SECURITIES AND EXCHANGE COMMISSION
                    Washington, D.C.  20549
                          FORM 10-Q/A

                         AMENDMENT NO. 1

        Filed Pursuant to Section 12, 13, or 15(d) of the
                 Securities Exchange Act of 1934


                     AMFAC/JMB HAWAII, INC.
                  ----------------------------
     (Exact name of registrant as specified in its charter)


Commission File No. 33-24180            IRS Employer
Identification
                                        No. 99-0217738

                     AMFAC/JMB FINANCE, INC.
                   --------------------------
     (Exact name of registrant as specified in its charter)
                                
                                
Commission File NO. 33-24180-01      IRS Employer Identification
                                         No. 36-3611183

     The undersigned registrant hereby amends the following
section of its Report for the quarter ended March 31, 1997 on
Form 10-Q as set forth in the pages attached thereto:

                             PART I
Item 1.   Financial Statements
Item 2.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations



      Pursuant to the requirements of the Securities Exchange Act
of  1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

                              AMFAC/JMB HAWAII, INC.
                              AMFAC/JMB FINANCE, INC.

                              BY:  GARY SMITH
                                   Vice President and
                                   Principal Accounting Officer




Dated:         August 27, 1997

                   ADDITIONAL REGISTRANTS (1)

                                                     Address, including,
                                                     zip code,
Exact name of      State or other     IRS            and telephone number,
registrant as      jurisdiction of    Employer       including area code of
specified in its   incorporation or   Identification registrant's principal
Charter            organization       Number         executive offices

Amfac Agri-        Hawaii             99-0176334     900 North Michigan Avenue
  business,  Inc.                                    Chicago, Illinois 60611
                                                     312/440-4800

Amfac Property     Hawaii             99-0150751     900 North Michigan Avenue
  Development  Corp.                                 Chicago, Illinois 60611
                                                     312/440-4800

Amfac  Property    Hawaii             99-0202331     900 North Michigan Avenue
 Investment                                          Chicago, Illinois 60611
 Corp.                                               312/440-4800

Amfac Sugar and    Hawaii             99-0185633     900 North Michigan Avenue
  Agribusiness,                                      Chicago, Illinois 60611
 Inc.                                                312/440-4800

Amfac  Vacation    Hawaii             94-3261831     900 North Michigan Avenue
Managers,  Inc.                                      Chicago, Illinois 60611
                                                     312/440-4800

Kaanapali Water    Hawaii             99-0185634     900 North Michigan Avenue
 Corporation                                         Chicago, Illinois 60611
                                                     312/440-4800

Kekaha Sugar       Hawaii             99-0044650     900 North Michigan Avenue
 Company,                                            Chicago, Illinois 60611
 Limited                                             312/440-4800

H. Hackfeld        Hawaii             99-0037425     900 North Michigan Avenue
 & Co., Ltd.                                         Chicago, Illinois 60611
                                                     312/440-4800

The Lihue          Hawaii             99-0046535     900 North Michigan Avenue
 Plantation                                          Chicago, Illinois 60611
 Company,                                            312/440-4800
 Limited

Oahu Sugar         Hawaii              99-0105277    900 North Michigan Avenue
 Company,                                            Chicago, Illinois 60611
 Limited                                             312/440-4800

Pioneer Mill       Hawaii              99-0105278    900 North Michigan Avenue
 Company,                                            Chicago, Illinois 60611
 Limited                                             312/440-4800

Puna Sugar         Hawaii              99-0051215    900 North Michigan Avenue
 Company,                                            Chicago, Illinois 60611
 Limited                                             312/440-4800

Waiahole           Hawaii              99-0144307    900 North Michigan Avenue
 Irrigation                                          Chicago, Illinois 60611
 Company,                                            312/440-4800
 Limited

Waikele Golf       Hawaii              99-0304744    900 North Michigan Avenue
 Club, Inc.                                          Chicago, Illinois 60611
                                                     312/440-4800


1)  The    Additional   Registrants   listed   are   wholly-owned
    subsidiaries  of  the registrant and are  guarantors  of  the
    registrant's  Certificate  of  Land  Appreciation  Notes  due
    2008.
                       TABLE OF CONTENTS




PART I   FINANCIAL INFORMATION


Item 1.  Financial Statements                            4

Item 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations            22






<TABLE>
PART I.  FINANCIAL INFORMATION
     ITEM 1.  Financial Statements
                         AMFAC/JMB HAWAII, INC.

                       Consolidated Balance Sheets

                  March 31, 1997 and December 31, 1996
                         (Dollars in Thousands)
                              (Unaudited)

                              A S S E T S
<CAPTION>
                                            March 31,       December 31,
                                             1997                1996
                                         --------------    -------------
<S>                                      <C>                <C>
A S S E T S
Current assets:
 Cash and cash equivalents                  $7,908             8,736
 Receivables-net                             3,969             4,741
 Inventories                                63,690            56,808
 Prepaid expenses                            3,839             3,439
                                          --------           --------
     Total current assets                   79,406            73,724
                                          --------           --------
Investments                                 46,287            46,187
                                          --------           --------
Property, plant and equipment:
 Land and land improvements                286,549           289,294
 Machinery and equipment                    60,917            60,981
 Construction in progress                    1,481             1,365
                                          --------          --------
                                           348,947           351,640
 Less accumulated depreciation
 and amortization                           35,371            33,856
                                          --------          --------
                                           313,576           317,784
                                          --------          --------
Deferred expenses, net                      12,772            12,975
Other assets                                36,367            32,935
                                          --------          --------
                                        $  488,408           483,605
                                         ==========        ==========
L I A B I L I T I E S
Current liabilities:
 Accounts payable                       $    6,337             5,719
 Accrued expenses                            7,935             9,274
 Current portion of
 long-term debt                              1,294             1,471



                            AMFAC/JMB HAWAII, INC.

                    Consolidated Balance Sheets - Continued

                      March 31, 1997 and December 31, 1996
                             (Dollars in Thousands)
                                  (Unaudited)
                                            March 31,       December 31,
                                             1997                1996
                                         -------------     -------------
 Current portion of
 deferred income taxes                       7,953             5,422
 Amounts due to affiliates                   9,582             8,905
                                          --------           --------
 Total current liabilities                  33,101            30,791
                                          --------           --------
Amounts due to affiliates                  113,762           103,579
Accumulated postretirement
benefit obligation                          56,679            57,662
Long-term debt                             105,770           100,606
Other long-term liabilities                 34,820            35,501
Deferred income taxes                       87,571            88,345
Certificate of Land
Appreciation Notes                         220,692           220,692
                                          --------           --------
 Total liabilities                         652,395           637,176
                                          --------           --------
Commitments and contingencies
(notes 2, 3, 4, 6, 7 and 8)


S T O C K H O L D E R `S  E Q U I T Y  (D E F I C I T )

Common stock, no par value;
 authorized, issued and
 outstanding 1,000 shares                       1                    1
Additional paid-in capital                  1,207                6,278
Retained earnings (deficit)              (165,195)            (159,850)
                                         ---------             ---------

 Total stockholder's equity
 (deficit)                               (163,987)            (153,571)
                                         ---------            ---------
                                        $ 488,408              483,605
                                       ============         ===========

<FN>
   The accompanying notes are an integral part of the consolidated financial
   statements.
</TABLE>

<TABLE>
                     AMFAC/JMB HAWAII, INC.
             Consolidated Statements of Operations
           Three Months Ended March 31, 1997 and 1996
                     (Dollars in Thousands)
                          (Unaudited)
<CAPTION>
                                 1997     1996
                              -------   -------
<S>                            <C>     <C>
Revenue:
 Agriculture                  $   675    5,688
 Property                       8,808    9,368
                              -------   -------
                                9,483   15,056
                              -------   -------
Cost of sales:
 Agriculture                      769    4,113
 Property                       5,738    5,339
                               -------  -------
                                6,507    9,452
Operating expenses:
 Selling, general
 and administrative             3,066    3,149
 Depreciation and
 amortization                   1,515    1,596
                               -------  -------
Total costs and expenses       11,088   14,197

Operating income(loss)         (1,605)     859
                               -------  -------
Non-operating income
(expenses):
 Amortization of
  deferred costs                 (419)    (316)
 Interest expense              (6,676)  (6,908)
 Interest income                   41       92
                               -------  -------
                               (7,054)  (7,132)
                               -------  -------
 Loss before taxes             (8,659)  (6,273)
                               -------  -------
 Income tax benefit            (3,314)  (2,333)
                               -------  -------
 Net loss                     $(5,345)  (3,940)
                              ========  ========
<FN>
   The  accompanying  notes are an integral part of the  consolidated  financial
statements.
</TABLE>


<TABLE>
                     AMFAC/JMB HAWAII, INC.

             Consolidated Statements of Cash Flows

           Three Months Ended March 31, 1997 and 1996

                     (Dollars in Thousands)
                          (Unaudited)
<CAPTION>
                                                   1997             1996
                                                 --------        --------
<S>                                             <C>            <C>
Cash flows from operating activities:
 Net loss                                        $(5,345)        (3,940)
 Items not requiring (providing) cash:
   Depreciation and amortization                   1,515          1,596
   Amortization of deferred costs                    419            316
   Equity in earnings of investments                  10             23
   Income tax benefit                             (3,314)        (2,333)
   Deferred interest                                 268          2,160

Changes in:
   Receivables - net                                 772          2,760
   Inventories                                    (4,009)        (6,407)
   Prepaid expenses                                 (400)           214
   Accounts payable                                  618         (1,217)
   Accrued expenses                               (1,339)          (933)
   Amounts due to affiliates                         677          1,208
   Other long-term liabilities                    (2,002)        (1,009)
                                                  --------       --------
   Net cash used in
    operating activities                         (12,130)        (7,562)
                                                 --------       --------
Cash flows from investing activities:
 Property additions                                 (116)          (514)
 Investments in joint ventures
 and partnerships                                   (110)          (135)
 Other assets                                     (3,432)            99
 Other long-term liabilities                           6            (31)
                                                  --------       --------


                    AMFAC/JMB HAWAII, INC.

          Consolidated Statement of Cash Flows - Continued

             Three Months Ended March 31, 1997 and 1996
                    (Dollars in Thousands)
                         (Unaudited)

                                                      1997          1996
                                                   -------        --------
 Net cash used in investing activities            (3,652)          (581)
                                                  --------        --------
Cash flows from financing activities:
 Deferred expenses                                  (216)             8
 Net borrowings (repayments) of
 long-term debt                                    4,987           (486)
 Amounts due to affiliates                        10,183          7,437
                                                ---------        --------
 Net cash provided by financing activities        14,954          6,959
                                                ---------        --------
 Net decrease in cash and cash
 equivalents                                        (828)        (1,184)
 Cash and cash equivalents,
 beginning of year                                 8,736          11,745
                                                ---------        --------
 Cash and cash equivalents,
 end of period                                   $ 7,908          10,561
                                                =========        ========
Supplemental disclosure of cash flow
information:
 Cash paid for interest
 (net of amount capitalized)                     $ 6,543          5,250
                                                =========       ========
 Schedule of non-cash investing and
 financing activities:
 Transfer of property actively held
 for sale to real estate inventories
 and accrued costs relating to real
 estate sales                                    $ 2,873           510
                                                =========      ========
<FN>
The  accompanying  notes  are  an integral part of  the  consolidated  financial
statements.
</TABLE>
                      AMFAC/JMB HAWAII, INC.

           Notes to Consolidated Financial Statements

                    March 31, 1997 and 1996

                        (Dollars in Thousands)

Readers   of   this   quarterly   report   should   refer   to   the   Company's
audited    financial   statements   for   the   fiscal   year   ended   December
31,   1996,   which   are  included  in  the  Company's  1996   Annual   Report,
as     certain     footnote     disclosures    which     would     substantially
duplicate    those    contained   in   such   audited    financial    statements
have been omitted from this report.

