<PAGE>

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

                                    FORM 10-K
(Mark One)
[x]             ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 2004
                                       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 number 1-4673

                           WILSHIRE ENTERPRISES, INC.
             (Exact name of registrant as specified in its charter)


          DELAWARE                                             84-0513668
(State or other jurisdiction of                               (IRS Employer
 incorporation or organization)                             Identification No.)

           921 BERGEN AVENUE
         JERSEY CITY, NEW JERSEY                                07306-4204
(Address of principal executive offices)                        (Zip Code)

       Registrant's telephone number, including area code: (201) 420-2796

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

                                                    Name of each exchange
          Title of each class                       on which registered
          -------------------                       -------------------
      Common Stock, $1 par value                   American Stock Exchange

           Securities registered pursuant to section 12(g) of the Act:

                                      None
                              ---------------------
                              (Title of each class)

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 (ss.229.405 of this chapter) 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. ___

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act).
         Yes        No   x
             -----     -----
<PAGE>

The aggregate market value of the voting and non-voting common equity held by
non-affiliates of the registrant computed by reference to the price at which the
common equity was last sold, or the average bid and asked price of such common
equity, as of the last business day of the registrant's most recently completed
second fiscal quarter (June 30, 2004), was $22,039,000.

The number of shares outstanding of each of the registrant's $1 par value common
stock, as of March 21, 2005 was 7,780,230.

                       DOCUMENTS INCORPORATED BY REFERENCE

Registrant's Proxy Statement for its 2005 Annual Meeting of Stockholders (Part
III).




                                       2
<PAGE>

                           WILSHIRE ENTERPRISES, INC.
                                      INDEX


<TABLE>
<CAPTION>
                                                                                            Page No.
                                                                                            --------
<S>                                                                                         <C>
Part I

Item 1.           Business                                                                        4
Item 2.           Properties                                                                      8
Item 3.           Legal Proceedings                                                              10
Item 4.           Submission of Matters to a Vote of Security Holders                            10
Item 4A.          Executive Officers of the Registrant                                           11

Part II

Item 5.           Market for Registrant's Common Equity, Related Stockholder
                  Matters and Issuer Purchases of Equity Securities                              12
Item 6.           Selected Financial Data                                                        13
Item 7.           Management's Discussion and Analysis of Financial Condition
                  and Results of Operation                                                       15
Item 7A.          Quantitative and Qualitative Disclosures About Market Risk                     30
Item 8.           Financial Statements and Supplementary Data                                    32
Item 9.           Changes in and Disagreements with Accountants on Accounting
                  and Financial Disclosure                                                       58
Item 9A.          Controls and Procedures                                                        59
Item 9B.          Other Information                                                              59

Part III

Item 10.          Directors and Executive Officers of the Registrant                             60
Item 11.          Executive Compensation                                                         60
Item 12.          Security Ownership of Certain Beneficial Owners and Management
                  and Related Stockholder Matters                                                60
Item 13.          Certain Relationships and Related Transactions                                 60
Item 14.          Principal Accountant Fees and Services                                         60

Part IV

Item 15.          Exhibits and Financial Statement Schedules                                     61
                  Signatures                                                                     66

</TABLE>


                                       3
<PAGE>

                                     PART I

ITEM 1. BUSINESS

This report contains "forward-looking statements" within the meaning of the
federal securities laws. These statements relate to future economic performance,
plans and objectives of management for future operations and projections of
revenues and other financial items that are based on the beliefs of our
management, as well as assumptions made by, and information currently available
to, our management. The words "expect," "estimate," "anticipate," "believe" and
similar expressions are intended to identify forward-looking statements. Those
statements involve risks, uncertainties and assumptions, including industry and
economic conditions, competition and other factors discussed in this and our
other filings with the SEC. If one or more of these risks or uncertainties
materialize or underlying assumptions prove incorrect, actual outcomes could
vary materially from those indicated. We have made forward-looking statements in
Items 1, 2, 5, 7 and 7A of this report. See "Disclosure Regarding
Forward-Looking Statements" at the end of Item 7 for a description of some of
the important factors that may affect actual outcomes.

Background

Wilshire Enterprises, Inc. ("Wilshire" or the "Company") is a Delaware
corporation founded on December 7, 1951. The Company changed its name from
Wilshire Oil Company of Texas to its current name on June 30, 2003. As of the
date of filing this report, the Company's principal executive offices are
located at 921 Bergen Avenue, Jersey City, New Jersey 07306, (201) 420-2796. The
Company has signed a lease and expects to relocate its corporate offices in May
2005 to One Gateway Center, Newark, New Jersey 07102. Wilshire maintains a
website at www.wilshireenterprisesinc.com.

Wilshire is principally engaged in acquiring, owning and managing real estate
properties. As further described below, the Company currently owns multi-family
properties, office space, retail space, and land located in the states of
Arizona, Texas, Florida, Georgia and New Jersey.

In July 2003 the Company committed to the sale of its oil and gas operations and
to either reinvest the net proceeds in its ongoing real estate business or
otherwise utilize the proceeds to maximize shareholder value. As of June 2004,
the Company had completed its divestiture of its oil and gas operations
receiving gross proceeds of $28.1 million. See Note 2 to the Consolidated
Financial Statements in Item 8 of this Annual Report on Form 10-K.

As part of its efforts to maximize shareholder value, effective July 2004 the
Company employed a new senior management team with Daniel C. Pryor as President
& Chief Operating Officer and Seth H. Ugelow as Chief Financial Officer. The new
senior management team reports to Sherry Wilzig Izak, Chairman & Chief Executive
Officer.

The Company remains committed to maximizing shareholder value and is continually
exploring all possible alternatives to accomplish this goal. The Company remains
receptive to negotiating acceptable bids to sell the entire Company, while at
the same time is prepared to pursue the expansion of its real estate portfolio
by completing corporate mergers or acquisitions regardless if Wilshire is the
acquirer or acquiree and by investing in real estate properties or securities.
In the interim, the Company's goal is to increase the value of its real estate
portfolio by implementing improvements to its existing properties and completing
the opportunistic divestiture of select real estate assets. The Company cannot
assure investors of any actions or of the timing of potential actions.


                                       4
<PAGE>

REAL ESTATE OPERATIONS

Wilshire is engaged principally in acquiring, owning and managing real estate
properties. As of December 31, 2004, Wilshire owned the properties described
below:

CORE OPERATING ASSETS. Wilshire has identified certain of its properties that it
believes to be well situated in their respective markets and have attractive
cash flow or valuation characteristics. These include:

<TABLE>
<CAPTION>

Name                            City                State    Asset Class               Size
----                            ----                -----    -----------               ----
<S>                             <C>                 <C>      <C>                       <C>
Alpine Village                  Sussex              NJ       Apartments                132 units
Biltmore Club (a)               Phoenix             AZ       Apartments                378 units
Summercreek                     San Antonio         TX       Apartments                180 units
Sunrise Ridge                   Tucson              AZ       Apartments                340 units
Van Buren                       Tucson              AZ       Apartments                70 units
Wellington                      San Antonio         TX       Apartments                228 units

Galsworthy Arms (b)             Long Branch         NJ       Condominiums              45 units
Jefferson Gardens               Jefferson           NJ       Condominiums              20 units

Royal Mall Plaza                Mesa                AZ       Office & retail           66,552 SF
Tamarac Office Plaza            Tamarac             FL       Office                    26,990 SF
Tempe Corporate                 Tempe               AZ       Office                    50,700 SF

</TABLE>

(a) The Company entered into an agreement to sell Biltmore Club for $21.0
million on February 2, 2005. This action has caused the Company to classify this
asset as discontinued. See Note 11 to the Consolidated Financial Statements in
Item 8 of this Annual Report on Form 10-K.

(b) The Company sold one 2-bedroom unit on January 26, 2005.

OTHER ASSETS. The Company has other assets that currently do not generate the
cash flow typically expected by the Company. These include:

<TABLE>
<CAPTION>
Name                            City                     State   Asset Class                Size
----                            ----                     -----   -----------                ----
<S>                             <C>                      <C>     <C>                        <C>
Amboy Tower (a)                 Perth Amboy              NJ      Office & Retail            75,000 SF

Twelve Oaks (a)(d)              Atlanta                  GA      Apartments                 72

Wilshire Grand Hotel &                                                                      89 rooms;
Banquet Facility                West Orange              NJ      Triple Net Lease (b)       50,000 SF
Rutherford Bank                 Rutherford               NJ      Triple Net Lease (b)       0.1727 acres

Alpine Village (c)              Sussex                   NJ      Land                       0.51 acres
Alpine Village (c)              Wantage                  NJ      Land                       17.32 acres
Lake Hopatcong (a)              Lake Hopatcong           NJ      Land                       1.8 acres
West Orange (a)                 West Orange              NJ      Land                       0.6 acre

</TABLE>

(a) Classified by the Company as Discontinued Operations. See Note 2 to the
Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.
(b) Wilshire leases the land and improvements to others on a triple net lease
basis.
(c) Alpine Village land parcels are adjacent to the Alpine Village Apartments
listed as a Core Operating Asset.
(d) The Company entered into an agreement on March 23, 2005 to sell Twelve Oaks
for $1.7 million, net of expenses. See Note 11 to the Consolidated Financial
Statements in Item 8 of this Annual Report on Form 10-K.

                                       5
<PAGE>

In addition, the Company held a mortgage receivable with a gross carrying value
of $1,165,000 and unearned income of $727,000 as of December 31, 2004. Security
for the mortgage was a first lien on in excess of 100 condominium units in two
contiguous buildings located in Jersey City, New Jersey. On February 22, 2005,
the Company entered into an agreement with the mortgagee to settle and satisfy
the mortgage for $1,100,000, which was paid to the Company during the first
quarter of 2005. (See Note 11 to the Notes to the Consolidated Financial
Statements in Item 8 of this Annual Report on Form 10-K.)

BUSINESS STRATEGY

Wilshire's principal investment objective is to increase the net asset value of
its investment portfolio through effective management, growth, financing and
investment strategies. Wilshire is currently focused on optimizing the valuation
potential and cash flow from its Core Operating Assets and repositioning or
selling its Other Assets. The Company is also focused on increasing long-term
growth in cash and cash equivalents generated from operations and cash and cash
equivalents available for distribution per share. The Company does not currently
pay a dividend.

Wilshire believes that it is part of its ongoing business strategy to initiate
or entertain corporate transaction discussions, such as acquiring other
companies for cash and/or stock or selling/merging the Company for cash and/or
stock.

The Company also intends to selectively acquire assets that offer attractive
financial returns. In general, it seeks multifamily properties with 200 units or
more in geographic regions in which the Company or its contracted property
management company (see below) has operations. However, the Company is actively
evaluating other asset classes such as office buildings, retail centers and real
estate securities and other geographic regions and may invest in one or more of
these asset classes in lieu of a multifamily property.

ACQUISITION OF ASSETS

Wilshire did not acquire any real estate properties in 2004.

DIVESTITURE OF ASSETS

The Company divested of the following real estate properties in 2004.


<TABLE>
<CAPTION>

                                                                                                 Taxes
Name (State)                                                      Net Book         Mortgage    Payable on
(asset class)                   Date Sold     Selling Price         Value           Value        Sale        Net Proceeds (a)
-------------                   ---------     -------------       --------         --------    ----------    ----------------
<S>                             <C>           <C>               <C>             <C>            <C>           <C>
Jersey City (NJ) (13
residential properties)           Various       $14,750,000     $8,925,000      $3,870,000     $2,332,000       $8,427,000
Montville (NJ) (land)             8/26/04        $1,000,000       $629,000            $-0-       $142,000         $833,000
Jefferson Gardens (NJ)
(1-bedroom condominium)           9/27/04          $140,000        $36,000         $75,000        $38,000          $17,000  (b)
Jefferson Gardens (NJ)
(1-bedroom condominium)          10/18/04          $136,000        $39,000        $126,000        $35,000         $(25,000) (b)
Schalk Station (NJ)
(land)                           12/22/04        $3,950,000     $3,072,000            $-0-       $335,000       $3,557,000

</TABLE>

(a) Net proceeds = selling price less mortgage value and transaction costs such
as commissions, legal fees, taxes and other expenses.
(b) At the time of sale, the Company elected to repay a larger portion of the
underlying mortgage for Jefferson Gardens than required. If a pro-rata amount of
the mortgage had been repaid, the Company would have realized net proceeds of
approximately $65,000 on the September 27, 2004 sale and approximately $64,000
on the October 18, 2004 sale.

                                       6
<PAGE>

The Company divested or entered into an agreement to sell the following real
estate properties and securities in 2005.

<TABLE>
<CAPTION>

                                                                                                 Taxes
Name (State)                                                      Net Book         Mortgage    Payable on
(asset class)                   Date Sold     Selling Price         Value           Value        Sale        Net Proceeds (a)
-------------                   ---------     -------------       --------         --------    ----------    ----------------
<S>                             <C>           <C>               <C>             <C>            <C>           <C>
Biltmore Club (b)                12/23/05       $20,956,000     $4,152,000      $9,103,000     $5,900,000    $10,000,000
Galsworthy Arms (NJ)
(2-bedroom condominium)           1/26/05          $269,500        $57,000        $251,000        $79,000       $(79,000) (c)
Mortgage Receivable (d)           3/23/05        $1,100,000       $438,000            $-0-       $276,000       $824,000
Twelve Oaks (e)                   3/23/05        $1,725,000       $939,000      $1,609,000       $240,000      $(230,000)

</TABLE>

(a) Net proceeds = selling price less mortgage value and transaction costs such
as commissions, legal fees, taxes and other expenses.

(b) The Company has entered into a definitive agreement to sell the asset with
the closing date scheduled for no later than December 23, 2005.

(c) At the time of sale, the Company elected to repay a larger portion of the
underlying mortgage for Galsworthy Arms than required. If a pro-rata amount of
the mortgage had been repaid, the Company would have realized net proceeds of
approximately $136,000 on the sale.

(d) The Company has entered into a definitive agreement to sell the asset and
the selling price was received during the first quarter of 2005.

(e) The Company has entered into a definitive agreement to sell the asset with
the closing date scheduled as soon as practicable from the March 23, 2005
signing of the contract.

EMPLOYEES

As of December 31, 2004, the Company had a total of six full-time employees in
its corporate office. Wilshire also employed two employees to manage its real
estate assets in New Jersey and two part-time consultants who were previously
employees of the Company to assist as needed in financial reporting.

PROPERTY MANAGEMENT

Wilshire contracts with a property management company (the "PMC") located in
Phoenix, Arizona to assist in the management of the Company's properties
including providing onsite personnel, regional supervision, and bookkeeping
functions. The PMC has managed nearly all of Wilshire's properties located
outside of New Jersey since 1998. In January of 2005 Wilshire contracted with
the PMC to assist in the management of the Company's New Jersey properties
obligating the PMC to provide onsite personnel and bookkeeping functions but not
regional supervision for the New Jersey properties. Wilshire believes that the
PMC can provide cost-efficient bookkeeping functions in part because it is
located in Arizona, a state that generally has lower wage expense than that
experienced in New Jersey. As of December 31, 2004 the PMC employed 259 full
time and 32 part time people and managed property on behalf of Wilshire and
others in the states of Arizona, New Mexico, Colorado, Texas, Florida and
Georgia. The PMC does not currently own real estate assets for its own
investment purposes. In 2004, Wilshire accounted for approximately 18% of PMC's
total revenues and was its largest customer.

INSURANCE

The Company carries comprehensive property, general liability, fire, extended
coverage and rental loss insurance on all of its existing properties, with
policy specifications, insured limits and deductibles customarily carried for
similar properties. The Terrorism Risk Insurance Act of 2002 was signed into law
on November 26, 2002. The law provides that losses resulting from certified acts
of terrorism will be partially reimbursed by the United States after the
insurance company providing coverage pays a statutory deductible amount. The law
also requires that the insurance company offer coverage for terrorist acts for
an additional premium. We accepted the offer to include this coverage in our
property and casualty policies.

                                       7
<PAGE>

We believe that our properties are adequately covered by insurance. There are,
however, some types of losses (such as losses arising from acts of war) that are
not generally insured because they are either uninsurable or not economically
insurable. If an uninsured loss or a loss in excess of insured limits occurs, we
could lose our capital invested in a property, as well as the anticipated future
revenues from the property, and we would continue to be obligated on any
mortgage indebtedness or other obligations related to the property. Any loss of
that kind could materially adversely affect us.

COMPETITION

All of the properties owned by the Company are in areas where there is
substantial competition with other multifamily properties, with single-family
housing that is either owned or leased by potential tenants and with other
commercial properties. The principal method of competition is to offer
competitive rental rates. In order to maintain occupancy rates and attract
quality tenants, the Company may also offer rental concessions, such as free
rent to new tenants for a stated period. The Company also competes by offering
properties in attractive locations and providing residential and commercial
tenants with amenities such as covered parking, recreational facilities, garages
and pleasant landscaping. The Company intends to continue upgrading and
improving the physical condition of its existing properties and will consider
selling existing properties, which the Company believes have realized their
potential, and re-investing in properties that may require renovation but that
offer greater appreciation potential.

ENVIRONMENTAL MATTERS

The Company believes that each of its properties is in compliance, in all
material respects, with federal, state and local regulations regarding hazardous
waste and other environmental matters and is not aware of any environmental
contamination at any of its properties that would require any material capital
expenditure by the Company for the remediation thereof. No assurance can be
given that environmental regulations will not, in the future, have a materially
adverse effect on the Company's operations.

INVESTMENT IN MARKETABLE SECURITIES

The Company holds investments in certain marketable securities. From time to
time, the Company buys and sells securities in the open market. The Company's
investments in marketable securities are accounted for as securities available
for sale.

ITEM 2. PROPERTIES

The executive and administrative office of the Company consists of approximately
2,000 square feet, located at 921 Bergen Avenue, Jersey City, New Jersey.
Wilshire leased this office on a month-to-month basis at a monthly rental of
$2,683. In December 2004, the 921 Bergen Avenue building was sold by a major
bank and the new owner increased the monthly rental to $5,350 in January 2005.
The Company expects to relocate its corporate offices to newly leased space in
April 2005.

The Company maintained its principal office for its now discontinued United
States oil and gas operations in Oklahoma City, Oklahoma, leasing 3,618 square
feet on a month-to-month basis, at a monthly cost of $2,345. With the sale in
April 2004 of the United States oil and gas assets, this lease was terminated in
June 2004.

The Company's Canadian subsidiary maintained an exploration office in Calgary,
Alberta, Canada. The Company leased 1,583 square feet on a month-to-month basis
at a monthly rental of $3,408 Canadian. With the sale of the Canadian oil and
gas assets in April 2004, this lease was terminated in April 2004.

The following table provides summary information regarding the Company's
apartment properties and condominium properties.

                                       8
<PAGE>


<TABLE>
<CAPTION>
                                                                       Apartment Unit Type
                                                           ---------------------------------------------
                                      Date       No. of       Studio /                                              Rentable
Name (State)                        Acquired      Units    Efficiencies    1 BR      2 BR       3 BR      Acreage    Sq. Ft.
------------                        --------      -----    ------------    ----      ----       ----      -------    -------
<S>                                 <C>         <C>        <C>             <C>       <C>        <C>       <C>        <C>
      APARTMENTS:
Alpine Village (NJ)                 10/29/95        132              -       48        84          -       13.73     101,724
Biltmore Club (AZ) (a)(b)           10/23/97        378            192      186         -          -        8.08     193,716
Summercreek (TX)                     3/29/01        180              -       84        96          -        8.17     142,452
Sunrise Ridge (AZ)                  10/24/97        340              -      144       196          -       17.73     291,674
Twelve Oaks (GA) (b)                 4/10/96         72              -        -        42         30       10.04      91,404
Van Buren (AZ)                       6/11/98         70              -       42        28          -        1.41      81,404
Wellington (TX)                      7/30/98        228             24       60       116         28        8.69     214,744
     CONDOMINIUMS:
Galsworthy Arms (c)                  3/31/94         45              -       31        14          -           -      38,026
Jefferson Gardens (d)                3/31/94         20              -       16         4          -           -      15,843

</TABLE>

(a) The Company has entered into a definitive agreement to sell the property in
February 2005 for $21.0 million.

(b) Classified by the Company as Discontinued Operations. See Note 2 to the
Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.

(c) Galsworthy Arms has a total of 64 units, 44 one bedroom and 20 two bedroom.

(d) Jefferson Gardens has a total of 50 units, 34 one bedroom and 16 two
bedroom.

The following table provides summary information regarding the Company's
commercial properties.

<TABLE>
<CAPTION>

Name (State)                                             Date Acquired            Rentable Sq. Ft.         Acreage
------------                                             -------------            ----------------         -------
<S>                                                      <C>                <C>                            <C>
     OFFICE & RETAIL:
Amboy Tower (NJ) (a)                                             3/31/98                    75,000
Royal Mall Plaza (AZ)                                            3/31/94                    66,552
Tamarac Office Plaza (FL)                                       12/31/92                    26,990
Tempe Corporate (AZ)                                            12/31/92                    50,700
     TRIPLE NET LEASE:
Rutherford Bank (NJ)                                             3/31/94                         -            0.17
Wilshire Grand Hotel & Banquet Facility (NJ)                    12/31/97    89 hotel rooms; 50,000           12.29
                                                                               SF banquet facility
     LAND:
Alpine Village , Sussex (NJ)                                    10/28/98                         -            0.51
Alpine Village , Wantage (NJ)                                    2/16/01                         -           17.32
Lake Hopatcong (NJ) (a)                                          3/31/94                         -            1.81
West Orange (NJ) (a)                                             3/31/94                         -            0.60

</TABLE>

(a) Classified by the Company as Discontinued Operations. See Note 2 to the
Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.

The following table provides summary financial information for the Company's
properties that are not carried as discontinued operations. Discontinued
operations contain properties that either are under contracts for sale or the
Company has identified as properties potentially for sale depending on market
conditions including Biltmore Club (AZ), Twelve Oaks (GA), Amboy Tower (NJ) and
the West Orange and Lake Hopatcong New Jersey land parcels.


