UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

      |X|Annual report pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

            For the fiscal year ended December 28, 1997, or

      |_|Transition report pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

        For the transition period from _______________ to _______________

                           Commission File No. 1-9510

                               FFP PARTNERS, L.P.
             (Exact name of registrant as specified in its charter)

            Delaware                                      75-2147570
 (State or other jurisdiction of                       (I.R.S. employer
 incorporation or organization)                     identification number)
                2801 Glenda Avenue; Fort Worth, Texas 76117-4391
          (Address of principal executive office, including zip code)

                                  817/838-4700
              (Registrant's telephone number, including area code)


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

        Title of Each Class         Name of Each Exchange on Which Registered

          Class A Units of                 American Stock Exchange
   Limited Partnership Interests

        Unit Purchase Rights               American Stock Exchange
 Securities registered pursuant to

                            Section 12(g) of the Act
                                      None

      Indicate by check mark whether the  registrant:  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.    Yes X     No

      Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]

      The aggregate market value of Class A Units held by  non-affiliates of the
registrant at March 31, 1998, was $3,208,000.  For purposes of this computation,
all officers,  directors,  and  beneficial  owners of 10% or more of the Class A
Units of the registrant are deemed to be affiliates.  Such determination  should
not be deemed an admission that such officers,  directors, and beneficial owners
are affiliates.

                             Class A Units 2,234,262
               (Number of units outstanding as of March 31, 1998)

<PAGE>

                                      Index

                                                                       Page
Part I
   Item 1.  Business                                                     1
   Item 2.  Properties                                                   5
   Item 3.  Legal Proceedings                                            5
   Item 4.  Submission of Matters to a Vote of Security Holders          5

Part II
   Item 5.  Market for the Registrant's Units and Related
              Security Holder Matters                                    6
   Item 6.  Selected Financial and Operating Data                        8
   Item 7.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations                        8
   Item 7A. Quantitative and Qualitative Disclosures About
              Market Risk                                               10
   Item 8.  Financial Statements and Supplementary Data                 10
   Item 9.  Changes in and Disagreements with Accountants on
              Accounting and Financial Disclosure                       10

Part III
   Item 10. Directors and Executive Officers of the Registrant          11
   Item 11. Executive Compensation                                      13
   Item 12. Security Ownership of Certain Beneficial Owners
              and Management                                            16
   Item 13. Certain Relationships and Related Transactions              17

Part IV
   Item 14. Exhibits, Financial Statements, Schedules and
              Reports on Form  8-K                                      21
Signatures                                                              23


<PAGE>

                                     PART I

Item 1.  Business.

General Background

            FFP Partners,  L.P.  ("FFPLP" or the "Company"),  a Delaware limited
partnership,  was formed in December 1986,  pursuant to the Agreement of Limited
Partnership  of FFP  Partners,  L.P.  (the  "Partnership  Agreement"),  with FFP
Partners Management Company, Inc. ("FFPMC") as its general partner. In May 1987,
FFPLP  purchased  convenience  stores,  truck  stops,  other  retail  motor fuel
outlets,  and ancillary  businesses from affiliates of its general partner.  The
purchase of these  outlets  was  completed  in  conjunction  with the  Company's
initial public offering of Class A Units of limited  partnership  interest.  The
senior executives of the Company had owned and managed these operations prior to
their  acquisition  by FFPLP,  and,  through its  subsidiaries,  FFPLP owned and
operated them, and other businesses, until December 1997.

            In December 1997,  FFPLP completed a restructuring by which the real
estate used in the aforementioned  retail operations was retained by FFPLP while
the convenience  store,  truck stop, other retail motor fuel outlets,  and other
businesses it conducted were  transferred to FFP Marketing  Company,  Inc. ("FFP
Marketing"),  in exchange for all the common stock of FFP Marketing.  The common
stock of FFP Marketing was then  distributed to the general  partner and limited
partners of FFPLP.

            The real estate retained by FFPLP was contributed to FFP Properties,
L.P. ("FFP Properties"),  a newly formed Texas limited partnership,  in exchange
for the general partnership interest in FFP Properties.  The limited partnership
interests in FFPLP held by John H.  Harvison,  the Chairman and Chief  Executive
Officer of FFPMC, members of his family, and corporations, partnerships, trusts,
and  other  business  entities   affiliated  with  him  or  his  family  members
(collectively, the "Harvison Family") were exchanged for economically equivalent
limited  partnership  interests in FFP  Properties,  L.P. In addition,  FFP Real
Estate Trust, a newly formed Texas real estate  investment  trust that is wholly
owned by FFPMC, became the general partner of FFPLP.

             By  virture  of  this  restructuring,  all of the  non-real  estate
operating  activities of FFPLP were  transferred to FFP Marketing and the future
business of FFPLP will consist of the ownership and rental of real estate.

            Unless the context requires otherwise, references herein to FFPLP or
the Company  include its subsidiary and its general  partner.  References to FFP
Marketing include its subsidiaries.

            The Company maintains its principal executive offices at 2801 Glenda
Avenue, Fort Worth, Texas 76117-4391; its telephone number is 817.838.4700;  its
Internet web site is at http://www.ffplp.com.

Business Strategy

            FFPLP  intends  to  expand  its real  estate  holdings  through  the
acquisition  of pad retail sites  (including  convenience  stores,  truck stops,
fast-food restaurants,  and other retail outlets) and other real estate. Some of
the real  estate  acquired  may be  leased to FFP  Marketing  but it may also be
leased to other parties. Although FFPLP will consider investments in any type of
real  estate,  it is  anticipated  that  most  initial  investments  will  be in
convenience  store  locations  since most of the Company's  contacts are in that
industry and it has an in-depth  knowledge of the economics of those operations.
In addition,  FFPLP  expects that most real estate  acquired  will be in smaller
communities  and  towns.  The  Company  believes  that the larger  providers  of
financing  for pad retail  sites and other  real  estate  concentrate  on larger
metropolitan  areas.  Consequently,  the Company  believes it can obtain  better
yields on  investments  in smaller  towns since there is less  competition  from
other sources of financing.

            FFPLP also intends to pursue  conversion to a real estate investment
trust for federal  income tax  purposes.  Such a  conversion  may occur  through
either a "merger" or an "exchange"  alternative.  In either  alternative,  FFPLP
unitholders  would  receive  shares of FFP Real  Estate  Trust in place of their
FFPLP units and the FFP Real Estate Trust shares would be listed on a securities
exchange.

            If FFPLP  is able to  obtain a  ruling  from  the  Internal  Revenue
Service  ("IRS")  that a merger of FFPLP and and its general  partner,  FFP Real
Estate  Trust,  would  be  tax-free  to  FFPLP  unitholders,   then  the  merger
alternative would be used. Under the merger  alternative,  FFPLP would be merged
into its  general  partner,  FFP  Real  Estate  Trust,  with  FFPLP  unitholders
receiving shares of FFP Real Estate Trust in exchange for their units of FFPLP.

            If FFPLP is not able to obtain a  favorable  ruling  from the IRS on
the merger alternative,  then it could convert to a real estate investment trust
under  the  exchange  alternative.   Under  the  exchange   alternative,   FFPLP
unitholders would be prohibited from  transferring  their units to a third party
but would be able to  require  FFPLP's  general  partner to redeem the units for
either shares of FFP Real Estate Trust or cash.  FFP Real Estate Trust,  not the
FFPLP  unitholder,  would determine whether to redeem the FFPLP units for shares
or cash and it is expected that the redemption would be made in exchange for FFP
Real Estate Trust shares.

            FFPLP  anticipates  requesting a revenue  ruling from the IRS on the
merger  alternative  within  the first  half of 1998.  However,  there can be no
assurance  that the IRS will  respond  favorably  to the  request  or about  the
time-frame within which it will respond.

Competition

            Numerous  entities  and  individuals,  many of  which  have  greater
financial resources than does FFPLP,  compete with it to acquire real estate for
use by  convenience  stores,  truck stops,  and other retail  activities.  These
entities  may be able to accept  more risk than FFPLP is  willing to  undertake.
Competition  generally may increase the  bargaining  power of owners  seeking to
sell  their   properties,   may  reduce  the  number  of   suitable   investment
opportunities  available to FFPLP,  and may decrease the yield achievable on any
real estate purchases by FFPLP.

Employees

            At March 31, 1998, FFP Real Estate Trust,  general partner of FFPLP,
had two  executive  officers,  both of whom  hold  similar  positions  with  FFP
Marketing. FFP Real Estate Trust has entered into a reimbursement agreement with
FFP Marketing  pursuant to which FFP Marketing will be reimbursed for all of its
direct and indirect costs allocable to the management of FFPLP. Neither FFP Real
Estate Trust nor FFPLP have any employees.