(1)  BASIS OF ACCOUNTING

        On    November   17,   1988,   the   stockholders   of    Amfac,    Inc.
("Amfac")    agreed   to   the   merger   ("Merger")   of    Amfac    with    an
affiliate    of    JMB   Realty   Corporation   ("JMB").    The    Merger    was
consummated    on   November   18,   1988.   Amfac/JMB   Hawaii,    Inc.    (the
"Company")   was   wholly-owned   by   Amfac,   a   subsidiary   of   Northbrook
Corporation   ("Northbrook").    In   May   1995,   Amfac   was   merged    into
Northbrook, with Northbrook being the surviving corporation.

        The    Company    has    two    primary    business    segments.     The
agriculture     segment     ("Agriculture")    is    responsible     for     the
Company's   activities   related   to  the   cultivation   and   processing   of
sugar    cane    and   other   agricultural   products.    The    real    estate
segment    ("Property")    is   responsible   for    development    and    sales
activities   related   to   the  Company's  owned  land,   all   of   which   is
in   the   State   of   Hawaii,  and  the  management  and  operation   of   the
Company's golf course facilities.

        The    consolidated   financial   statements   include   the    accounts
of   the   Company   and   its   wholly-owned  subsidiaries.   All   significant
intercompany    balances   and   transactions   have    been    eliminated    in
consolidation.

       The   Company's   policy   is  to  consider   all   amounts   held   with
original   maturities   of   three   months   or   less   in   U.S.   Government
obligations,    certificates    of    deposit    and    money    market    funds
(approximately   $3,600   and   $4,900  at   March   31,   1997   and   December
31,    1996,    respectively)   as   cash   equivalents,   which    approximates
market.    These   amounts   include   $1,255   and   $1,552   at   March    31,
1997    and   December   31,   1996,   respectively,   which   were   restricted
primarily   to   fund   debt  service  on  long-term   debt   related   to   the
acquisition of power generation equipment (see note 4).

       As   part   of   the  Company's  agriculture  operations,   the   Company
enters   into   commodities  futures  contracts  and   options   in   sugar   as
deemed     appropriate    to    reduce    the    risk    of     future     price
fluctuations   in   sugar.    These   futures   contracts   and   options    are
accounted   for   as   hedges   and,   accordingly,   gains   and   losses   are
deferred    and    recognized   in   cost   of   sales   as    part    of    the
production cost.

        Investments   in   certain   partnerships   and   joint   ventures,   if
any,   over   which   the   Company   exercises   significant   influence    are
accounted    for    by    the    equity   method.     Revenues    include    the
Company's   equity   in   net  income  or  loss  from  such   investments.    To
the   extent   the   Company   engages  in  such   activities   as   a   general
partner,    the   Company   is   contingently   liable   for   the   obligations
of its partnership and joint venture investments.

                       AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Continued

                         (Dollars in Thousands)

        Project    costs   associated   with   the   acquisition,    development
and    construction    of   real   estate   projects   are    capitalized    and
classified    as    construction   in   progress.    Such   capitalized    costs
are   not   in   excess   of   the   project's   estimated   fair   value,    as
reviewed periodically or as considered necessary.

        Land    actively   held   for   sale   and   any   related   development
costs   transferred   from   construction   in   progress   are   reported    as
inventories    in   the   accompanying   consolidated   balance    sheets    and
are stated at the lower of cost or fair value less costs to sell.

        For    financial    reporting   purposes,   the   Company    uses    the
effective    interest    rate    method   and   accrued    interest    on    the
Certificate   of   Land   Appreciation  Notes   due   2008   ("COLAS")   at   4%
per annum, which is the "Mandatory Base Interest" (see note 3).

        Interest    is    capitalized   to   qualifying   assets    (principally
real   estate   under   development)  during  the  period   that   such   assets
are    undergoing   activities   necessary   to   prepare   them    for    their
intended   use.    Such   capitalized   interest   is   charged   to   cost   of
sales   as   revenue   from   the   real  estate  development   is   recognized.
Interest   cots   of  $358  and  $0  have  been  capitalized   for   the   three
months ended March 31, 1997 and 1996, respectively.

       Net   interest   received   (paid)   on   contracts   that   qualify   as
hedges    is    recognized   over   the   life   of   the   contract    as    an
adjustment   to   interest   income   (expense)   of   the   hedged    financial
instrument.

       The   Company   and  its  subsidiaries  report  their   taxes   as   part
of     the    consolidated    tax    return    of    the    Company's    parent,
Northbrook.    The   Company  and  its  subsidiaries   have   entered   into   a
tax    indemnification    agreement    with    Northbrook    that    indemnifies
the   Company   and   its  subsidiaries  for  responsibility   for   all   past,
present    and    future    federal   and   state   income    tax    liabilities
(other    than    income    taxes   which   are   directly    attributable    to
cancellation   of   indebtedness   income   caused   by   the   repurchase    or
redemption   of   securities   as   provided   for   in   or   contemplated   by
the Repurchase Agreement).

        Current    and   deferred   taxes   have   been   allocated    to    the
Company   as   if   the   Company  were  a  separate  taxpayer   in   accordance
with   the   provisions   of   SFAS  No.  109-Accounting   for   Income   Taxes.
However,   to   the   extent  the  tax  indemnification   agreement   does   not
require   the   Company   to   actually  pay   income   taxes,   current   taxes
payable   or   receivable   have   been  reflected   as   deemed   contributions
or    distributions,   respectively,   to   additional   paid-in   capital    in
the accompanying consolidated financial statements.

        The   preparation   of   financial   statements   in   conformity   with
generally    accepted    accounting   principles    requires    management    to
make    estimates   and   assumptions   that   affect   the   amounts   reported
in    the    financial    statements    and    accompanying    notes.     Actual
results         could         differ        from        those         estimates.
                         AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Continued

                         (Dollars in Thousands)


(2)  AMOUNTS DUE TO AFFILIATES - FINANCING

        The    approximately    $15,097    of   remaining    acquisition-related
financing   owed   to  affiliates  had  a  maturity  date  of   June   1,   1998
and   bore   interest   at   a   rate   per   annum   based   upon   the   prime
interest rate (8.5% at March 31, 1997), plus 1%.

        On    June    1,    1995,    the   Company   borrowed    $52,000    from
Northbrook    to   redeem   Class   A   COLAS   pursuant   to   the   Redemption
Offer   (see   note   3).    The   Company  has  also   borrowed   approximately
$18,746   and   $9,814   during   1996   and   1995,   respectively,   to   fund
COLA    Mandatory    Base    Interest    payments    and    other    operational
needs.    The    loans   from   Northbrook   were   payable    interest    only,
matured   on   June   1,   1998  and  carried  an  interest   rate   per   annum
equal to the prime interest rate plus 2%.

       In   February   1997  the  above  noted  affiliate  loans,   along   with
certain   other   amounts   due   Northbrook,  were   converted   into   a   new
ten-year   note   payable.   The  new  note  is  payable   interest   only   and
accrues   interest   at   the  prime  rate  plus  2%.   The   Company   borrowed
an   additional   $7,714  during  the  three  months  ended   March   31,   1997
to     fund    COLA    Mandatory    Base    Interest    payments    and    other
operational   needs.   The   total   amount   due   Northbrook   as   of   March
31,   1997   was   $113,762,  which  includes  accrued   interest   of   $1,289.
Pursuant    to   the   Indenture   relating   to   the   COLAS,   the    amounts
borrowed    from   Northbrook   are   considered   "Senior   Indebtedness"    to
the COLAS.

(3)  CERTIFICATE OF LAND APPRECIATION NOTES

        The   COLAS   are   unsecured   debt   obligations   of   the   Company.
Interest   on   the   COLAS  is  payable  semi-annually  on  February   28   and
August   31   of   each   year.   The  COLAS  mature  on  December   31,   2008,
and   bear   interest   after  the  Final  Issuance  Date  (August   31,   1989)
at   a   rate   of   10%  per  annum  ("Base  Interest")  of   the   outstanding
principal    balance   of   the   COLAS   on   a   cumulative,    non-compounded
basis,    of   which   6%   per   annum   is   contingent   ("Contingent    Base
Interest")   and   payable  only  to  the  extent  of   Net   Cash   Flow   (Net
Cash   Flow   for  any  period  is  generally  an  amount  equal   to   90%   of
the    Company's    net   cash   revenues,   proceeds   and    receipts    after
payment    of    cash   expenditures,   including   the   Qualified    Allowance
(as   defined)   other   than  federal  and  state  income   taxes   and   after
the   establishment   by   the   Company  of  reserves)   or   Maturity   Market
Value    (as    defined   below).   The   Company   has    not    generated    a
sufficient   level   of   Net  Cash  Flow  to  pay  Contingent   Base   Interest
on   the   COLAS   from   1990   through   the   current   date.   Approximately
$89,855   of   the   $97,479   cumulative   deficiency   of   Contingent    Base
Interest    related   to   the   period   from   August    31,    1989    (Final
Issuance   Date)   through  March  31,  1997  has  not  been  accrued   in   the
accompanying    consolidated    financial    statements    as    the     Company
believes   that   it   is  not  probable  at  this  time   that   a   sufficient
level   of   Net   Cash  Flow  will  be  generated  in  the   future   or   that
there   will   be   sufficient  Maturity  Market  Value   (as   defined   below)
as   of   December   31,   2008   (the  COLA  maturity   date)   to   pay   such
unaccrued    Contingent   Base   Interest.   The   following    table    is    a
summary    of   Mandatory   Base   Interest   and   Contingent   Base   Interest
for   the   three   months   ended  March  31,   1997   and   the   year   ended
December 31, 1996::

                                        1997      1996
                                       -----     ------
Mandatory Base Interest paid          $4,414     8,828
Contingent Base Interest paid             --        --
Cumulative deficiency of Contingent
  Base Interest at end of period     $97,479    94,169

Net Cash Flow was $0 for 1996 and is expected to be $0 for 1997.


                         AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Continued

                         (Dollars in Thousands)

     In   each   calendar   year,  principal  reductions  may   be   made   from
remaining   Net   Cash   Flow,   if  any,  in  excess   of   all   current   and
unpaid    deferred   Contingent   Base   Interest.   The   COLAS    will    bear
additional   contingent   interest   in   any   year,   after   any    principal
reduction,    equal    to    55%   of   remaining   Net    Cash    Flow.    Upon
maturity,    holders   of   COLAS   will   be   entitled    to    receive    the
remaining   outstanding   principal   balance   of   the   COLAS   plus   unpaid
Mandatory   Base   Interest   (4%)   plus   additional   interest    equal    to
the    unpaid    Contingent   Base   Interest,   to   the    extent    of    the
Maturity   Market   Value   (Maturity   Market   Value   generally   means   90%
of   the   excess   of   the   Fair   Market   Value   (as   defined)   of   the
Company's    assets    at    maturity   over    its    liabilities    (including
Qualified   Allowance,   but   only   to   the   extent   earned   and   payable
from   Net   Cash   Flow   generated  through  maturity)  at   maturity,   which
liabilities     have     been     incurred    in     connection     with     its
operations), plus 55% of the remaining Maturity Market Value.

       On   March   14,   1989,   Amfac/JMB  Finance  ("Finance"),   a   wholly-
owned   subsidiary   of   Northbrook,  and   the   Company   entered   into   an
agreement      (the     "Repurchase     Agreement")     concerning     Finance's
obligations   to   repurchase,   on  June  1,   1995   and   1999,   the   COLAS
upon   request   of   the   holders  thereof.   The   COLAS   were   issued   in
two   units   consisting   of  one  Class  A  and  one   Class   B   COLA.    As
specified    in    the   Repurchase   Agreement,   the   repurchase    of    the
Class   A   COLAS   may   have   been  requested  by   the   holders   of   such
COLAS   on   June   1,  1995  at  a  price  equal  to  the  original   principal
amount   of   such   COLAS   ($.5)  minus  all   payments   of   principal   and
interest    allocated   to   such   COLAS.   The   cumulative   interest    paid
per   Class   A   COLA   through  June  1,  1995  was  $.135.   The   repurchase
of   the   Class   B  COLAS  may  be  requested  of  Finance  by   the   holders
of   such   COLAS  on  June  1,  1999  at  a  price  equal  to   125%   of   the
original   principal   amount   of  such  COLAS   ($.5)   minus   all   payments
of   principal   and   interest   allocated  to   such   COLAS.    Through   the
date   of   this  report,  the  cumulative  interest  paid  per  Class   A   and
Class B COLA is approximately $.175 and $.175, respectively.