                                       9
<PAGE>

<TABLE>
<CAPTION>

                                               As of 12/31/04                         For the Year 2004
                                         ----------------------------    --------------------------------------------
                                                                            Net
                                           Net Book       Mortgage       Operating        Interest          Capital
Name (State)                                 Value        Principal        Income         Expense        Expenditures
------------                             -----------     -----------     ----------       --------       ------------
<S>                                      <C>             <C>             <C>              <C>            <C>
APARTMENTS:
Alpine Village (NJ)                      $ 3,465,000     $ 4,889,000       $536,000        $297,000        $  85,000
Summercreek (TX)                           5,328,000       4,117,000        443,000         310,000          207,000
Sunrise Ridge (AZ)                         5,651,000      10,463,000      1,139,000         627,000          258,000
Van Buren (AZ)                             1,792,000       2,054,000        229,000         130,000          126,000
Wellington (TX)                            3,974,000       4,303,000        543,000         265,000          257,000
     CONDOMINIUMS:
Galsworthy Arms                            2,130,000       1,544,000        169,000          98,000          424,000
Jefferson Gardens                            750,000         403,000         60,000          36,000           13,000
     OFFICE & RETAIL:
Royal Mall Plaza (AZ)                      1,408,000               -        442,000               -           50,000
Tamarac Office Plaza (FL)                    775,000         608,000        136,000          39,000            4,000
Tempe Corporate (AZ)                       2,548,000       3,887,000        337,000         261,000          278,000
     TRIPLE NET LEASE:
Wilshire Grand Hotel  (NJ)                 4,868,000       3,421,000         63,000         224,000                -
Rutherford Bank (NJ)                         604,000         463,000        110,000          33,000                -
                                         -----------     -----------     ----------       --------       ------------
Total:                                   $33,293,000     $36,152,000     $4,207,000      $2,320,000       $1,702,000
                                         ===========     ===========     ==========      ==========       ==========
</TABLE>


ITEM 3. LEGAL PROCEEDINGS

At December 31, 2004, the Company was not a party to any actions or proceedings
which management believes are reasonable likely to have a material adverse
effect upon the Company.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of security holders during the fourth
quarter of fiscal 2004.

                                       10
<PAGE>

ITEM 4A  EXECUTIVE OFFICERS OF THE REGISTRANT

The following table sets forth the name and age of each executive officer of the
Company. Each officer is appointed by the Company's Board of Directors. Unless
otherwise indicated, the persons named below have held the position indicated
for more than the past five years.

<TABLE>
<CAPTION>
                                                Officer of
                                                The Company                Position with the Company
Name and Age                                      Since                     and Business Experience
<S>                                        <C>                    <C>

S. Wilzig Izak, Age 46                            1987            Chairman  of  the  Board  of  the   Company   since
                                                                  September 20, 1990;  Chief Executive  Officer since
                                                                  May 1991;  Executive  Vice  President  (1987-1990);
                                                                  prior thereto, Senior Vice President

Daniel C. Pryor, Age 44                        June, 2004         President  and  Chief  Operating   Officer  of  the
                                                                  Company  since June 2004;  Investment  Banker  from
                                                                  1993 - 2004  including  at  D&T  Corporate  Finance
                                                                  (2001 - 2004),  Lehman Brothers (1999 - 2001),  and
                                                                  Salomon  Smith  Barney  (Citigroup)  (1993 - 1999);
                                                                  developer,  property  manager  and  investor in the
                                                                  real estate industry (1985 - 1991)

Seth H. Ugelow, Age 52                         June, 2004         Chief  Financial  Officer of the Company since June
                                                                  2004;  Senior Vice  President and Controller of The
                                                                  Trust  Company of New Jersey  (January  2003 - June
                                                                  2004);  Consultant (June 2002 - January 2003); Vice
                                                                  President  and  Head of  Accounting  at The Bank of
                                                                  Tokyo-Mitsubishi  (New York  Office)  (June  2001 -
                                                                  June  2002);   Vice  President  and  Controller  of
                                                                  Credit Agricole  Indosuez (New York Office ) (April
                                                                  1995 - June 2001)
</TABLE>



                                       11
<PAGE>

                                     PART II

ITEM 5.    MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
           AND ISSUER PURCHASES OF EQUITY SECURITIES

The Company's common stock is traded on the American Stock Exchange. The
following table indicates the high and low sales prices of the Company's common
stock for the quarters indicated during the years ended December 31, 2004 and
2003:

<TABLE>
<CAPTION>
                                 Quarter 1                Quarter 2                Quarter 3                Quarter 4
                             ---------------------    --------------------      -------------------     ---------------------
                             High    -    Low         High     -   Low          High     -  Low         High     -   Low
                             -------      --------   --------     -------      --------    -------     --------     --------
<S>                       <C>             <C>      <C>            <C>      <C>             <C>      <C>             <C>

2004                      $  6.80    -    5.25     $  5.86     -   4.61    $    5.30     -  4.90    $   7.60     -   5.00
2003                         4.00    -    3.51        5.00     -   3.37         5.95     -  4.50        7.09     -   5.31

</TABLE>


As of March 21, 2005, there were 4,480 common shareholders of record.

The Company has not paid any dividends to shareholders during the past two
years. Based on a primary objective of increasing shareholder value, the Board
of Directors will consider the payment of dividends from time to time in the
future based on the Company's capital requirements and results of operations.

In June 2004, the Company's Board of Directors authorized management to conduct
a buyback of up to 1,000,000 common shares. Under this authorization, the
Company conducted an odd-lot share repurchase program, which offered
shareholders who owned a small number of common shares the opportunity to sell
their shares without paying a broker's commission. The Company also benefited
under the odd-lot share repurchase program by lowering its administrative costs
through the closing of approximately 1,900 shareholder accounts. Under the Board
authorization, the Company also allowed other shareholders the opportunity to
sell their shares to the Company.

The following table presents the total share repurchase activity under the
Board's authorization. No repurchase activity took place from the date of the
announcement of the Board's authorization through June 30, 2004. The
authorization to repurchase common shares has no expiration date and the Company
has not determined when, or if, the program will be discontinued.


<TABLE>
<CAPTION>
                                                                        (c) Total number of
                                                                        shares (or units)        (d) Maximum number (or approximate
                              (a) Total number of    (b) Average        purchased as part of      dollar value) of shares (or units)
                              of shares (or units)  price paid per      publicly announced         that may yet be purchased
Period                             purchased        share (or unit)     plans or programs         under the plans or programs
------                             ---------        ---------------     -----------------         ----------------------------------
<S>                           <C>                   <C>                 <C>                       <C>

July 1 - 31, 2004                     2,080             $5.03                   2,080             997,920 common shares
August 1 - 31, 2004                  18,029             $5.08                  18,029             979,891 common shares
September 1 - 30, 2004               10,322             $5.08                  10,322             969,569 common shares
October 1 - 31, 2004                  6,600             $5.14                   6,600             962,969 common shares
November 1 - 30, 2004                   400             $6.09                     400             962,569 common shares
December 1 - 31, 2004                 1,047             $6.84                   1,047             961,522 common shares

</TABLE>


                                       12
<PAGE>

EQUITY COMPENSATION PLAN INFORMATION

The following table provides information as of December 31, 2004 with respect to
shares of the Company's common stock that may be issued under the Company's
existing equity compensation plans, which consist of the (i) 1995 Stock Option
and Incentive Plan, (ii) 1995 Non-Employee Director Stock Option Plan, (iii)
2004 Stock Option and Incentive Plan, and (iv) 2004 Non-Employee Director Stock
Option Plan, each of which has been approved by the Company's shareholders.

<TABLE>
<CAPTION>
                                                                                                               (c)
                                                                                                             Number of
                                                        (a)                       (b)                       Securities
                                                     Number of                  Weighted                Remaining Available
                                                  Securities To Be          Average Exercise            For Future Issuance
                                                    Issued Upon                 Price Of                    Under Equity
                                                    Exercise Of                Outstanding               Compensation Plans
                                                    Outstanding                 Options,                    (Excluding)
                                                 Options, Warrants            Warrants and              Securities Reflected
Plan Category                                        and Rights                  Rights                    In Column (a))
--------------------                            ---------------------     ----------------------     ---------------------------
<S>                                             <C>                       <C>                        <C>

Equity compensation plans approved by
security holders                                      457,460                      $3.81                         695,471

Equity compensation plans not approved by
security holders                                            -                          -                               -
                                                      -------                      -----                         -------

Total                                                 457,460                      $3.81                         695,471
                                                      =======                      =====                         =======
</TABLE>


ITEM 6. SELECTED FINANCIAL DATA

The selected consolidated financial data for the Company for each of the five
(5) fiscal years in the period ended December 31, 2004 are derived from the
consolidated financial statements that have been audited. J.H. Cohn LLP
Independent Registered Public Accounting Firm for Wilshire has reported upon the
consolidated financial statements as of and for the year ended December 31,
2004. The consolidated financial statements as of and for the years ended
December 31, 2003 and 2002 have been reported upon by Ernst & Young LLP,
Independent Registered Public Accounting Firm. Ernst & Young LLP, Independent
Registered Public Accounting Firm has also reported upon the consolidated
statements of income, cash flows and changes in stockholders' equity for the
year ended December 31, 2001. The consolidated balance sheet as of December 31,
2001 and the consolidated financial statements as of and for the year ended
December 31, 2000 have been reported upon by Arthur Andersen LLP.

The following table sets forth the Company's selected financial data and should
be read in conjunction with the Consolidated Financial Statements and notes
thereto included in Item 8, "Financial Statements and Supplementary Data" and
Item 7, "Management's Discussion and Analysis of Financial Condition and Results
of Operations" in this Annual Report on Form 10-K.

                                       13
<PAGE>

<TABLE>
<CAPTION>
                                                                              As of December 31
                                            ---------------------------------------------------------------------------------------
                                                 2004               2003              2002               2001              2000
                                                 ----               ----              ----               ----              ----
                                                               (In thousands of dollars except per share amounts)
<S>                                           <C>               <C>                 <C>             <C>                <C>
BALANCE SHEET DATA AT YEAR-END:
Total assets                                     $87,553           $98,997            $107,920          $107,903           $98,541
Long-term debt                                    46,855            58,494              65,706            67,948            61,543
Stockholders' equity                              29,111            24,527              24,239            23,693            21,428

Weighted average shares outstanding:
Basic                                              7,796             7,810               7,832             7,914             8,161
Diluted                                            7,955             7,930               7,832             7,914             8,161

                                                                       For the Year Ended December 31,
                                            ---------------------------------------------------------------------------------------
                                                    2004              2003                2002              2001              2000
                                                    ----              ----                ----              ----              ----
                                                               (In thousands of dollars except per share amounts)
INCOME STATEMENT DATA:
Revenues                                        $  9,706          $  9,257           $   9,143         $   8,413          $  7,434
                                               ---------         ---------          ----------        ----------        ----------

Costs and expenses:
Operating expenses                                 5,499             5,453               5,260             4,559             3,878
Depreciation                                       1,673             1,647               1,541             1,320             1,271
General and administrative                         2,143             2,349               2,131             1,690             1,689
                                               ---------         ---------          ----------        ----------        ----------
Total costs and expenses                           9,315             9,449               8,932             7,569             6,838
                                               ---------         ---------          ----------        ----------        ----------

Dividend and interest income                         685               743                 877               867                 -
Sale of marketable securities                          -             2,621                 711           (1,684)                 -
Life insurance proceeds                                -             1,000                   -                 -                 -
Other income                                         629               232                 540                87               192

Interest  expense  including  amortization
of deferred financing costs                      (2,343)           (3,408)             (2,226)           (2,995)           (1,729)
                                               ---------         ---------          ----------        ----------        ----------

Income (loss) before provision for taxes           (638)               996                 113           (2,881)             (941)
Income taxes                                       (221)             (107)                (47)           (1,129)             (350)
                                               ---------         ---------          ----------        ----------        ----------

Income (loss) from continuing operations           (417)             1,103                 160           (1,752)             (591)

Discontinued operations - real estate              3,766               702                (92)               363             (579)
Discontinued operations - oil & gas                (711)           (3,178)               1,008             1,841             2,394
                                               ---------         ---------          ----------        ----------        ----------

Net income (loss)                                $ 2,638          $(1,373)            $  1,076        $      452          $  1,224
                                               =========         =========          ==========        ==========        ==========

Basic earnings (loss) per share:
Continuing operations                            $(0.05)             $0.14               $0.02           $(0.22)           $(0.07)
Discontinued operations                             0.39            (0.32)                0.12              0.28              0.22
                                               ---------         ---------          ----------        ----------        ----------
Net income (loss) per share                        $0.34           $(0.18)               $0.14             $0.06             $0.15
                                               =========         =========          ==========        ==========        ==========

Diluted earnings (loss) per share:
Continuing operations                            $(0.05)             $0.14               $0.02           $(0.22)           $(0.07)
Discontinued operations                             0.38            (0.32)                0.12              0.28              0.22
                                               ---------         ---------          ----------        ----------        ----------
Net income (loss) per share                      $  0.33           $(0.18)               $0.14           $  0.06            $ 0.15
                                               =========         =========          ==========        ==========        ==========

</TABLE>

                                       14
<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Wilshire's business has been comprised of three sets of activities - the real
estate business, the oil and gas business (which was sold in April 2004) and
corporate.

The real estate business consists of residential and commercial properties in
Arizona, Florida, Georgia, New Jersey and Texas. Within this portfolio of
properties, certain properties have been designated as being held for sale and
have been classified as discontinued operations. The following discussion takes
an income statement approach and discusses the results of operations first for
the properties comprising "continuing operations" and then discusses the
discontinued operations.

The assets comprising Wilshire's oil and gas business were sold in April 2004,
effective March 1, 2004. Oil and gas operations for all periods presented in
this report have been classified as discontinued operations.

Corporate activities include investments in marketable securities, management of
Wilshire's short-term cash positions and administrative functions.

All three activities are reviewed and analyzed in the following discussion,
which should be read in conjunction with the financial statements and notes
contained in Item 8 of this Form 10-K. Certain statements in this discussion may
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements reflect
Wilshire's current expectations regarding future results of operations, economic
performance, financial condition and achievements of Wilshire, and do not relate
strictly to historical or current facts. Wilshire has tried, wherever possible,
to identify these forward looking statements by using words such as "believe,"
"expect," "anticipate," "intend," "plan," "estimate," or words of similar
meaning. Although Wilshire believes that the expectations reflected in such
forward-looking statements are based on reasonable assumptions, such statements
are subject to risks and uncertainties, which may cause the actual results to
differ materially from those projected. Such factors include, but are not
limited to, the following: general economic and business conditions, which will,
among other things, affect demand for rental space, the availability of
prospective tenants, lease rents and the availability of financing; adverse
changes in Wilshire's real estate markets, including among other things,
competition with other real estate owners, risks of real estate development and
acquisitions; governmental actions and initiatives; and environmental / safety
requirements.

CRITICAL ACCOUNTING POLICIES

Pursuant to the Securities and Exchange Commission ("SEC") disclosure guidance
for "Critical Accounting Policies," the SEC defines Critical Accounting Policies
as those that require the application of Management's most difficult,
subjective, or complex judgments, often because of the need to make estimates
about the effects of matters that are inherently uncertain and may change in
subsequent periods.

Wilshire's discussion and analysis of its financial condition and results of
operations are based upon Wilshire's consolidated financial statements, which
have been prepared in accordance with accounting principles generally accepted
in the United States. The preparation of these financial statements requires
Wilshire to make estimates and judgments that affect the reported amounts of
assets, liabilities, revenues and expenses. Wilshire bases its estimates on
historical experience and on various other assumptions that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates under different assumptions or conditions.

                                       15
<PAGE>

IMPAIRMENT OF PROPERTY AND EQUIPMENT

On a periodic basis, management assesses whether there are any indicators that
the value of its real estate properties may be impaired. A property's value is
considered impaired if management's estimate of the aggregate future cash flows
(undiscounted and without interest charges) to be generated by the property is
less than the carrying value of the property. To the extent impairment has
occurred, the loss shall be measured as the excess of the carrying amount of the
property over the fair value of the property. Management does not believe at
December 31, 2004 and 2003 that the value of any of its properties is impaired.

REVENUE RECOGNITION

Revenue from real estate properties is recognized during the period in which the
premises are occupied and rent is due from tenants. For commercial properties,
rental revenue is recognized on a straight-line basis over the term of the
lease. The excess of rents recognized over amounts contractually due pursuant to
the underlying leases are included in accounts receivable. For residential
properties where lease agreements are almost exclusively for one- year terms,
rental revenue is recognized in accordance with the contractual terms of the
underlying leases. The Company follows a policy of aggressively pursuing its
rental tenants to ensure timely payment of amounts due. When a tenant becomes 30
days in arrears on paying rent, the amount is written-off and turned over to a
collection agency for action. Accordingly, no allowance for uncollectible
accounts is maintained for the Company's real estate tenants.

An allowance for uncollectible accounts was maintained based on the Company's
estimate of the inability of its joint interest partners in the oil and gas
division to make required payments. With the sale of the oil and gas division,
the Company no longer maintains an allowance for uncollectible accounts.

FOREIGN OPERATIONS

The assets and liabilities of Wilshire's Canadian subsidiary have been
translated at year-end exchange rates. The related revenues and expenses have
been translated at average annual exchange rates. The aggregate effect of
translation losses is included as a component of accumulated other comprehensive
income (loss) until the sale or liquidation of the underlying foreign
investment.

As a result of the sale of the Canadian oil and gas assets in 2004 and the
anticipated distribution of net proceeds to the United States parent company in
2005, Wilshire has provided $2.1 million of United States taxes and $900,000 of
Canadian taxes that are expected to be incurred upon such remittance. See Note 1
of the Notes to the Consolidated Financial Statements in Item 8 of this Annual
Report on Form 10-K.

STOCK-BASED COMPENSATION

Wilshire follows the disclosure-only provisions of SFAS 123 and SFAS 148. The
provisions of SFAS 123R will be adopted commencing January 1, 2006.

EFFECTS OF RECENT ACCOUNTING PRONOUNCEMENTS

In December 2004, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 153, " Exchanges of
Nonmonetary Assets an amendment of APB Opinion No. 29." SFAS 153 amends Opinion
29 to eliminate the exception for non monetary exchanges of similar productive
assets and replaces it with a general exception for exchanges of nonmonetary
assets that do not have commercial substance. The provisions of SFAS 153 are
effective for nonmonetary asset exchanges occurring in fiscal periods beginning
after June 15, 2005. Adoption of the provisions of SFAS 153 is not expected to
have a material impact on the Company's consolidated financial condition.

                                       16
<PAGE>

In December 2004, the FASB issued SFAS No. 123R, "Accounting for Stock-Based
Compensation." SFAS 123R establishes standards for the accounting for
transactions in which an entity exchanges its equity instruments for goods or
services. This Statement focuses primarily on accounting for transactions in
which an entity obtains employee services in share-based payment transactions.
SFAS 123R requires that the fair value of such equity instruments be recognized
as an expense in the historical financial statements as services are performed.
Prior to SFAS 123R, only certain pro forma disclosures of fair value were
required. SFAS 123R shall be effective for Wilshire as of the beginning of the
first interim or annual reporting period that begins after December 15, 2005.
The adoption of this new accounting pronouncement is not expected to have a
material impact on Wilshire's consolidated financial statements.

In December 2003, the FASB issued revised Financial Accounting Interpretation
("FIN") 46R, "Consolidation of Variable Interest Entities, an Interpretation of
Accounting Research Bulletin No. 51." FIN 46R requires the consolidation of an
entity in which an enterprise absorbs a majority of the entity's expected
losses, receives a majority of the entity's expected residual returns, or both,
as a result of ownership, contractual or other financial interests in the entity
(variable interest entities, or "VIEs"). Currently, entities are generally
consolidated by an enterprise when it has a controlling financial interest
through ownership or a majority voting interest in the entity. Application of
FIN 46R is required in financial statements of public entities that have
interests in VIEs or potential VIEs commonly referred to as special-purpose
entities for periods ending after December 31, 2003. Application by public
entities (other than small business issuers) for all other types of entities is
required in financial statements for periods ending after March 15, 2004.
Application by small business issuers to entities other than special-purpose
entities and by nonpublic entities to all types of entities is required at
various dates in 2004 and 2005. In some instances, enterprises have the option
of applying or continuing to apply Interpretation 46 for a short period of time
before applying Interpretation 46(R). As of December 31, 2004, the Company does
not have any variable interest entities that fall within the provisions of FIN
46(R).

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity." This Statement
requires that an issuer classify financial instruments that are within its scope
as a liability. Many of those instruments were classified as equity under
previous guidance. Most of the guidance in SFAS 150 was effective for all
financial instruments entered into or modified after May 31, 2003, and otherwise
was effective at the beginning of the first interim period beginning after June
15, 2003. As of December 31, 2004, the Company did not have any financial
instruments outstanding that were within the scope of Statement No. 150.

In April 2003, the FASB issued SFAS No. 149, "Amendment of Statement 133 on
Derivative Instruments and Hedging Activities." The adoption of the provisions
of SFAS 149 did not have any impact on Wilshire's consolidated financial
statements.


                                       17
<PAGE>

RESULTS OF OPERATIONS

The following table presents the increases (decreases) in each major statement
of income category for the year ended December 31, 2004 ("2004") compared with
the year ended December 31, 2003 ("2003") and 2003 compared with the year ended
December 31, 2002 ("2002").

