U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   Form 10-QSB/A


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

                  For the quarterly period ended June 30, 1996

                                       OR

               [ ]TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934


                           Commission file No. 1-13080

                    GROVE REAL ESTATE ASSET TRUST (Exact name of small  business
              issuer as specified in its charter)


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

598 Asylum Avenue, Hartford, Connecticut                     06105
      (Address of principal offices)                      (Zip Code)

                                 (860) 520-4789
                           (Issuer's telephone number)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15 (d) of  theExchange  Act during the past 12 months (or for such shorter
period that the registrant was required  tofile such reports),  and (2) has been
subject to such filing requirements for the past 90 days.
 Yes: X No:

525,000 common shares, $.01 par value, were outstanding as of August 2, 1996.





<PAGE>






                                       GROVE REAL ESTATE ASSET TRUST

                                                Form 10-QSB
                                                   Index
                                                                            Page

Part I:        Financial Information                                          3

Item 1:        Financial Statements

               Balance Sheets of Grove Real Estate Asset Trust as of
               June 30, 1996 and December 31, 1995                            3

               Income Statements of Grove Real Estate Asset Trust
               for the six months ended June 30, 1996 and June 30, 1995       4

               Income Statements of Grove Real Estate Asset Trust
               for the three months ended June 30, 1996 and June 30, 1995     5

               Statement of Shareholders' Equity of Grove Real Estate
               Asset Trust for the six months ended June 30, 1996             6

               Statements of Cash flows of Grove Real Estate Asset Trust
               for the six months ended June 30, 1996 and June 30, 1995       7

               Notes to Financial Statements                             8 - 10

Item 2:        Management's Discussion and Analysis of Financial
               Condition and Results of Operations                      11 - 14

Part II:       Other Information                                            15

Item 1:        Legal proceedings                                            15

Item 2:        Changes in Securities                                        15

Item 3:        Submission of Matters to a Vote of Security Holders          15

Item 4:        Other Information                                            15

Item 5:        Exhibits and Reports on Form 8-K                             15

Signatures                                                                  15






                                      -2-
<PAGE>
PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements

                          GROVE REAL ESTATE ASSET TRUST
                                 BALANCE SHEETS
                                                        June 30,    December 31,
                                                          1996          1995
                                                       (Unuadited)    (Audited)
                                                       -----------    ---------
ASSETS
Real estate assets:
        Land ......................................    $  920,293      493,823
        Buildings and improvements ................     8,457,640    4,658,438
        Furniture, fixtures and equipment .........       343,392      240,438
                                                          -------      -------
                                                        9,721,325    5,392,699
        Less - accumulated depreciation ...........      (864,169)   (694,215)
                                                         --------    --------
                Net real estate assets ............     8,857,157    4,698,484

Cash and cash equivalents .........................       479,466      383,725
Cash - resident security deposits .................       157,700       99,973
Deferred charges, net of accumulated amortization
     of $3,042 and $11,736, respectively ..........        62,360       56,279
Other assets ......................................        26,698        2,712
                                                           ------        -----
Total assets .....................................     $9,583,381    5,241,173
                                                        =========    =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
        Mortgage note payable .....................    $5,68$,403    1,190,031
        Accounts payable, accrued expense and other        66,770       31,304
        Due to affiliates .........................         1,796       97,528
        Resident security deposits ................       157,700       99,973
        Dividends payable .........................       120,750      119,438
                                                          -------      -------
Total liabilities .................................     6,028,419    1,538,273
                                                        ---------    ---------

Commitments and subsequent event ..................          --           --

Shareholders' equity:
        Preferred shares, $.01 par value per share,
            4,000,000 shares authorized; no shares
            issued or outstanding .................          --           --
        Common shares, $.01 par value per share,
            10,000,000 shares authorized; 525,000
            shares issued and outstanding .........         5,250        5,250
        Additional paid-in capital ................     3,913,176    3,913,176
        Distributions in excess of earnings .......      (363,464)    (215,526)
                                                         --------     --------
Total equity ......................................     3,554,962    3,702,900
                                                        ---------    ---------
Total liabilities and shareholders' equity ........    $9,583,381    5,241,173
                                                        =========    =========
               See accompanying notes to financial statements

