debt at a rate of  5.71%.  The  agreement  is in effect
     through June 1, 1998.
<PAGE>


5.   REVOLVING CREDIT FACILITY

          In March 1997,  the  Operating  Partnership  entered into a three year
     Revolving Credit Facility with a bank, guaranteed by the Company, for up to
     $25.0 million (the "original Revolving Credit Faciltiy").  Borrowings under
     the original  Revolving  Credit  Facility were  collateralized  by thirteen
     properties  with a  carrying  value of  approximately  $38.7  million as of
     December 31, 1997 and bears interest,  payable monthly,  at a floating rate
     of 1.2% above the 30, 60, or 90 day LIBOR rate.  The Operating  Partnership
     was  required to maintain  certain  financial  covenants  as defined in the
     original Revolving Credit Facility agreement. The original Revolving Credit
     Facility was available to fund future property  acquisitions;  $4.0 million
     was  available  to fund  working  capital  needs,  while $2.0  million  was
     available  to  fund  the  redemption  of  Common  Units  by  the  Operating
     Partnership  or the  purchase  of Common  Shares.  As of March 31, 1998 and
     December 31,  1997, there was $23 million and $15.6 million,  respectively,
     outstanding under the original Revolving Credit Facility.

          In April 1998, the Operating  Partnership  entered into a new two year
     Revolving Credit Facility with its bank and retired the original  Revolving
     Credit  Facility.   The  new  Revolving   Credit  Facility   increased  the
     availability  of the credit line to $50.0  million  from $25.0  million and
     converted  the line to an  unsecured  line  from a  secured  line.  The new
     Revolving Credit Facility bears interest payable monthly at a floating rate
     of 1.2% above the 30, 60, or 90 day LIBOR rate.  The new  Revolving  Credit
     Facility is available to fund future property  acquisitions  and up to $5.0
     million is available to fund working capital needs.

6.   SHAREHOLDERS' EQUITY

          The  following  table  outlines  the  1997 and  1998  activity  in the
     Operating Partnership equity accounts:
                                                              Number of:
                                              ----------------------------------
                                                                       Limited
                                                    Company's         Partners'
                                                    Operating         Operating
                                                   Partnership       Partnership
                                                       Units             Units
  Outstanding at December 31, 1996                    620,102                 -
  Consolidation Transactions in March 1997:            
   New Equity Investment                            3,333,333                 -
   Transfer of property interests-Grove Companies           -           909,115
   Transfer of property interests-non-affiliates            -         1,205,324
  June 1997 acquisitions                                    -           420,183
  Proceeds from stock options in May 1997                  394               -
  September 1997 acquisitions                                -          325,836
  October 1997 acquisitions                                   -         143,334
  The November 1997 Offering                         4,500,000               -
                                              ----------------- ----------------
  Outstanding at March 31, 1998                      8,453,829        3,003,792
   and December 31, 1997                      ================= ================
  Ownership Percentage                                 73.78%            26.22%
                                              ================= ================


          Income  is  allocated  to  the  Minority  Interest  in  the  Operating
     Partnership  based on its  weighted  average  ownership  percentage  of the
     Operating Partnership. The ownership percentage is computed by dividing the
     weighted  average number of OP Units held by the Minority  Interest holders
     by the total weighted average OP Units outstanding.  Issuance or redemption
     of additional Common Shares or OP Units changes the ownership percentage of
     both the  Minority  Interest  and the Company.  Such  transactions  and the
     proceeds or use of proceeds  therefrom are treated as capital  transactions
     and result in an  allocation  between  Shareholders'  Equity  and  Minority
     Interest to account for the change in the respective  percentage  ownership
     of the underlying equity of the OP.


          An OP Unit and each Common Share have  essentially  the same  economic
     characteristics as they effectively share equally in the net income or loss
     and  distributions  of the OP. OP Units  generally may be redeemed for cash
     or, at the  election of the  Company,  for Common  Shares on a  one-for-one
     basis, subject to certain lock-up provisions.
<PAGE>


 

Common Shares have been reserved for future issuance as follows:


         OP Units not owned by the Company (see above)              3,003,792
         Underwriters warrants                                         47,248
         Stock options issued                                         977,723
         Additional stock options issuable                             90,003
                                                               ---------------
                                                                    4,118,766
                                                               ===============
<PAGE>



     Item 2.  Management's  Discussion and Analysis of Financial  Condition
     and Results of Operations.