        On    March    14,   1989,   Northbrook   entered   into   a   keep-well
agreement     with     Finance,    whereby    it    agreed     to     contribute
sufficient   capital   or  make  loans  to  Finance   to   enable   Finance   to
meet      its      COLA     repurchase     obligations     described      above.
Notwithstanding    Finance's   repurchase   obligations,   the    Company    may
elect   to   redeem   any   COLAS   requested   to   be   repurchased   at   the
specified price.

       On   March   15,   1995,   pursuant  to  the   indenture   that   governs
the   terms   of   the   COLAS  (the  "Indenture"),  the  Company   elected   to
offer   to   redeem   (the  "Redemption  Offer")  all   Class   A   COLAS   from
the   registered   holders  at  the  same  price  as  would   be   required   of
Finance     under     the    Repurchase    Agreement,    thereby     eliminating
Finance's    obligation    to   satisfy   the   Class    A    COLA    repurchase
options   requested   by   such  holders  as  of   June   1,   1995.    Pursuant
to   the   Redemption  Offer,  and  in  accordance  with  the   terms   of   the
Indenture,    the   Company   was   therefore   obligated   to   purchase    any
and   all   Class   A   COLAS  submitted  pursuant  to  the   Redemption   Offer
at   a   price   of   $.365  per  Class  A  COLA.   In  conjunction   with   the
Company's   Redemption   Offer,  the  Company   made   a   tender   offer   (the
"Tender   Offer")   to   purchase   up   to  approximately   $68,000   principal
value   of  the  Class  B  COLAS  at  a  price  of  $.220  per  Class   B   COLA
from    COLA    holders    electing   to    have    their    Class    A    COLAS
repurchased.    Approximately   229,000   Class   A   COLAS    were    submitted
for      repurchase      pursuant     to    the     Redemption     Offer     and
approximately   99,000   Class   B   COLAS   were   submitted   for   repurchase
pursuant   to   the   Tender   Offer,  requiring   an   aggregate   payment   by
the    Company   of   approximately   $105,450   on   June   1,    1995.     The
Company    used    its   available   cash   to   purchase    Class    B    COLAS
pursuant   to   the   Tender   Offer  and  borrowed  $52,000   from   Northbrook
to   purchase   Class   A   COLAS  pursuant  to  the   Redemption   Offer.    As
of   March   31,   1997,  the  Company  had  approximately   156,000   Class   A
COLAS   and   approximately   286,000  Class  B  COLAS   outstanding,   with   a
principal     balance     of     approximately     $78,000     and     $143,000,
respectively.

                         AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Continued

                        (Dollars in Thousands)

       As   a   result   of   the  COLA  repurchases  in   1995,   the   Company
retired   approximately   $164,045   in   face   value   of   COLA   debt    and
recognized    a    financial   statement   gain   in   1995   of   approximately
$32,544    (net    of    income   taxes   of   $20,807,   the    write-off    of
deferred    financing   costs   of   $10,015,   the   write-off    of    accrued
Contingent   Base   Interest   of   $5,667   and   expenses   of   $894).   Such
gain   was   treated   as   cancellation  of   indebtedness   income   for   tax
purposes    and,    accordingly,   the    income   taxes    related    to    the
Class     A     Redemption    Offer    (approximately    $9,106)    were     not
indemnified by the tax agreement with Northbrook (see note 1).

        The   terms   of   the   Indenture   relating   to   the   COLAS   place
certain   restrictions   on   the   Company's   declaration   and   payment   of
dividends.    Such    restrictions   generally    relate    to    the    source,
timing   and   amounts   that  may  be  declared   and/or   paid.    The   COLAS
also    impose    certain   restrictions   on,   among   other    things,    the
creation    of    additional   indebtedness   for    certain    purposes,    the
Company's    ability   to   consolidate   or   merge   with   or   into    other
entities, and the Company's transactions with affiliates.

(4)  LONG-TERM DEBT

        In    June   1991,   the   Company   obtained   a   five-year    $66,000
nonrecourse    loan   from   the   Employees'   Retirement   System    of    the
State   of   Hawaii   ("ERS").  The  loan  is  secured  by  a   first   mortgage
on    the    Kaanapali    Golf    Courses,    and    is    considered    "Senior
Indebtedness"    (as    defined    in   the   Indenture    relating    to    the
COLAS).    The   loan  bore  interest  at  a  rate  per  annum  equal   to   the
greater   of   (i)   the  base  interest  rate  announced   by   the   Bank   of
Hawaii   on  the  first  of  July  for  each  year  or  (ii)  ten  percent   per
annum    through    June    30,    1993   and    nine    percent    per    annum
thereafter.   The   annual   interest   payments   were   in   excess   of   the
cash flow generated by the Kaanapali Golf Courses.

       In   April   1996,  the  Company  reached  an  agreement  to  amend   the
loan   with   the   ERS,   extending  the  maturity   date   for   five   years.
In   exchange   for  the  loan  extension,  the  ERS  received  the   right   to
participate    in    the    "Net    Disposition    Proceeds"    (as     defined)
related   to  the  sale  or  refinancing  of  the  golf  courses   or   at   the
maturity    of    the   loan.   The   ERS   share   of   the   Net   Disposition
Proceeds   increases  from  30%  through  June  30,  1997,  to   40%   for   the
period   from   July  1,  1997  to  June  30,  1999  and  to   50%   thereafter.
The   loan   amendment   effectively  adjusted   the   interest   rate   as   of
January   1,   1995   to   9.5%   until  June  30,   1996.    After   June   30,
1996,   the   loan  bears  interest  at  a  rate  per  annum  equal  to   8.73%.
The   loan   amendment   requires  the  Company   to   pay   interest   at   the
rate   of   7%  for  the  period  from  January  1,  1995  to  June  30,   1996,
7.5%   from  July  1,  1996  to  June  30,  1997,  7.75%  from  July   1,   1997
to    June    30,    1998    and    8.5%   thereafter   ("Minimum    Interest").
Accrued   Minimum   Interest   as   of  March   31,   1997   was   $1,221.   The
scheduled    Minimum   Interest   payments   are   paid   quarterly    on    the
principal    balance   of   the   $66,000   loan.    The   difference    between
the    accrued    interest   expense   and   the   Minimum   Interest    payment
accrues   interest   and   is   payable  on  an   annual   basis   from   excess
cash    flow,   if   any,   generated   from   the   Kaanapali   Golf   Courses.
The   accrued   interest  payable  from  excess  cash   flow   was   $3,419   as
of   March   31,   1997.   Although  the  outstanding   loan   balance   remains
nonrecourse,    certain    payments    and    obligations,    such    as     the
Minimum   Interest   payments   and  the  ERS's  share   of   appreciation,   if
any,    are    recourse    to    the   Company.     However,    the    Company's
obligations   to   make   future   Minimum  Interest   payments   and   to   pay
the    ERS   a   share   of   appreciation   would   be   terminated   if    the
Company   tendered   an   executed  deed  to  the  golf   course   property   to
the ERS in accordance with the terms of the amendment.

                     AMFAC/JMB HAWAII, INC.
                                
     Notes to Consolidated Financial Statements - Continued
                                
                     (Dollars in Thousands)

        In    January    1993,   The   Lihue   Plantation    Company,    Limited
("Lihue")    obtained   a   ten-year   $13,250   loan   used   to    fund    the
acquisition    of    Lihue's   power   generation   equipment.    The    $13,250
loan,     constituting     "Senior    Indebtedness"     under     the     COLAS'
Indenture,    consists   of   two   ten-year   amortizing    term    loans    of
$10,000    and    $3,250,   respectively,   payable   in    forty    consecutive
installments   commencing   July   1,  1993   in   the   principal   amount   of
$250     and    $81,    respectively    (plus    interest).     The    remaining
balance   of   the  $3,250  loan  was  fully  repaid  in  January   1997.    The
$10,000   loan   has  an  outstanding  balance  of  $6,184  as  of   March   31,
1997   and   bears   interest  at  a  rate  equal  to  prime   rate   (8.5%   at
March    31,   1997)   plus   three   and   one   half   percent.   Lihue    has
purchased    an    interest    rate    agreement    which    protects    against
fluctuations    in   interest   rates   and   effectively   caps    the    prime
rate   at   eight   percent   for   the  first   seven   years   of   the   loan
agreement.    The   loan   is   secured   by   the   Lihue   power    generation
equipment,     sugar    inventories    and    receivables,     certain     other
assets   and   real   property  of  the  Company  and   has   limited   recourse
to the Company and certain other subsidiaries.

      In   October   1993,   Waikele  Golf  Club,  Inc.  ("WGCI"),   a   wholly-
owned    subsidiary    of   the   Company   that   owns   and    operates    the
Waikele   Golf   Course,   obtained   a  five   year   $20,000   loan   facility
from   two   lenders.    The   loan  consisted   of   two   $10,000   amortizing
loans.    Each   loan  bore  interest  only  for  the  first   two   years   and
interest   and   principal   payments   based   upon   an   assumed   20    year
amortization   period   for  the  remaining  three   years.   The   loans   bore
interest   at   prime   plus  1/2%  and  LIBOR  (5.5%   at   March   31,   1997)
plus   3%,   respectively.   In   February   1997,   WGCI   entered   into    an
amended    and   restated   loan   agreement   with   the   Bank   of    Hawaii,
whereby    the    outstanding    principal    amount    of    the    loan    was
increased   to   $25,000,   the  maturity  date   was   extended   to   February
2007,   the   interest   rate  was  changed  to  LIBOR   plus   2%   until   the
fifth   anniversary   and   LIBOR  plus  2.5%  thereafter   and   principal   is
to   be   repaid   based   on   a   30-year   amortization   schedule.   As   of
March    31,   1997,   the   outstanding   principal   balance   was    $24,962,
with   scheduled   remaining   annual   principal   maturities   of   $151    in
1997,   $243  in  1998,  $262  in  1999,  $282  in  2000,  $304  in   2001   and
$23,720   thereafter.   The   loan   is   secured   by   WGCI's   assets    (the
golf     course     and    related    improvements    and     equipment),     is
guaranteed     by     the     Company,     and     is     considered     "Senior
Indebtedness"    (as    defined    in   the   Indenture    relating    to    the
COLAS).

       In   December   1996,  Amfac  Property  Development  Corp.,   a   wholly-
owned   subsidiary   of   the  Company,  obtained  a   $10,000   loan   facility
from   a   Hawaii  bank.  The  loan  is  secured  by  a  mortgage  on   property
under    development   at   the   mill-site   of   Oahu   Sugar    (the    sugar
plantation    was    closed    in    1995),   and    is    considered    "Senior
Indebtedness"    (as    defined    in   the   Indenture    relating    to    the
COLAS).    The   loan  bears  interest  at  the  bank's  base  rate   (8.5%   at
March 31, 1997) plus .5% and matures on December 1, 1998.