<TABLE>
<CAPTION>
                                                  INCREASE (DECREASE) IN CONSOLIDATED STATEMENTS OF INCOME CATEGORIES FOR THE
                                                  PERIODS:
                                                             2004 v. 2003                             2003 v. 2002
                                                  ------------------------------------   ----------------------------------------
                                                       Amount ($)          %             Amount ($)                %
                                                       ----------          -             ----------                -

<S>                                                    <C>               <C>                  <C>                <C>
REVENUES                                               $  449,000        4.9  %               $  114,000         1.2  %
                                                       ----------                             ----------
COSTS AND EXPENSES
      Operating expenses                                   46,000        0.8                     193,000         3.7
      Depreciation expense                                 26,000        1.6                     106,000         6.9
      General and administrative                        (206,000)      (8.8)                     218,000        10.2
                                                        ---------                        ---------------
         Total costs and expenses                       (134,000)      (1.4)                     517,000         5.8
                                                        ---------                        ---------------
INCOME (LOSS) FROM OPERATIONS                             583,000      303.6                   (403,000)     (191.0)
OTHER INCOME
      Dividend and interest income                       (58,000)      (7.8)                   (134,000)      (15.3)
      Gain on sale of marketable securities           (2,621,000)    (100.0)                   1,910,000       268.6
      Insurance proceeds                              (1,000,000)    (100.0)                   1,000,000       100.0
      Other income                                        397,000      171.1                   (308,000)      (57.0)
INTEREST EXPENSE                                      (1,065,000)     (31.3)                   1,182,000        53.1
                                                      -----------                        ---------------
         INCOME (LOSS) BEFORE PROVISION FOR
         INCOME TAXES                                 (1,634,000)    (164.1)                     883,000       781.4
INCOME TAX EXPENSE (BENEFIT)                              114,000      106.5                      60,000      (127.7)
                                                      -----------                        ---------------

INCOME (LOSS) FROM CONTINUING OPERATIONS              (1,520,000)    (137.8)                     943,000       589.4
                                                      -----------                        ---------------
DISCONTINUED OPERATIONS - REAL ESTATE, NET OF
TAXES
      LOSS FROM OPERATIONS                               (89,000)     (23.5)                   (137,000)      (56.6)
      GAIN FROM SALES                                   2,975,000      275.2                     931,000       620.7
DISCONTINUED OPERATIONS - OIL & GAS, NET OF
TAXES
      INCOME (LOSS) FROM OPERATIONS                     1,900,000       59.8                 (4,186,000)    (415.3.)
      GAIN FROM SALES                                     567,000      100.0                          -          (A)
                                                       ----------                        ---------------
NET INCOME (LOSS)                                      $4,011,000      292.1                $(2,449,000)     (227.6)
                                                       ==========                        ===============
BASIC EARNINGS (LOSS) PER SHARE:
      Income (loss) from continuing operations            $(0.19)    (135.7)                     $  0.12       600.0
      Income (loss) from discontinued operations            0.71       229.0                      (0.44)      (366.7)
                                                          ------                                 ------
      Net income (loss) applicable to common
      stockholders                                        $  0.52      288.9                     $(0.32)        228.6
                                                          =======                                =======

DILUTED EARNINGS (LOSS) PER SHARE:
      Income (loss) from continuing operations            $(0.19)    (135.7)                     $  0.12       600.0
      Income from discontinued operations                    0.70      218.8                      (0.44)     (366.7)
                                                          -------                                -------
      Net income (loss) applicable to common
      stockholders                                        $  0.51      283.3                     $(0.32)     (228.6)
                                                          =======                                =======
</TABLE>

(A) There was no gain from the sale of the oil and gas business in either 2003
or 2002.

                                       18
<PAGE>

RESULTS OF OPERATIONS - 2004 V. 2003

OVERVIEW

Net income for 2004 amounted to $2,638,000 or $0.33 per diluted share, an
improvement of $4,011,000 from the net loss of $1,373,000 or $0.18 per diluted
share reported for 2003. Results of operations are shown as continuing and
discontinued, with discontinued operations comprised of the results of
operations from the Company's oil and gas businesses, the results of the sale of
the oil and gas properties, the operating results from real estate properties
held for sale and the gain from real estate properties held for sale that were
sold during the period.

CONTINUING OPERATIONS:

Loss from continuing operations was $417,000 in 2004 compared with income of
$1,103,000 in 2003. Results per diluted share from continuing operations
amounted to $(0.05) in 2004 and $0.14 in 2003. The 2003 period included
$1,550,000 of after tax ($2,621,000 before taxes) gains on the sale of
marketable securities and $1,000,000 after tax income from death benefits
received from an insurance policy on the life of the Company's former Senior
Consultant. Without these two special transactions, the Company would have
incurred a loss from continuing operations of $1,447,000 in 2003.

Reported income from continuing operations in 2004 compared with 2003 reflects a
higher level of income from operations (defined as revenues reduced by operating
expenses, depreciation and general and administrative expenses), a lower level
of interest expense and an increased income tax benefit, that was offset by
lower other income. These factors are discussed below.

SEGMENT INFORMATION

Wilshire presently conducts business in the residential (including condominiums
that it owns and rents) and commercial real estate segments. The following table
sets forth comparative data for Wilshire's real estate segments in continuing
operations.

<TABLE>
<CAPTION>

                       Residential Real Estate                 Commercial Real Estate                           Total
                  ----------------------------------       -------------------------------          -------------------------------
                        Year ended          Increase           Year ended         Increase           Year ended            Increase
                       December 31        (Decrease)          December 31       (Decrease)          December 31          (Decrease)
                       -----------        ----------          -----------       ----------          -----------          ----------
                   2004       2003          $      %       2004      2003         $      %     2004        2003           $       %
                   ----       ----          -      -       ----      ----         -      -     ----        ----           -       -
                        (In 000s of $)                         (In 000s of $)                        (In 000s of $)
<S>              <C>        <C>         <C>     <C>      <C>       <C>        <C>    <C>     <C>        <C>           <C>      <C>
Rental income    $6,920     $6,839        $81    1.2     $2,179    $1,908      $271   14.2   $9,099      $8,747        $352     4.0
Tenant fees           5          1          4      -          6         3         3  100.0       11           4           7       -
Vending
income               75         62         13   21.0          -         -         -      -       75          62          13    21.0
Other               456        411         45   10.9         65        33        32   97.0      521         444          77    17.3
                 ------     ------      -----            ------    ------      ----          ------     -------        ----
Total
revenues          7,456      7,313        143    2.0      2,250     1,944       306   15.7    9,706       9,257         449     4.9
Operating
expenses          4,337      4,405       (68)   (1.5)     1,162     1,048       114   10.9    5,499       5,453          46     0.8
                 ------     ------      -----            ------    ------      ----          ------     -------        ----
Net
operating
income           $3,119     $2,908       $211    7.3     $1,088    $  896      $192   21.4   $4,207      $3,804        $403    10.6
                 ======     ======       ====  =====     ======    ======      ====   ====   ======      ======        ====    ====
Average
occupancy %        91.2       91.6                         60.5      55.7                      84.1        84.1

<CAPTION>
<S>                                                                                           <C>         <C>

Reconciliation to consolidated income (loss) from continuing operations:
Net operating income                                                                           $4,207      $3,804
Depreciation expense                                                                           (1,673)     (1,647)
General and administrative expenses                                                            (2,143)     (2,349)
Other income                                                                                    1,314       4,596
Interest expense                                                                               (2,343)     (3,408)
Income tax benefit                                                                                221         107
                                                                                               ------      ------
Income (loss) from continuing operations                                                       $ (417)     $1,103
                                                                                               ======      ======
</TABLE>

                                       19
<PAGE>

The above table details the comparative net operating income ("NOI") for
Wilshire's residential and commercial real estate segments, and reconciles the
combined NOI to consolidated income (loss) from continuing operations. NOI is
based on operating revenue and expenses directly associated with the operations
of the real estate properties, but excludes depreciation and interest expense.
Wilshire assesses and measures segment operating results based on NOI, which is
a direct measure of each property's contribution to the results of the Company
before considering revenues from treasury activities, overhead expenses and
other costs that are not directly related to the performance of a property. The
Company believes NOI is a more descriptive measure of the Company's performance
than income (loss) from continuing operations. NOI is not a measure of operating
results or cash flow as measured by accounting principles generally accepted in
the United States of America and is not necessarily indicative of cash available
to fund cash needs and should not be considered an alternative to cash flows as
a measure of liquidity.

RESIDENTIAL SEGMENT

During 2004 revenues increased $143,000 or 2.0% to $7,456,000 and NOI increased
$211,000 or 7.3% to $3,119,000. Wilshire's properties in Texas (Summercreek and
Wellington) contributed NOI increases of $212,000, while the Arizona properties
(Sunrise Ridge and Van Buren) contributed NOI increases of $59,000. The New
Jersey properties (Alpine Village, Galsworthy Arms and Jefferson Gardens) had a
NOI decrease of $60,000. These results are partially reflective of the relative
strengths of the rental markets in these areas. In addition, the condominiums
owned by Wilshire at Galsworthy Arms were intentionally left vacant for portions
of 2004 so that upgrades, repairs and maintenance work could be performed.
Similarly, condominium units at Jefferson Gardens were intentionally left vacant
while the Company evaluated the sale of these units.

In addition to the work Wilshire is undertaking in the units that it owns at
Galsworthy Arms, the condominium association, in which Wilshire is the majority
owner, has commenced work to upgrade the common areas of the Galsworthy Arms
complex, including the parking lot, awnings, doorways, lighting and landscaping.
During 2004, Wilshire has paid to the association a special assessment of
$315,000 for its share of these improvements. The Company believes these
expenditures will strengthen the competitive position of the property and
potentially enhance the value of the condominiums.

COMMERCIAL SEGMENT

During 2004 revenues increased $306,000 or 15.7% to $2,250,000 and NOI increased
$192,000 or 21.4% to $1,088,000. The primary factor in the increased NOI was the
Wilshire Grand Hotel where increased rental income in 2004 resulted in a
$175,000 improvement in NOI. This improvement was partly offset by a decline in
NOI at Tempe Corporate Center which experienced lower rental income in 2004 due
to tenants moving out not being replaced and higher operating costs.

During the second half of 2004, and continuing into 2005, the Company has
undertaken a program to upgrade the common areas of the Tempe Corporate Center.
Through February 2005, in excess of $300,000 has been spent on this program.
Partially as a result of this upgrade program and increased marketing efforts,
the Company has entered into several leases with new tenants and the building
has an improved occupancy percentage in February 2005 as compared to September
2004, when the increased marketing efforts commenced.


                                       20
<PAGE>

REVENUES

<TABLE>
<CAPTION>
                                                                      Years Ended December 31,
                                                                ------------------------------
                                                                      2004                2003            Increase (Decrease)
                                                                      ----                ----            -------------------
<S>                                                             <C>                 <C>                   <C>
Alpine Village, New Jersey                                      $1,120,000          $1,141,000                      $(21,000)
Galsworthy Arms, New Jersey                                        481,000             485,000                        (4,000)
Jefferson Gardens, New Jersey                                      200,000             229,000                       (29,000)
Summercreek, Texas                                               1,091,000           1,031,000                         60,000
Sunrise Ridge, Arizona                                           2,388,000           2,341,000                         47,000
Van Buren Apartments, Arizona                                      588,000             561,000                         27,000
Wellington, Texas                                                1,588,000           1,525,000                         63,000
                                                                 ---------           ---------                         ------
Sub-total - Condominium & Residential Properties                 7,456,000           7,313,000                        143,000
                                                                 ---------           ---------                        -------

Royal Plaza, Arizona                                               655,000             619,000                         36,000
Rutherford, New Jersey                                             110,000             110,000                              -
Tamarac, Florida                                                   313,000             281,000                         32,000
Tempe Corporate Center, Arizona                                    684,000             692,000                        (8,000)
Wilshire Grand Hotel, New Jersey                                   488,000             242,000                        246,000
                                                                 ---------           ---------                        -------
Sub-total - Commercial Properties                                2,250,000           1,944,000                        306,000
                                                                 ---------           ---------                        -------

Total Revenues                                                  $9,706,000          $9,257,000                       $449,000
                                                                ==========          ==========                       ========
</TABLE>


Revenues from rental properties amounted to $9,706,000 in 2004, an increase of
$449,000 or 4.9%, from $9,257,000 in 2003. The majority of the increase for the
2004 period is attributable to higher rent and reimbursement of real estate tax
expenses applicable to the Wilshire Grand Hotel, the Company's triple net leased
hotel and conference facility located in New Jersey. The remainder of the
increase is related to improved occupancy and market conditions at the Company's
properties located outside of New Jersey. Excluding the Wilshire Grand Hotel,
revenues were lower at the Company's New Jersey properties mainly due to
building improvements and enhanced maintenance that required a number of the
rental units to remain vacant.

OPERATING EXPENSES

<TABLE>
<CAPTION>
                                                                   Years Ended December 31,
                                                               -------------------------------
                                                                      2004                2003            Increase (Decrease)
                                                                      ----                ----            -------------------
<S>                                                            <C>                 <C>                    <C>
Alpine Village, New Jersey                                     $   584,000            $587,000                       $(3,000)
Galsworthy Arms, New Jersey                                        312,000             324,000                       (12,000)
Jefferson Gardens, New Jersey                                      140,000             119,000                         21,000
Summercreek, Texas                                                 648,000             671,000                       (23,000)
Sunrise Ridge, Arizona                                           1,249,000           1,244,000                          5,000
Van Buren Apartments, Arizona                                      359,000             349,000                         10,000
Wellington, Texas                                                1,045,000           1,111,000                       (66,000)
                                                                 ---------           ---------                       --------
Sub-total - Condominium and Residential Properties               4,337,000           4,405,000                       (68,000)
                                                                 ---------           ---------                       --------

Royal Plaza, Arizona                                               213,000             228,000                       (15,000)
Rutherford, New Jersey                                                   -             (1,000)                          1,000
Tamarac, Florida                                                   177,000             137,000                         40,000
Tempe Corporate Center, Arizona                                    347,000             330,000                         17,000
Wilshire Grand Hotel, New Jersey                                   425,000             354,000                         71,000
                                                                 ---------           ---------                         ------
Sub-total - Commercial Properties                                1,162,000           1,048,000                        114,000
                                                                 ---------           ---------                        -------

Total Operating Expenses                                        $5,499,000          $5,453,000                       $ 46,000
                                                                ==========          ==========                       ========
</TABLE>


Operating expenses were $5,499,000 in 2004, $46,000, or 0.8% higher than
$5,453,000 in 2003. The majority of the increase for the 2004 period is
primarily attributable to higher real estate tax expenses applicable to the
Wilshire Grand Hotel.

                                       21
<PAGE>

Depreciation expense amounted to $1,673,000 in 2004, an increase of 1.6% from
the $1,647,000 in 2003, reflecting increased capital expenditures throughout the
Company's network of residential and commercial properties. These expenditures
were undertaken as part of a program to reposition and strengthen the Company's
properties within their targeted markets. Depreciation expense is not included
in the operating expenses included in the preceding table and discussion.

General and administrative expense decreased $206,000, or 8.8%, to $2,143,000 in
2004 from $2,349,000 in 2003. The decrease was related largely to an increased
allocation of expenses to discontinued operations - real estate, reflecting the
increased management time and expense associated with managing and selling these
properties. This decrease was partly offset by a non-cash charge of $114,000
related to stock options for the former president of the Company who retired
June 30, 2004 and whose services has been retained under a three-year consulting
agreement. The stock option expense will be amortized over the three-year term
of the consulting agreement. At December 31, 2004, $431,000 remained to be
amortized into expense.

Other income decreased $3,282,000 to $1,314,000 in 2004 from $4,596,000 in 2003,
principally related to $2,621,000 of gains in 2003 from the sale of marketable
securities and the receipt of $1,000,000 by the Company in 2003 as a beneficiary
of life insurance policies on the life of the Company's former Chairman and
President Siggi B. Wilzig, who had been serving as its Senior Consultant up to
his death on January 7, 2003. The receipt of the life insurance proceeds was not
taxable to the Company. No securities were sold in the 2004 period. These 2003
events were partly offset by a $181,000 gain in 2004 on the sale of two
condominium units at the Company's Jefferson Gardens, New Jersey, property. The
Company intends to continue to operate the remaining units.

Interest expense decreased to $2,343,000 from $3,408,000 in 2003, mainly related
to the payoff of approximately $6.4 million of mortgage debt related to real
estate properties sold and the impact of the Company's refinancing of certain
real estate properties in 2003. Due to the refinancing that was generally
effective March 1 2003, 2003 interest expense includes a one-time prepayment
penalty of $469,000 and $383,000 of amortization expense applicable to a
write-off of unamortized mortgage costs associated with approximately $31.5
million of debt that was refinanced. This refinancing of the mortgage notes
payable reduced the effective rate paid by the Company from 7.36% to 6.22% and
extended its maturity and terms. The impact of the refinancing was reflected in
a reduction of interest expense for ten months of 2003 and the full year 2004.

The provision for income taxes amounted to a tax benefit of $221,000 in 2004
compared to a tax benefit of $107,000 in 2003. The change in the provision for
income taxes is related to the level of income from continuing operations in
2004 compared to 2003 and the change in the mix between taxable and tax-exempt
income. In 2004, the Company earned approximately $194,000 of tax-exempt
interest income compared to none earned in 2003, while in 2003, the $1,000,000
of insurance proceeds received was exempt from taxation.

DISCONTINUED OPERATIONS, NET OF TAXES:

REAL ESTATE

Income from discontinued operations amounted to after tax income of $3,766,000
in 2004 and $702,000 in 2003. The increased income reflects the high level of
sales of properties in 2004 compared to 2003.

During 2004, the Company sold land in Montville, New Jersey, and South
Brunswick, New Jersey for gross proceeds of $1,000,000 and $3,950,000,
respectively, that resulted in after-tax gains of $205,000 and $485,000,
respectively. The Company also sold thirteen residential properties located in
Jersey City, New Jersey for gross proceeds of $14,750,000 that resulted in an
after-tax gain of $3,366,000.

In 2003, three properties in Florida were sold for gross proceeds of $3,190,000
that resulted in an after-tax gain of $1,081,000.

                                       22
<PAGE>

The loss on operating discontinued real estate properties declined in 2004 to
$290,000 in 2004 from $379,000 in 2003, reflecting the sale of thirteen
residential properties in Jersey City, New Jersey, during the first quarter of
2004.

OIL AND GAS

The Company announced in July 2003 its intention to sell its oil and gas
businesses. The Canadian oil and gas business was sold in April 2004 to Addison
Energy Inc., a wholly owned subsidiary of Exco Resources, Inc., for $15 million
in gross proceeds. The United States oil and gas business was sold in April 2004
to Crow Creek Energy LLC, a Tulsa, Oklahoma based privately held portfolio
company of Natural Gas Partners of Dallas, Texas, for $13.3 million in gross
proceeds. During 2004 and 2003, respectively, the Company recorded losses, net
of taxes, from its oil and gas businesses of $1,278,000 and $3,178,000,
respectively. The net loss from operating the oil and gas business in 2004
includes the operating results of the oil and gas business for January and
February and the continuing reconciliation process between the Company and its
partners for periods prior to the effective dates of the sales. The Company
received gross proceeds from the sale of its oil and gas assets in the United
States and Canada of $28.3 million and recorded a net after-tax gain of $567,000
on the sale.

RESULTS OF OPERATIONS - 2003 V. 2002

OVERVIEW

Net income for 2003 amounted to a loss of $1,373,000 or $0.18 per diluted share,
compared to net income of $1,076,000 or $0.14 per diluted share reported for
2002.

CONTINUING OPERATIONS:

Income from continuing operations was $1,103,000 in 2003 compared with $160,000
in 2002. Results per diluted share from continuing operations amounted to $0.14
in 2003 and $0.02 in 2002. The 2003 period included $1,550,000 of after tax
($2,621,000 before taxes) gains from the sale of marketable securities and
$1,000,000 after tax income from death benefits received from an insurance
policy on the life of the Company's former senior consultant. The 2002 period
included $421,000 of after tax ($711,000 before taxes) gains from the sale of
marketable securities. Without these special transactions, the Company would
have incurred losses from continuing operations of $1,447,000 in 2003 and
$308,000 in 2002.

Reported income from continuing operations in 2003 compared with 2002 reflects a
higher level of other income that included the previously mentioned gains from
the sale of marketable securities and the proceeds from an insurance policy on
the life of the Company's former Senior Consultant and a higher income tax
benefit. This positive factor was offset by reduced income from operations and
higher interest expense.


                                       23
<PAGE>

SEGMENT INFORMATION

The following table sets forth comparative data for Wilshire's real estate
segments in continuing operations.


<TABLE>
<CAPTION>
                              Residential Real Estate               Commercial Real Estate                                    Total
                    ---------------------------------  -----------------------------------   --------------------------------------
                         Year ended          Increase          Year ended         Increase           Year ended            Increase
                        December 31        (Decrease)         December 31       (Decrease)          December 31          (Decrease)
                        -----------        ----------         -----------       ----------          -----------          ----------
                    2003       2002          $      %     2003       2002         $      %      2003       2002           $       %
                    ----       ----          -      -     ----       ----         -      -      ----       ----           -       -
                         (In 000s of $)                       (In 000s of $)                         (In 000s of $)
<S>               <C>       <C>         <C>      <C>    <C>        <C>        <C>     <C>     <C>        <C>          <C>    <C>
Rental income     $6,839     $6,817        $22    0.3   $1,908     $1,842      $ 66    3.6    $8,747     $8,659         $88     1.0
Tenant fees            1          3        (2)      -        3          2         1   50.0         4          5         (1)  (20.0)
Vending
income                62         57          5    8.8        -          -         -      -        62         57           5     8.8
Other                411        395         16    4.1       33         27         6    22.2      444        422          22     5.2
                  ------     ------     ------          ------     ------     -----           ------     ------       -----
Total
revenues           7,313      7,272         41    0.6    1,944      1,871        73    3.9     9,257      9,143         114     1.2
Operating
expenses           4,405      4,096        309    7.5    1,048      1,164     (116)  (10.0)    5,453      5,260         193     3.7
                   -----      -----     ------           -----      -----     -----            -----      -----         ---
Net
operating
income            $2,908     $3,176     $(268)  (8.4)   $  896     $  707     $ 189   26.7    $3,804     $3,883       $(79)   (2.0)
                  ======     ======     ======  =====   ======     ======     =====  =====    ======     ======       =====  ======

Average
occupancy %         91.6       91.5                       55.7       53.6                       84.1       83.8

<CAPTION>
<S>                                                                                           <C>         <C>
Reconciliation to consolidated income (loss) from continuing operations:
Net operating income                                                                              $3,804     $3,883
Depreciation expense                                                                             (1,647)    (1,541)
General and administrative expenses                                                              (2,349)    (2,131)
Other income                                                                                       4,596      2,128
Interest expense                                                                                 (3,408)    (2,226)
Income tax benefit                                                                                   107         47
                                                                                                  ------    -------
Income (loss) from continuing operations                                                          $1,103    $   160
                                                                                                  ======    =======
</TABLE>


The above table details the comparative net operating income ("NOI") for
Wilshire's residential and commercial real estate segments, and reconciles the
combined NOI to consolidated income (loss) from continuing operations. NOI is
based on operating revenue and expenses directly associated with the operations
of the real estate properties, but excludes depreciation and interest expense.
Wilshire assesses and measures segment operating results based on NOI, which is
a direct measure of each property's contribution to the results of the Company
before considering revenues from treasury activities, overhead expenses and
other costs that are not directly related to the performance of a property. The
Company believes NOI is a more descriptive measure of the Company's performance
than income (loss) from continuing operations. NOI is not a measure of operating
results or cash flow as measured by generally accepted accounting principles,
and is not necessarily indicative of cash available to fund cash needs and
should not be considered an alternative to cash flows as a measure of liquidity.