                                      -3-
<PAGE>
                          GROVE REAL ESTATE ASSET TRUST
                                INCOME STATEMENTS
                                   (Unaudited)


                                                   For the Six Months Ended
                                                   ------------------------

                                                   June 30,        June 30,
                                                     1996            1995
                                                     ----            ----

Revenues:
    Rental income ..............................  $1,000,825       $ 639,354
    Interest and other income ..................      19,729          14,249
                                                      ------          ------

        Total revenues .........................   1,020,554         653,603
                                                   ---------         -------


Expenses:
    Property operating and maintenance .........     346,069         190,034
    Real estate taxes ..........................     101,712          73,946
    Related party management fees ..............      52,594          33,255
    General and administrative .................      40,450          36,305
                                                      ------          ------

        Total expenses .........................     540,826         333,540
                                                     -------         -------


                                                     479,729         320,063

Interest expense ...............................     189,203          42,234
Depreciation and amortization ..................     198,275         107,117
                                                     -------         -------


            Net income .........................   $  92,250       $ 170,712
                                                      ======         =======


Net income per share ...........................   $    0.18       $    0.33
                                                        ====            ====


Weighted average number of shares ..............     525,000         525,000
                                                     =======         =======


               See accompanying notes to financial statements


                                      -4-
<PAGE>

                          GROVE REAL ESTATE ASSET TRUST
                                INCOME STATEMENTS
                                   (Unaudited)


                           For the Three Months Ended
                                                    --------------------------

                                                      June 30,        June 30,
                                                        1996            1995
                                                        ----            ----


Revenues:
    Rental income                                     $514,593        $328,203
    Interest and other income                           10,857           7,043
                                                        ------           -----

        Total revenues                                 525,450         335,246
                                                       -------         -------


Expenses:
    Property operating and maintenance                 165,595          89,583
    Real estate taxes                                   52,105          37,002
    Related party management fees                       27,059          17,105
    General and administrative                          20,026          26,493
                                                        ------          ------

        Total expenses                                 264,785         170,183
                                                       -------         -------

                                                       260,665         165,063

Interest expense                                       101,580          21,195
Depreciation and amortization                           87,789          53,846
                                                        ------          ------

           Net income                                 $ 71,297        $ 90,022
                                                        ======          ======



Net income per share                                     $0.14           $0.17
                                                         =====           =====

Weighted average number of shares                      525,000         525,000
                                                       =======         =======



               See accompanying notes to financial statements


                                      -5-
<PAGE>

                          GROVE REAL ESTATE ASSET TRUST
                        STATEMENT OF SHAREHOLDERS' EQUITY
                     FOR THE SIX MONTHS ENDED JUNE 30, 1996
                                   (Unaudited)


                            Additional Distributions
                                          Common        Paid-in    in Excess of
                                          Shares       Capital     Net Income
                                          ------       -------     ----------

 Amounts at December 31, 1995           $   5,250    3,913,176      (215,526)
         Net Income                                                   92,250
         Declared dividends                                         (240,188)
                                         ---------   ---------       --------

 Amounts at June 30, 1996(unaudited)    $   5,250    3,913,176      (363,464)
                                         =========   =========      ========



              See accompanying notes to financial statements









                                      -6-
<PAGE>

                          GROVE REAL ESTATE ASSET TRUST
                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                            For the Six Months Ended
                                                       ------------------------
                                                            June 30,   June 30,
                                                              1996       1995
                                                              ----       ----
Cash flows from operating activities:
      Net income .......................................   $ 92,250   $ 170,712
      Furniture, Fixtures and Equipment
      provided by operating activities:
         Depreciation and amortization .................    198,275     107,116
         Imputed interest - mortgage ...................     18,415      17,131
         Increase in other assets ......................    (35,221)      5,448
         Increase (decrease) in accounts payable,
            accrued expenses and other .................     35,466     (11,239)
                                                             ------     -------