Government Regulation -- Environmental Regulation

            Substantially  all the  properties  leased by FFPLP to FFP Marketing
contain  underground  storage  tanks  used for the  storage of motor  fuel.  The
underground  storage  tanks are  owned and  operated  by FFP  Marketing  and FFP
Marketing is  responsible  for  compliance  with all  enviornmental  regulations
regarding  such tanks.  However,  if for any reason FFP  Marketing  is unable or
unwilling  to take all  actions  that may be  required  under  current or future
environmental   regulations   regarding   underground  storage  tanks  or  other
activities, FFPLP could be required to take such actions.

            FFPLP  anticipates  that any additional  properties that it acquires
will be subject to similar environmental  regulations,  either because they will
also  contain  underground  storage  tanks or for  other  reasons,  and that the
lessees  of such  properties  will  be  responsible  for  compliance  with  such
environmental regulations.

Federal Income Tax Law

            As a publicly traded partnership,  FFPLP pays no federal income tax.
Rather,  the income or loss of FFPLP is allocated to its partners to be included
in their respective tax returns. In addition,  (i) the passive loss rules of the
Internal Revenue Code are applied  separately with respect to items attributable
to each publicly  traded  partnership  and (ii) net income from publicly  traded
partnerships is not treated as passive income.

            At such time as FFPLP might  become a real estate  investment  trust
for federal  income tax purpose {see  Business  Strategy},  its earnings will no
longer be allocated to its partners but it will not, as an entity,  generally be
subject to federal  income  tax.  However,  it will be  required  to comply with
various complex requirements which limit the nature of its assets and sources of
its income.  In  addition,  it will be required  to  distribute  annually to its
sharehlders  at least 95% of its real estate  investment  trust taxable  income.
Differences in timing  between the actual receipt of income,  the actual payment
of deductible  expenses in arriving at taxable income, the creation of reserves,
and required  debt  amortization  payments  could  require the Company to borrow
funds to meet the 95% distribution  requirement even if management believed that
the then prevailing market conditions were not favoarable for such borrowings or
that  the   borrowings   were  not   advisable   in  the  absence  of  such  tax
considerations.

Forward-Looking Statements

            Certain of the  statements  made in this report are  forward-looking
statements  that involve a number of risks and  uncertainties.  Statements  that
should generally be considered  forward-looking include, but are not limited to,
those  that  contain  the words  "estimate,"  "anticipate,"  "in the  opinion of
management," "believes," and similar phrases. Although the Company believes that
the  expectations  reflected in such  forward-looking  statements are based upon
reasonable  assumptions,  the Company's  actual results could differ  materially
from those set forth in the forward-looking  statements.  Among the factors that
could  cause  actual  results  to  differ  materially  from the  forward-looking
statements  made  include  the  following:  changes in real  estate  conditions,
including  rental  rates  and the  construction  or  availability  of  competing
properties;  changes in the  industry in which  FFPLP's  sole  tenant  competes;
changes in general  economic  conditions;  the ability of management to identify
acquisitions  and  investment   opportunities  meeting  the  FFPLP's  investment
objectives;  the timely leasing of unoccupied  properties;  timely  releasing of
currently  occupied  properties  upon  expiration  of the current  leases or the
default  of  the  current  tenant;  the  Company's  ability  to  generate  funds
sufficient to meet its debt service payments and other operating  expenses;  the
inability of FFPLP to control the management and operation of its tenant and the
businesses conducted on the Company's properties; financing risks, including the
availability  of funds to  service  or  refinance  existing  debt and to finance
acquisitions of additional  property,  changes in interest rates associated with
its variable rate debt; the possibility that the Company's  existing debt (which
requires a so-called  "balloon"  payment of  principal)  may be  refinanced at a
higher  interest rate or on other terms less favorable to FFPLP than at present;
the existence of complex tax regulations  relating to the Company's  status as a
publicly-traded  real estate  partnership  and, if achieved,  to its status as a
real  estate  investment  trust and the adverse  consequences  of the failure to
qualify as such; and other risks  detailed from time to time in FFPLP's  filings
with the Securities and Exchange Commission. Given these uncertainties,  readers
are cautioned not to place undue reliance on the forward-looking statements. The
Company  undertakes  no  obligation  to  publicly  release  the  results  of any
revisions to these  forward-looking  statements  that may be made to reflect any
future events or circumstances.

<PAGE>

Item 2. Properties.

            The real  estate  owned by FFPLP is being  leased to FFP  Marketing.
This real estate is comprised of 78 parcels of land, together will the buildings
thereon,  and 105  buildings on land leased by FFP  Marketing  from the Harvison
Family.  The leases  covering the real estate where FFPLP owns both the land and
building generally expire in December 2002 with two five-year renewal periods at
the sole option of FFP  Marketing.  If the leases are renewed,  the rent will be
adjusted by the change in the consumer  price index from January 1, 1998, to the
date of renewal.  The leases  covering  the  buildings  that are located on land
leased from the Harvison Family terminate  concurrently with the underlying land
lease (generally,  May 2002) and contain renewal provisions  consistent with the
underlying land lease.

            The  rental  rates  for all the real  estate  leased by FFPLP to FFP
Marketing were  determined by FFPLP based on its knowledge of the properties and
the  general  experience  of its  management  in acting as lessor and lessee for
similar  properties.  FFPLP believes that the rental rates paid by FFP Marketing
are a fair rental value.  However,  neither FFPLP nor FFP Marketing  engaged any
third party  advisors  or  referred  to any third  party  surveys or analyses of
rental rates in making this determination.


Item 3.  Legal Proceedings.

            None.


Item 4.  Submission of Matters to a Vote of Security Holders.

            On  December  26,  1997,   FFPLP  held  a  special  meeting  of  its
unitholders to consider  approval of the  restructuring of FFPLP discussed under
Business - General  Background,  above. At the meeting,  2,200,163 units (59.4%)
voted for the  restructuring  proposal,  37,578 units  (1.0%) voted  against the
restructuring proposal,  3,675 units (0.1%) abstained from voting, and 1,462,789
(39.5%) units did not vote.  The  restructuring  proposal was covered by a proxy
statement  dated  December  11,  1997,  filed by FFPLP with the  Securities  and
Exchange  Commission and distributed to its unitholders of record as of December
5, 1997.

<PAGE>

                                     PART II


Item 5.  Market for the Registrant's Units and Related Security Holder Matters.

            The Class A Units of FFPLP are listed for trading on the  American
Stock Exchange  (symbol  "FFP").  At April 2, 1998,  there were 189 holders of
record  of the Class A Units.  {See Item 12.  Security  Ownership  of  Certain
Beneficial Owners and Management.}

            In  August  1989,   FFPLP  entered  into  a  Rights   Agreement  and
distributed  to  its   Unitholders   Rights  to  purchase  Units  under  certain
circumstances.  Initially  the Rights  were  attached  to all Unit  Certificates
representing  Units then  outstanding and no separate Rights  Certificates  were
distributed.  Under the Rights  Agreement,  the Rights were to separate from the
Units and be distributed to Unitholders  following a public  announcement that a
person or group of affiliated or associated persons (an "Acquiring  Person") had
acquired, or obtained a right to acquire, beneficial ownership of 20% or more of
Class A Units of FFPLP or all classes of outstanding Units. On August 8, 1994, a
group of Unitholders announced that they had an informal understanding that they
would vote their Units together as a block. The agreement  related to units that
constituted approximately 25% of the Class A Units then outstanding.  Therefore,
the Rights  became  exercisable  on October  7,  1994,  the record  date for the
issuance of the Rights Certificates (the "Distribution Date").

            The Rights  currently  represent the right to purchase a Rights Unit
(which  is  substantially  equivalent  to a Class A Unit) of FFPLP at a price of
$20.00 per Unit.  However,  the Rights Agreement  provides,  among other things,
that if any person  acquires  30% or more of the Class A Units or of all classes
of  outstanding  Units  then each  holder of a Right,  other  than an  Acquiring
Person,  will have the right to  receive,  upon  exercise,  Rights  Units (or in
certain  circumstances,  other property)  having a value of $40.00 per Unit. The
Rights  will  expire on August 13,  1999,  and do not have any voting  rights or
rights to cash distributions.

            The  following  table  sets  forth  the  range of high and low sales
prices for the Class A Units of FFPLP as reported on the American Stock Exchange
for the periods indicated:

                                                High         Low
                                                     Dollars
        1996
          First Quarter                           8        6 3/16
          Second Quarter                       7 13/16        6
          Third Quarter                         7 5/8         6
          Fourth Quarter                       7 7/16       5 1/8
        1997
          First Quarter                        5-13/16      4-1/4
          Second Quarter                        5-1/8      3-9/16
          Third Quarter                        4-15/16      3-3/8
          Fourth Quarter                        4-1/4      3-1/16

            Following  the  restructuring  of FFPLP in December  1997  discussed
earlier in this  report and the related  distribution  of FFP  Marketing  common
stock to FFPLP's  unitholders,  the price of FFPLP's Class A Units  reflects the
restructuring.  From January 14, 1998 (the date on which FFPLP Class A Units and
FFP Marketing  common stock began trading  separately),  through March 31, 1998,
FFPLP Class A Units have traded at prices ranging from $1-5/16 to $1-7/8.