                     AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Continued

                     (Dollars in Thousands)
(5)  SEGMENT INFORMATION

        Agriculture   and   Property   comprise   separate   industry   segments
of    the    Company.    "Operating   Income-Other"   consists   primarily    of
unallocated    overhead    expenses    and   "Total    Assets-Other"    consists
primarily   of   cash   and   deferred   expenses.    Total   assets   at    the
balance    sheet    dates   and   capital   expenditures,    operating    income
(loss)   and   depreciation   and   amortization   during   the   three   months
ended   March   31,   1997   and   1996   are   set   forth   below   by    each
industry segment:
<TABLE>
<CAPTION>
                                                       March 31,  December 31,
                                                          1997        1996
                                                      ---------    ---------
<S>                                                  <C>         <C>
Total Assets:
     Agriculture                                      $239,839      239,222                                      
     Property                                          230,724      225,372                                    
     Other                                              17,845       19,011
                                                      ---------   ---------
                                                      $488,408      483,605
                                                     =========     =========
                                                   Three Months  Three Months
                                                       Ended         Ended
                                                    March 31,      March 31,
                                                       1997          1996
                                                   -----------  -----------
Capital Expenditures:
 Agriculture                                         $   23          341
 Property                                                93          173
                                                     ---------   ---------
                                                     $  116          514
                                                     =========   =========

Operating income (loss):
 Agriculture                                        $(1,216)         395
 Property                                                33        1,412
 Other                                                 (422)        (948)
                                                   ---------    ---------
                                                    $(1,605)         859
                                                   ==========   =========
Depreciation and amortization:
 Agriculture                                         $  971        1,029
 Property                                               533          518
 Other                                                   11           49
                                                   ---------   ---------
                                                     $1,515        1,596
                                                  =========    =========
</TABLE>

                     AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Continued

                         (Dollars in Thousands)

(6)  TRANSACTIONS WITH AFFILIATES

        The    Company    incurred    interest    expense    of    approximately
$2,024    for    the    three    months    ended    March    31,    1996     and
approximately   $2,469  for  the  three  months  ended   March   31,   1997   in
connection   with   the   acquisition   and   additional   financing    obtained
from    an    affiliate.    Approximately   $1,289   of   such   interest    was
unpaid as of March 31, 1997.

       With   respect   to  any  calendar  year,  JMB  or  its  affiliates   may
receive    a    Qualified    Allowance   in   an   amount    equal    to:    (i)
approximately    $6,200    during   each   of   the    calendar    years    1989
through   1993,   and   (ii)  thereafter,  1-1/2%  per   annum   of   the   Fair
Market   Value   (as  defined)  of  the  gross  assets  of   the   Company   and
its    subsidiaries    (other    than   cash   and    cash    equivalents    and
Excluded    Assets    (as    defined))   for    providing    certain    advisory
services    for    the   Company.   The   aforementioned   advisory    services,
which    are    provided    pursuant   to   a   30-year    Services    Agreement
entered   into   between   the  Company,  certain  of   its   subsidiaries   and
JMB    in    November    1988,   include   making   recommendations    in    the
following    areas:   (i)   the   construction   and   development    of    real
property;   (ii)   land   use  and  zoning  changes;  (iii)   the   timing   and
pricing   of   properties   to   be   sold;   (iv)   the   timing,   type    and
amount    of    financing    to    be    incurred;    (v)    the    agricultural
business;     and,     (vi)     the     uses     (agricultural,     residential,
recreational   or   commercial)   for   the   land.   However,   the   Qualified
Allowance    shall   be   earned   and   paid   for   each   year    prior    to
maturity   of   the   COLAS   only   if   the   Company   generates   sufficient
Net   Cash   Flow   to  pay  Base  Interest  to  the  holders   of   the   COLAS
for   such   year  of  an  amount  equal  to  8%  of  the  average   outstanding
principal   balance   of  the  COLAS  for  such  year;  any   portion   of   the
Qualified   Allowance   not   paid  for  any   year   shall   cumulate   without
interest   and   JMB  or  its  affiliates  shall  be  paid  such   amount   with
respect    to    any    succeeding   year,   after   the    payment    of    all
Contingent   Base   Interest  for  such  year,  to  the  extent   of   100%   of
remaining   Net  Cash  Flow  until  an  amount  equal  to  20%   of   the   Base
Interest   with   respect   to  such  year  has  been  paid,   and   thereafter,
to   the   extent   of   the   product  of  (a)   remaining   Net   Cash   Flow,
multiplied   by   (b)   a   fraction,   the   numerator   of   which   is    the
cumulative   deficiency  as  of  the  end  of  such  year   in   the   Qualified
Allowance    and   the   denominator   of   which   is   the    sum    of    the
cumulative    deficiencies   as   of   the   end   of   such   year    in    the
Qualified   Allowance   and   Base   Interest.   A   Qualified   Allowance   for
1989    of    approximately   $6,200   was   paid   on   February   28,    1990.
Approximately    $54,400    of    Qualified    Allowance    related    to    the
period   from   January   1,   1991  through   December   31,   1996   has   not
been   earned   and   paid,  and  is  payable  only   from   future   Net   Cash
Flow.   Accordingly,   because   the   Company   does   not   believe   it    is
probable   at   this   time  that  a  sufficient  level   of   Net   Cash   Flow
will   be   generated   in   the   future  to  pay  Qualified   Allowance,   the
Company    has    not   accrued   for   any   Qualified   Allowance    in    the
accompanying    consolidated   financial   statements.    JMB    has    informed
the    Company   that   no   incremental   costs   or   expenses    have    been
incurred    relating   to   the   provision   of   these   advisory    services.
The    Company   believes   that   using   an   incremental   cost   methodology
is   reasonable.   The   following  table  is  a  summary   of   the   Qualified
Allowance for the year ended December 31, 1996:

                                               1996
                                              ------
Qualified Allowance calculated                $9,240
Qualified Allowance paid                          --
Cumulative deficiency of Qualified
 Allowance at end of year                    $60,632

The   Qualified   Allowance   for   1997,   which   will   not   be   calculated
until   the  year  is  completed,  is  not  expected  to  be  paid.   Net   Cash
Flow was $0 for 1996 and is expected to be $0 for 1997.

                     AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Continued

                     (Dollars in Thousands)


       After   the   maturity  date  of  the  COLAS,  JMB   will   continue   to
provide   advisory   services   pursuant  to   the   Services   Agreement,   the
Qualified   Allowance  for  such  years  will  continue   to   be   1-1/2%   per
annum   of   the  Fair  Market  Value  of  the  gross  assets  of  the   Company
and   its   subsidiaries   and  the  Qualified  Allowance   will   continue   to
be    payable    from    the    Company's   Net    Cash    Flow.     Upon    the
termination   of   the   Services   Agreement,   if   there   has    not    been
sufficient   Net   Cash   Flow  to  pay  the  cumulative   deficiency   in   the
Qualified   Allowance,   if   any,   such   amount   would   not   be   due   or
payable to JMB.

        The    Company,    its   subsidiaries,   and   their   joint    ventures
reimburse     Northbrook,    JMB    and    their    affiliates    for     direct
expenses   incurred   on   their   behalf,  including   salaries   and   salary-
related    expenses   incurred   in   connection   with   the   management    of
the    Company's    or    its   subsidiaries'   and    the    joint    ventures'
operations.    The   total   of   such  costs   was   approximately   $163   for
the   three   months   ended   March  31,  1997  and  approximately   $154   for
the   three   months  ended  March  31,  1996;  approximately   $163   of   such
costs   were   unpaid  as  of  March  31,  1997.  In  addition,  as   of   March
31,   1997,   the   other  amounts  due  to  affiliates   includes   $9,106   of
income   tax   payable   related  to  the  Class   A   COLA   Redemption   Offer
(see     note     3).    Also,    the    Company    pays    a    non-accountable
reimbursement    of   approximately   $30   per   month   to    JMB    or    its
affiliates   in   respect   of   general  overhead   expense,   all   of   which
was paid as of March 31, 1997.

         JMB     Insurance    Agency,    Inc.    earns    insurance    brokerage
commissions     in    connection    with    providing    the    placement     of
insurance    coverage   for   certain   of   the   properties   and   operations
of    the    Company.     Such    commissions   are    comparable    to    those
available    to    the   Company   in   similar   dealings   with   unaffiliated
third    parties.    The   total   of   such   commissions   for    the    three
months     ended    March    31,    1996    was    approximately    $235     and
approximately   $250   for  the  three  months  ended  March   31,   1997,   all
of which was paid as of March 31, 1997.

     Northbrook    and   its   affiliates   allocate   certain    charges    for
services    to    the    Company   based   upon   the   estimated    level    of
services.   Such   charges  totaled  $254  and  $240  for   the   three   months
ended    March    31,    1997   and   March   31,   1996,   respectively.    The
affiliated   charges   for   the  first  quarter  of   1997   were   offset   by
$197    of    charges    for   services   provided   by    the    Company    for
Northbrook.    As  of  March  31,  1997,  on  a  net  basis,  the   amount   due
Northbrook    totaled   approximately   $313   related   to   these    services.
These   services   and   costs   are   intended   to   reflect   the   Company's
separate   costs   of   doing   business  and   are   principally   related   to
the    inclusion    of    the   Company's   employees    in    the    Northbrook
pension   plan,   payment   of   severance   and   termination   benefits    and
reimbursement   for   insurance  claims  paid  on   behalf   of   the   Company.
All    amounts   described   above,   deferred   or   currently   payable,    do
not bear interest and are expected to be paid in future periods.


                     AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Continued

                         (Dollars in Thousands)


(7)  EMPLOYEE BENEFIT PLANS

         The     Company     participates    in    benefit    plans     covering
substantially   all   of   its   employees,   which   provide   benefits   based
primarily    on   length   of   service   and   compensation   levels.     These
plans    are   administered   by   Northbrook   in   conjunction   with    other
plans    providing    benefits   to   employees   of    Northbrook    and    its
affiliates.

(8)  COMMITMENTS AND CONTINGENCIES

       The   Company   is  involved  in  various  matters  of   litigation   and
other    claims.   Management,   after   consultation   with   legal    counsel,
is   of   the   opinion   that   the  Company's   liability   (if   any),   when
ultimately   determined,   will  not  have  a   material   adverse   effect   on
the Company's financial position.

        The    Company's   Property   segment   had   contractual    commitments
(related   to   project   costs)   of   approximately   $1,527   as   of   March
31,    1997.    Additional   development   expenditures   are   dependent   upon
the   Company's   ability   to  obtain  financing  for   such   costs   and   on
the timing and extent of property development and sales.

       As   of   March  31,  1997,  certain  portions  of  the  Company's   land
not   currently   under   development  or   used   in   sugar   operations   are
mortgaged    as    security    for   approximately   $1,300    of    performance
bonds related to property development.

                     AMFAC/JMB HAWAII, INC.

     Notes to Consolidated Financial Statements - Concluded

                     (Dollars in Thousands)

(9)  INCOME TAXES

        Deferred    income   taxes   reflect   the   net    tax    effects    of
temporary   differences   between   the   carrying   amounts   of   assets   and
liabilities   for   financial   reporting  purposes   and   the   amounts   used
for   income   tax   purposes.   Significant   components   of   the   Company's
deferred tax liabilities and assets
as of December 31, 1996 are as follows:


    Deferred tax (assets):
      Postretirement benefits                                      $(22,488)
      Interest accruals                                              (2,975)
      Other accruals                                                 (3,549)
                                                                   ---------
                Total gross deferred tax assets                     (29,012)
                                                                   ---------
    Deferred tax liabilities:
     Accounts receivable, related to profit on sales of sugar         3,065
      Inventories, principally due to sugar production
       costs, capitalized costs, capitalized interest and
        purchase accounting adjustments                                 258
      Plant and equipment, principally due to depreciation
        and purchase accounting adjustments                           8,129
      Land and land improvements, principally due
       to purchase accounting adjustments                            89,537
      Deferred gains, due to installment sales for income
        tax purposes                                                  7,429
      Investments in unconsolidated entities, principally
        due to purchase accounting adjustments                       14,361
                                                                    --------
                Total deferred tax liabilities                      122,779
                                                                    --------
                Net deferred tax liability                          $93,767
                                                                   =========


(10) ADJUSTMENTS

     In    the   opinion   of   the   Company,   all   adjustments   (consisting
solely    of    normal   recurring   adjustments)   necessary   for    a    fair
presentation   have   been   made   to   the   accompanying   figures   as    of
March   31,   1997  and  for  the  three  months  ended  March  31,   1997   and
1996.
<TABLE>
                    AMFAC/JMB FINANCE, INC.