Net cash provided by operating activities ..............    309,185     289,168
                                                            -------     -------

Cash flows from investing activities:
      Expenditures for building and improvements .......    (31,162)    (16,125)
      Expenditures for furniture, fixtures and equipment    (17,661)    ( 8,967)
                                                            -------     - -----

Net cash used in investing activities ..................    (48,823)    (25,092)
                                                            -------     -------

Cash flows from financing activities:
      Proceeds from mortgage payable ...................    220,197        --
      Financing costs ..................................    (23,169)       --
      Repayment of mortgage payable ....................    (27,043)       --
      Repayment of notes payable to affiliates .........    (95,732)    (50,000)
      Dividends paid ...................................   (238,875)   (233,625)
                                                           --------    --------

Net cash provided by (used in) financing activities ....   (164,621)   (283,625)
                                                           --------    --------

Net increase (decrease) in cash and cash equivalents ...     95,741     (19,549)

Cash and cash equivalents, beginning of period .........    383,725     416,012
                                                            -------     -------

Cash and cash equivalents, end of period ...............   $479,766    $396,463
                                                            =======     =======

                 See accompanying notes to financial statements

                                      -7-
<PAGE>

                         GROVE REAL ESTATE ASSET TRUST

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)


1.   FORMATION AND BUSINESS OF THE COMPANY

     Grove Real Estate Asset 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 four properties with a total of 257 residential
     apartments.  The Company  purchased three  properties on June 23, 1994 (the
     "Original Properties"),  and the fourth property ("Cambridge") was acquired
     for  $4,250,000  in  January  of  1996.  Cambridge  is  a  ninety-two  unit
     multifamily apartment complex located in Norwich, Connecticut

     These  statements  do not contain  all  information  required by  generally
     accepted  accounting  principles  to be included in a full set of financial
     statements.  In the  opinion  of  management,  the  accompanying  unaudited
     financial  statements  reflect  all the  adjustments  necessary  to present
     fairly the  financial  position of the Company at June 30, 1996 and results
     of  operations  and its cash flows for the period then ended and the period
     ended June 30, 1995. These unaudited financial statements should be read in
     conjunction  with the audited  financial  statements and notes contained in
     the Company's Form 10-KSB for the year ended December 31, 1995.  Results of
     operations for this period are not necessarily  indicative of results to be
     expected for the full year.

     Earnings per share is based on the weighted average number of common shares
     issued and  outstanding  from  January 1, 1996 to June 30,  1996,  and from
     January 1, 1995 to June 30, 1995,  which was equal to 525,000  shares.  The
     assumed exercise of outstanding  stock options and warrants is not dilutive
     and, therefore, is not included.




                                      -8-
<PAGE>

2.   MORTGAGE NOTES PAYABLE

     Mortgage  notes  payable at June 30, 1996 and  December 31, 1995 consist of
     the following:


                                            June 30, 1996     December 31, 1995
                                            -------------     -----------------
       Southington Apartments note         $   1,208,446         $   1,190,031
       Cambridge Estates note                  4,472,957                     0
                                               ---------                     -
                                           $   5,681,403         $   1,190,031
                                           =============         =============

     The  mortgage  note  on the  Southington  Apartments  property  located  in
     Southington,  Connecticut, one of the Original Properties, which has a face
     amount of $1,250,000,  has an imputed interest rate of 7.25% due in monthly
     interest  payments of $4,167  through June 1997 and monthly  principal  and
     interest  payments of $8,527 through July 2013. The note is  collateralized
     by the  Southington  Apartments  property  and 15% of the  face  amount  is
     guaranteed by certain executive officers and shareholders of the Company.

     The Cambridge note payable had an original principal balance of $4,500,000.
     Monthly  principal  and  interest  payments  of $31,920  based on a 25-year
     amortization  table are due  through  January  2006.  Interest  is fixed at
     7.04%.  The  mortgage is secured by a blanket  first  mortgage  lien on the
     Cambridge  property,  and the two  other  Original  Properties  located  in
     Hamden, Connecticut.