            The following table sets forth the  distributions  declared and paid
by FFPLP in 1996:
                                                      Amount per
                                                     Class A and
             Record Date         Date Paid          Class B Unit
           April 10, 1996     April 24, 1996            $0.205
           August 27, 1996    September 11, 1996         0.210

            No distributions were paid in 1997.

            Distributions  in the future will be  dependent  upon the level of
earnings  and cash flow of FFPLP,  expenditures  to  acquire  additional  real
estate,   and   requirements   for  servicing   FFPLP's  debt.  {See  Item  7.
Management's  Discussion  and Analysis of Financial  Condition  and Results of
Operations, Liquidity and Capital Resources.}

<PAGE>

Item 6.  Selected Financial and Operating Data.

                                               December 28, 1997
                                                 (In thousands)

Real property                                      $27,517
Accumulated depreciation                            (9,374)
Real property, net                                 $18,143

Current installments of long-term debt              $1,208
Long-term debt, excluding current installmaent      14,730
Total debt                                         $15,938

Item 7.  Management's Discussion and Analysis of Financial Condition and
       Results of Operations.


General

            This  discussion  should be read in conjunction  with the selected
financial and  operating  data,  the  description  of the  Company's  business
operations,  and the  financial  statements  and related  notes and  schedules
included  elsewhere in this Annual Report on Form 10-K.  {See Item 1. Business
- Forward-Looking Statements.}

            Concurrently with the close of its 1997 fiscal year, FFPLP completed
a  restructuring  in which the real estate used in its former retail  operations
was retained by it while all its other assets and businesses were transferred to
FFP Marketing Company, Inc. In addition to retaining the real estate referred to
above, FFPLP also retained certain liabilities,  principally bank debt and other
debt secured by the real estate retained by it. All other liabilities (including
trade  accounts  payable and accrued  expenes,  money orders  payable,  deferred
income taxes,  and  obligations  under capital  leases) were  transferred to FFP
Marketing.

            Accordingly,  FFPLP's  business  going  forward  will consist of the
leasing and management of its current real estate  holdings and the  acquisition
of additional real properties.

Liquidity and Capital Resources

            In connection  with the December 1997  restructuring  of FFPLP,  the
real estate used in its retail operations was retained by FFPLP,  along with the
year end balances due under a bank revolving  credit  facility  ($7,439,000),  a
bank term loan ($7,905,000), and other debt ($594,000) securing the real estate.
All other businesses,  assets and liabilities were transferred to FFP Marketing.
However,  subsidiaries  of FFP  Marketing  remain liable on the debt retained by
FFPLP, pending its refinancing, and could be required to repay the debt if FFPLP
is unable to do so.  Accordingly,  FFPLP has indemnified  FFP Marketing  against
this liability and has granted to FFP Marketing the right to offset any payments
FFP  Marketing  might be required to make on the debt  retained by FFPLP against
any amounts otherwise due to FFPLP by FFP Marketing.

            Although  FFPLP  retained the liability for the $7,439,000 due under
the  revolving  credit line portion of the bank debt at the date of the December
1997  restructuring,  FFP Marketing  retains  availability  under this revolving
credit  facility.  The  revolving  credit line  provides  for  borrowings  up to
$15,000,000,  with the amount  available at any time related to a borrowing base
comprised of FFP Marketing's  trade  receivables and inventories.  To the extent
that  borrowings  under this credit  facility fall below the $7,439,000  balance
retained by FFPLP they are treated as loans by FFP  Marketing to FFPLP and FFPLP
will pay interest to FFP  Marketing on such amounts at the lender's  prime rate,
which is same  rate that is  payable  to the  lender.  FFP  Marketing  bears the
interest cost on any balances  under the revolving  credit  facility that exceed
the $7,439,000 amount.

            The  revolving  credit  facility  and the bank  term  loan both bear
interest at the lender's  prime rate,  payable  monthly;  the term loan requires
monthly principal  payments of $95,000;  and both loans mature in November 2000.
The loans are subject to a Loan and  Security  Agreement  among FFP Partners and
two companies that prior to the December 1997 restructuring were subsidiaries of
FFP Partners but are now subsidiaries of FFP Marketing.  The agreement  contains
various  restrictive  convenants  including  financial covenants relating to the
maintenance  of a specified  minimum  tangible net worth, a debt to tangible net
worth ratio, and a cash flow coverage ratio, all as defined in the agreement. As
a result of the  restructuring,  these ratios are calculated on a combined basis
for FFPLP and FFP  Marketing.  The loans  under the  agreement  are secured by a
negative pledge of the assets of FFPLP. They are also secured by FFP Marketing's
trade  accounts  receivable,   inventories,  and  its  equipment  not  otherwise
encumbered, and by a negative pledge of its other assets.

            FFPLP expects to refinance the bank and other debt during 1998.  FFP
Marketing will have no liability for the obligations that refinance the existing
debt.

            In addition to refinancing  the existing  debt,  FFPLP is seeking to
obtain  funds to expand  its real  estate  assets and has had  discussions  with
various  lenders who have  expressed  an interest in providing  such  financing.
However,  the Company has not yet received any formal proposals to refinance the
current debt or to fund the acquisition of additional properties.

"Year 2000" Computer Issues

            FFPLP  uses a various  computer  software  programs  to  manage  its
properties.  The  functioning of such software is subject to problems if it does
not  properly  interpret  dates in the  year  2000 and  beyond.  Software  which
properly  handles dates  beginning in 2000 is said to be "year 2000  compliant."
FFPLP's principal  accounting and management  information  software is currently
year  2000  compliant,  as is  its  computer  networking  and  operating  system
software.  The Company believes the cost to modify any incidental  software that
it uses to make it year 2000 compliant, or to replace such software, will not be
material.

            FFPLP is also dependent  upon software used in  conjunction  with or
provided  by  third  parties,   such  as  its  banks  and  various  governmental
authorities that levy taxes on real property. While the direct cost of rendering
any such software year 2000 compliant will be borne by others, there could be an
adverse impact on the Company's  operations if the necessary  modifications  are
not made in a timely manner. The third parties involved are large, sophisticated
organizations  that the Company  believes  are  responsible  in  managing  their
businesses and business relationships and, accordingly,  believes that they will
take appropriate steps to make their systems year 2000 compliant.  However,  the
Company  is in the  process  of  determining  if  such  software  is  year  2000
compliant, and, if not, the timetable of the respective third parties to make it
compliant and will monitor their progress in doing so.


Item 7A.  Quantitative and Qualitative Disclosures About Market Risk.

            Not applicable.


Item 8.  Financial Statements and Supplementary Data.

            The financial statements and supplementary data filed herewith begin
on page F-1.


Item 9.  Changes in and Disagreements with Accountants on Accounting and
       Financial Disclosure.

            There were no changes in, nor disagreements with, accountants during
1997.

<PAGE>

                                    PART III


Item 10.  Directors and Executive Officers of the Registrant.

General Partner

            FFP Real Estate Trust (the "General  Partner"),  a Texas real estate
investment  trust formed in December 1997, is the general partner of and manages
the affairs and business of FFPLP.  FFP Real Estate Trust succeeded FFP Partners
Management  Company,  Inc.,  as the  general  partner  in  conjunction  with the
restructuring  of FFPLP that occurred in December 1997. The Unitholders  have no
power,  as limited  partners,  to direct,  or participate in the control of, the
business of FFPLP.

Management of the General Partner

            Set  forth  below  are the  names,  ages,  positions,  and  business
experience  of the  executive  officers  and trust  managers  of FFP Real Estate
Trust:

                 Name               Age              Position
       John H. Harvison             64     Chairman of the Board of Trust
                                             Managers, President, and
                                             Chief Executive Officer
       Steven B. Hawkins            50     Vice President - Finance and
                                             Administration, Secretary,
                                             Treasurer, and Chief Financial
                                             Officer
       Robert E. Garrison, II [1]   56     Trust Manager
       Joseph F. Leonardo [1]       51     Trust Manager
       J. D. St.Clair               63     Trust Manager
       Randall W. Harvison          40     Trust Manager
--------------------------------
[1]  Member of Audit Committee

            John H. Harvison has been  Chairman of the Board of FFPLP's  general
partner since the commencement of FFPLP's operations in May 1987; he is also the
Chairman  of the Board and Chief  Executive  Officer of FFP  Marketing  Company,
Inc., which leases all the real estate owned by FFPLP. Mr. Harvison is a founder
and an executive  officer of each of the  companies  from which FFPLP  initially
acquired  the retail  outlets  that were  transferred  to FFP  Marketing  in the
December 1997  restructuring of FFPLP. He has been active in the retail gasoline
business  since  1958 and in the  convenience  store  business  since  1973.  In
addition,  he has been involved in oil and gas exploration  and production,  the
ownership and management of an oil refinery and other personal  investments.  In
January 1995, Mr. Harvison consented to the entry of a cease and desist order by
the  United  States  Office of Thrift  Supervision  that,  among  other  things,
prohibits him from  participating in any manner in the conduct of the affairs of
federally insured depository  institutions.  This Order was issued in connection
with Mr. Harvison's ownership in a federal savings bank and transactions between
him (and companies in which he had an ownership  interest) and that institution.
In  consenting to the issuance of the Order,  Mr.  Harvison did not admit any of
the allegations against him and consented to the issuance of the Order solely to
avoid the cost and distraction  that would be caused by prolonged  litigation to
contest the positions taken by the Office of Thrift Supervision. Mr. Harvison is
the father of Randall W.  Harvison,  who is also a Trust  Manager of the General
Partner.