                         Balance Sheets

              March 31, 1997 and December 31, 1996

      (Dollars in thousands, except per share information)

                          (Unaudited)

<CAPTION>
                          A s s e t s

                                         March 31,     December 31,
                                           1997           1996
                                        -----------    -----------
<S>                                    <C>            <C>
Cash                                    $        1              1
                                        ==========      =========

     L i a b i l i t y  a n d  S t o c k h o l d e r ` s  E q u i t y

Repurchase obligation (note 2)

Common stock, $1 par value; authorized, issued
 and outstanding - 1,000 shares         $        1             1
                                        ==========      =========

<FN>
     The accompanying notes are an integral part of these balance sheets.
</TABLE>
                     AMFAC/JMB FINANCE, INC.

                  Notes to the Balance Sheets

                          (Unaudited)

                      (Dollars in Thousands)


(1)  ORGANIZATION AND ACCOUNTING POLICY

      Amfac/JMB  Finance,  Inc. ("Finance")  was  incorporated
November 7, 1988 in the State of Illinois.  Finance has had no
financial  operations.   All  of  the  outstanding  shares  of
Finance are owned by Northbrook Corporation ("Northbrook").

(2)  REPURCHASE OBLIGATIONS

     On March 14, 1989, Finance and a subsidiary of Northbrook
(Amfac/JMB  Hawaii,  Inc.)  entered  into  an  agreement  (the
"Repurchase  Agreement") concerning Finance's  obligation  (on
June  1,  1995  and 1999) to repurchase, upon request  of  the
holders  thereof,  the Certificate of Land Appreciation  Notes
due 2008 ("COLAS"), to be issued by Amfac/JMB Hawaii, Inc.  in
conjunction with the acquisition of Amfac/JMB Hawaii, Inc..  A
total  aggregate principal amount of $384,737  of  COLAS  were
issued  during  the offering, which terminated on  August  31,
1989.   The COLAS were issued in two units consisting  of  one
Class  A and one Class B COLA.  As specified in the Repurchase
Agreement, the repurchase of the Class A COLAS may  have  been
requested of Finance by the holders of such COLAS on  June  1,
1995 at a price equal to the original principal amount of such
COLAS  ($.500)  minus all payments of principal  and  interest
allocated  to  such COLAS.  The cumulative interest  paid  per
Class  A  COLA through June 1, 1995 was $.135.  The repurchase
of  the  Class  B  COLAS may be requested of  Finance  by  the
holders of such COLAS on June 1, 1999 at a price equal to 125%
of  the original principal amount of such COLAS ($.500)  minus
all  payments  of  principal and interest  allocated  to  such
COLAS.  To date, the cumulative interest paid per Class A  and
Class B COLA is approximately $.175 and $.175, respectively.

      On  March  14, 1989, Northbrook entered into a keep-well
agreement  with  Finance,  whereby  it  agreed  to  contribute
sufficient  capital to Finance to enable Finance to  meet  the
COLA  repurchase  obligations described above. Notwithstanding
Finance's repurchase obligations, Amfac/JMB Hawaii,  Inc.  may
elect  to redeem any COLAS requested to be repurchased at  the
specified purchase price in accordance with the terms  in  the
indenture   that   governs  the  terms  of  the   COLAS   (the
"Indenture").

      On  March 15, 1995, pursuant to the Indenture, Amfac/JMB
Hawaii,  Inc.  elected to exercise its right  to  redeem,  and
therefore  was obligated to repurchase, any and  all  Class  A
COLAS submitted pursuant to the redemption offer at a price of
$.365 per Class A COLA.



PART I.  FINANCIAL INFORMATION

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

     All  references  to  "Notes"  herein  are  to  Notes   to
Consolidated Financial Statements contained in this report.
     
LIQUIDITY AND CAPITAL RESOURCES

     A  significant portion of the Company's cash needs result
from the nature of the real estate development business, which
requires   significant  investment  in  preparing  development
plans,   seeking  land  urbanization  and  other  governmental
approvals, and completing infrastructure improvements prior to
the realization of sales proceeds.  The Company has funded its
cash  requirements to date primarily through the use of short-
term  bank borrowings, long-term financing secured by its golf
courses  on Maui and Oahu and by a planned real estate project
on  Oahu,  borrowings from affiliates and  revenues  generated
from   the   development  and  sale  of  its  properties   and
investments.    Funding   of   the   Company's   future   cash
requirements is dependent upon obtaining appropriate financing
and  revenues generated from the development and sale  of  its
properties.

      In  order  to  generate additional cash  flows  for  the
Company,  management has identified certain land parcels  that
are not included in the Company's long-term development plans.
During  the  three  months ended March 31, 1997,  the  Company
generated  approximately $2.9 million from these non-strategic
land  sales.  During 1996, the Company generated approximately
$18.9  million  in land sales, most of which related  to  non-
strategic parcels.

      At  March  31,  1997,  the Company  had  cash  and  cash
equivalents of approximately $7.9 million.

      The  Company  intends  to use its cash  reserves,  sales
proceeds and financing or joint venture arrangements  to  meet
its short-term (next 12 months) and long-term (beyond the next
12  months) liquidity requirements, which include funding  the
development costs remaining at Waikele and on West Maui,  Oahu
and  Kauai, agricultural deficits, payment of interest expense
and  the  repayment  of  principal  on  debt  obligations,  as
necessary.  The  Company's long-term  remaining  liquidity  is
dependent upon its ability to obtain additional financing  and
the  consummation of certain property sales. There can  be  no
assurance that additional long-term financing can be  obtained
or  property sales consummated. The Company's land holdings on
Maui  and  Kauai are its primary sources of future  land  sale
revenues.   However,  due  to current market  conditions,  the
difficulty  in  obtaining  land use  approvals  and  the  high
development  costs  of  required infrastructure,  the  planned
development of these land holdings and the ability to generate
cash  flow from these land holdings are longer term in  nature
than  the time frame experienced at Waikele.  Accordingly,  if
no such financing can be obtained or additional property sales
consummated,  the Company will defer (to the extent  possible)
development  costs and capital expenditures to meet  liquidity
requirements. Additionally, the Company's plans  for  property
sales  may  also  be adversely impacted by  the  inability  of
potential buyers to obtain financing.

      During the first three months of 1997, net cash used  in
operating   activities  of  $12.1  million  and  in  investing
activities  of  $3.7 million was primarily provided  by  $10.2
million  of long-term financing from the Company's parent  and
$5.5 million of additional long-term financing related to  the
refinancing of the WGCI loan (see Note 4).

     During the first three months of 1997, net cash flow used
in  operating activities was $12.1 million, as compared to net
cash  used in operating activities of $7.6 million during  the
first three months of 1996.  The $4.5 million decrease in cash
flow related to operating activities was primarily due to: (i)
an increase in 1997 of the net loss (after adjusting for items
not  requiring  or  providing cash) by $4.3 million  and  (ii)
changes in cash flow related to working capital components.

     During the first three months of 1997, net cash flow used
in  investing activities totaled $3.7 million, principally due
to  the  incurrence of other capitalizable  costs  related  to
future  land  development.  During the first three  months  of
1996,  investing  activities used net  cash  of  $.6  million,
principally due to property additions.

      During  the  first three months of 1997, net  cash  flow
provided  by  financing activities totaled $15.0 million,  due
primarily  to  $10.2 million of long-term financing  from  the
Company's  parent  and  $5.5 million of  additional  long-term
financing  related to the refinancing of the  WGCI  loan  (see
Note 4).  During the first three months of 1996, net cash flow
provided  by  financing activities totaled $7.0  million,  due
primarily  to  $7.4  million of long-term financing  from  the
Company's  parent,  partially offset by  $.5  million  of  net
repayments of long-term debt.

     On December 5, 1988, the Company commenced an offering to
the  public  of COLAS pursuant to a Registration Statement  on
Form S-1 under the Securities Act of 1933.  A total of 384,737
COLAS were issued prior to the termination of the offering  on
August  31, 1989.  The net proceeds received from the sale  of
the  COLAS totaled approximately $352 million (after deduction
of  organization  and offering expenses of  approximately  $33
million).  Such net proceeds were used to repay a  portion  of
the  acquisition-related financing, which was incurred to  pay
certain  costs associated with the Merger, including a portion
of the Merger consideration paid to shareholders of Amfac.

      On  March  14,  1989, Amfac/JMB Finance  ("Finance"),  a
wholly-owned    subsidiary    of    Northbrook     Corporation
("Northbrook"), and the Company entered into an agreement (the
"Repurchase  Agreement") concerning Finance's obligations  (on
June 1, 1995 and 1999) to repurchase the COLAS upon request of
the  holders  thereof.  The COLAS were  issued  in  two  units
consisting of one Class A and one Class B COLA.  As  specified
in  the  Repurchase Agreement, the repurchase of the  Class  A
COLAS may have been requested by the holders of such COLAS  on
June 1, 1995 at a price equal to the original principal amount
of  such  COLAS  ($500) minus all payments  of  principal  and
interest allocated to such COLAS. The cumulative interest paid
per  Class  A  COLA  through  June  1,  1995  was  $135.   The
repurchase of the Class B COLAS may be requested of Finance by
the holders of such COLAS on June 1, 1999 at a price equal  to
125%  of  the  original principal amount of such COLAS  ($500)
minus all payments of principal and interest allocated to such
COLAS.   Through  the  date  of this  report,  the  cumulative
interest  paid  per Class A and Class B COLA is  approximately
$175 and $175, respectively.

      On  March  14, 1989, Northbrook entered into a keep-well
agreement  with  Finance,  whereby  it  agreed  to  contribute
sufficient capital or make loans to Finance to enable  Finance
to  meet  its  COLA  repurchase obligations  described  above.
Notwithstanding Finance's repurchase obligations, the  Company
may  elect to redeem any COLAS requested to be repurchased  at
the specified price.

     On March 15, 1995, pursuant to the indenture that governs
the  terms of the COLAS (the "Indenture"), the Company elected
to  offer to redeem (the "Redemption Offer") all Class A COLAS
from  its  registered  holders.  Pursuant  to  the  Redemption
Offer, and in accordance with the terms of the Indenture,  the
Company was therefore obligated to purchase any and all  Class
A  COLAS submitted pursuant to the Redemption Offer at a price
of  $365  per Class A COLA.  In conjunction with the Company's
Redemption Offer, the Company made a tender offer (the "Tender
Offer")  to purchase up to approximately $68 million principal
value of the Class B COLAS at a price of $220 per Class B COLA
from  COLA  holders  electing to  have  their  Class  A  COLAS
repurchased. Approximately  229,000  Class  A  COLAS  were
submitted  for repurchase  pursuant to the Redemption Offer and
approximately 99,000 Class B to COLAS were submitted for repurchase
pursuant to  the  Tender Offer, requiring an aggregate payment
of the Company of approximately $105 million on June 1,  1995.
The Company  used  its available cash to purchase  Class  B
COLAS pursuant  to  the Tender Offer and borrowed $52  million
from Northbrook  to  purchase  Class  A  COLAS  pursuant   to
the Redemption  Offer.  As of March 31, 1997,  the  Company
has approximately 156,000 Class A COLAS and approximately
286,000 Class  B  COLAS  outstanding  with  a  principal
balance of approximately $78 million and $143 million, respectively.