3.   STOCK OPTIONS AND WARRANTS

     The Company has  adopted  the 1994 Share  Option Plan (the  "Plan") and has
     reserved  100,000  shares for  issuance  under the Plan.  The  Company  has
     granted options to purchase 50,000 shares to the executive officers with an
     exercise  price of $11.125 per share.  The options will expire on the tenth
     anniversary  of the  closing  of the IPO.  Additionally,  the  Company  has
     granted each Trust Manager of the Company who is not an employee upon their
     election as a Trust Manager a non-qualified  stock option to purchase 2,000
     shares for a total of 6,000  shares with an  exercise  price of $11.125 per
     share.  At  the  time  of  each  annual  meeting  of   shareholders,   each
     non-employee  Trust Manager  receives an option to purchase 1,000 shares at
     the fair market value of the shares on the date of grant. All options which
     have been granted under the Plan become exercisable in increments of 33 1/3
     % per year on each of the first three  anniversaries  of the date of grant.
     At June 30, 1996, no options had been exercised.  At June 30, 1996,  62,000
     options are outstanding, of which 38,334 are exercisable.

     At June 30, 1996, warrants to purchase an aggregate of 40,000 common shares
     are exercisable at $13.35 per share and expire in June 1999.



                                      -9-
<PAGE>

4.   RELATED PARTY TRANSACTIONS

     Due to Affiliates

     Amounts due to affiliates at June 30, 1996 and December 31, 1995 consist of
     the following:

                                             June 30, 1996   December 31, 1995
                                             -------------   -----------------
     Grove Investment Group                    $      0          $   70,457
     Grove  Property  Services, LP                1,796              14,890
     Grove Development Corp.                          0              12,181
                                                      -              ------
     Total due to affiliates                   $  1,796          $   97,528
                                               ========          ==========

     The amount due to the Grove  Investment  Group ("GIG")  relates to advances
     made by GIG to GREAT to fund  expenses  incurred by the Company  related to
     the IPO and to fund initial  organization costs. The Company repaid $50,000
     of note payable  balance  during the second  quarter of 1995 and repaid the
     remaining balance in January 1996. No interest was paid.

     Management Fee

     Grove  Property  Services  Limited  Partnership,  an  affiliate  of  GREAT,
     provides  all of the  operating  and  support  functions  requisite  to the
     operation of properties owned by GREAT,  including building  management and
     leasing, to the Company. The management agreement provides for a management
     fee equal to 5% of gross rental revenues, as defined. The agreement expires
     on June 30, 1997.

5.   SUPPLEMENTAL CASH FLOW INFORMATION

     Cash paid for interest  expense was $175,971 and $42,131 for the six months
     ended June 30, 1996 and 1995, respectively.  Cash paid for interest expense
     was $102,445 and $21,143 for the three months ended June 30, 1996 and 1995,
     respectively.  On January  12,  1996 the Company  purchased  Cambridge  for
     $4,250,000,  which was financed  with a $4,500,000  first  mortgage  from a
     bank.




                                      -10-
<PAGE>


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

OVERVIEW

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 six months  ended June 30,  1996 and three
months  ended  June 30,  1996  include  the three  multifamily  properties  (the
"Original  Properties")  that GREAT has owned since its  inception  and a fourth
property  ("Cambridge")  that GREAT  acquired on January 12, 1996.  The Original
Properties are comprised of 165 residential  apartment  units, in the aggregate,
two of  which  are  located  in  Hamden,  Connecticut  and  one of  which  is in
Southington,  Connecticut.  Cambridge is a ninety-two unit multifamily apartment
complex located in Norwich,  Connecticut.  The results of operations for the six
months  ended June 30, 1995 and the three months ended June 30, 1995 include the
three Original Properties.