            Steven  B.   Hawkins   has  been  Vice   President   -  Finance  and
Administration,  Secretary,  and Treasurer of FFPLP's  general partner since May
1987.  He is also the Vice  President  - Finance  and  Administration  and Chief
Financial  Officer of FFP  Marketing  Company,  Inc.,  which leases all the real
estate owned by FFPLP.  From April 1980 through  December  1987, Mr. Hawkins was
employed  as  Secretary/Treasurer,  Controller  and Chief  Financial  Officer by
various companies  affiliated  through common ownership with the General Partner
and the former general partner of FFPLP.  Prior to joining such affiliates,  Mr.
Hawkins was employed for nine years by Arthur  Andersen & Co., an  international
public  accounting  firm.  He is a member  of both  the  American  Institute  of
Certified Public Accountants and the Texas Society of CPAs.

            Robert E.  Garrison,  II, was a director of FFPLP's  former  general
partner from May 1987 until the December  1997  restructuring  of FFPLP.  He was
elected to the Board of Trust  Managers  of FFP Real  Estate  Trust in  December
1997. Mr. Garrison is a managing partner of Harris, Webb & Garrison,  a regional
merchant and investment  bank, and is also Chairman and Chief Executive  Officer
of Pinnacle Management & Trust Co., a state chartered independent trust company.
From October 1992 through February 1994, Mr. Garrison was Chairman of Healthcare
Capital  Group,  Inc., a regional  investment  bank  focusing on the health care
industry.  From April 1991 through  October 1992, Mr.  Garrison was Chairman and
Chief  Executive  Officer  of Med  Center  Bank  &  Trust,  one  of the  leading
independent  banks in  Houston,  Texas.  Mr.  Garrison  served as  President  of
Iroquois  Brands,   Ltd.  ("IBL"),  a  manufacturer  of  material  handling  and
construction equipment,  pharmaceutical and personal care products, and operator
of  convenience  stores and retail fuel outlets in the United  Kingdom from 1989
until  September  1990.  From 1982 through March 1989,  Mr.  Garrison  served as
Executive Vice President and director of Lovett  Mitchell Webb & Garrison,  Inc.
("LMW&G"),  one of the representatives of the underwriters in the initial public
offering of the Company in May 1987,  where he managed the  Investment  Research
and Investment Banking Division,  and Boettcher & Company,  Inc., which acquired
LMW&G in  September  1987.  From  1971 to 1982,  Mr.  Garrison  was  First  Vice
President and Director of Institutional Research at Underwood Neuhaus & Co. From
1969 to 1971,  Mr.  Garrison  was Vice  President  of BDSI,  a  venture  capital
subsidiary of General Electric.

            Joseph F. Leonardo was elected to the Board of Trust Managers of FFP
Real Estate Trust in December  1997.  Since August 1992,  Mr.  Leonardo has been
President and Chief Executive Officer of Leonardo Management Corporation,  which
provide strategic planning,  market  positioning,  and other sales and marketing
consulting  services.  Mr. Leonardo also operates  Convenience  Directions which
publishes Info  Marketing,  a convenience  store industry  newsletter.  Prior to
forming Leonardo Management,  Mr. Leonardo served in various executive positions
with several convenience store operators.

            J. D. St.Clair was a director of FFPLP's former general partner from
May 1987 until the December 1997  restructuring  of FFPLP. He was elected to the
Board of Trust Managers of FFP Real Estate Trust in December 1997. Mr.  St.Clair
is also a director of FFP  Marketing  Company,  Inc.,  which leases all the real
estate  owned  by  FFPLP,  and  has  been  Vice  President  -  Fuel  Supply  and
Distribution of FFP Marketing, and its predecessor, since May 1987. Mr. St.Clair
is a founder and an  executive  officer of several of the  companies  from which
FFPLP  initially  acquired  the  retail  outlets  that were  transferred  to FFP
Marketing in the December 1997  restructuring  of FFPLP. He has been involved in
the retail gasoline  marketing and convenience  store business since 1971. Prior
to 1971, Mr. St.Clair performed operations research and system analysis for Bell
Helicopter,  Inc.,  from 1967 to 1971;  for the National  Aeronautics  and Space
Administration  from 1962 to 1967;  and Western  Electric  Company  from 1957 to
1962.

            Randall W.  Harvison  was elected to the Board of Trust  Managers in
December 1997. He is an attorney and has been engaged in a solo practice in Fort
Worth,  Texas, since 1994. Since 1987, Mr. Harvsion has also been an employee of
a subsidiary  of FFP  Marketing (a former  subisidiary  of FFPLP) and of various
companies  controlled  by the  Harvison  Family  that are engaged in real estate
investment and management and other investment  activities.  Randall W. Harvison
is the son of John H. Harvison, the Chairman of the Board of Trust Managers.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

            Regulations issued under the Securities Exchange Act of 1934 require
certain  persons to report their  holdings of the Company's  Class A and Class B
Units to the Securities and Exchange  Commission ("SEC") and to the Company.  To
the best of the  Company's  knowledge,  based upon  copies of reports  and other
representations provided to the Company, all 1997 reports required under Section
16 of the  Securities  Exchange Act of 1934 were filed in a timely manner except
that the following reports were filed late: (i) report for the month of December
setting forth the year-end holdings for Robert E. Garrison,  II; (ii) report for
the month of December  setting  forth the  year-end  holdings and changes in the
price of options to acquire Class A Units due to the December 1997 restructuring
of FFPLP for Steven B.  Hawkins;  (iii)  report for the month of  December  1997
reporting the initial holdings for Joseph F. Leonardo; (iv) report for the month
of December 1997  reporting the  disposition  of Class A Units and Class B Units
and  changes in the price of options  to acquire  Class A Units,  all due to the
December  1997  restructuring  of  FFPLP,  for  John H.  Harvison  and for J. D.
St.Clair;  and  (v)  report  for  the  month  of  December  1997  reporting  the
disposition  of  Class  A Units  and  Class B  Units  due to the  December  1997
restructuring of FFPLP for Randall W. Harvison.


Item 11.  Executive Compensation.

            The Company reimburses its general partner for all of its direct and
indirect  costs  (principally  officers'  compensation  and  other  general  and
administrative costs) allocable to the Company.

            Each trust  manager who is not an officer or employee of the general
partner or the  Company  receives  an annual  retainer of $4,000 plus $1,000 for
each Board meeting,  or committee  meeting not held in conjunction  with a Board
meeting,  which he  attends  and $500 for  each  telephone  meeting  in which he
participates.   Each  director  is  also  reimbursed  for  expenses  related  to
attendance at board meetings.

            In  addition,  non-employee  trust  managers are  generally  granted
options  to  acquire  25,000  Class A Units  at the  fair  market  value  of the
underlying  units on the date of grant.  The  options  become  exercisable  with
respect to one-third  of the units  covered  thereby on each of the  anniversary
dates  following  the grant and expire ten years after grant.  In the event of a
change in control of the Company, any unexercisable  portion of the options will
become immediately exercisable.  Upon exercise, the option price may be paid, in
whole or in part, in Class A Units owned by the trust manager.

            Trust managers who are officers or employees of the general  partner
or the Company  receive no additional  compensation  for  attendance at Board or
committee meetings.

Summary Compensation Table

            The following table provides information regarding compensation paid
during each of FFPLP's last three fiscal  years to its general  partner's  Chief
Executive  Officer and to each other  executive  officer  who earned  salary and
bonus of more than  $100,000 in the latest  fiscal  year.  The amounts  reported
below are the payments made to officers of FFPLP's  former general  partner.  In
connection  with the December 1997  restructuring  of FFPLP,  the former general
partner was replaced by FFP Real Estate  Trust.  Mr.  Harvison is the  Chairman,
President, and Chief Executive Officer of FFP Real Estate Trust.