     As  a result of the COLA repurchases, the Company retired
approximately $164 million face value of debt and recognized a
financial  statement  gain  in  1995  of  approximately  $32.5
million  (net of income taxes of $20.8 million, the  write-off
of deferred financing costs of $10.0 million, the write-off of
accrued  contingent base interest of $5.7 million and expenses
of  $.9  million).  Such gain was treated as  cancellation  of
indebtedness  income  for tax purposes and,  accordingly,  the
income   taxes  related  to  the  Class  A  Redemption   Offer
(approximately $9.1 million) were not indemnified by  the  tax
agreement with Northbrook (see Note 1).

      In  addition to the $52 million borrowed from Northbrook
to  redeem Class A COLAS pursuant to the Redemption Offer (see
Note  3),  the  Company has also borrowed approximately  $18.7
million  and  $9.8 million during 1996 and 1995, respectively,
to  fund  COLA  Base  Interest payments and other  operational
needs.   These  loans  from Northbrook were  payable  interest
only, matured on June 1, 1998 and carried an interest rate per
annum equal to the prime interest rate plus two percent.

      In  February 1997 the above noted affiliate loans, along
with certain other amounts due Northbrook, were converted into
a  new ten-year note payable. The new note is payable interest
only  and  accrues  interest at the prime rate  plus  2%.  The
Company  borrowed an additional $7.7 million during the  three
months  ended  March  31,  1997 to  fund  COLA  Base  Interest
payments  and  other operational needs. The total  amount  due
Northbrook  as  of  March 31, 1997 was $113.8  million,  which
includes  accrued interest of $1.3 million.  Pursuant  to  the
Indenture  relating  to the COLAS, the amounts  borrowed  from
Northbrook are considered "Senior Indebtedness" to the COLAS.

     Pursuant  to the terms of the Indenture relating  to  the
COLAS, the Company is required to maintain a Value Maintenance
Ratio of 1.05 to 1.00. Such ratio is equal to the relationship
of the Company's Net Asset Value (defined as the excess of (i)
Fair Market Value of the gross assets of the Company over (ii)
the amount of the liabilities (excluding liabilities resulting
from   generally   accepted  accounting   principles   enacted
subsequent to the date of the Indenture) of the Company  other
than  the  outstanding principal balance  of  the  COLAS,  any
unpaid  Mandatory  and Contingent Base Interest,  and  certain
other liabilities, to the sum of (x) the outstanding principal
amount  of the COLAS, plus (y) any unpaid Base Interest,  plus
(z)  the  outstanding  principal balance of  any  Indebtedness
incurred  to  redeem  COLAS. The COLA Indenture  requires  the
Company  to  obtain independent appraisals of the fair  market
value  of  the  gross  assets  used  to  calculate  the  Value
Maintenance  Ratio  as  of December 31 in  each  even-numbered
calendar  year. Accordingly, the Company obtained  independent
appraisals  of  substantially all of  its  gross  real  estate
assets  as of December 31, 1996; the appraised values of  such
assets were sufficient to meet the Value Maintenance Ratio. In
odd-numbered  years  (during which  time  appraisals  are  not
required),  the Fair Market Value of the gross assets  of  the
Company  used  to  compute  the  Value  Maintenance  Ratio  is
determined  by the Company's management.  To the  extent  that
management  believes that the aggregate Fair Market  Value  of
the  Company's assets exceeds by more than 5% the Fair  Market
Value  of  such assets included in the most recent  appraisal,
the  Company must obtain an updated appraisal supporting  such
increase.  It should be noted that the concept of Fair  Market
Value  is  intended to represent the value that an independent
arm's-length purchaser, seeking to utilize such asset for  its
highest and best use would pay, taking into consideration  the
risks
and  benefits associated with such use or development, current
restrictions  on  development (including  zoning  limitations,
permitted  densities, environmental restrictions,  restrictive
covenants,  etc.)  and  the  likelihood  of  changes  to  such
restrictions; provided, however, that with respect to any Fair
Market  Value  determination of  all  of  the  assets  of  the
Company, such assets shall not be valued as if sold in bulk to
a  single  purchaser.   There can be  no  assurance  that  the
Company's   properties  can  be  ultimately  sold  at   prices
equivalent to their appraised values.

      In  June  1991,  the Company obtained  a  five-year  $66
million  loan  from the Employees' Retirement  System  of  the
State of Hawaii ("ERS"). The nonrecourse loan is secured by  a
first   mortgage  on  the  Kaanapali  Golf  Courses,  and   is
considered "Senior Indebtedness" (as defined in the  Indenture
relating to the COLAS).  The loan bore interest at a rate  per
annum  equal  to  the  greater of (i) the base  interest  rate
announced by the Bank of Hawaii on the first of July for  each
year  or (ii) ten percent per annum through June 30, 1993  and
nine   percent  per  annum  thereafter.  The  annual  interest
payments  were  in  excess of the cash flow generated  by  the
Kaanapali Golf Courses.

      In April 1996, the Company reached an agreement to amend
the  loan  with the ERS, extending the maturity date for  five
years.   In exchange for the loan extension, the ERS  received
the right to participate in the "Net Disposition Proceeds" (as
defined)  related to the sale or the refinancing of  the  golf
courses or at the maturity of the loan.  The ERS share of  the
Net  Disposition Proceeds increases from 30% through June  30,
1997, to 40% for the period from July 1, 1997 to June 30, 1999
and   to  50%  thereafter.   The  loan  amendment  effectively
adjusted the interest rate as of January 1, 1995 to 9.5% until
June  30,  1996.  After June 30, 1996, the loan bears interest
at  a  rate  per  annum equal to 8.73%.   The  loan  amendment
requires the Company to pay interest at the rate of 7% for the
period  from January 1, 1995 to June 30, 1996, 7.5% from  July
1,  1996 to June 30, 1997, 7.75% from July 1, 1997 to June 30,
1998 and 8.5% thereafter ("Minimum Interest"). Accrued Minimum
Interest  as of March 31, 1997 was $1.2 million. The scheduled
Minimum  Interest payments are paid quarterly on the principal
balance  of the $66 million loan.  The difference between  the
accrued  interest  expense  and the Minimum  Interest  payment
accrues interest and is payable on an annual basis from excess
cash  flow, if any, generated from the Kaanapali Golf Courses.
The  accrued  interest  payable  from  excess  cash  flow  was
approximately $3.4 million as of March 31, 1997. Although  the
outstanding loan balance remains nonrecourse, certain payments
and  obligations such as the Minimum Interest payments and the
ERS's  share  of  appreciation, if any, are  recourse  to  the
Company.  However, the Company's obligations  to  make  future
Minimum  Interest  payments and to pay  the  ERS  a  share  of
appreciation  would be terminated if the Company  tendered  an
executed  deed  to  the golf course property  to  the  ERS  in
accordance with the terms of the amendment.

      In  October  1993, Waikele Golf Club, Inc.  ("WGCI"),  a
wholly-owned subsidiary of the Company that owns and  operates
the Waikele Golf Course, obtained a five year $20 million loan
facility  from  two lenders.  The loan consisted  of  two  $10
million  amortizing loans.  Each loan bore interest  only  for
the first two years with interest and principal payments based
upon  a  20  year amortization period for the remaining  three
years.  The  loans bore interest at prime (8.5% at  March  31,
1997)  plus 1/2% and LIBOR (5.5% at March 31, 1997)  plus  3%,
respectively. In February 1997, WGCI entered into  an  amended
and  restated  loan agreement with the Bank of  Hawaii,  (they
bought   out   the  other  lender's  interest),  whereby   the
outstanding principal amount of the loan was increased to  $25
million, the maturity date was extended to February 2007,  the
interest  rate  was changed to LIBOR plus 2% until  the  fifth
anniversary and LIBOR plus 2.5% thereafter and principal  will
be  repaid based on a 30-year amortization schedule. The  loan
is secured by WGCI's assets (see Note 4), is guaranteed by the
Company and is considered "Senior Indebtedness" (as defined in
the COLA Indenture).
      Pursuant to an agreement entered into with the  City  of
Honolulu  in 1991 relating to the development of the Company's
Waikele project, if the Company sells the Waikele golf course,
depending  on  the  price and certain other  contingencies,  a
payment  of up to $15 million might be required to be made  to
the City to be used to assist in the City's affordable housing
developments.

      In  December 1996, Amfac Property Development  Corp.,  a
wholly-owned subsidiary of the Company, obtained a $10 million
loan  facility from a Hawaii bank. The loan is  secured  by  a
mortgage  on  property under development at the  mill-site  of
Oahu  Sugar (the sugar plantation was closed in 1995), and  is
considered "Senior Indebtedness" (as defined in the  Indenture
relating to the COLAS).  The loan bears interest at the bank's
base  rate  (8.5% at March 31, 1997) plus .5% and  matures  on
December 1, 1998.

      The  Company  uses  the effective  interest  method  and
accrued interest on the COLAS at 4% per annum ("Mandatory Base
Interest") for the three months ended March 31, 1996 and 1997.
The  Company has not generated a sufficient level of Net  Cash
Flow  to pay Base Interest on the COLAS (see Note 3) in excess
of  4%  ("Contingent  Base Interest") from  1990  through  the
current date. Contingent Base Interest is payable only to  the
extent  of  Net  Cash Flow (Net Cash Flow for  any  period  is
generally  an  amount equal to 90% of the Company's  net  cash
revenues,  proceeds  and  receipts  after  payment   of   cash
expenditures,  including the Qualified Allowance,  other  than
federal and state income taxes and after the establishment  by
the  Company  of reserves) or Maturity Market Value  (Maturity
Market  Value generally means 90% of the excess  of  the  Fair
Market  Value  (as defined below) of the Company's  assets  at
maturity  over its liabilities (including Qualified Allowance,
but  only to the extent earned and payable from Net Cash  Flow
generated  through  maturity) at maturity,  which  liabilities
have   been  incurred  in  connection  with  its  operations).
Approximately  $89.9 million of the $97.5  million  cumulative
deficiency  of Contingent Base Interest related to the  period
from  August 31, 1989 (Final Issuance Date) through March  31,
1997  has  not  been accrued in the accompanying  consolidated
financial statements as  the Company believes that it  is  not
probable at this time that a sufficient level of Net Cash Flow
will  be  generated  in  the future  or  that  there  will  be
sufficient Maturity Market Value as of December 31, 2008  (the
COLA  maturity date) to pay any such unaccrued Contingent Base
Interest.  The following table is a summary of Mandatory  Base
Interest  and  Contingent Base Interest for the  three  months
ended  March  31,  1997 and the year ended December  31,  1996
(dollars are in millions):

                                         1997      1996
                                        -----     ------
Mandatory Base Interest paid           $  4.4       8.8
Contingent Base Interest paid              --        --
Cumulative deficiency of Contingent
  Base Interest at end of period       $ 97.5      94.2

Net  Cash  Flow was $0 for 1996 and is expected to be  $0  for
1997.

