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                                                                    EXHIBIT 99.1

                         ART FLORIDA PORTFOLIO II, LTD.
           (PROPERTIES FORMERLY OWNED BY INVESTORS GENERAL ENTITIES)

          COMBINED STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES

                      FOR THE YEAR ENDED DECEMBER 31, 1997

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                      Page No.
                                                                      --------
<S>                                                                     <C>
INDEPENDENT AUDITOR'S REPORT ......................................       1

COMBINED STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES ......       2

NOTES TO COMBINED FINANCIAL STATEMENT .............................       3

</TABLE>

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[WAGNER NOBLE & COMPANY LETTERHEAD]

                          INDEPENDENT AUDITOR'S REPORT


To the Board of Directors
American Realty Trust, Inc.
Dallas, Texas


We have audited the accompanying combined statement of revenues and direct
operating expenses of Art Florida Portfolio II, Ltd. (properties formerly owned
by Investors General entities) for the year ended December 31, 1997. This
combined statement of revenues and direct operating expenses is the
responsibility of the entities' management. Our responsibility is to express an
opinion on this statement of revenues and direct operating expenses based on
our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the statement of revenues and direct
operating expenses is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the statement of revenues and direct operating expenses. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall statement of revenues and direct
operating expenses presentation. We believe that our audit provides a
reasonable basis for our opinion.

The accompanying financial statement is prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission (for
inclusion in Form 8-K of American Realty Trust, Inc.) and, as described in 
Note 1, is not intended to be a complete presentation of the results of 
operations.

In our opinion, the combined statement of revenues and direct operating
expenses referred to above present fairly, in all material respects, the
combined revenues and direct operating expenses, as defined in Note 1, of Art
Florida Portfolio II, Ltd. (properties formerly owned by Investors General
entities) for the year ended December 31, 1997, in conformity with generally
accepted accounting principles.

Charlotte, North Carolina
June 1, 1998.

                                                  /s/  WAGNER NOBLE & COMPANY
                                               ---------------------------------
                                                    Wagner Noble & Company



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                         ART FLORIDA PORTFOLIO II, LTD.
            PROPERTIES FORMERLY OWNED BY INVESTORS GENERAL ENTITIES)
 
          COMBINED STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES
 
                      FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
                                                                             Properties
                                          --------------------------------------------------------------------------------
                                                       Conradi                Grand                 Morning    Park Avenue
                                          Bay Anchor    House      Daluce     Lagoon    Lee Hills     Star       Villas
                                          ----------   --------   --------   --------   ---------   --------   -----------
<S>                                       <C>          <C>        <C>        <C>        <C>         <C>        <C>
REVENUES:
 Net rental revenues                       $54,421     $327,856   $582,803   $365,779    $64,133    $321,337    $690,004
 Other revenues                              1,564       11,918     27,712     15,393      4,102      17,059      21,529
                                           -------     --------   --------   --------    -------    --------    --------
      Total revenues                        55,985      339,774    610,515    381,172     68,235     338,396     711,533
DIRECT OPERATING EXPENSES:
 Personnel expense                          10,395       74,013     97,448     38,424     10,987      50,872      62,993
 Property management fee                     2,242       13,579     24,401     15,249      2,728      13,537      28,436
 Administrative expense                      1,831       10,491     10,221      7,404      3,565       8,567      11,760
 Leasing expense                             1,758       18,513     12,547      3,688      2,907      10,597      14,910
 Utility expense                             2,757       23,001     51,741     22,021      1,577      18,630      10,583
 Service expense                             2,845       17,971     27,794     21,942      3,666      23,540      24,223
 Cleaning and decorating expense               955        4,868     13,097      8,204      2,469      10,260       9,627
 Repairs and maintenance expense             1,108        6,277     10,804      9,690      3,281      14,376       9,274
 Property taxes                              4,859       25,368     61,201     23,336      8,144      22,038      95,921
 Property insurance                          5,836        3,277      7,759     28,234      1,358       5,482      13,889
                                           -------     --------   --------   --------    -------    --------    --------
      Total direct operating expenses       34,586      197,358    317,013    178,192     40,682     177,899     281,616
                                           -------     --------   --------   --------    -------    --------    --------
REVENUES IN EXCESS OF DIRECT OPERATING
 EXPENSES                                  $21,399     $142,416   $293,502   $202,980    $27,553    $160,497    $429,917
                                           =======     ========   ========   ========    =======    ========    ========
 