RESIDENTIAL SEGMENT

During 2003 revenues increased $41,000 or 0.6% to $7,313,000 and NOI decreased
$268,000 or 8.4% to $2,908,000. Excluding Sunrise Ridge which had a NOI increase
of $16,000, all properties had a decline in NOI. The decline was attributable to
generally weak rental markets across all of the communities served by Wilshire.
In addition, operating expenses increased primarily due to higher utility,
maintenance and insurance costs. In particular, energy costs have increased
substantially in the Southwest.

COMMERCIAL SEGMENT

During 2003 revenues increased $73,000 or 3.9% to $1,944,000 and NOI increased
$189,000 or 26.7% to $896,000. NOI improved at all properties except for Tempe
Corporate Center which had a NOI decline of $89,000 due to reduced rental
income. NOI in 2003 was improved by the first time inclusion of revenue from the
Company's triple net lease with a major bank at Rutherford, New Jersey.

                                       24
<PAGE>

REVENUES

<TABLE>
<CAPTION>
                                                                    Years Ended December 31,
                                                          ----------------------------------
                                                                2003                    2002              Increase (Decrease)
                                                                ----                    ----              -------------------
<S>                                                       <C>                     <C>                     <C>
Alpine Village, New Jersey                                $1,141,000              $1,061,000                       $   80,000
Galsworthy Arms, New Jersey                                  485,000                 472,000                           13,000
Jefferson Gardens, New Jersey                                229,000                 217,000                           12,000
Summercreek, Texas                                         1,031,000               1,055,000                         (24,000)
Sunrise Ridge, Arizona                                     2,341,000               2,356,000                         (15,000)
Van Buren Apartments, Arizona                                561,000                 583,000                         (22,000)
Wellington, Texas                                          1,525,000               1,528,000                          (3,000)
                                                          ----------              ----------                       ----------
Sub-total - Residential Properties                         7,313,000               7,272,000                           41,000
                                                          ----------              ----------                       ----------

Royal Plaza, Arizona                                         619,000                 571,000                           48,000
Rutherford, New Jersey                                       110,000                       -                          110,000
Tamarac, Florida                                             281,000                 270,000                           11,000
Tempe Corporate Center, Arizona                              692,000                 850,000                        (158,000)
Wilshire Grand Hotel, New Jersey                             242,000                 180,000                           62,000
                                                          ----------              ----------                       ----------
Sub-total - Commercial Properties                          1,944,000               1,871,000                           73,000
                                                          ----------              ----------                       ----------
Total Rental Revenues                                     $9,257,000              $9,143,000                       $  114,000
                                                          ==========              ==========                       ==========
</TABLE>


Revenues amounted to $9,257,000 in 2003, an increase of $114,000 or 1.2%, from
$9,143,000 in 2002. The majority of the increase is related to the triple net
leases the Company holds with the Wilshire Grand Hotel and the Company's newly
leased bank branch in Rutherford, New Jersey and Alpine Village, New Jersey.
These increases were partly offset by a decline in revenue at Tempe Corporate
Center, Arizona, which experienced a lag in leasing up vacant office space.

OPERATING EXPENSES

<TABLE>
<CAPTION>
                                                                Years Ended December 31,
                                                           ---------------------------------
                                                                2003                    2002              Increase (Decrease)
                                                                ----                    ----              -------------------
<S>                                                         <C>                  <C>                      <C>
Alpine Village, New Jersey                                  $587,000             $   481,000                       $  106,000
Galsworthy Arms, New Jersey                                  324,000                 241,000                           83,000
Jefferson Gardens, New Jersey                                119,000                  99,000                           20,000
Summercreek, Texas                                           671,000                 629,000                           42,000
Sunrise Ridge, Arizona                                     1,244,000               1,275,000                         (31,000)
Van Buren Apartments, Arizona                                349,000                 350,000                          (1,000)
Wellington, Texas                                          1,111,000               1,021,000                           90,000
                                                          ----------              ----------                       ----------
Sub-total - Residential Properties                         4,405,000               4,096,000                          309,000
                                                          ----------              ----------                       ----------

Royal Plaza, Arizona                                         228,000                 261,000                         (33,000)
Rutherford, New Jersey                                       (1,000)                   8,000                          (9,000)
Tamarac, Florida                                             137,000                 148,000                         (11,000)
Tempe Corporate Center, Arizona                              330,000                 399,000                         (69,000)
Wilshire Grand Hotel, New Jersey                             354,000                 348,000                            6,000
                                                          ----------              ----------                       ----------
Sub-total - Commercial Properties                          1,048,000               1,164,000                        (116,000)
                                                          ----------              ----------                       ----------

Total Operating Expenses                                  $5,453,000              $5,260,000                       $  193,000
                                                          ==========              ==========                       ==========
</TABLE>


                                       25
<PAGE>

Operating expenses were $5,453,000 in 2003, $193,000, or 3.7% higher than
$5,260,000 in 2002. The operating expense increase was centered in the Company's
New Jersey properties that experienced higher property taxes, insurance and
maintenance charges in 2003.

Depreciation expense amounted to $1,647,000 in 2003, an increase of 6.9% from
$1,541,000 in 2002, reflecting the capital improvements incurred during 2002 and
2003.

General and administrative expense increased $218,000, or 10.2%, to $2,349,000
in 2003 from $2,131,000 in 2002. The 2003 expense level included a full year of
compensation expense for a senior executive officer hired in mid-2002. The
remainder of the increase was attributable to higher corporate insurance
expenses and legal and accounting fees.

Other income increased $2,450,000 to $4,596,000 in 2003 from $2,128,000 in 2002.
This increase included $1,000,000 received by the Company in 2003 as a
beneficiary of life insurance policies on the life of the Company's Senior
Consultant. The receipt of the life insurance proceeds was not taxable to the
Company. Also included in other income for 2003 were gains from the sale of
securities of $2,621,000, which exceeded the gains reported in 2002 by
$1,910,000.

Interest expense in 2003 increased to $3,408,000 from $2,226,000 in 2002.
Interest expense in 2003 includes a one time prepayment penalty of $469,000 and
$383,000 of amortization expense applicable to a write-off of unamortized
mortgage costs associated with approximately $31.5 million of debt that was
refinanced. This refinancing of the mortgage notes payable reduced the effective
rate paid by the Company from 7.36% to 6.22% and extended its maturity and
terms.

The provision for income taxes amounted to a tax benefit of $107,000 in 2003
compared to a tax benefit of $47,000 2002. The change in the provision for
income taxes is related to the level of income from continuing operations in
2003 compared to 2002 and the change in the mix between taxable and tax-exempt
income. In 2003, $1,000,000 of insurance proceeds received was exempt from
taxation.

DISCONTINUED OPERATIONS, NET OF TAXES:

REAL ESTATE

Income from discontinued operations amounted to after tax income of $702,000 in
2003 and a loss of $92,000 in 2002. The increased income reflects the higher
level of sales of properties in 2003 compared to 2002.

During 2003, the Company sold three properties in Florida for gross proceeds of
$3,190,000 that resulted in an after-tax gain of $1,081,000. In 2002, the
Company sold several smaller residential properties in New Jersey for an
after-tax gain of $150,000.

The loss on operating discontinued real estate properties increased to $379,000
in 2003 from $242,000 in 2002 mainly due to additional properties being
classified as discontinued in 2004 with the resulting reclassification of their
operating results out of continuing operations into discontinued operations for
the 2003 and 2002 periods.

OIL AND GAS

During 2003 the Company recorded a loss, net of taxes, from its oil and gas
businesses of $3,178,000, which included a $4.4 million after tax charge
resulting from the difference between the carrying value and estimated market
value of the Company's Canadian oil and gas properties. Excluding this non-cash
charge, the Company would have reported after-tax earnings in 2003 of
$1,222,000.

In 2002, the Company reported after-tax earnings from operating its oil and gas
properties of $1,008,000.

                                       26
<PAGE>

EFFECTS OF INFLATION

The effects of inflation on the Company's financial condition are not considered
to be material by management.

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 2004, the Company had working capital of $34.6 million, compared
to a working capital deficiency of $7.2 million at December 31, 2003. The change
reflects the receipt of approximately $28.1 million from the sale of the oil and
gas business and approximately $20.0 million from the sale of real estate
properties, partly offset by the payment of a portion of the income taxes
related to those sales and the repayment of $5.3 million of debt related to the
real estate properties sold.

The Company has $35.0 million of cash and cash equivalents at December 31, 2004.
This balance is comprised of working capital accounts for its real estate
properties and corporate needs and short-term investments in government and
corporate securities and money market funds. The Company estimates that it has
approximately $5.6 million of taxes remaining to be paid relating to the sale of
the oil and gas business, including U.S. and Canadian taxes on the repatriation
of earnings from its Canadian subsidiary, and the sales of real estate
properties. These obligations will be satisfied in the first half of 2005,
partly through the application of an approximate $2.9 million estimated
overpayment of 2004 U.S. Federal taxes. After considering the tax payments
previously described, Wilshire will have $32.3 million of cash and cash
equivalents for working capital and other purposes.

The Company continues to explore corporate and real estate property acquisitions
as they arise. The timing of such acquisitions, if any, will depend upon, among
other criteria, economic conditions and the favorable evaluation of specific
opportunities presented to the Company. In the short-term, the Company will
continue to invest these funds in high quality investments that are consistent
with its investment policy. Management considers its liquidity position adequate
to fulfill the Company's current business plans.

Net cash used in operating activities amounted to $10.2 million in 2004, while
in 2003 and 2002 operating activities provided net cash of $7.4 million and $4.9
million, respectively. The 2004 use of cash resulted from net income of $2.6
million, the sale of the oil and gas business and the sale of real estate
properties with their related changes in receivables, payables and current and
deferred tax accounts. The 2003 provision of cash was mainly related to a net
loss of $1.4 million and non-cash charges for depreciation and amortization
expense ($6.2 million) and an impairment loss related to Wilshire's Canadian oil
and gas operations ($7.0 million), partly offset by changes in other current
asset and liability and income tax accounts related to normal business activity.
The 2002 provision of cash was mainly related to a net income of $1.1 million
and non-cash charges for depreciation and amortization expense ($3.9 million).

Net cash provided by investing activities amounted to $43.6 million in 2004 and
$2.1 million in 2003. In 2002, investing activities used net cash of $3.3
million. The cash provided by investing activities in 2004 is due mainly to the
sale of real estate assets and oil and gas assets in 2004, partly offset by an
increase in restricted cash related to the IRS Section 1031 exchange that the
Company has entered into with the proceeds from the sale of land at Schalk
Station, New Jersey. The 2003 provision of cash from investing activities is
related to proceeds from the sale of real estate properties and marketable
securities, partly offset by capital expenditures on real estate properties and
oil and gas activities. The 2002 use of cash from investing activities relates
to the purchase of marketable securities and capital expenditures on real estate
properties and oil and gas activities, partly offset by proceeds from the sale
of marketable securities.

Net cash used in financing activities amounted to $11.8 million in 2004, $7.7
million in 2003 and $2.6 million in 2002. The 2004 use of cash reflects the
repayment of long term debt due to the sales of real estate properties and the
oil and gas assets and normal annual amortization of long term debt from monthly
debt service payments. The 2003 use of cash reflects the net of repayments of
long term debt due to the refinancing of various mortgage loans, the sale of
real estate properties and normal annual amortization of long term debt from
monthly debt service payements, partly offset by the issuance of new mortgage
loans from the previously mentioned refinancing. The 2002 use of funds is
related to the repayment of long term debt partly offset by the issuance of new
debt.

                                       27
<PAGE>

In addition to the generation of funds from its operations, the Company had a
$2.0 million line of credit with a major financial institution that expired in
January 2005 and was not renewed. The Company believes it has adequate capital
resources to fund its operations for the foreseeable future and is investigating
the renewal of this line of credit, but is not committed to doing so.

The Company is committed to investing in its properties to maintain their
competitiveness within their markets and for the purposes of upgrading and
repositioning in more upscale markets. The following table sets forth the
amounts of capital expenditures made in each property within the past three
years, exclusive of those properties which were sold.

<TABLE>
<CAPTION>
                                                                                        Years Ended December 31,
                                                                                 -----------------------------------
Name of property                                                                 2004            2003           2002
----------------                                                                 ----            ----           ----
<S>                                                                         <C>            <C>             <C>
Residential continuing operations:
Alpine Village                                                               $ 85,000       $ 177,000       $ 49,000
Summercreek                                                                   207,000          88,000         84,000
Sunrise Ridge                                                                 258,000         204,000        234,000
Van Buren                                                                     126,000         107,000         91,000
Wellington                                                                    257,000         575,000        161,000
Galsworthy Arms                                                               424,000          87,000         44,000
Jefferson Gardens                                                              13,000          18,000         14,000

Commercial continuing operations:
Royal Mall Plaza                                                               50,000          22,000        299,000
Tamarac Office Plaza                                                            4,000           4,000         82,000
Tempe Corporate                                                               278,000          97,000        115,000
Wilshire Grand Hotel & Banquet Facility                                             -         316,000        722,000
Rutherford Bank                                                                     -               -              -

Discontinued operations - residential:
Biltmore Club                                                                 195,000          55,000        299,000
Twelve Oaks                                                                    56,000          90,000         37,000

Discontinued operations - commercial:
Amboy Towers                                                                  298,000          55,000         54,000
                                                                           ----------      ----------     ----------

Total capital expenditures                                                 $2,251,000      $1,895,000     $2,285,000
                                                                           ==========      ==========     ==========
</TABLE>

On June 3, 2004, the Company's Board of Directors approved the repurchase of up
to 1,000,000 shares of its common stock on the open market, in privately
negotiated transactions or otherwise. This purchasing activity may occur from
time to time, in one or more transactions. At December 31, 2004, the Company had
purchased 38,478 shares at an aggregate cost of $198,000 under this program. The
majority of the shares acquired were from stockholders who at the time owned
less than 100 shares of the Company's common stock.

During March 2005, Wilshire negotiated a long-term lease for new offices in
Newark, New Jersey. The lease is for a 65 month term with two renewal options
each for a five-year term and covers 4,502 rentable square feet at a base rate
of $29.00 per square foot. The Company has an option to early terminate the
lease after two years, subject to a termination fee described in note 5 to the
Notes to the Consolidated Financial Statements in Item 8 of this Form 10-K.

The Company has concluded negotiations with the city of Perth Amboy, New Jersey
concerning the redevelopment zone status of its office building (Amboy Towers).
The City has agreed to exclude Amboy Towers from the redevelopment zone and the
Company has agreed to invest $750,000 in capital improvements in the building
over the next 18 months.

                                       28
<PAGE>

In January 2005, the Company sold one 2-bedroom condominium at Galsworthy Arms,
New Jersey, for gross proceeds of $269,500. After payment of closing costs and
taxes, the Company will realize net income in the first quarter 2005 of
approximately $115,000.

In February 2005, the Company signed an agreement to sell its Biltmore Club
apartment complex (Phoenix, Arizona) to GDG Partners L.L.C. an independent third
party, for $20,956,000. The agreement is expected to close no later than
December 23, 2005. GDG Partners L.L.C. has paid Wilshire a nonrefundable deposit
of $100,000 and additional nonrefundable deposits of $150,000 and $250,000 are
required by April 3, 2005 and July 2, 2005, respectively. We expect to report a
gain on the sale after taxes of approximately $8.5 million and have net proceeds
after transaction costs and paying off the mortgage of approximately $10.0
million.

Also in February 2005, the Company entered into an agreement to accept
$1,100,000 in settlement of its mortgage receivable, which was paid during the
first quarter of 2005. Security for the mortgage was a first lien on in excess
of 100 condominium units in two contiguous buildings located in Jersey City, New
Jersey. At December 31, 2004, the mortgage receivable had a gross carrying value
of $1,165,000 and $727,000 of unearned income. As a result of this transaction,
the Company recognized a gain of approximately $400,000 in the first quarter of
2005.

In March 2005, the Company signed an agreement to sell its Twelve Oaks apartment
complex (Atlanta, Georgia) to Interstate East Management, Inc., an independent
third party, for $1,725,000. The agreement contains a "time is of the essence
clause" and is expected to close as soon as practicable. We expect to report a
gain on the sale after taxes of approximately $440,000. The property had been
highly leveraged and the transaction will generate net proceeds after
transaction costs and taxes of approximately $1,379,000, which will be used to
repay the outstanding mortgage balance of approximately $1,609,000. The
shortfall in the net proceeds will be made up from general corporate sources of
funds.

Also in March 2005 the Company was evaluating alternatives for optimizing its
investment in the Wilshire Grand Hotel and Banquet Facility (the "Wilshire
Hotel"). The Company leases the Wilshire Hotel under two 25-year operating
leases, one for the hotel and one for the banquet facility, to an experienced
hotel operator (the "Hotel Operator"). The Hotel Operator has encountered
financial adversity and in 2004 ceased payment on its mortgage obligations,
which are held by a third party (the "Mortgagor"). As of March 2005, the Hotel
Operator was also delinquent on lease payments to Wilshire for the months of
January, February and March 2005. The Mortgagor is required to cure any defaults
of the Hotel Operator (i.e., pay any amounts due Wilshire under the lease) in
order to protect its mortgage and cannot impair Wilshire's ownership interest in
the property. As a result of the Hotel Operator's delinquency, Wilshire is
evaluating alternatives for its investment including: a) declaring the Hotel
Operator in default and pursuing tenant eviction proceedings and b) assisting in
the consummation of a settlement agreement by which Wilshire would assume
operational control of the Wilshire Hotel and in the event of a subsequent sale
of the hotel, would receive an agreed upon value prior to any proceeds being
distributed to the Mortgagor or Hotel Operator. At this time, Wilshire does not
expect to incur a loss on this property.

FORWARD-LOOKING STATEMENTS

This Report on Form 10-K for the year ended December 31, 2004 contains
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. All statements included herein other than
statements of historical fact are forward-looking statements. Although the
Company believes that the underlying assumptions and expectations reflected in
such forward-looking statements are reasonable, it can give no assurance that
such expectations will prove to be correct. The Company's business and prospects
are subject to a number of risks which could cause actual results to differ
materially from those reflected in such forward-looking statements, including
uncertainties inherent in any attempt to sell a portion or all of the business
or to acquire or merge into other companies at an acceptable price,
environmental risks relating to the Company's real estate properties,
competition, the substantial capital expenditures required to fund the Company's
real estate operations, market and economic changes in areas where the Company
holds real estate properties, interest rate fluctuations, government regulation,
and the ability of the Company to implement its business strategy.

                                       29
<PAGE>

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company has an investment in the common stock of one publicly traded real
estate company in the United States in which the Company has exposure to the
risk of market value fluctuation. The Company accounts for this investment as
securities that are available for sale and marks them to market at each
period-end. The change in value in the investment, net of tax impact, is
reported in Accumulated Other Comprehensive Income, a separate component of
stockholders' equity. The Company also evaluates its investment to determine if
it has suffered a decline in market value that is permanent, which would require
a charge to the Statement of Income. At December 31, 2004, in the opinion of
management, there has been no permanent decline in value in the Company's
holdings of equity securities.

After the sale of its Canadian oil and gas assets, the Company has cash and cash
equivalents at its Canadian subsidiary whose value is exposed to fluctuations in
the value of the Canadian dollar / U.S. dollar exchange rate. The change in
value in the Canadian dollar denominated accounts is reported in Accumulated
Other Comprehensive Income, a separate component of stockholders' equity. The
Company will be repatriating all assets, net of liabilities, of its Canadian
subsidiary during 2005. At that time, the foreign exchange component previously
reported in Accumulated Other Comprehensive Income will be recognized as a
component of net income. At December 31, 2004, the unrealized foreign exchange
component of Accumulated Other Comprehensive Income was a gain of $26,000.

Long-term debt as of December 31, 2004 and December 31, 2003 consists of the
following -

<TABLE>
<CAPTION>
                                        2004                   2003
                                    -----------            -----------

<S>                                 <C>                    <C>
Mortgage notes payable              $46,855,000            $53,824,000
Note payable                                  -              2,700,000
Revolving demand loan                         -              1,970,000
                                    -----------            -----------
Total                                46,855,000             58,494,000
Less-current portion (1)                729,000              7,148,000
                                    -----------            -----------
Long term portion (2)               $46,126,000            $51,346,000
                                    ===========            ===========
</TABLE>

(1)  Includes mortgage debt associated with discontinued operations of $156,000
     in 2004 and $3,654,000 in 2003.
(2)  Includes mortgage debt associated with discontinued operations of
     $10,547,000 in 2004 and $14,514,000 in 2003.

The aggregate maturities of the long-term debt in each of the five years
subsequent to December 31, 2004 and thereafter are -

Year                                                       Amount
----                                                       ------
2005                                                    $ 729,000
2006                                                      785,000
2007                                                      845,000
2008                                                      906,000
2009                                                    4,797,000
Thereafter                                             38,793,000
                                                      -----------
                                                      $46,855,000
                                                      ===========


                                       30
<PAGE>

The Company is not exposed to changes in interest rates. At December 31, 2004,
the Company had no floating rate debt outstanding under its $2.0 million U.S.
credit line. At December 31, 2004, the Company had $46,855,000 of mortgage debt
outstanding which all bears interest at an average fixed rate of 6.098% and an
average remaining life of approximately 7.9 years. The fixed rate mortgages are
subject to repayment (amortization) schedules that are longer than the term of
the mortgages. As such, the approximate amount of balloon payments for all
mortgage debt that will be required is as follows:

Year                                                       Amount
----                                                       ------
2009                                                   $3,853,000
2013                                                   35,421,000
                                                      ------------
                                                      $39,274,000
                                                      ===========

Wilshire expects to re-finance the individual mortgages with new mortgages when
their terms expire. To this extent, we have exposure to interest rate risk on
our fixed rate mortgage debt obligations. If interest rates, at the time any
individual mortgage note is due, are higher than the current fixed interest
rate, higher debt service may be required, and/or re-financing proceeds may be
less than the amount of mortgage debt being retired.

We believe that the values of our properties will be adequate to command
re-financing proceeds equal to, or higher than the mortgage debt to be
re-financed.



                                       31
<PAGE>


ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders
Wilshire Enterprises, Inc.