      With respect to any calendar year, JMB or its affiliates
may  receive a Qualified Allowance in an amount equal to:  (i)
approximately  $6.2 million during each of the calendar  years
1989  through 1993, and (ii) thereafter, 1-1/2% per  annum  of
the  Fair Market Value (Fair Market Value generally means  the
value which an independent arm's-length purchaser, seeking  to
utilize the asset for its highest and best use, would pay  for
such  asset  taking  into consideration the associated  risks,
benefits,  current restrictions and likelihood of  changes  to
such restriction; provided, however, that with respect to  any
Fair  Market  Value  determination of  all  of  the  Company's
assets, such assets shall not be valued as if sold in bulk  to
a single purchaser) of the gross assets of the Company and its
subsidiaries,  other  than  cash  and  cash  equivalents   and
Excluded  Assets  (Excluded  Assets  generally  means   assets
acquired by the Company without the expenditure of any  amount
included  in  revenues or receipts for purposes of determining
Net  Cash  Flow  or assets designated as Excluded  Assets,  as
restricted  by  the Indenture; the Company  has  not  had  any
Excluded Assets), for providing
certain advisory services for the Company.  The aforementioned
advisory  services, which are provided pursuant to  a  30-year
Services  Agreement entered into between the Company,  certain
of  its  subsidiaries and JMB in November 1988, include making
recommendations  in the following areas: (i) the  construction
and  development of real property; (ii) land  use  and  zoning
changes;  (iii)  the timing and pricing of  properties  to  be
sold;  (iv)  the  timing, type and amount of financing  to  be
incurred;  (v) the agricultural business; and, (vi)  the  uses
(agricultural,  residential, recreational or  commercial)  for
the land. However, the Qualified Allowance shall be earned and
paid for each year prior to maturity of the COLAS only if  the
Company  generates  sufficient  Net  Cash  Flow  to  pay  Base
Interest  to  the  holders of the COLAS for such  year  of  an
amount  equal  to  8%  of  the average  outstanding  principal
balance  of  the  COLAS  for such year;  any  portion  of  the
Qualified  Allowance  not  paid for any  year  shall  cumulate
without interest and JMB or its affiliates shall be paid  such
amount  with respect to any succeeding year, after the payment
of  all  Contingent Base Interest for such year, to the extent
of  100%  of remaining Net Cash Flow until an amount equal  to
20%  of  the Base Interest with respect to such year has  been
paid,  and  thereafter, to the extent of the  product  of  (a)
remaining  Net  Cash Flow, multiplied by (b) a  fraction,  the
numerator of which is the cumulative deficiency as of the  end
of such year in the Qualified Allowance and the denominator of
which is the sum of the cumulative deficiencies as of the  end
of  such year in the Qualified Allowance and Base Interest.  A
Qualified Allowance for 1989 of approximately $6.2 million was
paid  on  February  28, 1990. Approximately $54.4  million  of
Qualified Allowance related to the period from January 1, 1991
through December 31, 1996 has not been earned and paid, and is
payable  only from future Net Cash Flow. Accordingly,  because
the  Company does not believe it is probable at this time that
a  sufficient level of Net Cash Flow will be generated in  the
future to pay Qualified Allowance, the Company has not accrued
for  any  Qualified Allowance in the accompanying consolidated
financial  statements. JMB has informed the  Company  that  no
incremental  costs or expenses have been incurred relating  to
the   provision  of  these  advisory  services.   The  Company
believes  that  using  an  incremental  cost  methodology   is
reasonable.  The following table is a summary of the Qualified
Allowance for the year ended December 31, 1996 (dollars are in
millions):

                                        1996
                                        ----
Qualified Allowance calculated       $  9.2
Qualified Allowance paid                 --
Cumulative deficiency of Qualified
 Allowance at end of year            $ 60.6

The Qualified Allowance for 1997, which will not be calculated
until  the year is completed, is not expected to be paid.  Net
Cash Flow was $0 for 1996 and is expected to be $0 for 1997.

      After  the maturity date of the COLAS, JMB will continue
to   provide  advisory  services  pursuant  to  the   Services
Agreement,  the  Qualified  Allowance  for  such  years   will
continue  to be 1-1/2% per annum of the Fair Market  Value  of
the  gross assets of the Company and its subsidiaries and  the
Qualified  Allowance  will continue to  be  payable  from  the
Company's Net Cash Flow.  Upon the termination of the Services
Agreement, if there has not been sufficient Net Cash  Flow  to
pay  the cumulative deficiency in the Qualified Allowance,  if
any, such amount would not be due or payable to JMB.

      Upon  maturity,  holders of COLAS will  be  entitled  to
receive  the  remaining outstanding principal balance  of  the
COLAS  plus  unpaid  Mandatory Base Interest  plus  additional
interest equal to the unpaid Contingent Base Interest, to  the
extent of the Maturity Market Value, plus 55% of the remaining
Maturity Market Value.

      The  Company continues to implement certain cost savings
measures  and to defer development project costs  and  capital
expenditures for longer-term projects. The Company's  Property
segment  is  anticipated to expend an additional approximately
$14.2  million in project costs during the remainder of  1997.
As  of  March  31,  1997, contractual commitments  related  to
project costs totaled approximately $1.5 million.

     The price of raw sugar that the Company receives is based
upon   the   price  of  domestic  sugar  (less  delivery   and
administrative   costs)  as  currently  controlled   by   U.S.
Government  price  supports legislation.  On  April  4,  1996,
President  Clinton signed the Federal Agriculture  Improvement
and Reform Act of 1996 ("the Act").  The Act, which expires in
2002,  keeps  the loan rate at 18 cents per pound.  The  "loan
rate"  refers  to the minimum sugar price established  by  the
government,  which is supported primarily by  the  setting  of
import  quotas.   In  addition,  if  prices  fall  below  such
minimum,  the  sugar grower is able to receive a  18-cent-per-
pound  loan, using their crop as collateral, and either  repay
the  loan  (with interest) or forfeit the sugar. However,  the
Act  includes  certain other adjustments to the sugar  program
including  making  crop loans recourse  to  the  producer  and
repealing marketing allotments which may over time depress the
domestic  price of raw sugar. There can be no assurance  that,
in  the  future,  the  government price support  will  not  be
reduced  or  eliminated  entirely.  Such  a  reduction  or  an
elimination  of  price supports could have a material  adverse
affect  on the Company's agriculture operations, and  possibly
could  cause  the  Company to evaluate the  cessation  of  its
remaining sugar cane operations.

      The sugar industry in Hawaii has experienced significant
difficulties during the past several years.  Growers in Hawaii
have  struggled with the high costs of production, which  have
led  to  the  closure  of several plantations,  including  the
Company's  sugar operations on Oahu in 1995.  The Company  has
tried  to  address  these  challenges  through  a  number   of
different measures, including a restructuring in 1995, whereby
its  two  Kauai plantations were consolidated and all  of  its
sugar  operations (including the Maui plantation) were changed
to a seasonal mode.

      While  the  above-noted changes have  helped  to  reduce
expenses, the Company must continue to explore alternatives to
further address the high costs of sugar production.  One  such
alternative  relates  to  the three-year  labor  contract  the
Company has with its sugar plantation employees, which expires
in  February  1998.  Within the contract is a  provision  that
allows the Company and the union to renegotiate wages in 1997.
In  light of the difficulties the Company has had in trying to
improve   the   operating  results  of  its  sugar   business,
management  has  been  meeting with union  representatives  to
discuss   appropriate  wage  levels.  After  discussions   and
negotiations  with the union, it was agreed that  wages  would
remain  at  the current levels until the end of the  contract.
This  agreement  is  subject  to  ratification  by  the  union
membership.  The Company and the union have tentatively agreed
to return to the bargaining table during the summer of 1997 to
negotiate  the  terms for a new contract which will  begin  in
1998.  Although  the  Company is hopeful that  it  will  reach
agreement  on  contract modifications that would help  improve
the  viability  of  its sugar plantations,  there  can  be  no
assurance that sufficient changes will be agreed upon.

       In   early   March  1997,  the  Company   announced   a
restructuring  that  has  resulted  in  the  creation  of  six
separate  operating  entities  in  the  following  businesses:
Sugar,  Golf, Coffee, Water, Land Management and  Real  Estate
Development.  Each  separate  company  or  division  will   be
responsible  for its own operations. The Company  believes  it
will    operate   more   effectively   as   several    smaller
entrepreneurial-minded entities, rather  than  as  one  large,
diverse  conglomerate.  Approximately  four  percent  of   the
Company's  total  employees  were  released  as  part  of  the
restructuring,  which is expected to result in annual  payroll
savings  of  approximately $1.1 million. The Company  incurred
termination costs of approximately $.6 million related to  the
restructuring during the first quarter of 1997.

 RESULTS OF OPERATIONS

     GENERAL:

      The Company and its subsidiaries report their taxes as a
part  of  the consolidated tax return of the Company's parent,
Northbrook.  The Company and its subsidiaries entered  into  a
tax   indemnification   agreement   with   Northbrook,   which
indemnifies    the   Company   and   its   subsidiaries    for
responsibility  for all past, present and future  federal  and
state  income tax liabilities (other than income  taxes  which
are  directly  attributable  to cancellation  of  indebtedness
income caused by the repurchase or redemption of securities as
provided for in or contemplated by the Repurchase Agreement).

      Current  and deferred taxes have been allocated  to  the
Company  as  if  the  Company  were  a  separate  taxpayer  in
accordance  with the provisions of SFAS No. 109  -  Accounting
for   Income   Taxes.   However,  to  the   extent   the   tax
indemnification  agreement does not  require  the  Company  to
actually pay income taxes, current taxes payable or receivable
(excluding  income  taxes which are directly  attributable  to
cancellation  of indebtedness income caused by the  repurchase
or redemption of securities as provided for in or contemplated
by  the  Repurchase Agreement) have been reflected  as  deemed
contributions  and distributions, respectively, to  additional
paid-in  capital  in  the accompanying consolidated  financial
statements.

      Accrued  expenses  decreased as of  March  31,  1997  as
compared   to  December  31,  1996,  primarily   due   to   an
approximately  $2.2 million decrease in the  accrual  of  COLA
interest based on the timing of such payments.

     Long-term debt increased as of March 31, 1997 as compared
to  December  31,  1996, due primarily to  approximately  $5.5
million of proceeds received related to the refinancing of the
WGCI loan (see Note 4).

       The  current  portion  of  amounts  due  to  affiliates
increased  as  of March 31, 1997 as compared to  December  31,
1996  due  primarily to approximately $.4 million  of  pension
costs  and  salary-related costs incurred  on  behalf  of  the
Company.

      The  long-term  portion  of amounts  due  to  affiliates
increased  as  of March 31, 1997 as compared to  December  31,
1996,   due  primarily  to  approximately  $10.2  million   of
financing provided by affiliates to fund interest payments and
other operational needs (see Note 2).

     AGRICULTURE:

      The  Company's  Agriculture segment is  responsible  for
activities related to the cultivation, processing and sale  of
sugar  cane  and  other  agricultural products.  Agriculture's
revenues are primarily derived from the Company's sale of  its
raw sugar.

     Inventories increased as of March 31, 1997 as compared to
December  31,  1996 due to the capitalization of approximately
$6.6  million  of planting and other costs and the  timing  of
harvesting of sugar cane.

     Agricultural revenues and cost of sales decreased and the
operating  income decreased for the three months  ended  March
31,  1997 as compared to the three months ended March 31, 1996
due  to the timing of sugar production and related sales.  For
the  three  months ended March 31, 1997, the Company  did  not
harvest or sell any of its sugar cane, which compares  to  the
approximately  12,400 tons sold and 1,600 acres harvested  for
the  three months ended March 31, 1996.  The average price  of
sugar  sold  for  the three months ended March  31,  1996  was
approximately $385 per ton.

      The  Company's sugar plantation subsidiaries sell  their
raw  sugar production to the Hawaiian Sugar and Transportation
Company  ("HSTC"), which is an agricultural cooperative  owned
by  the  major  Hawaii producers of raw sugar  (including  the
Company),  under a marketing agreement.  HSTC  sells  the  raw
sugar  production to the California and Hawaii  Sugar  Company
("C&H") pursuant to a long-term supply contract.  The terms of
the  supply  contract  do not require  a  specified  level  of
production by the Hawaii producers; however, HSTC is obligated
to  sell  and  C&H  is  obligated to purchase  any  raw  sugar
produced.  HSTC  returns to its raw sugar  suppliers  proceeds
based  upon  the  domestic  sugar  price  less  delivery   and
administrative charges.  The Company recognizes  revenues  and
related cost of sales upon delivery of its raw sugar to C&H.

       Reference  is  made  to  the  "Liquidity  and   Capital
Resources" section of "Management's Discussion and Analysis of
Financial   Condition  and  Results  of  Operations"   for   a
discussion of potential uncertainties regarding the  price  of
raw  sugar  and the continuation of the Company's  sugar  cane
operations.