                           Summary Compensation Table
                                                     Annual Compensation
                                                     -------------------
                                                                  Other
                                                                  Annual
                                                                  Compen-
     Name and Principal Position          Year        Salary      sation

John H. Harvison                          1997       $135,000        -
Chairman and Chief Executive Officer      1996        137,597[1]     -
                                          1995        135,000        -

Robert J. Byrnes [2]                      1997       $135,000        -
President, Chief Operating Officer        1996        137,597[1]     -
  and Director                            1995        135,000        -

--------------------
[1]The annual  salaries  did not change from 1995 to 1996.  The Company pays its
   employees  on a weekly  basis and there were 53 pay periods in 1996 vs 52 pay
   periods in 1997 and 1995.

[2]In connection with the December 1997  restructuring of FFPLP, FFP Real Estate
   Trust became the general partner of FFPLP. Mr. Byrnes is not a trust manager,
   officer,  or  employee  of FFP Real  Estate  Trust.  There were no  long-term
   compensation awards or payouts during any of the last three years.

            FFP Real  Estate  Trust,  the  general  partner  of  FFPLP,  and FFP
Marketing have entered into a reimbursement agreement pursuant to which FFP Real
Estate Trust will  reimburse  FFP  Marketing  for all direct and indirect  costs
(principally  officers' compensation and other general and administrative costs)
paid  by FFP  Marketing  that  are  allocable  to FFP  Real  Estate  Trust.  The
reimbursement  for  officers'  compensation  costs  incurred by FFP Marketing in
connection  with FFP Real Estate  Trust's  activities  will be determined by the
amount of time  management and other  personnel  spend on activities of FFP Real
Estate  Trust  compared  to the amount of time they spend on  activities  of FFP
Marketing.  Since  FFP Real  Estate  Trust's  only  activity  is to serve as the
general partner of FFPLP, all of FFP Real Estate Trust's costs and expenses will
be borne by  FFPLP.  The costs to be  reimbursed  to FFP  Marketing  by FFP Real
Estate Trust for 1998 are expected to be approximately $200,000.

            Options  Exercised  during  Fiscal  1997 and Fiscal  Year End Option
Values. All options held by directors,  officers, and employees to acquire Class
A Units of FFPLP that were  outstanding  at the  completion of the December 1997
restructuring  of FFPLP were divided into separate  options to purchase  Class A
Units of FFPLP and a like number of FFP Marketing  common  shares.  The exercise
price for the  existing  FFPLP unit  options  was  divided  between  the two new
options  in  proportion  to the  average  closing  price on the  American  Stock
Exchange of FFPLP Class A Units and FFP Marketing common shares during the first
month of trading following completion of the restructuring.

            The following table provides  information  about options to purchase
FFPLP  Class A Units  exercised  during  the last  fiscal  year and the value of
unexercised  options to purchase  FFPLP units held at the end of the fiscal year
by the named executive officers:

             Aggregated Option/SAR Exercises in Last Fiscal Year
                          and FY-End Option/SAR Values

                                                                    Value of
                                                Number of         Unexercised
                            Units              Unexercised       In-the-Money
                           Acquired            Options/SARs       Options/SARs
                             on       Value     at Fiscal          at Fiscal
                           Exercise  Realized   Year End           Year End
                             (#)       ($)         (#)               ($) [1]
         Name and                              Exercisable/       Exercisable/
    Principal Position                         Unexercisable      Unexercisable

John H. Harvison            - 0 -    - 0 -       40,000/0             $0/$0
Chairman and Chief
  Executive Officer

Robert J. Byrnes [2]        - 0 -    - 0 -       35,000/0             $0/$0
President, Chief
  Operating Officer, and
  Director
---------------------
[1]The closing price for the Company's Class A Units as reported by the American
   Stock Exchange on December 26, 1997, the last day of trading prior the end of
   the  Company's  fiscal  year was  $3.75.  The value  shown is  calculated  by
   multiplying the difference between this closing price and the option exercise
   price times the number of units underlying the option.

[2]In connection with the December 1997  restructuring of FFPLP, FFP Real Estate
   Trust became the general partner of FFPLP. Mr. Byrnes is not a trust manager,
   officer, or employee of FFP Real Estate Trust.

   Item 12. Security Ownership of Certain Beneficial Owners and Management.

Class A Units

            The  following  table sets forth as of March 28,  1998,  information
regarding the only persons known by the Company to own,  directly or indirectly,
more than 5% of its Class A Units:

                                           Amount and      Percent
                                            Nature of       of Class
           Name and Address                Beneficial
         of Beneficial Owner                Ownership

Edmund & Mary Shea Real Property Trust       126,700         5.7%
Edmund H. Shea, Jr., Trustee                  Direct
655 Brea Canyon Road
P. O. Box 489
Walnut, California  91789-0489

            The  following  table sets forth as of March 28,  1998,  information
with respect to the Class A Units  beneficially  owned by all trust managers and
executive  officers of FFP Real Estate Trust, the general partner of FFPLP (such
information is based on ownership reported to the Company by such persons):

                                           Amount and Nature        Percent
                                             of Beneficial             of
    Name of Beneficial Owner                 Ownership [1]          Class [1]

John H. Harvison, Chairman and President       40,000 [2]             1.8%
Steven B. Hawkins, Vice President              26,300 [3]             1.2%
Robert E. Garrison, II, Trust Manager          86,805 [4]             3.7%
Joseph F. Leonardo, Trust Manager                   0                 0.0%
J. D. St.Clair, Trust Manager                  37,400 [5]             1.6%
Randall W. Harvison, Trust Manager                  0                 0.0%
All directors and executive officers
  as a group (6 persons)                      190,505                 8.5%
------------------------------------------------------
[1]Based on 2,234,262 FFPLP Class A Units outstanding.  FFPLP Class A Units that
   an  individual  has the  right to  acquire  within  60 days  pursuant  to the
   exercise of options are deemed to be outstanding for the purpose of computing
   the  percentage  ownership  of  such  individual  but are  not  deemed  to be
   outstanding  for the purpose of  computing  the  percentage  ownership of any
   other person or group shown in the table.

[2]Consists of options to acquire 40,000 units.

[3]Includes 1,300 units held by an Individual Retirement Account for the benefit
   of Mr. Hawkins and options to acquire 25,000 units.

[4]Includes  79,751 units held  directly  and 7,054 units held by an  Individual
   Retirement Account for the benefit of Mr. Garrison.

[5] Includes 7,400 units held directly and options to acquire 30,000 units.


General Partner

            FFP Real Estate Trust is the General  Partner of FFPLP and, as such,
makes all decisions  relating to the management of FFPLP.  A company  indirectly
owned by John H.  Harvison  and  members  of his  immediate  family  is the sole
shareholder of FFP Real Estate Trust.


Item 13.  Certain Relationships and Related Transactions.

Related Transactions

            FFP Real  Estate  Trust,  the  general  partner  of  FFPLP,  and FFP
Marketing have entered into a reimbursement agreement pursuant to which FFP Real
Estate Trust will  reimburse  FFP  Marketing  for all direct and indirect  costs
(principally  officers' compensation and other general and administrative costs)
paid  by FFP  Marketing  that  are  allocable  to FFP  Real  Estate  Trust.  The
reimbursement  for  officers'  compensation  costs  incurred by FFP Marketing in
connection  with FFP Real Estate  Trust's  activities  will be determined by the
amount of time  management and other  personnel  spend on activities of FFP Real
Estate  Trust  compared  to the amount of time they spend on  activities  of FFP
Marketing.  Since  FFP Real  Estate  Trust's  only  activity  is to serve as the
general partner of FFPLP, all of FFP Real Estate Trust's costs and expenses will
be borne by  FFPLP.  The costs to be  reimbursed  to FFP  Marketing  by FFP Real
Estate Trust for 1998 are expected to be approximately $200,000.

            As a result of the December 1997  restructuring of FFPLP,  FFPLP and
two of its former  subsidiaries  that are now  subsidiaries of FFP Marketing are
jointly liable on  substantially  all the debt that was  transferred to FFPLP in
the  restructuring.  FFPLP has indemnified FFP Marketing (and its  subsidiaries)
against this  liability and has granted to FFP Marketing the right to offset any
payments FFP  Marketing  might be required to make on the debt retained by FFPLP
against any amounts otherwise due to FFPLP by FFP Marketing.