RESULTS OF OPERATIONS

Results of  operations  of GREAT for the six months ended June 30, 1996 and June
30, 1995.
--------------------------------------------------------------------------------
The Original  Properties  experienced  increases  in occupancy  and rental rates
which increased revenues.  The Original Properties weighted average rental rates
increased  to $672 for the six months  ended June 30, 1996 from $656 for the six
months  ended June 30, 1995.  Physical  occupancy  for the  Original  Properties
increased  to an  aggregate  weighted  average  occupancy  of 98.18% for the six
months ended June 30, 1996 from an aggregate  weighted average of 96.87% for the
six months ended June 30, 1995.  Physical occupancy for the Original  Properties
decreased to 98.19% at June 30, 1996 from 98.79% at June 30, 1995.  The weighted
average physical occupancy for the Original Properties and Cambridge for the six
months  ended June 30,  1996 was 97.73%.  Physical  occupancy  for the  Original
Properties and Cambridge was 98.44% at June 30, 1996.

Rental and other income  increased  $366,951 from $653,603 to $1,020,554  during
the six months ended June 30, 1996, as compared to the  corresponding  period in
1995.  Approximately  $342,000 of the increase is due to operation of Cambridge,
and the remainder of the increase is  attributable  to the previously  mentioned
increases in occupancy and rental rates.

Property operating and maintenance  expenses increased $156,035 from $190,034 to
$346,069  during  the six  months  ended  June  30,  1996,  as  compared  to the
corresponding period in 1995.  Approximately $123,000 of the increase is due the
acquisition of the Cambridge  property.  Additionally,  the Original  Properties
experienced an increase in operating and  maintenance  experiences due primarily
to the harsh winter  experienced in the New England area in 1996 compared to the
mild winter experienced in the New England area in 1995.


                                      -11-
<PAGE>


General and  administrative  expenses  increased  $4,145 from $36,305 to $40,450
during the six months  ended June 30,  1996,  as compared  to the  corresponding
period in 1995. The increase is primarily due to the additional expenses related
to the acquisition of the Cambridge Property.

Real estate taxes  increased  $27,767  from  $73,946 to $101,712  during the six
months ended June 30,  1996,  as compared to the  corresponding  period in 1995.
Related party management fees increased  $19,339 from $33,255 to $52,594.  These
increases were due primarily to the acquisition of the Cambridge property.

Interest  expense  increased  $146,969  from $42,234 to $189,203  during the six
months ended June 30, 1996, as compared to the corresponding period in 1995. The
increase is due to the  $4,500,000  mortgage  note  payable  used to finance the
acquisition of the Cambridge property.  Depreciation and amortization  increased
$91,158 primarily due to the acquisition of the Cambridge property.

The Company's net income  decreased  $78,462 from $170,712 to $92,250 during the
six months ended June 30, 1996, as compared to the corresponding period in 1995.
Approximately  $67,000 of the  decrease  is due to the loss  experienced  by the
Cambridge  property.  The decrease in net income for the Original  properties of
approximately  $11,000 was primarily  due to the increase in property  operating
and maintenance expenses.

Results of operations of GREAT for the three monhts ended June 30, 1996 and June
30, 1995.
--------------------------------------------------------------------------------
The Original  Properties  experienced  increases  in occupancy  and rental rates
which increased revenues.  The Original Properties weighted average rental rates
increased  to $674 for the three  months  ended June 30,  1996 from $658 for the
three months ended June 30, 1995. Physical occupancy for the Original Properties
decreased to an  aggregate  weighted  average  occupancy of 97.98% for the three
months ended June 30, 1996 from an aggregate  weighted average of 98.38% for the
three months ended June 30, 1995. The weighted  average  physical  occupancy for
the Original  Properties  and Cambridge for the three months ended June 30, 1996
was 98.06%.

Rental and other income increased  $190,204 from $335,246 to $525,450 during the
three  months ended June 30, 1996,  as compared to the  corresponding  period in
1995.  Approximately  $185,000 of the increase is due to operation of Cambridge,
and the remainder of the increase is  attributable  to the previously  mentioned
increases in occupancy and rental rates.