<CAPTION>
                                               Properties
                                          --------------------
                                          Pinecrest   Windsor
                                            West       Towers      Total
                                          ---------   --------   ----------
<S>                                       <C>         <C>        <C>
REVENUES:
 Net rental revenues                      $260,671    $326,447   $2,993,451
 Other revenues                              7,683      13,608      120,568
                                          --------    --------   ----------
      Total revenues                       268,354     340,055    3,114,019
DIRECT OPERATING EXPENSES:
 Personnel expense                          42,079      58,847      446,058
 Property management fee                    10,732      13,601      124,505
 Administrative expense                      6,759       7,868       68,466
 Leasing expense                             6,809       1,121       72,850
 Utility expense                            19,656      15,701      165,667
 Service expense                            16,142      12,702      150,825
 Cleaning and decorating expense             9,405       4,123       63,008
 Repairs and maintenance expense             8,600       9,795       73,205
 Property taxes                             23,080      26,177      290,124
 Property insurance                          5,909      15,703       87,447
                                          --------    --------   ----------
      Total direct operating expenses      149,171     165,638    1,542,155
                                          --------    --------   ----------
REVENUES IN EXCESS OF DIRECT OPERATING
 EXPENSES                                 $119,183    $174,417   $1,571,864
                                          ========    ========   ==========
</TABLE>
 
   The accompanying notes to financial statement are an integral part of this
                                   statement.

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                         ART FLORIDA PORTFOLIO II, LTD.
           (PROPERTIES FORMERLY OWNED BY INVESTORS GENERAL ENTITIES)

                    NOTES TO COMBINED STATEMENT OF REVENUES
                         AND DIRECT OPERATING EXPENSES

                      FOR THE YEAR ENDED DECEMBER 31, 1997

1.   ORGANIZATION AND BASIS OF PRESENTATION:

     The following properties were owned as of December 31, 1997, by various
       entities affiliated with Investors General, Inc. and related companies.
       Subsequent to January 1, 1998, the individual properties or the effective
       economic interest in the properties were acquired by Art Florida
       Portfolio II, Ltd.

<TABLE>
<CAPTION>
   Property Name                 Description            Location                Former Owner
   -------------                 -----------            --------                ------------
<C>                        <S>                       <S>                   <S>
    Bay Anchor              12 Residential Units     Panama City, FL        Investors Synd. Ltd. IV
  Conradi House             98 Residential Units     Tallahassee, FL           Opportunity Fund
      Daluce               112 Residential Units     Tallahassee, FL        Investors Synd. Ltd. IV
   Grand Lagoon             54 Residential Units     Panama City, FL        Investors Synd. Ltd. VI
     Lee Hills              16 Residential Units     Tallahassee, FL        Investors Synd. Ltd. IV
   Morning Star             82 Residential Units     Tallahassee, FL        Investors Synd. Ltd. IV
Park Avenue Villas         121 Residential Units     Tallahassee, FL        Investors Synd. Ltd. VI
  Pinecrest West            48 Residential Units     Tallahassee, FL        Investors Synd. Ltd. IV
  Windsor Towers            64 Residential Units        Ocala, FL             IG Capital Holdings
</TABLE>

     The accompanying combined statement of revenues and direct operating
       expenses combines the accounts of properties which were previously owned
       by various entities. There were no material intercompany transactions
       between the properties.

     Management of the properties defines direct operating expenses to include
       the specific expense items shown on the accompanying combined statement
       of revenues and direct operating expenses. In accordance with this
       definition, the statement does not include interest expense,
       replacements, professional fees, certain administrative expenses,
       additional management fees, loss on disposition of property, or
       provisions for depreciation and amortization. The statement also excludes
       interest income other than that earned directly in property accounts and
       any provision for income taxes. Accordingly, this statement is not
       intended to be a complete presentation of the results of operations.



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2. ACCOUNTING ESTIMATES:

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenditures
during the reporting period. Actual results could differ from those
estimates.

3. RELATED PARTY TRANSACTIONS:

     The combined entities paid Investors General, Inc. approximately $20,000
for property management fee which are included in this financial statement.
As of December 31, 1997, Investors General, Inc. or its affiliates owned
directly or indirectly the controlling interest in each entity.




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