            FFP Marketing leases buildings or land and buildings for some of its
retail  outlets from FFP  Partners,  L.P. John H.  Harvison,  Chairman and Chief
Executive  Officer of FFP  Marketing,  and  Steven B. Hawkins,  Vice President -
Finance and Chief  Financial  Officer of FFP Marketing,  hold similar  positions
with FFP Partners,  L.P. In addition,  companies owned directly or indirectly by
Mr.  Harvison and members of his  immediate  family  and/or other members of the
senior management of FFP Marketing hold corresponding ownership interests in FFP
Partners.  The leases on these  properties were entered into in conjunction with
the  restructuring  of FFP Partners that was completed in December 1997 in which
the non-real  estate assets and  businesses of FFP Partners were  transferred to
FFP Marketing  while the real estate used in the retail  operations was retained
by FFP Partners.  The lease rates for the locations  were  established  based on
knowledge of the  properties by the management of FFP Partners and FFP Marketing
and  their  general  experience  in  acting as lessor  and  lessee  for  similar
properties.  The  management of FFP Marketing  believes that the lease rates are
comparable to leases that could be entered into with  unrelated  third  parties.
However,  FFP Marketing did not engage any third party  advisors or refer to any
third party  surveys or analyses of rental  rates in making this  determination.
Since  these  leases  were  effective  concurrently  with  the  approval  of the
restructuring  of FFP Partners which occurred at the close of FFP Partners' 1997
fiscal year, no lease payments were made by FFP Marketing during its 1997 fiscal
year.  However,  FFP  Marketing  anticipates  that  it  will  pay  approximately
$2,430,000 in lease payments for these properties during fiscal 1998.

            Prior to the December 1997 restructuring of FFPLP, in the conduct of
the retail businesses  previously conducted by it, FFPLP leased land or land and
buildings for some of its retail outlets and some  administrative  and executive
office  facilities from various entities directly or indirectly owned by Messrs.
John H. Harvison (and/or members of his immediate family),  Robert J. Byrnes, J.
D. St.Clair,  and Garland R. McDonald,  all of whom were on the Board of FFPLP's
previous general partner.  During fiscal 1997, the Company paid $908,000 to such
entities  with  respect to these  leases.  FFPLP  believes the leases with these
affiliates  are on terms that are more  favorable to the Company than terms that
could have been obtained from unaffiliated third parties for similar properties.
These leases have been assumed by FFP Marketing in connection  with the December
1997 restructuring.

            John H. Harvison,  Chairman and Chief  Executive  Officer of FFPLP's
former general  partner,  owns 50% of Product Supply  Services,  Inc.  ("Product
Supply"),  which  provided  consulting  services  and  acted as an agent for the
Company  in  connection  with  the  procurement  of  motor  fuel for sale by the
Company, prior to the December 1997 restructuring.  Product Supply provided such
services to the Company pursuant to an agreement providing that the Company will
pay Product  Supply  $5,000 per month,  supply it with office  space and support
services,  such as telephone  and clerical  assistance,  and pay its  reasonable
out-of-pocket  costs in providing such  services.  The agreement may be canceled
either by the Company or Product Supply upon sixty days' written notice.  During
fiscal year 1997,  the Company paid $68,000 to Product  Supply for its services.
This agreement has been assumed by FFP Marketing in connection with the December
1997 restructuring.

            E. Michael Gregory, a Director of FFPLP's former general partner, is
the owner and  president of Gregory  Consulting,  Inc.  ("Gregory  Consulting"),
which  provided  engineering,  consulting,  and other  similar  services  to the
Company prior to the December 1997  restructuring.  During fiscal year 1997, the
Company paid Gregory Consulting $265,000 for such services.

            Because,  under Texas law,  the Company  was not  permitted  to hold
licenses to sell alcoholic  beverages at its former retail outlets in Texas,  it
had entered into agreements with Nu-Way Beverage Company ("Nu-Way Beverage"),  a
company  wholly  owned by John H.  Harvison,  under which Nu-Way  Beverage  sold
alcoholic  beverages at the Company's former retail outlets in Texas. Under this
agreement,  the Company  received rent and a management fee relative to the sale
of  alcoholic  beverages  and it  loaned  funds to  Nu-Way  Beverage  to pay for
alcoholic  beverage  purchases.  The Company received  interest on such funds at
1/2% above the prime rate  charged by a major  commercial  bank and the loan was
secured by the  alcoholic  beverage  inventory  located in the  Company's  Texas
outlets.  During 1997, the highest  balance due under this loan was $431,000 and
the balance at the end of the year was $426,000.  During 1997,  Nu-Way  Beverage
sold  $8,330,000 of alcoholic  beverages at the Company's  Texas outlets.  After
deducting  cost of sales and other  expenses  related to these sales,  including
$1,355,000 of rent,  management  fees, and interest paid to the Company,  Nu-Way
Beverage  had  earnings  of $83,000  from sales of  alcoholic  beverages  at the
Company's outlets. In conjunction with the restructuring, the agreements related
to this arrangement were assumed by FFP Marketing.

            In June 1994,  the Company  concluded  the  settlement  of a lawsuit
which it had filed against  Nu-Way Oil Company and Nu-Way  Distributing  Company
(the "Nu-Way  Companies"),  both of which are  controlled  by John  Harvison and
members of his immediate  family,  and a related suit which the Nu-Way Companies
had filed against the Company.  Under the settlement,  all claims in both of the
lawsuits were dismissed and the Company received cash, a promissory note from an
affiliated company (secured by first and second liens on real estate), and title
to a convenience  store which was being leased by the Company from an affiliate.
The Company estimated the assets it received had an aggregate value of $485,000.
The affiliated  companies  received  approximately  $65,000 in cash (held in the
Registry of the Court) and 30,000 Class B Units owned by an affiliate  that were
being held by an escrow agent.  This agreement was approved by the disinterested
directors  of the  General  Partner.  The note  which the  Company  received  in
connection with this  settlement is to be repaid over five years,  with interest
at 9.5%; the highest balance outstanding during 1997 under the note was $65,000,
and the  balance  outstanding  at year  end  1997  was  $44,000.  This  note was
transferred to FFP Marketing in connection with the December 1997  restructuring
of FFPLP.

            The Company provides vehicles to various employees,  primarily field
supervisory  personnel,  in conjunction with the performance of their employment
duties. In 1997, the Company purchased  vehicles totaling $106,000 from EZ Auto,
L.L.C., a company  50%-owned by members of John H. Harvison's  immediate family.
Management believes that the cost of these vehicles was comparable to that which
could have been obtained from unrelated third parties for similar vehicles.

            In 1980 and 1982, certain of the Affiliated Companies granted to E-Z
Serve,  Inc. ("E-Z Serve"),  the right to sell motor fuel at retail for a period
of ten  years at  certain  outlets  owned or  leased  by  companies  controlled,
directly or indirectly,  by John H. Harvison and members of his immediate family
or their  affiliates.  All rights to commissions  under these agreements and the
right to sell  motor  fuel at  wholesale  to E-Z  Serve at such  locations  were
assigned to the Company on May 21, 1987, in connection  with the  acquisition of
its initial base of retail operations.  In December 1990, in connection with the
expiration or termination of the agreements with E-Z Serve,  the Company entered
into agreements with Thrift Financial Co. ("Thrift Financial"),  a company owned
and controlled by members of John H. Harvison's immediate family, which grant to
the Company the exclusive right to sell motor fuel at certain retail  locations.
The terms of these  agreements are comparable to agreements that the Company has
with other  unrelated  parties.  During  fiscal  1997,  the Company  paid Thrift
Financial $323,000 under these agreements.  These agreements were transferred to
FFP Marketing in connection with the restructuring.

            Cost  Allocations.  Prior to the December 1997  restructuring of FFP
Partners,  the affairs of the Company were managed by its General  Partner.  The
General  Partner  made  determinations  with  respect  to costs  incurred  by it
(whether directly or indirectly  through its affiliates) that were reimbursed by
the  Company.  The  Company  reimbursed  the  General  Partner  and  any  of its
affiliates for direct and indirect general and administrative costs, principally
officers'  compensation and associated expenses,  related to the business of the
Company.  The  reimbursement  was based on the time  devoted by employees to the
Company's  business or upon such other reasonable basis as was determined by the
General Partner.  In fiscal 1997, the Company reimbursed the General Partner and
its affiliates $763,000 for such expenses.

            During 1997,  the Company paid  $386,000 to  affiliates to reimburse
them for legal fees they had paid that  benefited the Company.  This payment was
the final portion of an amount which had been accrued in 1996.

<PAGE>

                                     PART IV


Item 14.  Exhibits, Financial Statements, Schedules and Reports on Form 8-K.

      (a) The  following  documents  are filed as part of this Annual  Report on
Form 10-K:

                  (1)  Financial Statements.

                  See Index to  Financial  Statements  and  Financial  Statement
               Schedules on page F-1 hereof.

                  (2)  Financial Statement Schedules.

                  None.

                  (3) Exhibits.