Property  operating and maintenance  expenses  increased $76,012 from $89,583 to
$165,595  during  the three  months  ended June 30,  1996,  as  compared  to the
corresponding period in 1995.  Approximately  $59,000 of the increase is due the
acquisition of the Cambridge  property.  Additionally,  the Original  Properties
experienced an increase in operating and maintenance experiences due to painting
that was done at the Dogwood property,  along with snow removal costs associated
with late winter storms that were experienced in the New England area in 1996.

General and  administrative  expenses  decreased  $6,467 from $26,493 to $20,026
during the three months ended June 30,  1996,  as compared to the  corresponding
period in 1995.  The  decrease is primarily  due to exchange  listing fees which
were paid in the second quarter in 1995 but in the first quarter of 1996.


                                      -12-
<PAGE>

Real estate taxes  increased  $15,103  from $37,002 to $52,105  during the three
months ended June 30,  1996,  as compared to the  corresponding  period in 1995.
Related party  management fees increased  $9,954 from $17,105 to $27,059.  These
increases were due primarily to the acquisition of the Cambridge property.

Interest  expense  increased  $80,385 from $21,195 to $101,580  during the three
months ended June 30, 1996, as compared to the corresponding period in 1995. The
increase is due to the  $4,500,000  mortgage  note  payable  used to finance the
acquisition of the Cambridge property.  Depreciation and amortization  increased
$33,943 primarily due to the acquisition of the Cambridge property.


The Company's net income  decreased  $18,725 from $90,022 to $71,297  during the
three  months ended June 30, 1996,  as compared to the  corresponding  period in
1995.  Approximately  $13,000 of the decrease is due to the loss  experienced by
the Cambridge  property.  The decrease in net income for the Original properties
of approximately  $6,000 was primarily due to the increase in property operating
and maintenance expenses.

LIQUIDITY AND CAPITAL RESOURCES

Cash and cash  equivalents  totaled  $479,466 as of June 30, 1996. The Company's
long-term  debt to market  capitalization  on June 30, 1996 was 54.08%  based on
total market  capitalization  of  $10,504,841  (525,000  shares  outstanding  at
$9.1875 plus long-term debt) and long-term debt of $5,681,403.

Cash provided by operating activities was $309,185 for the six months ended June
30, 1996. Cash used in investing activities for the purchase of fixed assets was
$48,823 for the six months ended June 30, 1996.  On January 12, 1996,  Cambridge
was  purchased  from  Grove  Cambridge   Associates   Limited   Partnership  for
$4,250,000.  The acquisition was 100% financed by a first mortgage of $4,500,000
from a bank.

On May 17, 1996,  GREAT declared a dividend of $0.23 per share,  payable on July
17, 1996 to  shareholders  of record on June 26, 1996. On March 21, 1996,  GREAT
declared  a  dividend  of  $0.2275  per  share  payable  on  April  16,  1996 to
shareholders  of record on March 26, 1996.  The  dividends  declared  during the
period  of  $0.4575  per  share  resulted  in an  92.53%  payout  of funds  from
operations for the six months ended June 30, 1996

GREAT intends to meet its short term  liquidity  requirements  through cash flow
provided by  operations.  GREAT  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.
GREAT may use other  sources  of  capital  to  finance  additional  acquisitions
including,  but not  limited to, the selling of  additional  equity  interest in
GREAT,  non-distributed Funds From Operations,  the issuance of debt securities,
and exchanging Common Shares for properties or interest in properties.



                                      -13-
<PAGE>


FUNDS FROM OPERATIONS

Industry  analysts   generally   consider  funds  from  operations   ("FFO")  an
appropriate  measure of performance of an equity REIT.  Funds from operations 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. FFO for years prior
to 1996 have been adjusted to conform to the NAREIT  definition.  GREAT believes
that in order to  facilitate a clear  understanding  of its  operating  results,
funds from operations  should be examined in conjunction  with the net income as
presented in the financial statements and information included elsewhere in this
Report.  Funds from  operations 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.  Funds from
operations  should  not be  considered  as an  alternative  to net  income as an
indication of GREAT's performance or as an alternative to cash flow as a measure
of liquidity.