We have audited the accompanying consolidated balance sheet of Wilshire
Enterprises, Inc. and Subsidiaries as of December 31, 2004, and the related
consolidated statements of operations, changes in stockholders' equity and cash
flows and financial statement schedule for the year then ended. These
consolidated financial statements and financial statement schedule are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements and financial statement
schedule based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Wilshire
Enterprises, Inc. and Subsidiaries as of December 31, 2004, and their results of
operations and cash flows for the year then ended, in conformity with accounting
principles generally accepted in the United States of America. In addition, in
our opinion, the financial statement schedule referred to above, when considered
in relation to the basic consolidated financial statements taken as a whole,
presents fairly, in all material respects, the information required to be
included therein.



/s/ J.H. Cohn LLP

Roseland, New Jersey
March 26, 2005


                                       32
<PAGE>

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders
Wilshire Enterprises, Inc.

We have audited the accompanying consolidated balance sheet of Wilshire
Enterprises, Inc. and subsidiaries as of December 31, 2003 and the related
consolidated statements of operations, shareholders' equity and cash flows for
each of the years in the two year period ended December 31, 2003. These
financial statements are the responsibility of Wilshire's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Wilshire
Enterprises, Inc. and Subsidiaries as of December 31, 2003, and their results of
operations and cash flows for each of the two years in the period ended December
31, 2003, in conformity with accounting principles generally accepted in the
United States of America.

New York, New York
March 26, 2004
                                                       /s/ Ernst & Young LLP



                                       33
<PAGE>

                           WILSHIRE ENTERPRISES, INC.
                           CONSOLIDATED BALANCE SHEETS
                        AS OF DECEMBER 31, 2004 AND 2003

<TABLE>
                                    ASSETS                                              2004                 2003
                                                                                    -------------       -------------
<S>                                                                                 <C>                 <C>
Current assets:
      Cash  and cash equivalents                                                    $  31,110,000       $   7,763,000
      Restricted cash                                                                   4,082,000             327,000
      Marketable securities, available for sale, at fair value                          2,754,000           1,996,000
      Accounts receivable, net of allowance for doubtful accounts of $65,000
       in 2003                                                                            189,000           1,802,000
      Income taxes receivable                                                           4,389,000             544,000
      Prepaid expenses and other current assets                                         1,827,000           1,326,000
                                                                                    -------------       -------------
          Total current assets                                                         44,351,000          13,758,000
                                                                                    -------------       -------------
Noncurrent assets:
      Mortgage notes receivable                                                           957,000           2,504,000
                                                                                    -------------       -------------
      Other assets                                                                        208,000             860,000
                                                                                    -------------       -------------
Property and equipment:
      Oil and gas properties, using the full cost method of accounting  -
       Held for sale                                                                            -         143,601,000
      Real estate properties                                                           46,769,000          45,119,000
      Real estate properties - Held for sale                                           12,168,000          26,950,000
                                                                                    -------------       -------------
                                                                                       58,937,000         215,670,000
      Less:
      Accumulated depreciation and amortization                                        13,292,000          11,619,000
      Accumulated depreciation, depletion and amortization -
       Property held for sale                                                           3,608,000         122,176,000
                                                                                    -------------       -------------
                                                                                       42,037,000          81,875,000
                                                                                    -------------       -------------
Total Assets                                                                        $  87,553,000       $  98,997,000
                                                                                    =============       =============

                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
      Current portion of long-term debt                                             $     573,000       $   3,494,000
      Accounts payable                                                                  1,624,000           1,628,000
      Income taxes payable                                                              3,623,000             154,000
      Deferred income taxes                                                             2,465,000          10,489,000
      Accrued liabilities                                                                 606,000             800,000
      Deferred income                                                                     373,000             382,000
      Current liabilities associated with discontinued operations                         521,000           3,974,000
                                                                                    -------------       -------------
          Total current liabilities                                                     9,785,000          20,921,000
Noncurrent liabilities:
      Long-term debt, less current portion                                             35,579,000          37,023,000
      Deferred income taxes                                                             1,855,000           1,058,000
      Deferred income                                                                     621,000             868,000
      Noncurrent liabilities associated with discontinued operations                   10,602,000          14,600,000
                                                                                    -------------       -------------
          Total liabilities                                                            58,442,000          74,470,000
                                                                                    -------------       -------------

Commitments and Contingencies

Stockholders' equity:
      Preferred stock, $1 par value, 1,000,000 shares authorized; none issued
       and outstanding in 2004 and 2003                                                         -                   -
      Common stock, $1 par value, 15,000,000 shares authorized; issued
       10,013,544 shares in 2004 and 2003                                              10,014,000          10,014,000
      Capital in excess of par value                                                    9,524,000           9,029,000
      Retained earnings                                                                19,905,000          17,267,000
      Unearned  compensation                                                             (431,000)                  -
      Treasury stock, 2,234,732 and 2,210,713 shares at 2004 and 2003,
       respectively, at cost                                                          (10,491,000)        (10,355,000)
      Accumulated other comprehensive income (loss)                                       590,000          (1,428,000)
                                                                                    -------------       -------------
          Total stockholders' equity                                                   29,111,000          24,527,000
                                                                                    -------------       -------------
Total Liabilities and Stockholders' Equity                                          $  87,553,000       $  98,997,000
                                                                                    =============       =============
</TABLE>

The accompanying notes to consolidated financial statements are an integral part
of these financial statements.


                                       34
<PAGE>


                           WILSHIRE ENTERPRISES, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
              FOR THE YEARS ENDED DECEMBER 31, 2004, 2003 AND 2002

<TABLE>
<CAPTION>
                                                                     2004          2003            2002
                                                                 -----------    -----------    -----------
<S>                                                              <C>            <C>            <C>
REVENUES                                                         $ 9,706,000    $ 9,257,000    $ 9,143,000
                                                                 -----------    -----------    -----------

COSTS AND EXPENSES
       Operating expenses                                          5,499,000      5,453,000      5,260,000
       Depreciation expense                                        1,673,000      1,647,000      1,541,000
       General and administrative                                  2,143,000      2,349,000      2,131,000
                                                                 -----------    -----------    -----------
          Total costs and expenses                                 9,315,000      9,449,000      8,932,000
                                                                 -----------    -----------    -----------

INCOME (LOSS) FROM OPERATIONS                                        391,000       (192,000)       211,000

OTHER INCOME
       Dividend and interest income                                  685,000        743,000        877,000
       Gain on sale of marketable securities                               -      2,621,000        711,000
       Insurance proceeds                                                  -      1,000,000              -
       Other income                                                  629,000        232,000        540,000

INTEREST EXPENSE                                                  (2,343,000)    (3,408,000)    (2,226,000)
                                                                 -----------    -----------    -----------

          INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES           (638,000)       996,000        113,000

INCOME TAX EXPENSE (BENEFIT)                                        (221,000)      (107,000)       (47,000)
                                                                 -----------    -----------    -----------

INCOME (LOSS) FROM CONTINUING OPERATIONS                            (417,000)     1,103,000        160,000
                                                                 -----------    -----------    -----------

DISCONTINUED OPERATIONS - REAL ESTATE, NET OF TAXES
       LOSS FROM OPERATIONS                                         (290,000)      (379,000)      (242,000)
       GAIN FROM SALES                                             4,056,000      1,081,000        150,000

DISCONTINUED OPERATIONS - OIL & GAS, NET OF TAXES
       INCOME (LOSS) FROM OPERATIONS                              (1,278,000)    (3,178,000)     1,008,000
       GAIN FROM SALES                                               567,000              -              -
                                                                 -----------    -----------    -----------
NET INCOME (LOSS)                                                $ 2,638,000    $(1,373,000)   $ 1,076,000
                                                                 ===========    ===========    ===========

BASIC EARNINGS (LOSS) PER SHARE:
       Income (loss) from continuing operations                       $(0.05)         $0.14          $0.02
       Income (loss) from discontinued operations -
          Real estate - loss from operations                           (0.04)         (0.05)         (0.03)
          Real estate - gain on sales                                   0.52           0.14           0.02
          Oil and gas - income (loss) from operations                  (0.16)         (0.41)          0.13
          Oil and gas - gain on sale                                    0.07              -              -
                                                                       -----          -----         ------
       Net income (loss) applicable to common stockholders             $0.34         $(0.18)         $0.14
                                                                       =====         ======         ======

DILUTED EARNINGS (LOSS) PER SHARE:
          Income (loss) from continuing operations                    $(0.05)         $0.14          $0.02
          Income (loss) from discontinued operations -
              Real estate - loss from operations                       (0.04)         (0.05)         (0.03)
              Real estate - gain on sales                               0.51           0.14           0.02
            Oil and gas - income (loss) from operations                (0.16)         (0.41)          0.13
            Oil and gas - gain on sale                                  0.07              -              -
                                                                       -----          -----         ------
       Net income (loss) applicable to common stockholders             $0.33         $(0.18)        $ 0.14
                                                                       =====         ======         ======
</TABLE>

The accompanying notes to consolidated financial statements are an integral part
of these financial statements.


                                       35
<PAGE>

                           WILSHIRE ENTERPRISES, INC.
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                        DECEMBER 31, 2004, 2003 AND 2002


<TABLE>
<CAPTION>


                         PREFERRED STOCK         COMMON STOCK         CAPITAL IN
                         ---------------         ------------          EXCESS OF     UNEARNED      RETAINED       TREASURY
                        SHARES    AMOUNT     SHARES        AMOUNT      PAR VALUE   COMPENSATION    EARNINGS        STOCK
                        ------    ------     ------        ------      ---------   ------------    --------        -----
<C>                        <C>    <C>       <C>          <C>           <C>                 <C>    <C>           <C>
BALANCE, December 31,
2001                       -      $  -      10,013,544   $10,014,000   $9,029,000         $   -   $17,564,000   $(10,179,000)
Net income                                                                                          1,076,000
Foreign currency
translation adjustment
Change in unrealized
loss on marketable
securities, net of
income tax benefit of
$361,000

Comprehensive income
Purchase of treasury
stock                                                                                                                (176,000)
                         ---      ----      ----------   -----------   ----------          ----   -----------   ------------
BALANCE, December 31,
2002                       -         -      10,013,544    10,014,000    9,029,000             -   18,640,000      (10,355,000)
Net income                                                                                        (1,373,000)
Foreign currency
translation adjustment
Change in unrealized
loss on marketable
securities, net of
income tax benefit of
$89,000

Comprehensive income
                         ---      ----      ----------   -----------   ----------          ----   -----------   ------------

BALANCE, December 31,
2003                       -         -      10,013,544    10,014,000    9,029,000              -   17,267,000    (10,355,000)
Net income                                                                                          2,638,000
Foreign currency
translation adjustment
Change in unrealized
loss on marketable
securities, net of
income tax benefit of
$301,000

Comprehensive income

Issuance of shares of
common stock for
services                                                                                (24,000)                       28,000
Compensation
associated with stock
options                                                                   495,000      (495,000)
Amortization of
compensation
associated with stock
and stock option
awards                                                                                    88,000
Exercise of stock
options                                                                                                                34,000
Purchase of treasury
stock                                                                                                                (198,000)
                         ---      ----      ----------   -----------   ----------          ----   -----------   -------------
BALANCE, December 31,
2004                       -      $  -      10,013,544   $10,014,000   $9,524,000     $(431,000)  $19,905,000   $ (10,491,000)
                        ====      ====      ==========   ===========   ==========     =========   ===========   =============

<CAPTION>

                            ACCUMULATED
                               OTHER                            TOTAL
                           COMPREHENSIVE    COMPREHENSIVE   STOCKHOLDERS'
                           INCOME (LOSS)   INCOME (LOSS)       EQUITY
                           -------------   -------------       ------
<C>                          <C>                               <C>
BALANCE, December 31,
2001                          $(2,735,000)                     $23,693,000
Net income                                     $1,076,000       $1,076,000
Foreign currency
translation adjustment             88,000          88,000           88,000
Change in unrealized
loss on marketable
securities, net of
income tax benefit of
$361,000                         (442,000)       (442,000)        (442,000)
                                               ----------
Comprehensive income
                                                 $722,000
                                               ==========
Purchase of treasury
stock                                                             (176,000)
                              -----------                       -----------
BALANCE, December 31,
2002                           (3,089,000)                      24,239,000
Net income                                    $(1,373,000)      (1,373,000)
Foreign currency
translation adjustment          2,206,000       2,206,000        2,206,000
Change in unrealized
loss on marketable
securities, net of
income tax benefit of
$89,000                          (545,000)       (545,000)        (545,000)
                                               ----------
Comprehensive income                             $288,000
                              -----------      ==========       -----------

BALANCE, December 31,
2003                           (1,428,000)                      24,527,000
Net income                                      2,638,000        2,638,000
Foreign currency
translation adjustment          1,562,000       1,562,000        1,562,000
Change in unrealized
loss on marketable
securities, net of
income tax benefit of
$301,000                          456,000         456,000          456,000
                                               ----------
Comprehensive income                           $4,656,000
                                               ==========
Issuance of shares of
common stock for
services                                                             4,000
Compensation
associated with stock
options                                                                  -
Amortization of
compensation
associated with stock
and stock option
awards                                                              88,000
Exercise of stock
options                                                             34,000
Purchase of treasury
stock                                                             (198,000)
                              -----------                      -----------
BALANCE, December 31,
2004                            $ 590,000                      $29,111,000
                                =========                      ===========
</TABLE>

The accompanying notes to consolidated financial statements are an integral part
of these financial statements.


                                       36
<PAGE>

                           WILSHIRE ENTERPRISES, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                        DECEMBER 31, 2004, 2003 AND 2002

<TABLE>
<CAPTION>
                                                                      2004                2003               2002
                                                                      ----                ----               ----
<S>                                                          <C>                      <C>                       <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
      Net income (loss)                                           $  2,638,000       $ (1,373,000)        $1,076,000
      Adjustments to reconcile net income (loss)
      to net cash provided by (used in) operating
      activities -
      Depreciation, depletion and amortization                       1,687,000          6,244,000          3,884,000
      Amortization of compensation expense                              88,000                  -                  -
      Impairment loss on oil and gas assets                                  -          7,000,000                  -
      Deferred income tax (benefit) provision                       (7,329,000)          (594,000)           762,000
      Increase (decrease) in deferred income                           146,000           (445,000)         1,627,000
      Gain on sales of real estate assets                           (7,039,000)        (1,693,000)          (263,000)
      Gain on sale of oil and gas properties                          (768,000)                 -                  -
      Gain on sale of marketable securities                                  -         (2,621,000)          (711,000)
      Changes in operating assets and liabilities:
      Decrease (increase) in accounts receivable                     1,613,000           (897,000)          (262,000)
      Decrease (increase) in income taxes                           (3,845,000)            83,000           (626,000)
      receivable
      Decrease (increase) in prepaid expenses and
      other current assets                                             154,000            539,000           (462,000)
      Increase (decrease) in accounts payable,
      accrued liabilities and other liabilities                       (403,000)         1,058,000            (77,000)
      Increase (decrease) in taxes payable                           2,939,000            119,000            (15,000)
                                                                  ------------       ------------       ------------
         Net cash provided by (used in) operating activities       (10,119,000)         7,420,000          4,933,000
                                                                  ------------       ------------       ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
      Capital expenditures - real estate                            (2,295,000)        (2,415,000)        (2,500,000)
      Capital expenditures - oil & gas                                       -         (8,705,000)        (5,028,000)
      Proceeds from sale of oil and gas properties                  28,131,000                  -                  -
      Proceeds from sale of real estate properties                  19,874,000          3,107,000            737,000
      Proceeds on mortgage notes receivable                          1,673,000            531,000          3,162,000
      Proceeds from sales and redemptions of
      marketable securities                                                  -          9,494,000          2,336,000
      Purchases of marketable securities                                     -                  -         (1,930,000)
      (Increase) decrease in restricted cash                        (3,755,000)            78,000            (45,000)
                                                                  ------------       ------------       ------------
         Net cash provided by (used in) investing activities        43,628,000          2,090,000         (3,268,000)
                                                                  ------------       ------------       ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
      Principal payments of long-term debt                         (11,639,000)       (47,868,000)       (11,400,000)
      Loan payable to stockholder                                            -           (500,000)          (200,000)
      Proceeds from issuance of debt                                         -         40,656,000          9,158,000
      Purchase of treasury stock                                      (185,000)                 -           (176,000)
      Proceeds from exercise of stock options
                                                                        21,000                  -                  -
                                                                  ------------       ------------       ------------
         Net cash used in financing activities                     (11,803,000)        (7,712,000)        (2,618,000)
                                                                  ------------       ------------       ------------

EFFECT OF EXCHANGE RATE CHANGES ON CASH                              1,641,000          2,206,000             88,000
                                                                  ------------       ------------       ------------

         Net increase (decrease) in cash and cash
         equivalents                                                23,347,000          4,004,000           (865,000)

CASH AND CASH EQUIVALENTS, beginning of year                         7,763,000          3,759,000          4,624,000
                                                                  ------------       ------------       ------------

CASH AND CASH EQUIVALENTS, end of year                            $ 31,110,000       $  7,763,000       $  3,759,000
                                                                  ============       ============       ============

SUPPLEMENTAL DISCLOSURES TO THE STATEMENTS OF
CASH FLOWS:
      Cash paid during the year for -
         Interest                                                 $  3,025,000       $  4,716,000       $  4,683,000
                                                                  ============       ============       ============
         Income taxes                                             $  7,567,000       $    543,000       $    352,000
                                                                  ============       ============       ============
</TABLE>

The accompanying notes to condensed consolidated financial statements are an
integral part of these financial statements.


                                       37
<PAGE>

                           WILSHIRE ENTERPRISES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.       ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES:

         Wilshire Enterprises, Inc. ("Wilshire" or "the Company") is engaged in
         acquiring, owning and managing real estate properties and real estate
         related securities. The Company's real estate holdings are located in
         the states of Arizona, Florida, Georgia, New Jersey and Texas. The
         Company's real estate holdings are owned both in its own name and
         through holding companies and limited liability companies. The Company
         also maintains investments in marketable securities, which are
         classified as available for sale.

         The Company had also been engaged in oil and gas exploration and
         production in the United States and Canada. In April 2004, the Company
         sold its oil and gas operations and received net proceeds of
         $28,131,000. An escrow holdback of $600,000 was established to allow
         for any potential post closing adjustments relating to its United
         States operations. This escrow was paid in full to the Company on June
         22, 2004 and the consolidated statements of operations include a gain
         of $567,000 (after taxes) on the transaction. Since the sale was
         effective as of March 1, 2004, the financial statements as presented
         reflect in discontinued operations oil and gas operations for the first
         two months of 2004, compared to full years being included in
         discontinued operations in the statements of operations for 2003 and
         2002.

         PRINCIPLES OF CONSOLIDATIONS:

         The consolidated financial statements include the accounts of the
         Company and its subsidiaries. All significant intercompany account
         balances and transactions have been eliminated in consolidation. At
         December 31, 2004, the Company does not have any affiliates that
         require consolidation under the provisions of FIN 46R, "Consolidation
         of Variable Interest Entities, an Interpretation of Accounting Research
         Bulletin No. 51."

         USE OF ESTIMATES:

         The preparation of financial statements in conformity with accounting
         principles generally accepted in the United States of America requires
         management to make estimates and assumptions that affect certain
         reported amounts and disclosures. Accordingly, actual results could
         differ from those estimates.

         CASH AND CASH EQUIVALENTS:

         Financial instruments that potentially subject Wilshire to
         concentrations of credit risk consist primarily of cash and cash
         equivalents. Wilshire considers all highly liquid investments purchased
         with a maturity of three months or less to be cash equivalents.
         Wilshire maintains its cash in the United States in bank accounts
         ($6,207,000) and brokerage accounts ($12,444,000). The balances
         maintained in bank accounts may, at times, exceed Federally insured
         limits. At December 31, 2004, cash balances in banks that exceeded
         Federally insured limits amounted to $5,384,000, of which $3,905,000
         represents cash deposited with a qualified exchange agent for a Section
         1031 exchange the Company is investigating with the proceeds from the
         sale of the land at Schalk Station. The funds must remain with the
         qualified exchange agent and are not available for use by the Company
         until the time period for executing a Section 1031 exchange expires
         (180 days from the closing date of the initiating transaction). Under
         the contemplated transaction, the funds will be released to the Company
         in June 2005. Investments in accounts maintained at brokerage houses
         consist of short-term, mainly tax-exempt or tax advantaged, investments
         that are subject to the Company's investment policy guidelines
         concerning credit rating, concentrations and size of transaction. The
         Company also has $16,541,000 in cash with its Canadian subsidiary that
         is being invested in short-term deposits at a major Canadian bank. The
         funds at the Canadian subsidiary will be repatriated to the United
         States during 2005, and represent principally the only assets currently
         held outside of the United States.

                                       38
<PAGE>

         Restricted cash represents the $3,905,000 of funds on deposit with the
         qualified exchange agent and $177,000 of residential tenant deposits
         for Company properties located in New Jersey and Georgia.

         MARKETABLE SECURITIES:

         As of December 31, 2004 and 2003, the marketable securities held by the
         Company consist of equity securities in one real estate company in the
         United States, which is classified as available for sale. These
         securities are carried at fair value based upon quoted market prices of
         $2,754,000 at December 31, 2004 and $1,996,000 at December 31, 2003,
         which exceeded their cost of $1,799,000 by $955,000 at December 31,
         2004 and $197,000 at December 31, 2003. Unrealized gains and losses,
         representing the difference between an investment's cost and its fair
         value, are charged (credited) directly to shareholders' equity, net of
         related income taxes, as a component of accumulated comprehensive
         income (loss). The cost of securities sold is determined on a specific
         identification basis.

         The Company periodically reviews available for sale securities for
         impairment that is other than temporary. At December 31, 2004 and 2003,
         no write down was required to record other than temporary impairment of
         securities.

         DEFERRED LOAN COSTS:

         Prepaid expenses and other current assets include deferred loan costs
         of $540,000 at December 31, 2004 and $631,000 at December 31, 2003.
         Deferred loan costs are amortized on the straight-line method by annual
         charges to operations over the terms of the loans. Amortization of such
         costs is included in interest expense and amounted to approximately
         $86,000 in 2004, $394,000 in 2003 and $57,000 is 2002. The 2003 expense
         amount includes the write-off of unamortized deferred loan costs
         related to loans that were refinanced in 2003.

         REAL ESTATE AND OTHER PROPERTIES:

         Real estate properties and other property and equipment are stated at
         cost. Costs incurred to maintain and repair the property are expensed
         as incurred. Depreciation is provided on the straight-line method using
         an estimated useful life of 30 to 35 years for real estate buildings
         and seven years for furniture, fixtures and equipment at the
         properties, which approximates their estimated useful life.