               3.1    Amended and Restated Certificate of Limited Partnership of
                      FFP Partners, L.P. {1 - Ex.
                      3.7}
               4.1    Amended and Restated  Agreement of Limited  Partnership of
                      FFP Partners,  L.P., dated May 21, 1987, as amended by the
                      First  Amendment  to Amended  and  Restated  Agreement  of
                      Limited  Partnership  dated  August 14,  1989,  and by the
                      Second  Amendment  to Amended and  Restated  Agreement  of
                      Limited Partnership dated July 12, 1991. {2 - Ex 4.1}
               4.2    Third  Amendment  to Amended  and  Restated  Agreement  of
                      Limited  Partnership  of FFP Partners,  L.P.,  dated as of
                      December 28, 1997. {4}
               4.3  Rights  Agreement  dated as of August 14, 1989,
                      between the  Company and NCNB Texas  National
                      Bank, as Rights Agent.  {3 - Ex. 1}
              10.1  Nonqualified Unit Option Plan of FFP Partners,
                      L.P.   {1  -  Ex.  10.2}
              10.2  Form of Lease Agreement between FFP Properties, L.P., and
                      FFP Operating Partners, L.P. {4}
              10.3  Form of Building Lease Agreement between FFP Properties,
                      L.P., and FFP Operating Partners, L.P. {4}
              10.4    Loan  Agreement  among FFP Partners,  L.P.,  FFP Operating
                      Partners,  L.P.,  Direct  Fuels,  L.P.,  and HSBC Business
                      Loans, Inc., dated October 31, 1997. {4}
              21.1  Subsidiary of the Registrant.  {4}
              23.1  Consent of KPMG Peat Marwick LLP. {4}
                27  Financial data schedule. {4}
-----------------------------------
               {1}  Included as the indicated exhibit in the Partnership's
                    Registration Statement on Form S-1 (Registration
                    No. 33-12882) dated May 14, 1987, and incorporated herein
                    by reference.
               {2}  Included  as the  indicated  exhibit  in  the  Partnership's
                    Annual  Report  on Form  10-K  for  the  fiscal  year  ended
                    December 27, 1992, and incorporated herein by reference.
               {3}  Included  as the  indicated  exhibit  in  the  Partnership's
                    registration  statement  on Form 8-A dated as of August  29,
                    1989, and incorporated herein by reference.
               {4}  Included herewith.

       (b) No  reports on Form 8-K were  filed  during  the last  quarter of the
       period covered by this Annual Report on Form 10-K.

<PAGE>


                                   SIGNATURES

            Pursuant  to  the  requirements  of  Section  13  or  15(d)  of  the
Securities  and Exchange Act of 1934, the Registrant has duly caused this Annual
Report on Form 10-K to be signed  on its  behalf by the  undersigned,  thereunto
duly authorized.

Dated:  April 13, 1998                   FFP Partners, L.P.
                                         (Registrant)

                                         By: FFP Real Estate Trust
                                             General Partner

                                             By: /s/ John H. Harvison
                                                 ------------------------------ 
                                                 John H. Harvison
                                                 President

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

            Pursuant to the requirements of the Securities Exchange Act of 1934,
this Annual Report has been signed below by the  following  persons on behalf of
the Registrant in the capacities indicated as of April 13, 1998.

/s/ John H. Harvison              President and Chief Executive
---------------------------------   Officer  and Trust Manager of FFP
John H. Harvison                    Real Estate Trust (Principal
                                    executive officer)

/s/ Steven B. Hawkins             Vice President - Finance and
---------------------------------   Administration, and Chief
Steven B. Hawkins                   Financial Officer of FFP Real
                                    Estate Trust (Principal financial
                                    and accounting officer)

                                  Trust Manager of FFP Real Estate
---------------------------------   Trust
Robert E. Garrison, II

                                  Trust Manager of FFP Real Estate
---------------------------------   Trust
Joseph F. Leonardo

/s/ J. D. St.Clair                Trust Manager of FFP Real Estate
---------------------------------   Trust
J. D. St.Clair

/s/ Randall W. Harvison           Trust Manager of FFP Real Estate
---------------------------------   Trust
Randall W. Harvison


<PAGE>

Item 8.  Index to Financial Statements

                                                                 Page
                                                                Number
Independent Auditors' Report                                     F-2
Consolidated Balance Sheet as of December 28, 1997               F-3
Notes to Consolidated Financial Statements                       F-4






<PAGE>


                          Independent Auditors' Report



The Partners
FFP Partners, L.P.:

            We have audited the accompanying  consolidated  balance sheet of FFP
Partners,  L.P. (a Delaware  Limited  Partnership) and subsidiary as of December
28, 1997.  This  financial  statement  is the  responsibility  of the  Company's
management.  Our  responsibility  is to express  an  opinion  on this  financial
statement based on our audit.

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

            In our opinion,  the  consolidated  balance sheet  referred to above
presents  fairly,  in all  material  respects,  the  financial  position  of FFP
Partners,  L.P.  and  subsidiary  as of December 28, 1997,  in  conformity  with
generally accepted accounting principles.





                                             KPMG Peat Marwick LLP


Fort Worth, Texas
March 17, 1998

<PAGE>


                       FFP Partners, L.P., and Subsidiary
                           Consolidated Balance Sheet
                                December 28, 1997
                                 (In thousands)


                                                          1997
                        Assets
Current Assets
   Prepaid expenses                                       $196

Real Property
    Land and improvements                                6,026
    Buildings                                           21,491
                                                       -------
                                                        27,517
    Accumulated depreciation                            (9,374)
                                                       -------
                                                        18,143
                                                       -------
Total Assets                                           $18,339
                                                       =======

          Liabilities and Partners' Capital

Current Liabilities
   Current installments of long-term debt               $1,208

Long-term debt, excluding current installments          14,730
                                                       -------
      Total Liabilities                                 15,938

Minority interest in subsidiary                            960

Commitments and contingencies

Partners' Capital
    Limited partners' equity                             1,418
    General partner's equity                                23
                                                       -------
      Total Partners' Capital                            1,441
                                                       -------

Total Liabilities and Partners' Capital                $18,339
                                                       =======


             See accompanying notes to consolidated balance sheet.

<PAGE>

                       FFP Partners, L.P., and Subsidiary
                       Notes to Consolidated Balance Sheet
                                December 28, 1997



1.  Basis of Presentation

(a)  Organization of Company

            FFP Partners,  L.P.  ("FFPLP" or the "Company"),  a Delaware limited
partnership,  was formed in December 1986,  pursuant to the Agreement of Limited
Partnership  of FFP  Partners,  L.P.  (the  "Partnership  Agreement"),  with FFP
Partners Management Company, Inc. ("FFPMC") as its general partner. In May 1987,
FFPLP  purchased  convenience  stores,  truck  stops,  other  retail  motor fuel
outlets,  and ancillary  businesses from affiliates of its general partner.  The
purchase of these  outlets  was  completed  in  conjunction  with the  Company's
initial  public  offering  of Class A Units  of  limited  partnership  interest.
Through its  subsidiaries,  FFPLP owned and operated  these  outlets,  and other
businesses, until December 1997.

            In December 1997,  FFPLP completed a restructuring by which the real
estate used in the aforementioned  retail operations was retained by FFPLP while
the convenience  store,  truck stop, other retail motor fuel outlets,  and other
businesses it conducted were  transferred to FFP Marketing  Company,  Inc. ("FFP
Marketing"),  in exchange for all the common stock of FFP Marketing.  The common
stock of FFP Marketing was then  distributed to the general  partner and limited
partners of FFPLP. The assets and liabilities in the  accompanying  consolidated
balance sheet of FFPLP have been reflected at the historical  carrying values of
the predecesor entity prior to the restructuring.  Accordingly,  no gain or loss
was recognized as a result of the 1997 restructuring.

            The real estate retained by FFPLP was contributed to FFP Properties,
L.P. ("FFP Properties"),  a newly formed Texas limited partnership,  in exchange
for the general partnership interest in FFP Properties.  The limited partnership
interests in FFPLP held by John H.  Harvison,  the Chairman and Chief  Executive
Officer of FFPMC, members of his family, and corporations, partnerships, trusts,
and  other  business  entities   affiliated  with  him  or  his  family  members
(collectively, the "Harvison Family") were exchanged for economically equivalent
limited  partnership  interests in FFP  Properties,  L.P. In addition,  FFP Real
Estate Trust, a newly formed Texas real estate  investment  trust that is wholly
owned by FFPMC, became the general partner of FFPLP.

            By virture of this restructuring, all of the operating activities of
FFPLP were transferred to FFP Marketing and FFPLP's future business will consist
of the ownership and rental of real estate.

            The Company owns the real estate and conducts its rental  activities
through FFP  Properties,  in which it owns a 60% general partner  interest.  The
minority interest in subsidiary on the consolidated balance sheet represents the
Harvison Family's 40% limited partnership interest in FFP Properties.

(b)  Consolidation

            The consolidated  financial  statement  includes the accounts of the
Company and its majority owned subsidiary. All significant intercompany accounts
and transactions are eliminated in the consolidated financial statement.


2.  Significant Accounting Polices

(a)  Real Property

            Real  property  is stated at cost.  Depreciation  is provided on the
straight-line  method over the estimated useful lives of the respective  assets,
which range from five to twenty years.