FFO  decreased  $12,718 from  $272,298 for the six months ended June 30, 1995 to
$259,580 for the six months ended June 30, 1996.  Dividends declared for the six
months  ended June 30,  1996 were  $240,188,  representing  92.53% of funds from
operations.  FFO increased  $2,514 from $140,912 for the three months ended June
30, 1995 to $143,426 for the three months ended June 30, 1996.

The impact of  adopting  the NAREIT  recommendations  as set forth  above was to
reduce  FFO for the six  months  ended  June 30,  1996 and 1995 by  $22,317  and
$22,662 respectively.  The impact of adopting the NAREIT  recommendations was to
reduce  FFO for the three  months  ended  June 30,  1996 and 1995 by $9,846  and
$11,599, respectively.

INFLATION

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


                                      -14-
<PAGE>


PART II.  OTHER INFORMATION

Item 1.           Legal Proceedings.

         None.

Item 2.           Change in Securities.

         None.

Item 3.  Submission of Matters to a Vote of Security Holders.

         At the Annual  Meeting of  Shareholders  of the Company held on May 17,
         1996 the Shareholders considered and voted on two proposals. First, the
         Shareholders  voted  (410,297 for, 225 against and no  abstentions)  to
         elect Joseph R. LaBrosse and J. Joseph Garrahy as Trustees to the Board
         of Trustees to a term  expiring at the 1999 annual  meeting.  After the
         May 17, 1996 annual meeting the following  Trustees term of office as a
         trustee  continued:  Damon D.  Navarro,  Harold V.  Gorman and James F.
         Twadell.  Second,  the Shareholders  voted (409,522 for, 0 against with
         1,000  abstentions)  to ratify the  appointment of BDO Seidman,  LLP as
         independent  public  accountants  for the  Company  for the fiscal year
         ended December 31, 1996.

Item 4.  Other Information

         None.

Item 5.  Exhibits and Reports on Form 8-K.

         (a)  Exhibits

         See Index to Exhibits on pages 16 and 17

         (b)  Reports on Form 8-K.

         None.

SIGNATURES

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

         REGISTRANT:

         GROVE REAL ESTATE ASSET TRUST

Date: 10/16/96   By:   Joseph R. LaBrosse
                 --------------------------------------------
                 Name: Joseph R. LaBrosse
                 Title: Chief Financial Officer, Secretary and Treasurer


                                      -15-
<PAGE>

                                INDEX TO EXHIBITS

Number                                Title

3.1    Grove Real Estate Asset Trust Declaration of Trust dated March 21,
       1994 incorporated by reference as Exhibit Number 3.1 to GREAT's
       Registration Statement on Form SB-2 filed with the U.S. Securities
       and Exchange Commission, file no. 33-76732.

3.2    Grove Real Estate  Asset Trust  Bylaws  amended  through May 17, 1996 and
       attached hereto as Exhibit 3.2.

10.2   Amended Employment Agreement dated May 16, 1994 by and between GREAT
       and Damon D. Navarro incorporated by reference as Exhibit Number
       10.2 to GREAT's Registration Statement on Amendment No. 1 to Form
       SB-2 filed with the U.S. Securities and Exchange Commission, file
       No. 33-76732.

10.3   Amended Employment Agreement dated May 16, 1994 by and between GREAT
       and Brian A. Navarro incorporated by reference as Exhibit Number
       10.3 to GREAT's Registration Statement on Amendment No. 1 to Form
       SB-2 filed with the U.S. Securities and Exchange Commission, file
       No. 33-76732.

10.4   Amended Employment Agreement dated May 16, 1994 by and between GREAT
       and Edmund F. Navarro incorporated by reference as Exhibit Number
       10.4 to GREAT's Registration Statement on Amendment No. 1 to Form
       SB-2 filed with the U.S. Securities and Exchange Commission, file
       No. 33-76732.