         The Company has designated certain real estate properties as held for
         sale and reports results of operating the properties, including
         interest expense, and the gain or loss on the sale of such real estate
         properties as "Discontinued Operations". The Company ceases
         depreciating a property when it is designated as held for sale.



                                       39
<PAGE>

         The composition of the Company's real estate and other properties
follows:

<TABLE>
<CAPTION>
                                                                          December 31,
                                                            ------------------------------------
                                                                 2004                  2003
                                                            -------------         -------------
<S>                                                         <C>                   <C>
Real estate and other properties:
Land                                                        $   8,092,000         $   8,061,000
Building                                                       30,889,000            29,797,000
Furniture, fixtures and equipment                               7,788,000             7,261,000

Accumulated depreciation                                      (13,292,000)          (11,619,000)
                                                            -------------         -------------

Net real estate and other properties                           33,477,000            33,500,000
                                                            -------------         -------------

Real estate held for sale:
Land                                                            1,751,000             7,622,000
Building                                                        8,086,000            15,923,000
Furniture, fixtures and equipment                               2,331,000             3,405,000

Accumulated depreciation                                       (3,608,000)           (6,112,000)
                                                            -------------         -------------

Net real estate held for sale                                   8,560,000            20,838,000
                                                            -------------         -------------

Oil and gas properties held for sale:
Gross oil and gas properties                                            -           143,601,000
Accumulated depreciation, depletion and amortization                    -          (116,064,000)
                                                            -------------         -------------

Net oil and gas properties held for sale                                -            27,537,000
                                                            -------------         -------------

Net property, furniture, fixtures and equipment             $  42,037,000         $  81,875,000
                                                            =============         =============
</TABLE>

         On a periodic basis, management assesses whether there are any
         indicators that the value of the real estate properties may be
         impaired. A property's value is considered impaired if management's
         estimate of the aggregate future cash flows (undiscounted and without
         interest charges) to be generated by the property are less than the
         carrying value of the property. To the extent impairment has occurred,
         the loss shall be measured as the excess of the carrying amount of the
         property over the fair value of the property.

         Management does not believe at December 31, 2004 and 2003 that the
         value of any of its properties is impaired.

         REVENUE RECOGNITION:

         Revenue from real estate properties is recognized during the period in
         which the premises are occupied and rent is due from tenants. For
         commercial properties, rental revenue is recognized on a straight-line
         basis over the term of the lease. The excess of rents recognized over
         amounts contractually due pursuant to the underlying leases are
         included in accounts receivable. For residential properties where lease
         agreements are almost exclusively for one-year terms, rental revenue is
         recognized in accordance with the contractual terms of the underlying
         leases. The Company follows a policy of aggressively pursuing its
         rental tenants to ensure timely payment of amounts due. When a tenant
         becomes 30 days in arrears on paying rent, the amount is generally
         written-off and turned over to a collection agency for action.
         Accordingly, no allowance for uncollectible accounts is maintained for
         the Company's real estate tenants.

         An allowance for uncollectible accounts was maintained based on the
         Company's estimate of the inability of its joint interest partners in
         the oil and gas division to make required payments. With the sale of
         the oil and gas division, the Company no longer maintains an allowance
         for uncollectible accounts.


                                       40
<PAGE>

         INCOME TAXES:

         Deferred taxes are provided for the net tax effect of temporary
         differences between the carrying amounts of assets and liabilities for
         financial reporting purposes and the amounts used for income tax
         purposes. The primary temporary differences are those related to tax
         over book depreciation and unrealized gains and losses on marketable
         securities. In addition, the Company has provided $2.1 million of
         deferred U.S. taxes for the repatriation of earnings from its Canadian
         subsidiary and $0.9 million of Canadian withholding taxes.

         Deferred tax benefits are evaluated for realizability and a
         determination is made, taking into account tax planning strategies, on
         whether the deferred tax benefit is more likely than not to be
         realized. Based upon this evaluation, a valuation allowance is
         established to reduce the deferred tax benefit to the level where it is
         more likely than not to be ultimately realized. At December 31, 2004
         and 2003 the Company had a zero valuation allowance.

         FOREIGN OPERATIONS:

         The assets and liabilities of the Company's Canadian subsidiary have
         been translated at year-end exchange rates. The related revenues and
         expenses have been translated at average annual exchange rates. The
         aggregate effect of translation losses are reflected as a component of
         accumulated other comprehensive income (loss) until the sale or
         liquidation of the underlying foreign investment.

         Realized foreign exchange gain (loss) of $(528,000), $(179,000) and
         $29,000, net of taxes, are included in the statements of operations for
         the years ended December 31, 2004, 2003, and 2002, respectively. The
         2004 transaction relates to the settlement of an intercompany loan from
         the Canadian subsidiary to Wilshire. The 2003 and 2002 foreign exchange
         gain (loss) related to the conversion of the proceeds of maturing U.S.
         dollar denominated Certificate of Deposit accounts to Canadian dollars.
         These amounts are included in Discontinued Operations - Oil and Gas.

         See Note 2 for additional information on the sale of the Canadian oil
         and gas assets in 2004.

         EARNINGS (LOSS) PER SHARE:

         Basic earnings (loss) per share are calculated by dividing net income
         (loss) by the weighted average number of shares outstanding during each
         period. The calculation of diluted earnings (loss) per share is similar
         to that of basic earnings (loss) per share, except that the denominator
         is increased to include the number of additional shares that would have
         been outstanding if all potentially dilutive shares, such as those
         issuable upon the exercise of stock options and warrants, were issued
         during the period.

         In computing diluted earnings (loss) per share for the years ended
         December 31, 2004 and 2002, the assumed exercise of all of Wilshire's
         outstanding stock options, adjusted for application of the treasury
         stock method, would have increased the weighted average number of
         shares outstanding as shown in the earnings (loss) per share
         calculation table below. Diluted earnings (loss) per share for the year
         ended December 31, 2003 has not been presented, since the Company
         incurred a loss and the assumed exercise of the 438,740 stock options
         outstanding would have been anti-dilutive.

                                       41
<PAGE>

<TABLE>
<CAPTION>
                                                               2004              2002
                                                               ----              ----
<S>                                                         <C>               <C>
            Numerator-
               Net income (loss) - Basic and Diluted        $2,638,000        $1,076,000
                                                            ==========        ==========

            Denominator-
              Weighted average common
               shares outstanding - Basic                    7,795,843         7,831,817
              Incremental shares from assumed
               conversions of stock options                    159,242               234
                                                            ----------        ----------

              Weighted average common shares
               outstanding - Diluted                         7,955,085         7,832,051
                                                            ==========        ==========

            Basic earnings (loss) per share:                $     0.34        $     0.14
                                                            ==========        ==========

            Diluted earnings (loss) per share:              $     0.33        $     0.14
                                                            ==========        ==========
</TABLE>

         STOCK-BASED COMPENSATION:

         In accordance with the provisions of Accounting Principles Board
         Opinion No. 25, "Accounting for Stock Issued to Employees," Wilshire
         will recognize compensation cost as a result of the issuance of stock
         options to employees, including directors, based on the excess, if any,
         of the fair value of the underlying shares at the date of grant or
         award (or at an appropriate subsequent measurement date) over the
         amount the employees must pay to acquire the shares (the "intrinsic
         value method"). However, Wilshire will not be required to recognize
         compensation expense as a result of any grants to employees at an
         exercise price that is equal to or greater than fair value. The Company
         will also make pro forma disclosures, as required by Statement of
         Financial Accounting Standards No. 123, "Accounting for Stock-Based
         Compensation" ("SFAS 123"), and Statement of Financial Accounting
         Standards No. 148, "Accounting for Stock-Based Compensation -
         Transition and Disclosures" ("SFAS 148"), of net income or loss as if a
         fair value based method of accounting for stock options had been
         applied if such amounts differ materially from the historical amounts.

         In accordance with the provisions of SFAS 123, all other issuances of
         shares, options or other equity instruments to employees and
         non-employees as the consideration for goods or services received by
         Wilshire are accounted for based on the fair value of the equity
         instruments issued (unless the fair value of the consideration received
         can be more reliably measured). The fair value of any options or
         similar equity instruments issued will be estimated based on the
         Black-Scholes option-pricing model, which meets the criteria set forth
         in SFAS 123, and the assumption that all of the options or other equity
         instruments will ultimately vest. Such fair value is measured as of an
         appropriate date pursuant to EITF Issue No. 96-18 (generally, the
         earlier of the date the other party becomes committed to provide goods
         or services or the date performance by the other party is complete) and
         capitalized or expensed as if Wilshire had paid cash for the goods or
         services.

         All outstanding stock options were granted at exercise prices that
         equaled the fair value of the underlying stock at the date of grant.
         Accordingly, no compensation expense has been recognized for stock
         option plans.

         The pro forma impact of expensing stock options for the years ended
         December 31, 2004, 2003 and 2002 would have reduced reported net income
         for the year ended December 31, 2004 and 2002 by approximately $21,000
         and $11,000, respectively. The net loss reported in the year ended
         December 31, 2003 would have increased by approximately $61,000. The
         per share impact, basic and diluted, would have been less than $0.01
         per share for the years ended December 31, 2004 and 2002 and $0.01 per
         share for the year ended December 31, 2003.

                                       42
<PAGE>

         The fair value of stock options was estimated using the Black-Scholes
         option-pricing model based on the variables presented in the following
         table.

<TABLE>
<CAPTION>
                                                                     2004                2003               2002
                                                                     ----                ----               ----

<S>                                                                 <C>                 <C>                <C>
         Weighted average market price                              $5.18               $3.60              $3.32
         Risk free interest rate                                    3.97%               3.00%              3.87%
         Volatility                                                 37.4%               33.1%              33.1%
         Dividend yield                                                -%                  -%                 -%
         Expected option life                                     5 years             5 years            5 years
</TABLE>

         ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS):

         Comprehensive income (loss) includes net income (loss), unrealized gain
         (loss) on available for sale securities and foreign currency
         translation adjustments.

         Changes in the components of Accumulated other Comprehensive Income
         (Loss) for the years 2004, 2003 and 2002 are as follows -

<TABLE>
<CAPTION>
                                                       Unrealized Gains                Cumulative              Accumulated
                                                            (Losses) on          Foreign Currency                    Other
                                                     Available-for-Sale               Translation            Comprehensive
                                                             Securities                Adjustment            Income (Loss)
                                                             ----------                ----------            -------------
<S>                                                        <C>                      <C>                      <C>
            BALANCE, December 31, 2001                      $ 1,095,000              $(3,830,000)             $(2,735,000)
                  Change for the year 2002                     (442,000)                  88,000                 (354,000)
                                                            -----------              -----------              -----------
            BALANCE, December 31, 2002                          653,000               (3,742,000)              (3,089,000)
                  Change for the year 2003                     (545,000)               2,206,000                1,661,000
                                                            -----------              -----------              -----------
            BALANCE, December 31, 2003                          108,000               (1,536,000)              (1,428,000)
                  Change for the year 2004                      456,000                1,562,000                2,018,000
                                                            -----------              -----------              -----------
            BALANCE, December 31, 2004                      $   564,000              $    26,000              $   590,000
                                                            ===========              ===========              ===========
</TABLE>
         The change in unrealized gains (losses) on available for sale
         securities in 2003 includes a transfer to realized gain of $822,000.

         ADVERTISING EXPENSE:

         The Company advertises for tenants for its properties through various
         media, including print and internet. Advertising costs are expensed as
         incurred and amounted to $252,000 in 2004, $269,000 in 2003 and
         $273,000 in 2002.

         RECLASSIFICATIONS:

         Certain amounts in the 2003 and 2002 consolidated financial statements
         have been reclassified to conform to the 2004 presentation.


                                       43
<PAGE>

2. DISCONTINUED OPERATIONS:

         During 2004, the Company sold 13 residential properties located in
         Jersey City, New Jersey and parcels of land in South Brunswick, New
         Jersey, and Montville, New Jersey, for gross proceeds of $19,700,000
         and an after-tax gain of $4,056,000. In 2003, three residential
         properties in Florida were sold for gross proceeds of $3,190,000,
         yielding an after-tax gain of $1,081,000. In 2002, two condominium
         units and one parcel of unimproved land in New Jersey were sold for
         gross proceeds of $745,000, $150,000 after-tax gain.

         The Company has designated certain of its properties as held for sale,
         which under accounting principles generally accepted in the United
         States requires that the Company report the results of operating these
         properties as discontinued operations. At December 31, 2004, the
         Company's residential apartment complexes known as Biltmore Club
         (Phoenix, Arizona) and Twelve Oaks (Atlanta, Georgia) and its office
         building Amboy Towers (Perth Amboy, New Jersey) and several parcels of
         undeveloped land in New Jersey have been classified as discontinued
         operations.

         The Company has entered into an agreement to sell Biltmore Club. See
         Note 11 to Notes to Consolidated Financial Statements for additional
         information.

         The Company announced in July 2003 its intention to sell its oil and
         gas businesses. The Canadian oil and gas business was sold in April
         2004 to Addison Energy Inc., a wholly owned subsidiary of Exco
         Resources, Inc., for $15 million in gross proceeds. The United States
         oil and gas business was sold in April 2004 to Crow Creek Energy LLC, a
         Tulsa, Oklahoma based privately held portfolio company of Natural Gas
         Partners of Dallas, Texas, for $13.3 million in gross proceeds. After
         closing adjustments, the proceeds were reduced to $28,131,000. The
         Company recorded a net gain on the sale of its oil and gas assets of
         $567,000.

         During 2004 and 2003, respectively, the Company recorded losses, net of
         taxes from operating its oil and gas businesses of $1,278,000 and
         $3,178,000, respectively. The net loss from operating the oil and gas
         business in 2004 includes the operating results of the oil and gas
         business for January and February and the continuing reconciliation
         process between the Company and its partners for periods prior to the
         effective date of the sale. The Company reported net income from
         operating its oil and gas business in 2002 of $1,008,000.


                                       44
<PAGE>

3. LONG-TERM DEBT:

         Long-term debt as of December 31 consists of the following:

<TABLE>
<CAPTION>
                                                                                             2004                          2003
                                                                                             ----                          ----

<S>                                                                                   <C>                           <C>
         Mortgage notes payable (a)                                                   $11,935,000                   $18,467,000
         Mortgage notes payable (b)                                                    30,802,000                    31,195,000
         Mortgage notes payable (c)                                                     4,118,000                     4,162,000
         Note payable (d)                                                                       -                     2,700,000
         Revolving demand loan (e)                                                              -                     1,970,000
                                                                                      -----------                   -----------
         Total                                                                         46,855,000                    58,494,000
         Less current portion                                                             729,000                     7,148,000
                                                                                      -----------                   -----------

         Long term portion                                                            $46,126,000                   $51,346,000
                                                                                      ===========                   ===========

         Long-term debt applicable to discontinued operations: (a)(b)
         Included in current liabilities                                                $ 156,000                   $ 3,654,000
         Included in noncurrent liabilities                                            10,547,000                    14,514,000
                                                                                      -----------                   -----------

         Total                                                                        $10,703,000                   $18,168,000
                                                                                      ===========                   ===========
</TABLE>


(a)      Mortgage notes payable to North Fork Bank (formerly The Trust Company
         of New Jersey) payable in monthly installments, bearing interest at a
         weighted average effective rate of 7.53%. These mortgage notes were
         secured by a first mortgage interest in various residential and
         commercial real estate properties in Arizona, Florida, Georgia, and New
         Jersey and matured at various dates through 2010. On March 1, 2003, the
         notes were modified to reflect an effective interest rate of 6.375% for
         the next five years and a revised maturity of February 2013. At
         December 31, 2004, the properties securing the notes had an approximate
         net book value of $12,766,000.
(b)      Mortgage notes payable to five real estate mortgage conduits arranged
         by Merrill Lynch that are payable in monthly installments of principal
         and interest, bearing interest at a weighted average effective rate of
         5.75%, a 30-year amortization and a ten year term, maturing in March
         2013. The residential properties securing the mortgage conduit loans
         are located in Arizona, New Jersey and Texas and at December 31, 2004
         had an approximate net book value of $19,727,000.
(c)      Mortgage note payable to Orix Real Estate Capital Markets that is
         payable in monthly installments of principal and interest, bears
         interest at 7.9% and matures in June 2009. The note is secured by
         residential property located in Texas that at December 31, 2004 had an
         approximate net book value of $5,329,000.
(d)      During December 2003, the Company obtained a note payable of $2,700,000
         to The Trust Company of New Jersey. This loan bore interest at the
         prime lending rate and matured in March 2004 and was paid in full. The
         note was secured by a certificate of deposit in the same amount.
(e)      In August 2002, the Company's Canadian subsidiary entered into a
         maximum $5,088,000 ($8,000,000 Canadian) revolving operating demand
         loan with the National Bank of Canada (the "Bank"). The loan bears
         interest at the Bank's prime lending rate (4.5% at December 31, 2003)
         plus 0.25% and is paid monthly. The loan was obtained to fund the
         Company's capital requirements with respect to the drilling of 211
         development wells in Canada. The loan provisions requires the Company
         to repay the outstanding debt solely from available cash generated from
         its Canadian operations until the debt is paid in full. At December 31,
         2003, the Company owed the Bank $1,970,000 ($2,550,000 Canadian) under
         the loan. The loan was paid in full in April 2004 from the proceeds
         from the sale of the Canadian oil and gas operations.

                                       45
<PAGE>

         The aggregate maturities of the long-term debt in each of the five
         years subsequent to December 31, 2004 and thereafter are -

         Year                                                      Amount
         ----                                                      ------
         2005                                                 $   729,000
         2006                                                     785,000
         2007                                                     845,000
         2008                                                     906,000
         2009                                                   4,797,000
         Thereafter                                            38,793,000
                                                              -----------
                                                              $46,855,000
                                                              ===========

4.       MORTGAGE NOTES RECEIVABLE:

         During June 2000, the Company acquired mortgage notes receivable
         collateralized by underlying property from The Trust Company of New
         Jersey for $3,500,000. The Company subsequently advanced the borrower
         an additional $2,790,000. The mortgage notes receivable and subsequent
         advances are due 2007 and bear interest at 9.75%. In connection with
         the mortgage note receivable the Company will earn a $2,500,000
         financing fee. The fee is being recognized in income by the effective
         interest method over the term of the mortgage receivable. Under this
         agreement, the Company has the right to receive a portion of the
         proceeds from the sale of the underlying property. During the years
         2004 and 2003, the Company received amortization and financing fees in
         the amount of $471,000 and $650,000, respectively.

         In February 2005, the Company and the borrower negotiated a settlement
         of the outstanding mortgage notes receivable for $1.1 million, which
         was paid during the first quarter of 2005. The Company recognized a
         gain in the first quarter 2005 of approximately $400,000 after taxes on
         this transaction.

5.       COMMITMENTS AND CONTINGENCIES:

         COMMERCIAL LEASES:

         Wilshire leases commercial space to tenants for periods of up to five
         years. Most of the leases contain clauses for reimbursement of real
         estate taxes, maintenance, insurance and certain other operating
         expenses of the properties. Minimum rental income to be received from
         non-cancelable operating leases in years subsequent to December 31,
         2004 are as follows:

         Year ending December 31,                                   Amount (1)

         2005                                                      $1,303,000
         2006                                                         820,000
         2007                                                         580,000
         2008                                                         305,000
         2009                                                         143,000
         Thereafter                                                   890,000
                                                                   ----------
                                                                   $4,041,000
                                                                   ==========

         (1) Excludes rental income from the Wilshire Grand Hotel, which has a
         triple net lease.

         The above amounts assume that all leases which expire are not renewed
         and, accordingly, neither minimal rentals nor rentals from replacement
         tenants are included.

         Minimum future rentals do not include contingent rentals, which may be
         received under certain leases on the basis of percentage of reported
         tenants' sales volume or other factors. Rental income that is
         contingent on future events is not included in income until the
         contingency is resolved. Contingent rentals included in income for each
         of the three years in the period ended December 31, 2004 were not
         material.

                                       46
<PAGE>

         RESIDENTIAL LEASES:

         Lease terms for residential tenants are usually one year or less.

         CITY OF PERTH AMBOY, NEW JERSEY:

         Wilshire achieved a settlement agreement with the City of Perth Amboy,
         New Jersey, regarding the redevelopment zone status of its office
         building Amboy Towers. In an agreement signed in February 2005, the
         City has agreed to exclude Amboy Towers from the redevelopment zone and
         Wilshire has agreed to invest $750,000 in capital improvements in the
         building over the 18-month period commencing with the signing of the
         agreement.

         HEADQUARTERS LEASE:

         Wilshire has entered into an agreement to lease office space for its
         headquarters at One Gateway Center in Newark, New Jersey. The effective
         date of the lease is April 1, 2005 and it is for a 65 month period with
         two renewal options each for a five-year period. Wilshire has the right
         to cancel the lease after 24 months subject to reimbursing the landlord
         for certain unamortized costs associated with tenant improvements and
         real estate commissions. The base rent in the lease is $29.00 per
         square foot, with Wilshire receiving in the third year of the lease
         agreement five months of free rent. Base rental expense will be
         recognized on a straight-line basis and will amount to $121,000 per
         year.

         The Company is currently leasing space on a month-to-month basis in
         Jersey City, New Jersey, and does not anticipate any penalty from the
         termination of this lease. The Company also leased space on month to
         month leases in Calgary, Canada and Oklahoma City, Oklahoma for its oil
         and gas business. The lease in Calgary, Canada was terminated in April
         2004 with the sale of the Canadian oil and gas assets. The lease in
         Oklahoma City, Oklahoma was terminated in June 2004 after the final
         settlement of the sale of the United States oil and gas assets. Rental
         expense for all of the Company's offices amounted to approximately
         $60,000 in 2004 and $101,000 in 2003 and 2002.

         RIGHTS PLAN:

         In June 1996, the Company's Board of Directors adopted the Stockholder
         Protection Rights Plan (the "Rights Plan"). The Rights Plan provides
         for issuance of one Right for each share of common stock outstanding as
         of July 6, 1996. The Rights are separable from and exercisable upon the
         occurrence of certain triggering events involving the acquisition of at
         least 15% (or, in the case of certain existing stockholders, 25%) of
         the Company's common stock by an individual or group, as defined in the
         Rights Plan (an "Acquiring" Person) and may be redeemed by the Board of
         Directors at a redemption price of $0.01 per Right at any time prior to
         the announcement by the Company that a person or group has become an
         Acquiring Person.