Overview
          The results of  operations  for the three  months ended March 31, 1998
     include the 36 residential  communities  and four retail  properties  owned
     since January 1, 1998 and the  Tanglewood  Apartments  purchased on January
     23, 1998. (Collectively, the "Properties"). The following discussion should
     be read in  conjunction  with the  financial  statements  and notes thereto
     included elsewhere in this Report.


          The results of  operations  for the three  months ended March 31, 1997
     include the three multifamily  properties (the "Original  Properties") that
     the Company has owned since its inception, a fourth property ("Cambridge"),
     acquired on January 12, 1996, and twenty additional  properties acquired on
     March 14, 1997 in  conjunction  with the  Consolidation  Transactions  (the
     "Consolidation Properties").

Results of Operations
      Results of  operations of the Company for the three months ended March
     31, 1998 and 1997.

          Total  revenues  increased  $6,282,000  from  $1,306,000 to $7,588,000
     during  the  three  months  ended  March  31,  1998,  as  compared  to  the
     corresponding  period in 1997.  The increase is primarily due to operations
     of the  Consolidation  Properties  and the  other 17  properties  purchased
     subsequent  to  March  31,  1997   (collectively,   the  "1997  Acquisition
     Properties").

          The 27 apartment  communities (2,564 apartments) owned by Grove or its
     affiliated  predecessors  since the  beginning of 1996, a "Same  Community"
     comparison, experienced an increase in average monthly rental rates, offset
     by a small  decrease  in average  economic  occupancy  and  experienced  an
     increase in net operating  income.  On a Same Community basis, the weighted
     average monthly rental rate per apartment  increased 3.9% to $723 from $695
     and the economic occupancy rate decreased to 94.9% from 96.0% for the first
     quarter of 1998 as  compared  to the first  quarter of 1997,  respectively.
     Overall,  Same  Community net  operating  income  increased  10.9% to $3.02
     million from $2.72 million for the first quarter of 1998 as compared to the
     first quarter of 1997, respectively.  Net operating income increased due to
     a 3.0%  increase  in revenues  and 5.9%  decrease  in  operating  expenses.
     Revenues  increased due to the increase in rental rates partially offset by
     a decrease in occupancy.  Expenses decreased primarily due to a decrease in
     utility  costs and snow plowing as a result of the  unusually  mild weather
     experienced  in the first quarter of 1998. The following  table  summarizes
     Same Community operations:

                                                  
                                                      Quarter Ended           %
                                                  ---------------------------
                                                 3/31/98      3/31/97     Change
Economic Occupancy                                  94.9%        96.0%    -1.1%
                                           ===========================
Average monthly rental rate per unit             $   723      $   695     3.9%
                                           ===========================
Revenues (millions)                              $  5.29      $  5.14     3.0%
Operating expenses (millions)                       2.27         2.42    -5.9%
                                            ====================================
    Net operating income (millions)               $  3.02      $  2.72    10.9%
                                            ====================================

          Property operating and maintenance  expenses increased $2,091,000 from
     $556,000 to  $2,647,000  during the three months  ended March 31, 1998,  as
     compared to the corresponding period in 1997. The increase is primarily due
     to additional  expenses  related to the acquisition of the 1997 Acquisition
     Properties.

          General and administrative expenses increased $286,000 from $69,000 to
     $355,000  during the three months ended March 31, 1998,  as compared to the
     corresponding  period in 1997.  The increase is primarily due to additional
     expenses related to the Consolidation  Transactions and increased  overhead
     expenses.

          Real estate taxes increased  $663,000 from $116,000 to $779,000 during
     the three  months ended March 31,  1998,  as compared to the  corresponding
     period in 1997.  This  increase  is due to related to the 1997  Acquisition
     Properties.

<PAGE>

          Related party  management  fees were eliminated due to the acquisition
     by the  Company  of the  management  services  division  of Grove  Property
     Services  Limited   Partnership   ("GPS")  as  part  of  the  Consolidation
     Transactions in March 1997.

          Interest expense increased $829,000 from $173,000 to $1,002,000 during
     the three  months ended March 31,  1998,  as compared to the  corresponding
     period in 1997. This increase is due to the debt assumed and/or  refinanced
     related to the 1997 Acquisition Properties.