(b)  Fair Value of Financial Instruments

            The carrying amount of long-term debt approximates fair value due to
the variable interest rate on substantially all such obligations.

(c)  Units Issued and Outstanding

            The equity  interests in the Company are  comprised of Class A Units
of Limited  Partnership  interest  and units  representing  the general  partner
interest. The units issued and outstanding at year end 1997, after giving effect
to the restructuring, were as follows:

                                                 1997
                       Limited partner        2,234,262
                       General partner           37,416

            The Company's limited partner units are traded on the American Stock
Exchange.  The general partner units are held by its sole general  partner,  FFP
Real Estate Trust.

(d)  Use of Estimates

            The  use  of  estimates   is  required  to  prepare  the   Company's
consolidated   financial   statement  in  conformity  with  generally   accepted
accounting  principles.  Although  management  believes that such  estimates are
reasonable, actual results could differ from the estimates.

(e)  Impairment of Long-Lived Assets

            The Company reviews long-lived assets for impairment whenever events
or changes in  circumstances  indicate that the carrying  amount of an asset may
not be recoverable.  Recoverability of assets to be held and used is measured by
a  comparison  of the  carrying  amount of such  assets to future net cash flows
expected to be  generated  by the assets.  If such assets are  considered  to be
impaired, the impairment to be recognized is measured by the amount by which the
carrying amount of the assets exceeds the fair value of the assets.

(f)  Rental Revenue

            The Company recognizes rental revenues when earned.

(g)  Unit Option Plan

            The Company accounts for its unit option plan in accordance with the
provisions of Accounting Principles Board ("APB") Option No. 25, "Accounting for
Stock Issued to Employees," and related  interpretations.  As such, compensation
expense  would be recorded  only if the current  market price of the  underlying
unit on the date of the grant of the option  exceeded the exercise  price of the
option.

(g)  Income Taxes

            As a publicly traded partnership,  FFPLP pays no federal income tax.
Rather,  the income or loss of FFPLP is allocated to its partners to be included
in their  respective tax returns.  The net difference  between the tax bases and
the reported amounts of assets and liabilities at year end 1997 is $4,923,000.


3.  Notes Payable and Long-Term Debt

            In connection  with the December 1997  restructuring  of FFPLP,  the
Company  retained  the  obligation  for the year end  balances  due under a bank
revolving credit facility ($7,439,000), a bank term loan ($7,905,000), and other
debt ($594,000) securing the real estate it also retained. However, subsidiaries
of FFP  Marketing  remain  liable on the debt  retained  by FFPLP,  pending  its
refinancing,  and could be  required  to repay the debt if FFPLP is unable to do
so. Accordingly,  FFPLP has indemnified FFP Marketing against this liability and
has granted to FFP  Marketing  the right to offset any  payments  FFP  Marketing
might be  required  to make on the debt  retained  by FFPLP  against any amounts
otherwise due to FFPLP by FFP Marketing.

            Although  FFPLP  retained the liability for the $7,439,000 due under
the  revolving  credit line portion of the bank debt at the date of the December
1997  restructuring,  FFP Marketing  retains  availability  under this revolving
credit  facility.  The  revolving  credit line  provides  for  borrowings  up to
$15,000,000,  with the amount  available at any time related to a borrowing base
comprised of FFP Marketing's  trade  receivables and inventories.  To the extent
that  borrowings  under this credit  facility fall below the $7,439,000  balance
retained by FFPLP they are treated as loans by FFP  Marketing to FFPLP and FFPLP
will pay interest to FFP  Marketing on such amounts at the lender's  prime rate,
which is same  rate that is  payable  to the  lender.  FFP  Marketing  bears the
interest cost on any balances  under the revolving  credit  facility that exceed
the $7,439,000 amount.

            The  revolving  credit  facility  and the bank  term  loan both bear
interest at the lender's  prime rate,  payable  monthly;  the term loan requires
monthly principal  payments of $95,000;  and both loans mature in November 2000.
The loans are subject to a Loan and  Security  Agreement  among FFP Partners and
two companies that prior to the December 1997 restructuring were subsidiaries of
FFP Partners but are now subsidiaries of FFP Marketing.  The agreement  contains
various  restrictive  convenants  including  financial covenants relating to the
maintenance  of a specified  minimum  tangible net worth, a debt to tangible net
worth ratio, and a cash flow coverage ratio, all as defined in the agreement. As
a result of the  restructuring,  these ratios are caculated on a combined  basis
for FFPLP and FFP Marketing. As of year end, FFPLP and FFP Marketing were not in
compliance with certain  requirements  under the loan agreement;  the lender has
waived  declaring  a default  due to such  noncompliance.  The  loans  under the
agreement are secured by a negative pledge of the assets of FFPLP. They are also
secured by FFP  Marketing's  trade  accounts  receivable,  inventories,  and its
equipment  not  otherwise  encumbered,  and by a  negative  pledge  of its other
assets.

            FFPLP expects to refinance the bank and other debt during 1998.  The
Company   anticipates  that  FFP  Marketing  will  have  no  liability  for  the
obligations that refinance the existing debt.

            The Company has other notes payable which bear interest at 6% to 10%
and are due in  monthly  or annual  installments  through  2012.  Such notes are
secured by land and had aggregate balances of $594,000 at December 28, 1997.

            The aggregate  fixed  maturities  of long-term  debt for each of the
five yeras subsequent to 1997 are as follows:

                                         (In thounsands)
                     1998                    $1,208
                     1999                     1,299
                     2000                    13,118
                     2001                        55
                     2002                        53
                     Thereafter                 205
                                            -------
                                            $15,938
                                            =======

4. Nonqualified Unit Option Plan and Unit Purchase Rights.

           The Company has outstanding at year end 1997 nonqualified  options to
acquire 241,999 Class A Units.  Such options were granted under its Nonqualified
Unit Option Plan and a Nonqualified Unit Option Plan for Nonexecutive Employees.
The Nonqualified Unit Option plan has terminated and no further options under it
may  be  granted.   There  are  37,998  units  available  for  grant  under  the
Nonqualified Unit Option Plan for Nonexecutive Employees.

            All options to acquire Class A Units of FFPLP that were  outstanding
at the completion of the December 1997  restructuring of FFPLP were divided into
separate  options to  purchase  Class A Units of FFPLP and a like  number of FFP
Marketing common shares.  The exercise price for the existing FFPLP unit options
was divided  between the two new options in  proportion  to the closing price on
the  American  Stock  Exchange of FFPLP Class A Units and FFP  Marketing  common
shares. The adjusted exercise prices of the unit options outstanding at year end
1997 are:

                         Exercise     Options
                          Price     Outstanding
                         $1.211       165,333
                          1.252         6,666
                          1.393        20,000
                          1.938        25,000
                          2.261        25,000
                                      -------
                                      241,999
                                      =======

            The weighted average  exercise price of outstanding  options at year
end was $1.41  with a  remaining  contractual  life of 5.5 years.  The  weighted
average exercise price of the 205,333 options exercisable at year end was $1.36.

             In August 1989,  the Company  entered into a Rights  Agreement  and
distributed to its unitholders  rights to purchase  Rights Units  (substantially
equivalent to a Class A Unit) under certain circumstances.  Initially the Rights
were attached to all unit certificates  representing  units then outstanding and
no separate Rights  Certificates were  distributed.  Under the Rights Agreement,
the Rights were to separate  from the Units and be  distributed  to  Unitholders
following  a public  announcement  that a  person  or  group  of  affiliated  or
associated persons (an "Acquiring Person") had acquired,  or obtained a right to
acquire,  beneficial ownership of 20% or more of the Partnership's Class A Units
or all classes of outstanding  Units.  On August 8, 1994, a group of Unitholders
announced  that they had an  informal  understanding  that they would vote their
Units  together  as  a  block.  The  agreement  related  to  units  constituting
approximately 25% of the Class A Units then outstanding.  Therefore,  the Rights
became  exercisable  on October 7, 1994, the record date for the issuance of the
Rights Certificates (the "Distribution Date").

            The Rights  currently  represent the right to purchase a Rights Unit
(which is substantially  equivalent to a Class A Unit) of the Company at a price
of $20.00 per Unit. However, the Rights Agreement provides,  among other things,
that if any person  acquires  30% or more of the Class A Units or of all classes
of outstanding Units then each holder of a Right, other than an Acquiring Person
(as  defined  in the Rights  Agreement),  will have the right to  receive,  upon
exercise,  Rights Units (or in certain  circumstances,  other property) having a
value of $40.00 per Unit.  The Rights will expire on August 13, 1999, and do not
have any voting rights or rights to cash distributions.


5.  Leases.

            The real  property  owned by the  Company  is  being  leased  to FFP
Marketing  under  operating  leases  which  generally  expire  in 2002  with two
five-year  renewal  periods at the sole option of FFP Marketing.  Future minimum
rent under these leases is $2,430,000 annualy through 2002.