      As  part  of  the Company's agriculture operations,  the
Company  enters into commodities futures contracts and options
in  sugar  as deemed appropriate to reduce the risk of  future
price  fluctuations  in  sugar.  These futures  contracts  and
options  are  accounted for as hedges and, accordingly,  gains
and  losses  are deferred and recognized in cost of  sales  as
part of the production cost.

     PROPERTY:

      The  Company's Property segment is responsible  for  the
following:    land   planning  and   development   activities;
obtaining  land use, zoning and other governmental  approvals;
selling  or financing developed and undeveloped land  parcels;
and  the management and operation of the Company's golf course
facilities.

      For the three months ended March 31, 1997 and 1996,  the
Company  generated approximately $2.9 million and $3.1 million
of  land sales, respectively. For the three months ended March
31,  1997,  non-strategic land parcels on Kauai accounted  for
the  approximately $2.9 million in land sales. For  the  three
months ended March 31, 1996, the Company sold 10 homesites  at
the  Kaanapali  Golf Estates for $2.4 million, which  includes
eight  homesites for approximately $1.4 million to a developer
who  plans  to  construct and sell houses on the  lots.   Non-
strategic land parcels on Kauai and Hawaii accounted  for  the
balance of approximately $.4 million of land sales during  the
first three months of 1996.

     Land and land improvements decreased as of March 31, 1997
compared  to  December 31, 1996 due primarily  to  land  sales
having a cost basis of $3.0 million.

      Other  assets increased as of March 31, 1997 as compared
to  December 31, 1996 primarily due to a long-term  receivable
of  $2.2  million  arising from a land sale during  the  first
quarter of 1997 and deferred costs of $1.6 million related  to
preliminary  planning costs associated with  potential  future
development projects.

       Although  property  sales  decreased,  cost  of   sales
increased  for  the  three  months ended  March  31,  1997  as
compared  to  the three months ended March 31, 1996  primarily
due  to  lower  margins realized on property sold  during  the
first quarter of 1997.

MAUI ACTIVITY

      The planned development of the Company's land on Maui is
expected  to  be  longer term in nature than  the  time  frame
experienced with Waikele.  As Maui is less populated than Oahu
and more dependent on the resort/tourism industry, much of the
Company's land is intended for resort and resort-related uses.
Due  to  overall  economic conditions and trends  in  tourism,
recent  demand  for these land uses has been relatively  weak.
The  Company's currently available homesite inventory on Maui,
which  is  targeted to the second home buyer, has  experienced
slower  sales  activity to date than originally expected.  The
Company's competitors on Maui have also experienced slow sales
activity in the second home market.  The Company is continuing
to evaluate its planned products and the timing of development
of  its  land  holdings in light of the  current  weak  market
demand   and   the   capital  resources  needed   for   future
development.
      The  Company  is  marketing Kaanapali  Golf  Estates,  a
residential  community  that is  part  of  South  Beach  Mauka
adjacent  to  the  Kaanapali Beach Resort in  West  Maui.  The
Company  currently has six homesites on the market, which  are
priced  from  approximately $.4 million  to  $1  million.   In
addition,  the  Company is in the process of  obtaining  final
subdivision approval for a 32 lot subdivision of parcel  "17B"
at  Kaanapali  Golf  Estates.  Fourteen  of  these  lots  were
marketed  earlier  during  the  first  quarter  of  1997   and
reservations have been taken for all 14 lots.  Closing of  the
sale  of  these  lots is pending final subdivision,  which  is
expected  in the second or third quarter of 1997.  The  prices
for the lots are expected to be $.15 million each.

      In 1995, the Company subdivided an ocean front parcel in
Kaanapali  into  six single family homesites of  approximately
one  acre each. Sales of two of the lots in the project closed
in   December   1995,  generating  total  sales  proceeds   of
approximately  $4.1 million.  The Company has entered  into  a
sales  agreement for the four remaining lots. This sale, which
is scheduled to close June 1997, is for $5.2 million.

      In  1986,  the  Company entered  into  a  joint  venture
agreement with Tobishima Pacific Inc. ("Tobishima"), a wholly-
owned  subsidiary of a Japanese company, the purpose of  which
is  to  plan,  manage and develop approximately  96  acres  of
beachfront  property at Kaanapali (known  as  "North  Beach").
The  joint  venture (in which the Company has a 50%  interest)
has  State  land  use  and  County zoning  approvals  for  the
subdivision and development of the infrastructure improvements
necessary  to accommodate up to 3,200 hotel and/or condominium
units  on  this  site.  This North Beach property  constitutes
nearly all of the remaining developable beachfront acreage  at
Kaanapali.    In   October   1992,   the   Company   completed
construction of a 3-acre park on the North Beach  site,  which
is  part  of  the  master plan for this  property  and  was  a
requirement  imposed  by  the  County  in  obtaining   certain
permits.  The development of North Beach continues to be  tied
to  the  completion  of the Lahaina bypass  highway  or  other
traffic  mitigation measures satisfactory to the  Maui  County
Planning Commission.

     The Company is seeking final approvals to develop a time-
share  resort  on  14 acres of the North Beach  property  (the
"Site").  A  land option/purchase agreement was  entered  into
with  Tobishima  in  October 1996.  This agreement  gives  the
Company an option to purchase Tobishima's 50% interest in  the
Site for $7 million. The Company does not expect to consummate
the  purchase  until all discretionary land  use  permits  are
received  for  development  of  the  time-share  resort.    In
accordance  with  the  land  option/purchase  agreement,   the
Company has made a nonrefundable deposit of $.1 million (which
may  be  applied  to the purchase price) to  keep  the  option
available    through   September   30,    1997.     Additional
nonrefundable  deposits  may be  made  to  extend  the  option
through August 31, 2000. On March 12, 1997, the Company  filed
an  application for a special management area use permit  with
the  County of Maui ("SMA Permit") for the time-share  resort.
Although  there  is no assurance that the SMA permit  will  be
received (and that if such permit is received, that its  terms
will  be  acceptable to the Company), management is optimistic
that  the  Company  will  receive the necessary  approvals  to
proceed with the project.

      The Company believes that the potential for a successful
time-share development at North Beach will be greatly enhanced
by  the involvement of a company with past experience in time-
share development, and in the marketing and sale of time-share
intervals  (one week ownership rights). In February 1997,  the
Company formed a limited partnership with an affiliate  of  an
experienced  time-share  development and  management  company.
Known  as  Kaanapali Ownership Resorts L.P., the  new  limited
partnership is owned 85% by affiliates of the Company and  15%
by Kaanapali Partners Limited Partnership, an affiliate of the
owners of the Ridge Tahoe in Nevada.  After receipt of the SMA
permit, the partnership will need to arrange project financing
for  the  development  of the resort. In  addition,  the  land
option/purchase    agreement   includes   short-term    seller
financing, which the partnership may decide to utilize.

      In  February  1996, the Maui County  Council  adopted  a
Community  Plan ordinance for West Maui that does not  include
any  amendments  to the current Community Plan designation  of
the  Company's  North Beach property (thus rejecting  the  CAC
recommendations that two-third's of North Beach  be  downzoned
to  "Park").   The ordinance was signed by the  Mayor  of  the
County of Maui and became effective on February 27, 1996.

      Further, the Department of the Army has determined  that
there  are  two  wetlands sites on the North  Beach  property,
totaling  approximately 21,800 square feet.  The  Company  has
retained  experts  to  evaluate  these  sites  and  to  insure
compliance with all laws.  While there can be no assurances as
to  the  ultimate determinations with respect to the  wetlands
issue,  the Company does not anticipate that these sites  will
materially  adversely affect the development plans  for  North
Beach.

      In  March  1991,  the Company received  final  land  use
approval  from the State for development of approximately  240
residential lots on approximately 125 acres of land  known  as
"South   Beach  Mauka",  located  adjacent  to  the   existing
Kaanapali  Beach  Resort.  In connection with  this  land  use
approval,  the  Company  has agreed to  the  State  policy  of
providing  additional housing on Maui in the affordable  price
range,  and to participating in the funding of the design  and
construction  of  the  planned bypass highway  extending  from
Lahaina  to  Kaanapali.  The  Company  has  entered   into   a
development   agreement   with   the   State   Department   of
Transportation  covering the Company's  participation  in  the
design and construction of the bypass highway development.  It
is anticipated that, upon the receipt of government approvals,
the Company will expend up to $3.5 million (in the aggregate),
of  which  $2.4 million has been spent as of March  31,  1997,
toward the design of the bypass highway and/or the widening of
the existing highway.

      In  connection with the development of North Beach Mauka
and  adjacent parcels, the Company has committed $6.7  million
for the construction of the bypass highway, subject to certain
conditions.  The development and construction  of  the  bypass
highway is expected to be a long-term project that will not be
completed until the year 2004 or later.

     During 1993, the Company obtained final land use approval
from  the State, and certification through the State's Housing
Finance  Development Corporation ("HFDC"), for the development
of  a project on approximately 300 acres of Company land known
as  "Puukolii  Village", which is also located near  Kaanapali
Beach Resort.  In connection with this land use approval,  the
Company has committed to providing additional housing on  Maui
in the affordable price range. The final land use approval and
the  HFDC  development  agreement contain  certain  conditions
which  must  be satisfied in order for the Company to  develop
Puukolii Village, including adding the access road which  will
benefit  uses  for adjacent Company lands in  future  periods.
Moreover, development of certain portions of Puukolii  Village
cannot  commence  until after completion of the  state-planned
Lahaina   bypass  highway  (mentioned  above).  The   proposed
development of Puukolii Village is anticipated to satisfy  the
Company's  affordable housing requirements in connection  with
the  South Beach Mauka land use approval and other development
in the surrounding area. The Company commenced construction of
infrastructure  of  Puukolii Village in the  last  quarter  of
1996, beginning with the access road.

OAHU ACTIVITY

      The Company is currently developing the approximately 60
acres  of  fee  simple land it owns at the mill-site  of  Oahu
Sugar  Company (which was shut down in 1995). The Company  has
received  zoning  for  a light industrial  subdivision  on  an
approximately 37-acre portion of the property, which  excludes
property containing the sugar mill and adjacent buildings.  In
connection with the development of this property, the  Company
has  received state land use urbanization for the  entire  60-
acre  site.  Marketing of parcels within the light  industrial
subdivision  is slated for mid-to-late 1997 after  subdivision
is complete. In addition, the Company has begun the process of
seeking   the   necessary   government   approvals   for   the
redevelopment  for  the  remainder of the  mill-site  parcels,
including planned commercial, public and quasi-public uses.

KAUAI ACTIVITY

      In  June 1994, the Company submitted a Land Use Boundary
Amendment  Petition  with  the  State  of  Hawaii   Land   Use
Commission  ("LUC")  and a General Plan Amendment  Application
with the County of Kauai for the urbanization of approximately
552   acres   of  land  on  Kauai  currently  in  sugar   cane
cultivation.  The proposed project is planned to  be  a  mixed
use  master planned community which will include a variety  of
both  affordable and market rate residential units, commercial
and  industrial projects and a number of community and  public
based  facilities.  The filing of these land use  applications
is  the  first  step required in converting agriculture  zoned
land  into urban zoned land.  There are a number of additional
reports,  studies,  applications  and  permits  that  will  be
required before final land use approvals are obtained.  In May
1995, the County of Kauai approved the Company's General  Plan
Amendment  Application, subject to a number of conditions.  In
December  1995,  the  LUC granted the  Company  the  land  use
amendments  sought  by  the Company subject  to  a  number  of
conditions.   In  May  1996,  the Kauai  County  approved  the
Company's   application  to  rezone   the   project.    Before
construction  can commence, the Company must  satisfy  several
conditions  imposed  during the approval  process  and  obtain
additional administrative development permits for requirements
such  as  grading and subdivision. The permitting  process  in
Hawaii  has  historically been a very  difficult  and  arduous
process  and  there is no guarantee that all permits  will  be
obtained.  Once  construction  commences,  subject  to  market
conditions, the project is expected to span over 20 years.