          Depreciation  and  amortization  increased  $939,000  from $240,000 to
     $1,179,000 during the three months ended March 31, 1998, as compared to the
     corresponding  period in 1997.  The increase is primarily due to additional
     depreciation related to the 1997 Acquisition Properties.

          The  Company's  net  income  increased   $1,090,000  from  $97,000  to
     $1,187,000 during the three months ended March 31, 1998, as compared to the
     corresponding  period in 1997.  The increase is primarily due to additional
     net income related to the 1997 Acquisition Properties.


Liquidity and Capital Resources

          Cash and cash equivalents totaled $1,509,000 as of March 31, 1998. The
     Company's ratio of long-term debt, including the Revolving Credit Facility,
     to total market  capitalization  on March 31, 1998 was 31.8% based on total
     market capitalization of $177,426,000,  based on 3,003,792 Common Units and
     8,453,829  Common  Shares  valued at $10.5625 per  share/unit  (the closing
     price on March 31, 1998) plus  long-term  debt  $56,405,000,  including the
     Revolving Credit Facility.

          Cash provided by operating  activities  was  $2,642,000  for the three
     months  ended  March  31,  1998.  Cash  used in  investing  activities  was
     $8,589,000  for the three months ended March 31, 1998. Net cash provided by
     financing  activities  was  $5,990,000 for the three months ended March 31,
     1998.

          On March 11, 1998, the Company  declared a dividend of $0.17 per share
     which was paid on April 18, 1998. The dividends  declared during the period
     resulted in a 71.5%  payout of funds from  operations  for the three months
     ended March 31, 1998.

          On March 11, 1998, the Operating  Partnership  declared a distribution
     of $0.17 per Common Unit to the limited partners of the OP.

          In March 1997,  the  Operating  Partnership  entered into a three year
     Revolving  Credit  Facility  guaranteed  by the  Company,  for up to  $25.0
     million (the "original  Revolving Credit  Facility").  Borrowings under the
     original  Revolving Credit Facility were  collateralized by thirteen of the
     Properties  and  interest  was payable  monthly at a floating  rate of 1.2%
     above the 30,  60, or 90 day LIBOR  rate.  The  original  Revolving  Credit
     Facility was  available to fund future  property  acquisitions,  up to $4.0
     million was available to fund working capital needs, and up to $2.0 million
     was  available  to fund the  redemption  of Common Units or the purchase of
     Common Shares by the Operating Partnership.

          In April 1998, the Operating  Partnership  entered into a new two year
     Revolving Credit Facility with its bank and retired the original  Revolving
     Credit  Facility.   The  new  Revolving   Credit  Facility   increased  the
     availability  of the credit line to $50.0  million  from $25.0  million and
     converted  the line to an  unsecured  line  from a  secured  line.  The new
     Revolving Credit Facility bears interest payable monthly at a floating rate
     of 1.2% above the 30, 60, or 90 day LIBOR rate.  The new  Revolving  Credit
     Facility is available to fund future property  acquisitions  and up to $5.0
     million is available to fund working capital needs.


          The  Company  intends to meet its  short-term  liquidity  requirements
     through cash flow provided by operations and borrowings under the Revolving
     Credit Facility.  The Company  considers its ability to generate cash to be
     adequate,  and expects it to  continue  to be  adequate  to meet  operating
     requirements  and  pay  shareholder   dividends  in  accordance  with  REIT
     requirements.  The  Company  may use other  sources  of  capital to finance
     additional  acquisitions  including,  but not  limited  to, the  selling of
     additional  equity  interests  in the Company,  non-distributed  Funds From
     Operations,  the  issuance  of debt  securities,  funds from the  Revolving
     Credit  Facility,   and  exchanging  Common  Shares  or  Common  Units  for
     properties or interest in properties.
<PAGE>

Year 2000

          In the course of the  Company's  planned  upgrade  of its  information
     systems,  to  accommodate  growth of its business,  the Company will assure
     that its computer  software and hardware will be year 2000  compliant.  The
     Company  anticipates  that the upgrade of its  information  systems will be
     completed  during 1998 and  believes  that the cost thereof will not have a
     material impact on net income, assets or liabilities. Because of the nature
     of the  Company's  business,  it does not depend to any material  extent on
     electronic interchange of data or information with its residents, suppliers
     or vendors.