         On and after the tenth day following such triggering events, each Right
         would entitle the holder (other than the Acquiring Person) to purchase
         $50 in market value of the Company's Common Stock for $25. In addition,
         if there is a business combination between the Company and an Acquiring
         Person, or in certain other circumstances, each Right (if not
         previously exercised) would entitle the holder (other than the
         Acquiring Person) to purchase $50 in market value of the common stock
         of the Acquiring Person for $25.

         As of December 31, 2004 and 2003, 7,778,812 and 7,802,831,
         respectively, of Rights were outstanding. Each Right entitles the
         holder to purchase, for an exercise price of $25, one one-hundredth of
         a share of Series A Participating Preferred Stock. Each one
         one-hundredth share of Series A Participating Preferred Stock is
         designed to have economic terms similar to those of one share of common
         stock but will have one one-hundredth of a vote. Because the Rights are
         only exercisable under certain conditions, none of which were in effect
         as of December 31, 2004 and 2003, the outstanding Rights are not
         considered in the computation of basic and diluted earnings per share.

                                       47
<PAGE>

         SHARE REPURCHASE AUTHORIZATION:

         On June 3, 2004, the Company announced that the Board of Directors had
         authorized the purchase of up to 1,000,000 shares of its common stock
         on the open market, in privately negotiated transactions or otherwise.
         This purchasing activity may occur from time to time, in one or more
         transactions. Through December 31, 2004, the Company had purchased
         38,478 shares under this program at an approximate cost of $198,000 or
         $5.15 per share.

6.       STOCK OPTION PLANS:

         In June 2004, the Company's stockholders approved the 2004 Stock Option
         and Incentive Plan (the "2004 Incentive Plan"). The purpose of the 2004
         Incentive Plan is to encourage stock ownership by key employees and
         consultants of the Company, to provide additional incentive for them to
         promote the successful business operations of the Company, to encourage
         them to continue providing services to the Company, and to attract new
         employees and consultants to the Company. Awards under the 2004
         Incentive Plan may be granted in any one or all of the following forms,
         as those terms are defined under the 2004 Incentive Plan: (i) incentive
         stock options; (ii) non-qualified stock options; (iii) stock
         appreciation rights; (iv) restricted shares of common stock; (v)
         performance shares; (vi) performance units; and (vii) unrestricted
         shares of common stock. The maximum aggregate number of shares of
         common stock available for award under the 2004 Incentive Plan is
         600,000, subject to adjustment under the terms of the 2004 Incentive
         Plan.

         In June 2004, the Company's stockholders approved the 2004 Non-Employee
         Director Stock Option Plan (the "2004 Director Plan"). The purpose of
         the 2004 Director Plan is to attract qualified personnel to accept
         positions of responsibility as directors of the Company, to provide
         incentives for persons to remain on the Board and to induce such
         persons to maximize the Company's performance during the terms of their
         options. Only non-qualified stock options may be granted under the 2004
         Director Plan. The maximum aggregate number of shares of common stock
         available for grant under the 2004 Director Plan is 150,000, subject to
         adjustment under the terms of the 2004 Director Plan. Upon adoption of
         the 2004 Director Plan, each non-employee director was granted 10,000
         options to purchase common shares of the Company and on each
         anniversary date of the 2004 Director Plan's adoption will receive an
         additional 5,000 options to purchase common shares of the Company.

         In June 1995, the Company adopted two stock-based compensation plans
         (1995 Stock Option and Incentive Plan "Incentive Plan"; and 1995
         Non-employee Director Stock Option Plan "Director Plan") under which,
         up to 450,000 and 150,000 shares, respectively are available for grant.
         In 2002, 339,750 options were granted under the Incentive Plan. No
         options were granted under the Director Plan in 2002.

         In 2003, 50,000 options were granted under the Incentive Plan and 5,000
         options were granted under the Director Plan.

         In 2004, 5,000 options were granted under the Director Plan and 50,000
         options were granted under the 2004 Director Plan. No options were
         granted under the 2004 Incentive Plan.

         The number and terms of the options granted under these plans are
         determined by the Company's Stock Option Committee (the Committee)
         based on the fair market value of the Company's common stock on the
         date of grant. The period during which an option may be exercised
         varies, but no option may be exercised after ten years from the date of
         grant.

                                       48
<PAGE>

         The following table summarized stock option activity for 2004, 2003 and
2002:

<TABLE>
<CAPTION>
                                                               2004                         2003                          2002
                                               --------------------        ---------------------       -----------------------
                                                              Price                        Price                         Price
                                               Shares      Low-High        Shares       Low-High        Shares        Low-High
                                               ------      --------        ------       --------        ------        --------
<S>                                            <C>         <C>   <C>       <C>         <C>   <C>       <C>         <C>   <C>
Options outstanding at
beginning of year                              438,740     $3.32-6.12      383,740     $3.32-6.12      111,954     $3.94-6.51
Options granted                                 55,000      5.15-5.48       55,000      3.51-4.55      339,750           3.32
Options exercised                               (9,330)     3.32-5.95            -              -           -               -
Options terminated and  expired                (26,950)          3.32            -              -     (67,964)      5.53-6.51
                                               -------                     -------                    -------
Options  outstanding  at  end
of year                                        457,460     $3.32-6.12      438,740     $3.32-6.12      383,740     $3.32-6.12
                                               =======     ===========    ========     ==========     ========     ==========
Options  exercisable  at  end
of year                                        364,760     $3.94-6.12      185,940     $3.94-6.12       40,990     $3.94-6.12
                                               =======     ===========    ========     ==========     ========     ==========
</TABLE>

         The fair value of the options granted during 2004 was $112,000. The
         remaining weighted average contractual life of the options outstanding
         at December 31, 2004 was 7.4 years.

         During 2004, 4,529 shares of common stock were granted to employees
         under the 2004 Incentive Plan. The employee's right to receive these
         restricted shares vest serially over a three-year period. Compensation
         expense for the year ended December 31, 2004 includes an insignificant
         amount related to the issuance of these shares.

         During 2004, 600 shares of common stock were granted under the 2004
         Incentive Plan to non-employees who are involved with managing the
         Company's real estate properties. The shares were valued at their fair
         value on the date of grant and had an insignificant impact on the
         Company's financial condition.

         At the time of his retirement on June 30, 2004, the former President of
         the Company had 300,000 stock options outstanding with a weighted
         average exercise price of $3.35 per share. As part of the three year
         consulting arrangement between the former President and the Company,
         the life of his stock options were extended for the length of his
         consulting arrangement. This arrangement has resulted in the Company
         valuing his stock options at $495,000, which is the difference between
         the intrinsic value of the stock options at their date of grant and the
         market value of the Company's common stock at June 30, 2004. This value
         has been recorded as an increase to capital in excess of par value and
         an increase to unearned compensation, both separate components of
         stockholders' equity. The unearned compensation amount is being
         amortized into general and administrative expense over the term of the
         three year consulting arrangement. At December 31, 2004, $431,000 was
         remaining to be amortized into general and administrative expense over
         the next 2 1/2 years and $82,000 had been recognized in expense in
         2004.

7.       INCOME TAXES

         The components of income before income taxes is as follows:


<TABLE>
<CAPTION>
                                               2004                2003               2002
                                               ----                ----               ----

<S>                                         <C>                <C>                 <C>
United States operations                    $ 2,662,000        $ 2,440,000         $ 1,366,000

Operations outside the United States          1,866,000         (2,770,000)             40,000
                                            -----------        -----------         -----------
        Total                               $ 4,528,000        $  (330,000)        $ 1,406,000)
                                            ===========        ===========         ===========
</TABLE>

                                       49
<PAGE>


         Provision (benefit) for income taxes consist of the following:

<TABLE>
<CAPTION>
                                    2004                2003                2002
                                    ----                ----                ----

<S>                              <C>                 <C>                 <C>
Continuing Operations
     Federal
        Current                  $  (594,000)        $  (788,000)        $  (351,000)

        Deferred                     189,000             681,000             304,000
                                 -----------         -----------         -----------
                                    (405,000)           (107,000)            (47,000)
                                 -----------         -----------         -----------
     State
        Current                      670,000                   -                   -

        Deferred                    (486,000)                  -                   -
                                 -----------         -----------         -----------
                                     184,000                   -                   -
                                 -----------         -----------         -----------
        Total Continuing         $  (221,000)        $  (107,000)        $   (47,000)
                                 ===========         ===========         ===========
Discontinued Operations
     Real Estate
        Federal
        Current                  $ 2,275,000         $   402,000         $   221,000

        Deferred                    (247,000)            (41,000)           (368,000)
                                 -----------         -----------         -----------
                                   2,028,000             361,000            (147,000)
                                 -----------         -----------         -----------
        State
        Current                      222,000                   -                   -
        Deferred                    (176,000)                  -                   -
                                 -----------         -----------         -----------
                                      46,000                   -                   -
                                 -----------         -----------         -----------
        Total Real Estate        $ 2,074,000         $   361,000         $  (147,000)
                                 ===========         ===========         ===========
     Oil and Gas
        Federal
        Current                  $ 2,598,000         $    68,000         $   161,000
        Deferred                  (3,488,000)           (569,000)            326,000
                                 -----------         -----------         -----------
                                    (890,000)           (501,000)            487,000
                                 -----------         -----------         -----------
        State
        Current                        3,000              42,000              38,000
        Deferred                           -                   -                   -
                                 -----------         -----------         -----------
                                       3,000              42,000              38,000
                                 -----------         -----------         -----------
        Foreign
        Current                    4,044,000             635,000            (501,000)
        Deferred                  (3,120,000)         (1,987,000)            500,000
                                 -----------         -----------         -----------
                                     924,000          (1,352,000)             (1,000)
                                 -----------         -----------         -----------
        Total Oil & Gas               37,000         $(1,811,000)        $   524,000
                                 ===========         ===========         ===========

        Total                    $ 1,890,000         $(1,557,000)        $   330,000
                                 ===========         ===========         ===========
</TABLE>


                                       50
<PAGE>

A reconciliation of the differences between the effective tax rate and the
statutory U.S. income tax rate is as follows:


<TABLE>
<CAPTION>
                                             Amount           %         Amount          %        Amount           %

<S>                                       <C>               <C>     <C>              <C>      <C>               <C>
Federal income tax provision
(benefit) at statutory rate               $ 1,585,000       35.0%   $(1,376,000)     (35.0)%  $   478,000       34.0%
State income tax net of Federal impact        152,000        3.3         27,000        0.7         25,000        1.8
Impact of foreign operations                  271,000        6.0        408,000       10.4        (87,000)      (6.2)
Dividend exclusion                            (50,000)      (1.1)       (91,000)      (2.3)       (86,000)      (6.1)

Tax-exempt interest                           (68,000)      (1.5)             -        -                -         -
Liquidating dividend from foreign
operations                                          -         -       2,075,000       52.8              -         -

Impairment tax benefit                              -         -      (2,600,000)     (66.2)             -         -
                                          -----------      ----     -----------       ----    -----------      ----
Total tax expense (benefit) /
Effective tax rate (benefit)              $ 1,890,000       41.7%   $(1,557,000)     (39.6)%  $   330,000       23.5%
                                          ===========       ====    ===========       ====    ===========       ====
</TABLE>


         Significant components of deferred tax liabilities as of December 31,
2004 and 2003 were as follows -

<TABLE>
<CAPTION>
                                                                        2004                    2003
                                                                        ----                    ----

<S>                                                                 <C>                      <C>
Tax over book depreciation, depletion and amortization -
     Oil and gas and real estate properties - U.S.                  $  1,485,000             $  5,837,000
     Oil and gas properties - Canada                                           0                5,734,000
Deferred gains on sales of real estate properties - U.S.                 370,000                  412,000
U.S. tax on liquidating dividend from Canada                           2,075,000                2,075,000
Reserve for impairment - oil and gas                                           -               (2,600,000)
Unrealized gain on marketable securities                                 390,000                   89,000
                                                                    ------------             ------------

     Net deferred tax liability                                        4,320,000               11,547,000

Deferred tax liability included in  current                           (2,465,000)             (10,489,000)
                                                                    ------------             ------------

     Noncurrent deferred tax liability                              $  1,855,000             $  1,058,000
                                                                    ============             ============
</TABLE>

8.       SEGMENT INFORMATION:

         SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
         Information," established standards for reporting financial information
         about operating segments in interim and annual financial reports and
         provides for a "management approach" in identifying the reportable
         segments.

         Wilshire has determined that it has two reportable segments within its
         continuing operations: residential properties and commercial
         properties. These reportable segments have different types of customers
         and are managed separately because each requires different operating
         strategies and management expertise. The residential property segment
         has seven separate properties and the commercial segment has five
         properties. The accounting policies of the segments are the same as
         those described in Note 1.

                                       51
<PAGE>

         The chief operating decision-making group of Wilshire's residential and
         commercial real estate segments and corporate/other activities is
         comprised of Wilshire's Chairman & Chief Executive Officer, President &
         Chief Operating Officer and Chief Financial Officer.

         Wilshire assesses and measures segment operating results based on NOI,
         which is a direct measure of each property's contribution to the
         results of the Company before considering revenues from treasury
         activities, overhead expenses and other costs that are not directly
         related to the performance of a property. The Company believes NOI is a
         more descriptive measure of the Company's performance than income
         (loss) from continuing operations. NOI is not a measure of operating
         results or cash flow as measured by generally accepted accounting
         principles, and is not necessarily indicative of cash available to fund
         cash needs and should not be considered an alternative to cash flows as
         a measure of liquidity.

         Continuing real estate revenue, operating expenses, NOI and recurring
         capital improvements for the reportable segments are summarized below
         and reconciled to consolidated net income (loss) from continuing
         operations for each of the three years in the period ended December 31,
         2004. Asset information is not reported since Wilshire does not use
         this measure to assess performance.

<TABLE>
<CAPTION>
                                                                            2004              2003              2002
                                                                            ----              ----              ----
<S>                                                                      <C>               <C>               <C>
Real estate revenue:
Residential                                                              $ 7,456,000       $ 7,313,000       $ 7,272,000
Commercial                                                                 2,250,000         1,944,000         1,871,000
                                                                         -----------       -----------       -----------
Total                                                                    $ 9,706,000       $ 9,257,000       $ 9,143,000
                                                                         -----------       -----------       -----------

Real estate operating expenses:
Residential                                                              $ 4,337,000       $ 4,405,000       $ 4,096,000
Commercial                                                                 1,162,000         1,048,000         1,164,000
                                                                         -----------       -----------       -----------
Total                                                                    $ 5,499,000       $ 5,453,000       $ 5,260,000
                                                                         -----------       -----------       -----------

Net operating income:
Residential                                                              $ 3,119,000       $ 2,908,000       $ 3,176,000
Commercial                                                                 1,088,000           896,000           707,000
                                                                         -----------       -----------       -----------
Total                                                                    $ 4,207,000       $ 3,804,000       $ 3,883,000
                                                                         -----------       -----------       -----------

Capital improvements:
Residential                                                              $ 1,369,000       $ 1,255,000       $   678,000
Commercial                                                                   333,000           460,000         1,218,000
                                                                         -----------       -----------       -----------
Total                                                                    $ 1,702,000       $ 1,715,000       $ 1,896,000
                                                                         -----------       -----------       -----------

Reconciliation of NOI to consolidated income (loss) from continuing
operations:
Segment NOI                                                              $ 4,207,000       $ 3,804,000       $ 3,883,000
Total other income, including net investment income                        1,314,000         4,596,000         2,128,000
Depreciation expense                                                      (1,673,000)       (1,647,000)       (1,541,000)
General and administrative expense                                        (2,143,000)       (2,349,000)       (2,131,000)
Interest expense                                                          (2,343,000)       (3,408,000)       (2,226,000)
Income tax benefit                                                           221,000           107,000            47,000
                                                                         -----------       -----------       -----------

Income from continuing operations                                        $  (417,000)      $ 1,103,000       $   160,000
                                                                         ===========       ===========       ===========
</TABLE>


9.       PREFERRED STOCK

         The Company is authorized to issue up to 1,000,000 shares of preferred
         stock, par value $1.00 per share. At December 31, 2004 and 2003, there
         were no shares of preferred stock outstanding. The preferred stock may
         be issued in one or more series, from time to time, with each such
         series to have such designation, powers, preferences and relative
         participating, optional or other special rights, and qualifications,
         limitations or restriction thereof, as shall be stated and expressed in
         the resolution or resolutions providing for the issue of such series
         adopted by the Board of Directors of the Company, subject to the
         limitations prescribed by law and in accordance with the provisions set
         forth in the Certificate of Incorporation of the Company.

                                       52
<PAGE>

10.      FAIR VALUE OF FINANCIAL INSTRUMENTS

         The following disclosures of estimated fair value were determined by
         management, using available market information and appropriate
         valuation methodologies. Considerable judgment is necessary to
         interpret market data and develop estimated fair values. Accordingly,
         the estimates presented herein are not necessarily indicative of the
         amounts the Company could realize on disposition of the financial
         instruments. The use of different market assumptions and/or estimation
         methodologies may have a material effect on the estimated fair value
         amounts.

         Cash equivalents, accounts receivable, accounts payable, and revolving
         credit facilities balances reasonably approximate their fair values due
         to the short maturities of these items. The mortgage receivable is
         valued at $1.1 million, which equals the settlement price agreed to
         with the borrower in February 2005 and exceeds its carrying value by
         $662,000.

         Mortgage notes payable have an estimated fair value based on discounted
         cash flow models of approximately $46.0 million, which is lower than
         the carrying value by $0.9 million.

         Disclosure about fair value of financial instruments is based on
         pertinent information available to management as of December 31, 2004.
         Although management is not aware of any factors that would
         significantly affect the reasonable fair value amounts, such amounts
         have not been comprehensively revalued for purposes of these financial
         statements since that date and current estimates of fair value may
         differ significantly from the amounts presented herein.

11.      SUBSEQUENT EVENTS

         In January 2005, the Company sold one 2-bedroom condominium at
         Galsworthy Arms, New Jersey, for gross proceeds of $269,500. After
         payment of closing costs and taxes, the Company will realize net income
         in the first quarter 2005 of approximately $115,000.

         In February 2005, the Company signed an agreement to sell its Biltmore
         Club apartment complex (Phoenix, Arizona) to GDG Partners L.L.C. for
         $20,956,000. The agreement is expected to close no later than December
         23, 2005. GDG Partners L.L.C. has paid Wilshire a nonrefundable deposit
         of $100,000 and additional nonrefundable deposits of $150,000 and
         $250,000 are required by April 3, 2005 and July 2, 2005, respectively.
         We expect to report a gain on the sale after taxes of approximately
         $8.5 million and have net proceeds after transaction costs and paying
         off the mortgage of approximately $10.0 million.

         The Company held a mortgage receivable with a gross carrying value of
         $1,165,000 and $727,000 of unearned income as of December 31, 2004.
         Security for the mortgage was a first lien on in excess of 100
         condominium units in two contiguous buildings located in Jersey City,
         New Jersey. On February 22, 2005, the Company entered into an agreement
         with the mortgagee to settle and satisfy the mortgage for $1,100,000,
         which was paid in the first quarter of 2005. At the conclusion of this
         transaction, the Company will recognize a gain of approximately
         $400,000 in the first quarter of 2005.

         In March 2005, the Company signed an agreement to sell its Twelve Oaks
         apartment complex (Atlanta, Georgia) to Interstate East Management,
         Inc. for $1,725,000. The agreement contains a "time is of the essence
         clause" and is expected to close as soon as practicable. We expect to
         report a gain on the sale after taxes of approximately $440,000. The
         property had been highly leveraged and the transaction will generate
         net proceeds after transaction costs and taxes of approximately
         $1,379,000, which will be used to repay the outstanding mortgage
         balance of approximately $1,609,000. The shortfall in the net proceeds
         will be made up from general corporate sources of funds.

                                       53
<PAGE>

         Also in March 2005 the Company was evaluating alternatives for
         optimizing its investment in the Wilshire Grand Hotel and Banquet
         Facility (the "Wilshire Hotel"). The Company leases the Wilshire Hotel
         under two 25-year operating leases, one for the hotel and one for the
         banquet facility, to an experienced hotel operator (the "Hotel
         Operator"). The Hotel Operator has encountered financial adversity and
         in 2004 ceased payment on its mortgage obligations, which are held by a
         third party (the "Mortgagor"). As of March 2005, the Hotel Operator was
         also delinquent on lease payments to Wilshire for the months of
         January, February and March 2005. The Mortgagor is required to cure any
         defaults of the Hotel Operator (i.e., pay any amounts due Wilshire
         under the lease) in order to protect its mortgage and cannot impair
         Wilshire's ownership interest in the property. As a result of the Hotel
         Operator's delinquency, Wilshire is evaluating alternatives for its
         investment including: a) declaring the Hotel Operator in default and
         pursuing tenant eviction proceedings and b) assisting in the
         consummation of a settlement agreement by which Wilshire would assume
         operational control of the Wilshire Hotel and in the event of a
         subsequent sale of the hotel, would receive an agreed upon value prior
         to any proceeds being distributed to the Mortgagor or Hotel Operator.
         At this time, Wilshire does not expect to incur a loss on this
         property.



                                       54
<PAGE>

12.      QUARTERLY DATA (UNAUDITED)

         The following represents the Company's results of operations for each
         quarter for the years ended December 31, 2004 and 2003. The amounts
         presents are different from amounts presented in the Company's
         quarterly reports on Form 10-Q due to the reclassification of certain
         amounts of revenue and expense to discontinued operations - real estate
         to reflect the designation of additional properties as discontinued.