10.5   Amended Employment Agreement dated May 16, 1994 by and between GREAT
       and Joseph R. LaBrosse incorporated by reference as Exhibit Number
       10.5 to GREAT's Registration Statement on Amendment No. 1 to Form
       SB-2 filed with the U.S. Securities and Exchange Commission, file
       No. 33-76732.

10.6   Amended Employment Agreement dated May 16, 1994 by and between GREAT
       and Gerald A. McNamara incorporated by reference as Exhibit Number
       10.6 to GREAT's Registration Statement on Amendment No. 1 to Form
       SB-2 filed with the U.S. Securities and Exchange Commission, file
       No. 33-76732.

10.7   Amended Non-Competition Agreement dated May 16, 1994 by and between
       GREAT and Damon D. Navarro incorporated by reference as Exhibit
       Number 10.7 to GREAT's Registration Statement on Amendment No. 1 to
       Form SB-2 filed with the U.S. Securities and Exchange Commission,
       file No. 33-76732.

10.8   Non-Competition Agreement dated May 16, 1994 by and between GREAT and the
       Grove  Companies  incorporated  by  reference  as Exhibit  Number 10.8 to
       GREAT'S Registration Statement on Amendment No. 1 to Form SB-2 filed with
       U.S. Securities and Exchange Commission, file No.
       33-76732.

                                      -16-
<PAGE>

10.16  Grove Real Estate Asset Trust 1994 Share Option Plan incorporated by
       reference as Exhibit Number 10.16 to GREAT's Registration Statement
       on Form SB-2 filed with the U.S. Securities and Exchange Commission,
       file No. 33-76732.

10.18  Form  of  Indemnification  Agreement  by and  between  GREAT,  the  Trust
       Managers and the Executive Officers  incorporated by reference as Exhibit
       Number  10.18 to GREAT's  Registration  Statement on Form SB-2 filed with
       the U.S. Securities and Exchange Commission, file No.
       33-76732.


10.19  Form of Administrative Services Agreement by and between GREAT and
       the Grove Companies incorporated by references as Exhibit Number
       10.19 to GREAT's Registration Statement on Form SB-2 filed with the
       U.S. Securities and Exchange Commission, file No. 33-76732.

10.22  Assumption of Mortgage Deed and Security Agreement made June 23,
       1994 by and among Southington Baron Limited Partnership, Charles D.
       Gersten, Ada C. Berin, Grove Real Estate Asset Trust, Damon D.
       Navarro and Brian A. Navarro incorporated by reference as Exhibit
       Number 10.22 to GREAT's Form 10-KSB for the year ended December 31,
       1994 filed with the U.S. Securities and Exchange Commission, File
       No. 1-13080.

10.23  Mortgage Note from Southington Baron Limited Partnership to Charles
       D. Gersten and Ada C. Berin dated June 8, 1993 in the original
       principal amount of $1,250,000 incorporated by reference as Exhibit
       Number 10.23 to GREAT's Form 10-KSB for the year ended December 31,
       1994 filed with the U.S. Securities and Exchange Commission, File
       No. 1-13080.

10.24  Purchase  and Sale  Agreement  between  Grove Real Estate Asset Trust and
       Grove Cambridge Associates Limited Partnership  incorporated by reference
       Exhibit  Number 1 to GREAT's Form 8-K dated October 30, 1995 and attached
       hereto as Exhibit  10.24  filed  with the U.S.  Securities  and  Exchange
       Commission, File No. 1-13080.

10.25  Mortgage  Note from Grove Real Estate  Asset Trust to First Union Bank of
       Connecticut  dated January 11, 1996 in the principal amount of $4,500,000
       incorporated by reference as Exhibit 10.25 to GREAT's Form 10-KSB for the
       year ended December 31, 1995 filed with the U.S.  Securities and Exchange
       Commission, File No. 1-13080.

10.26  Form of  Management  Agreement  by and between  GREAT and Grove  Property
       Services Limited Partnership incorporated by reference as Exhibit 10.26
       to GREAT's Form 10-KSB for the year ended December 31, 1995 filed with
       the U.S. Securities and Exchange Commission, File No. 1-13080.


                                     -17-