Acquisitions/Dispositions

          The Company continuously evaluates properties for possible acquisition
     or  disposition.  Individual  properties  may be  acquired  through  direct
     purchase of the property or through the purchase of the entity  owning such
     property  and may be made  for cash or  securities  of the  Company  or the
     Operating Partnership. In connection with any acquisition,  the Company may
     incur additional  indebtedness.  If the Company acquires or disposes of any
     property,  such acquisition or disposition could have a significant  effect
     on the Company's financial condition, results of operations or cash flows.
<PAGE>

Funds from Operations

          Industry analysts  generally consider funds from operations ("FFO") an
     appropriate  measure of  performance  of an equity REIT.  FFO is defined as
     income  before  gains  (losses)  on  investments  and  extraordinary  items
     (computed in accordance with generally accepted accounting principles) plus
     real estate depreciation, less preferred dividends and after adjustment for
     significant  non-recurring  items, if any. This definition  conforms to the
     recommendations  set  forth  in a  White  Paper  adopted  by  the  National
     Association of Real Estate  Investment Trusts ("NAREIT") in early 1995. The
     Company  believes that in order to facilitate a clear  understanding of its
     operating  results,  FFO should be  examined  in  conjunction  with the net
     income as presented in the financial  statements and  information  included
     elsewhere  in this  Report.  FFO does not  represent  cash  generated  from
     operating  activities  in accordance  with  generally  accepted  accounting
     principles and is not necessarily indicative of cash available to fund cash
     needs.  FFO should not be considered as an  alternative to net income as an
     indication of the Company's  performance  or as an alternative to cash flow
     as a measure of liquidity.

          FFO increased  $2,320,000  from  $412,000 to $2,732,000  for the three
     months ended March 31, 1998 and 1997, respectively.  Dividends declared for
     the three  months  ended March 31,  1998 were $.17 per share,  representing
     71.5% of FFO, while dividends declared for the three months ended March 31,
     1997  were  $.16  per  share  representing  69.5%  of  FFO.  The  dividends
     declaration for the three months ended March 31, 1997 were for short period
     from  January  1,  1997 to March  14,  1997,  the  date  the  Consolidation
     Transactions closed.

FFO was calculated as follows:

                                               For the Three Months Ended
                                               --------------------------
                                                        March 31,         
                                                    1998           1997
                                                    -------------------
Income before minority interests                $  1,626        $   130
Real estate depreciation and amortization          1,135            217
Non-recurring expenses                                 0             69
                                              --------------- --------------
Funds  from   operations   before   minority       2,761            416
interests
Minority     interests    in    consolidated          29              4
partnerships
                                              --------------- --------------
FFO                                             $  2,732        $   412
                                              =============== ==============



Seasonality

          Historically,  net income  from the  Properties  has been lower in the
     first and second  quarters  than in the remainder of the year due to higher
     utility  charges,  snow  removal and other  weather  related  expenses.  In
     addition,  rental rates  increase  ratably during the year which results in
     higher rental revenues in the second half of the year.


Inflation

          Substantially  all of the leases at the  properties  are for a term of
     one year or less, which may enable the Company to seek increased rents upon
     renewal or reletting.  Such short-term  leases generally lessen the risk to
     the Company of the potential adverse effects of inflation.

"Safe Harbor" Statement under Private Securities Litigation Reform Act of 1996

          Certain statements contained in this report, and in particular in this
     "Management"s Discussion and Analysis of Financial Condition and Results of
     Operations,  statements in other filings with the  Securities and Exchange
     Commission and  statements in other public  documents of the Company may be
     forward  looking and are  subject to a variety of risks and  uncertainties.
     Many factors  could cause actual  results to differ  materially  from these
     statements.  These factors include,  but are not limited to, (i) population
     shifts which may increase or decrease the demand for rental  housing,  (ii)
     the value of commercial and residential  rental properties in the Northeast
     where all of the Company's  properties are located,  in recent years,  have
     fluctuated  considerably,  (iii) the effect on the Company's  properties of
     competition  from  new  apartment  complexes  which  may  be  completed  in
     proximity  to such  properties  thereby  increasing  competition,  (iv) the
     effect of  weather  and other  conditions  which can  significantly  affect
     property  operating expenses and (v) other factors which might be described
     for time to time in the Company's  filings with the Securities and Exchange
     Commission.  In addition,  the Company is subject to the effects of changes
     in the general business economic conditions.
<PAGE>

          Although the Company  believes that its properties will continue to be
     attractive to tenants and that it will be able to control expenses,  future
     revenue and operating trends cannot be reliably predicted. These trends may
     cause the Company to adjust its operation in the future.  Factors  external
     to the Company can also affect the price of the  Company's  Common  Shares.
     Because of the  foregoing  and other  factors,  recent trends should not be
     considered reliable indicators of future financial results or stock prices.

Item 3  Quantitative and Qualitative Disclosure About Market Risk

          Based on Securities Exchange Act Release No. 38223, the Company is not
     required to provide information in response to this item.


Part II. Other Information

Item 6

 (A)  Exhibits
     4.1     Revolving Credit Agreement among Grove Operating, L.P., Grove
             Property Trust and Rhode Island  Hospital  Trust National Bank and
             Other Banks Which May Become  Parties To This  Agreement  with
             Rhode  Island  Hospital  Trust National Bank, As Agent BancBoston 
             Securities, Inc. As Arranger Dated April 30, 1998- - to be filed 
             upon amendment

     27.   Financial Data Schedule

 (B)  Reports on Form 8-K

          During the quarter ended March 31, 1998, the Company filed two Current
     Reports  on Form  8-K  dated  December  31,  1997  and  January  23,  1998,
     respectively,  responding  to  Items 2 and  7.Amendments  to  such  Current
     Reports included the following financial statements:

12/31/97 Form 8-K:
          (a)   Financial statements of business acquired.

Ribbon Mill, Hilltop and Briar Knoll
          Statement  of Revenue and Certain  Expenses  for the nine months ended
     September 30, 1997 and the year ended December 31, 1996.

Village Arms
          Statement  of Revenue and Certain  Expenses  for the period  April 22,
     1997 to December 31, 1997.

                  (b)  Pro Forma Financial Statements.

          Pro  Forma  Condensed  Balance  Sheet of  Grove  Property  Trust  (the
     "Company")  as of September  30,  1997.  Pro Forma  Condensed  Consolidated
     Statements of Income of the Company for the nine months ended September 30,
     1997 and the year ended December 31, 1996.

<PAGE>

1/23/98 Form 8-K:
Pro Forma Condensed Consolidated Financial Statements (Unaudited):

Pro Forma Condensed Consolidated Balance Sheet as of September 30, 1997
Notes to Pro Forma Condensed Consolidated Balance Sheet
Pro Forma Condensed Consolidated Statements of Income for the Nine Months
   Ended September 30, 1997 and the Year Ended December 31, 1996
Notes to Pro Forma Condensed Consolidated Statements of Income

Tangelwood

Financial Statements:

Report of Independent Auditors
Statements of Revenues and Certain Expenses for the Nine Months
   Ended September 30, 1997 (Unaudited) and for the Year Ended
   December 31, 1996
Notes to the Statements of Revenues and Certain Expenses

<PAGE>


SIGNATURES

          In  accordance  with  the   requirements  of  the  Exchange  Act,  the
     registrant  has  caused  this  report  to be  signed  on its  behalf by the
     undersigned, thereunto duly authorized.

                                           REGISTRANT:

                                           GROVE PROPERTY TRUST

Date: May 15, 1998                         Joseph R. LaBrosse
                                         Name:/s/ Joseph R. LaBrosse
                                         ---------------------------
                   (on behalf of the registrant and as Chief Financial Officer)

<PAGE>

                                                   EXHIBIT INDEX


 Exhibit No.                                         Description

     4.1       Revolving Credit Agreement  among  Grove  Operating,L.P., Grove
               Property  Trust and Rhode Island  Hospital Trust National Bank
               and Other  Banks  Which May Become  Parties To This  Agreement
               with Rhode  Island  Hospital  Trust  National  Bank,  As Agent
               BancBoston Securities,  Inc. As Arranger Dated April 30, 1998-
               - to be filed upon amendment

      27      Financial Data Schedule

              
<PAGE>