<TABLE>
<CAPTION>
                                                                     Quarter ended
                                              -----------------------------------------------------------------
                                                March 31          June 30        September 30       December 31
                                                --------          -------        ------------       -----------
<S>                                           <C>               <C>               <C>               <C>
2004:
Revenues                                      $ 2,429,000       $ 2,479,000       $ 2,445,000       $ 2,353,000
                                              -----------       -----------       -----------       -----------

Costs and expenses:
Operating expenses                              1,388,000         1,332,000         1,416,000         1,363,000
Depreciation                                      427,000           398,000           398,000           450,000
General and administrative                        329,000           543,000           752,000           519,000
                                              -----------       -----------       -----------       -----------
Total costs and expenses                        2,144,000         2,273,000         2,566,000         2,332,000
                                              -----------       -----------       -----------       -----------

Income (loss) from operations                     285,000           206,000          (121,000)           21,000

Dividend and interest income                      194,000            46,000           192,000           253,000
Other income                                       53,000           185,000           206,000           185,000
Interest expense including  amortization
of deferred financing costs                      (616,000)         (583,000)         (579,000)         (565,000)
                                              -----------       -----------       -----------       -----------

Income (loss) before provision for taxes          (84,000)         (146,000)         (302,000)         (106,000)
Income taxes                                      (53,000)          (79,000)         (115,000)           26,000
                                              -----------       -----------       -----------       -----------

Income (loss) from continuing operations          (31,000)          (67,000)         (187,000)         (132,000)

Discontinued operations - real estate           2,887,000           248,000            (1,000)          632,000
Discontinued operations - oil & gas              (257,000)          842,000          (390,000)         (906,000)
                                              -----------       -----------       -----------       -----------

Net income (loss)                             $ 2,599,000       $ 1,023,000       $  (578,000)      $  (406,000)
                                              ===========       ===========       ===========       ===========

Basic earnings (loss) per share:
Continuing operations                               $   -            $(0.01)           $(0.02)           $(0.02)
Discontinued operations                              0.34              0.14                 -             (0.04)
                                                    -----             -----            ------            ------
Net income (loss)                                   $0.34             $0.13            $(0.02)           $(0.06)
                                                    =====             =====            ======            ======

Diluted earnings (loss) per share:
Continuing operations                               $   -            $(0.01)           $(0.02)           $(0.02)
Discontinued operations                              0.34              0.14                 -             (0.04)
                                                    -----             -----            ------            ------
Net income (loss)                                   $0.34             $0.13            $(0.02)           $(0.06)
                                                    =====             =====            ======            ======
</TABLE>


                                       55
<PAGE>


<TABLE>
<CAPTION>
                                                                      Quarter Ending
                                              -----------------------------------------------------------------
                                                March 31         June 30         September 30       December 31
                                                --------         -------         ------------       -----------
<S>                                           <C>               <C>               <C>               <C>
2003:
Revenues                                      $ 2,268,000       $ 2,286,000       $ 2,336,000       $ 2,367,000
                                              -----------       -----------       -----------       -----------

Costs and expenses:
Operating expenses                              1,313,000         1,327,000         1,419,000         1,394,000
Depreciation                                      418,000           415,000           415,000           399,000
General and administrative                        444,000           537,000           427,000           941,000
                                              -----------       -----------       -----------       -----------
Total costs and expenses                        2,175,000         2,279,000         2,261,000         2,734,000
                                              -----------       -----------       -----------       -----------

Income (loss) from operations                      93,000             7,000            75,000          (367,000)

Dividend and interest income                      224,000           145,000           176,000           198,000
Sale of marketable securities                     261,000                 -         2,360,000                 -
Life insurance proceeds                         1,000,000                 -                 -                 -
Other income                                      126,000           127,000            (6,000)          (15,000)
Interest expense including  amortization
of deferred financing costs                    (1,270,000)         (694,000)         (769,000)         (675,000)
                                              -----------       -----------       -----------       -----------

Income (loss) before provision for taxes          434,000          (415,000)        1,836,000          (859,000)
Income taxes                                     (185,000)         (181,000)          580,000          (321,000)
                                              -----------       -----------       -----------       -----------

Income (loss) from continuing operations          619,000          (234,000)        1,256,000          (538,000)

Discontinued operations - real estate            (252,000)           43,000           452,000           459,000
Discontinued operations - oil & gas               646,000           457,000            39,000        (4,320,000)
                                              -----------       -----------       -----------       -----------
Net income (loss)                             $ 1,013,000       $   266,000       $ 1,747,000       $(4,399,000)
                                              ===========       ===========       ===========       ===========

Basic earnings (loss) per share:
Continuing operations                               $0.08            $(0.03)            $0.16            $(0.07)
Discontinued operations                              0.05              0.06              0.06             (0.49)
                                                    -----            ------             -----            ------
Net income (loss)                                   $0.13             $0.03             $0.22            $(0.56)
                                                    =====             =====             =====            ======

Diluted earnings (loss) per share:
Continuing operations                               $0.08            $(0.03)            $0.16            $(0.07)
Discontinued operations                              0.05              0.06              0.06             (0.49)
                                                    -----            ------             -----            ------
Net income (loss)                                   $0.13             $0.03             $0.22            $(0.56)
                                                    =====             =====             =====            ======
</TABLE>


                                       56
<PAGE>

             SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION
                                DECEMBER 31, 2004
                                   ($ IN 000S)

<TABLE>
<CAPTION>
                                                                                           Column E
                                                              Column D                   Gross Amount
                                                          Costs Capitalized                At Which
                                       Column C             Subsequent To               Carried as of
Column A         Column B            Initial Cost            Acquisition              December 31, 2004
--------         --------            ------------            -----------              -----------------



                                           Building &            Building &               Building &
Description      Encumbrances   Land      Improvements  Land    Improvements   Land      Improvements    Total
-----------      ------------   ----      ------------  ----    ------------   ----      ------------    -----

<C>              <C>            <C>       <C>           <C>     <C>            <C>       <C>            <C>
Arizona
378 unit         $9,103         $600      $4,050        $-0-    $3,125         $600      $7,175         $7,775
garden
apartment
complex
340 unit         $10,473        $800      $5,600        $-0-    $2,888         $800      $8,488         $9,288
garden
apartment
complex
53,000 square    $3,887         $313      $2,384        $-0-    $1,702         $313      $4,086         $4,399
foot office
building

Texas
228 unit         $4,307         $620      $3,015        $-0-    $2,721         $620      $5,736         $6,356
apartment
complex
180 unit         $4,121         $805      $4,450        $-0-    $658           $805      $5,108         $5,913
apartment
complex

New Jersey
45 unit          $1,544         $517      $1,533        $-0-    $622           $517      $2,155         $2,672
condominium
complex
132 unit         $4,894         $480      $3,541        $-0-    $566           $480      $4,107         $4,587
apartment
complex
Hotel &
banquet
facility         $3,421         $3,057    $1,031        $-0-    $1,298         $3,057    $2,329         $5,386

Other
residential      $4,065         $470      $3,365        $-0-    $1,545         $470      $4,910         $5,380

Other
office/retail    $1,040         $654      $2,610        $-0-    $2,372         $654      $5,001         $5,655

Land held for
development      $-0-           $1,526    $-0-          $-0-    $-0-           $1,526    $-0-           $1,526

                 $46,855        $9,842    $31,579       $-0-    $17,497        $9,842    $49,095        $58,937
                 =======        ======    =======       ====    =======        ======    =======        =======

<CAPTION>




Column A            Column F       Column H    Column I
--------            --------       --------    --------

                                               Life on
                                               Which
                     Accumulated    Date       Depreciation
Description         Depreciation    Acquired   is Computed
-----------         ------------    --------   -----------

<C>                 <C>            <C>
Arizona
378 unit            $2,931         1992        Various
garden
apartment
complex
340 unit            $3,636         1992        Various
garden
apartment
complex
53,000 square       $1,851         1992        Various
foot office
building

Texas
228 unit            $2,382         1992        Various
apartment
complex
180 unit            $585           2001        Various
apartment
complex

New Jersey
45 unit             $565           1993        Various
condominium
complex
132 unit            $1,122         1997        Various
apartment
complex
Hotel &             $497           1997        Various
banquet
facility

Other               $1,514         Various     Various
residential

Other               $1,817         Various     Various
office/retail

Land held for       $-0-           Various     Various
development

                    $16,900
                    =======
</TABLE>


                                       57
<PAGE>

The changes in real estate for the three years ended December 31, 2004,
are as follows:

<TABLE>
<CAPTION>
                                                          2004          2003          2002
                                                          ----          ----          ----
                                                                     ($ in 000s)

<S>                                                     <C>           <C>           <C>
Balance at beginning of year                            $72,069       $71,355       $69,161
Property acquisitions                                         -             -             -
Improvements                                              2,251         2,415         2,679
Retirements/disposals                                  (15,383)       (1,701)         (485)
                                                       -------        ------          ----
Balance at end of year                                  $58,937       $72,069       $71,355
                                                        =======       =======       =======
</TABLE>


The aggregate cost of land, buildings and improvements, before depreciation, for
Federal income tax purposes at December 31, 2004 was approximately $58,012.

The changes in accumulated depreciation, exclusive of amounts relating to
equipment, autos, and furniture and fixtures, for the three years ended December
31, 2004, are as follows:

<TABLE>
<CAPTION>
                                                           2004          2003          2002
                                                           ----          ----          ----
                                                                     ($ in 000s)

<S>                                                     <C>           <C>           <C>
Balance at beginning of year                            $17,731       $15,504       $13,108
Depreciation for year                                     1,928         2,547         2,410
Retirements/disposals                                   (2,759)         (320)          (14)
                                                        -------       -------       -------
Balance at end of year                                  $16,900       $17,731       $15,504
                                                        =======       =======       =======
</TABLE>


ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

Ernst & Young LLP ("E&Y") informed the Company and its Audit Committee that it
would decline to stand for re-election as the Company's Independent Registered
Public Accounting Firm for the fiscal year ending December 31, 2004 due to the
economics of the engagement.

E&Y's reports on the Company's consolidated financial statements for each of the
years ended December 31, 2003 and 2002 did not contain an adverse opinion or
disclaimer of opinion, nor were they qualified or modified as to uncertainty,
audit scope or accounting principles.

During the years ended December 31, 2003 and 2002 and through July 5, 2004, the
date that J.H. Cohn LLP was appointed as the Company's new Independent
Registered Public Accounting Firm for the fiscal year ended December 31, 2004,
there were no disagreements with E&Y on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure which
if not resolved to E&Y's satisfaction, would have caused them to make reference
to the subject matter in connection with their report on the Company's
consolidated financial statements for such years. There were no reportable
events as defined in Item 304(a)(1)(v) of Regulation S-K, except that a material
weakness in internal controls was identified in connection with the Company's
2003 audit relating to its oil and gas business, which was addressed prior to
finalizing the year end audit and had no effect on any previously filed
financial statements. The oil and gas business has now been sold.

The Company has provided E&Y with a copy of the foregoing statements. Attached
as Exhibits 16.1 and 16.2 is a copy of E&Y's letters dated June 25, 2004 and
July 19, 2004, stating its agreement with such statements.


                                       58
<PAGE>

ITEM 9A.  CONTROLS AND PROCEDURES

Disclosure controls and procedures. As of the end of the period covered by this
report, we carried out an evaluation of the effectiveness of the design and
operation of Wilshire's disclosure controls and procedures. This evaluation was
carried out under the supervision and with participation of Wilshire's
management, including Wilshire's Chairman and Chief Executive Officer and Chief
Financial Officer, who concluded that the Company's disclosure controls and
procedures are effective. There have been no significant changes in Wilshire's
internal controls subsequent to the date we carried out our evaluation.

Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information required to be disclosed in Wilshire's
reports filed or submitted under the Exchange Act is recorded, processed,
summarized, and reported, within the time periods specified in the SEC's rules
and forms. Disclosure controls and procedures include, without limitation,
controls and procedures designed to ensure that information required to be
disclosed in Wilshire's reports filed under the Exchange Act is accumulated and
communicated to management, including Wilshire's Chief Executive Officer and
Chief Financial Officer as appropriate, to allow timely decisions regarding
required disclosure.

During the quarter there was a material weakness in our recording of a
transaction involving equity compensation for one former employee, which was
brought to our attention by our independent registered public accounting firm
and was corrected prior to the finalization of our consolidated financial
statements. Management believes it has taken the necessary actions to ensure the
appropriate accounting treatment for this type of transaction if it occurs in
the future.


ITEM 9B. OTHER INFORMATION

None


                                       59
<PAGE>

                                    PART III

Certain information required by Part III is incorporated by reference to
Wilshire's 2005 definitive proxy statement (the "Proxy Statement") to be filed
with the Securities and Exchange Commission no later than 120 days after the end
of Wilshire's fiscal year covered by this Annual Report. Only those sections of
the Proxy Statement that specifically address the items set forth in this Annual
Report are incorporated by reference from the Proxy Statement into this Annual
Report.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The information concerning Wilshire's Board of Directors required by this item
is incorporated herein by reference to the sections titled "Election of
Directors" and "Compliance with Section 16(a) of the Securities Exchange Act" in
Wilshire's Proxy Statement for its Annual Meeting to be held in June 2005.

The information concerning Wilshire's executive officers required by this item
is included in Item 4A of this Annual Report on Form 10-K.

The Company has adopted a Code of Conduct for its officers and employees. A copy
of the Code of Conduct is available on the Company's website
(http://www.wilshireenterprisesinc.com) under the caption "Corporate Policies."

ITEM 11. EXECUTIVE COMPENSATION

The information pertaining to executive compensation required by this item is
incorporated herein by reference to the section titled "Election of Directors -
Executive Compensation" in Wilshire's Proxy Statement for its Annual Meeting to
be held in June 2005.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information required by Item 403 of Regulation S-K to be included as part of
this item is incorporated herein by reference to the section titled "Voting
Securities and Principal Holders Thereof" and "Election of Directors" in
Wilshire's Proxy Statement for its Annual Meeting to be held in June 2005.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information required by this item is incorporated herein by reference to the
section titled "Compensation Committee Interlocks and Insider Participation;
Other Transactions" in Wilshire's Proxy Statement for its Annual Meeting to be
held in June 2005.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

The information required in response to this item is incorporated by reference
to the information contained in Wilshire's Proxy Statement for its Annual
Meeting to be held in June 2005 under the caption "Audit Fees and Related
Matters."


                                       60
<PAGE>

                                     PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)  Financial Statements

     (i)  Reports of Independent Registered Public Accounting Firm

     (ii) Consolidated Balance Sheets as of December 31, 2004 and 2003

     (iii) Consolidated Statements of Operations for the years ended December
          31, 2004, 2003 and 2002

     (iv) Consolidated Statements of Changes in Stockholders' Equity for the
          years ended December 31, 2004, 2003 and 2002

     (v)  Consolidated Statements of Cash Flows for the years ended December 31,
          2004, 2003 and 2002

     (vi) Notes to Consolidated Financial Statements

     Financial Statement Schedules:

     (i)  Real Estate and Accumulated Depreciation December 31, 2004

(b)  Exhibits

EXHIBIT #         DESCRIPTION
---------         -----------

3.1               Restated Certificate of Incorporation of Wilshire Enterprises,
                  Inc., as amended. (Incorporated by reference to Exhibit 3.1 of
                  Item 14 of the Registrant's Annual Report on Form 10-K for the
                  year ended December 31, 1992.)

3.2               Amended By-Laws, as of June 11, 1998, of Wilshire Enterprises,
                  Inc. (Incorporated by reference to Exhibit 3 of the
                  Registrant's Quarterly Report on Form 10-Q for the quarter
                  ended June 30, 1998.)

4.1               Stockholder Protection Rights Agreement, dated as of June 21,
                  1996, between Wilshire Enterprises, Inc. and Continental Stock
                  Transfer & Trust Company, as Rights Agent. (Incorporated by
                  reference to Exhibit 1 to the Company's Current Report on Form
                  8-K dated June 21, 1996.)

4.2               Reference is made to Exhibits 10.7 through 10.27.

4.3               The Company agrees to furnish the Commission upon request any
                  agreements with respect to long-term debt not referenced
                  herein.

10.1              General Assignments and Assignments of Leases dated March 31,
                  1992 with respect to the purchase of income producing real
                  estate properties. (Incorporated by reference to Exhibit 1 and
                  2 of Form 8 dated December 9, 1992 filed with the Commission.)

10.2              General Assignments, Assignments of Leases, and Escrow
                  Agreements and Early Possession Agreements with respect to the
                  purchase of four income producing real estate properties.
                  (Incorporated by reference to Exhibits 1(a) through 4(c) on
                  the Company's Form 8-K dated December 31, 1992 filed with the
                  Commission.)

10.3              Wilshire Enterprises, Inc. 1995 Stock Option and Incentive
                  Plan. (Incorporated by reference to Exhibit A of the
                  Registrant's Definitive Proxy Statement for its 1995 Annual
                  Meeting of Stockholders.)

10.4              Wilshire enterprises, Inc. 1995 Non-Employee Director Stock
                  Option Plan. (Incorporated by reference to Exhibit B of the
                  Registrant's Definitive Proxy Statement for its 1995 Annual
                  Meeting of Stockholders.)

                                       61
<PAGE>

10.5              Wilshire Enterprises, Inc. 2004 Stock Option and Incentive
                  Plan. (Incorporated by reference to Appendix C of the
                  Registrant's Definitive Proxy Statement for its 2004 Annual
                  Meeting of Stockholders.)

10.6              Wilshire Enterprises, Inc. 2004 Non-Employee Director Stock
                  Option Plan. (Incorporated by reference to Appendix D of the
                  Registrant's Definitive Proxy Statement for its 2004 Annual
                  Meeting of Stockholders.)

10.7              Environmental Indemnity Agreement between Biltmore Club
                  Apartments, L.L.C., a subsidiary of Wilshire Enterprises,
                  Inc., and Merrill Lynch Mortgage Lending, Inc. dated February
                  27, 2003. (Incorporated by reference to the similarly numbered
                  exhibit to the Company's Annual Report on Form 10-K for the
                  year ended December 31, 2002.)

10.8              Promissory Note given by Biltmore club Apartments, L.L.C., a
                  subsidiary of Wilshire Enterprises, Inc., and Merrill Lynch
                  Mortgage Lending, Inc. dated February 27, 2003. (Incorporated
                  by reference to the similarly numbered exhibit to the
                  Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.9              Indemnity and Guaranty Agreement between Biltmore Club
                  Apartments, L.L.C., a subsidiary of Wilshire Enterprises,
                  Inc., and Merrill Lynch Mortgage Lending, Inc. dated February
                  27, 2003. (Incorporated by reference to the similarly numbered
                  exhibit to the Company's Annual Report on Form 10-K for the
                  year ended December 31, 2002.)

10.10             Multifamily Deed of Trust, Security Agreement, Assignment of
                  Rents and Fixture Filing between Biltmore club Apartments,
                  L.L.C., a subsidiary of Wilshire Enterprises, Inc., and
                  Merrill Lynch Mortgage Lending, Inc. dated February 27, 2003.
                  (Incorporated by reference to the similarly numbered exhibit
                  to the Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.11             Promissory Note given by Alpine Village Apartments, L.L.C., a
                  subsidiary of Wilshire Enterprises, Inc., and Merrill Lynch
                  Mortgage Lending, Inc. dated February 28, 2003. (Incorporated
                  by reference to the similarly numbered exhibit to the
                  Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.12             Environmental Indemnity Agreement between Alpine Village
                  Apartments, L.L.C., a subsidiary of Wilshire Enterprises,
                  Inc., and Merrill Lynch Mortgage Lending, Inc. dated February
                  28, 2003. (Incorporated by reference to the similarly numbered
                  exhibit to the Company's Annual Report on Form 10-K for the
                  year ended December 31, 2002.)

10.13             Indemnity and Guaranty Agreement between Alpine Village
                  Apartments, L.L.C., a subsidiary of Wilshire Enterprises,
                  Inc., and Merrill Lynch Mortgage Lending, Inc. dated February
                  28, 2003. (Incorporated by reference to the similarly numbered
                  exhibit to the Company's Annual Report on Form 10-K for the
                  year ended December 31, 2002.)

10.14             Multifamily Mortgage, Security Agreement, Assignment of Rents
                  and Fixture Filing between Alpine Village Apartments, L.L.C.,
                  a subsidiary of Wilshire Enterprises, Inc., and Merrill Lynch
                  Mortgage Lending, Inc. dated February 28, 2003. (Incorporated
                  by reference to the similarly numbered exhibit to the
                  Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)


                                       62
<PAGE>

10.15             Promissory Note given by Sunrise Ridge, L.L.C., a subsidiary
                  of Wilshire Enterprises, Inc., and Merrill Lynch Mortgage
                  Lending, Inc. dated February 27, 2003. (Incorporated by
                  reference to the similarly numbered exhibit to the Company's
                  Annual Report on Form 10-K for the year ended December 31,
                  2002.)

10.16             Environmental Indemnity Agreement between Sunrise Ridge,
                  L.L.C., a subsidiary of Wilshire Enterprises, Inc., and
                  Merrill Lynch Mortgage Lending, Inc. dated February 27, 2003.
                  (Incorporated by reference to the similarly numbered exhibit
                  to the Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.17             Indemnity and Guaranty Agreement between Sunrise Ridge,
                  L.L.C., a subsidiary of Wilshire Enterprises, Inc., and
                  Merrill Lynch Mortgage Lending, Inc. dated February 27, 2003.
                  (Incorporated by reference to the similarly numbered exhibit
                  to the Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.18             Multifamily Deed of Trust, Security Agreement, Assignment of
                  Rents and Fixture Filing between Sunrise Ridge, L.L.C., a
                  subsidiary of Wilshire Enterprises, Inc., and Merrill Lynch
                  Mortgage Lending, Inc. dated February 27, 2003. (Incorporated
                  by reference to the similarly numbered exhibit to the
                  Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.19             Promissory Note given by Van Buren, L.L.C., a subsidiary of
                  Wilshire Enterprises, Inc., and Merrill Lynch Mortgage
                  Lending, Inc. dated February 27, 2003. (Incorporated by
                  reference to the similarly numbered exhibit to the Company's
                  Annual Report on Form 10-K for the year ended December 31,
                  2002.)

10.20             Environmental Indemnity Agreement between Van Buren, L.L.C., a
                  subsidiary of Wilshire Enterprises, Inc., and Merrill Lynch
                  Mortgage Lending, Inc. dated February 27, 2003. (Incorporated
                  by reference to the similarly numbered exhibit to the
                  Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.21             Indemnity and Guaranty Agreement between Van Buren, L.L.C., a
                  subsidiary of Wilshire Enterprises, Inc., and Merrill Lynch
                  Mortgage Lending, Inc. dated February 27, 2003. (Incorporated
                  by reference to the similarly numbered exhibit to the
                  Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.22             Multifamily Deed of Trust, Security Agreement, Assignment of
                  Rents and Fixture Filing between Van Buren, L.L.C., a
                  subsidiary of Wilshire Enterprises, Inc., and Merrill Lynch
                  Mortgage Lending, Inc. dated February 27, 2003. (Incorporated
                  by reference to the similarly numbered exhibit to the
                  Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.23             Promissory Note given by Wellington Apartments, L.L.C., a
                  subsidiary of Wilshire Enterprises, Inc., and Merrill Lynch
                  Mortgage Lending, Inc. dated February 27, 2003. (Incorporated
                  by reference to the similarly numbered exhibit to the
                  Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.24             Environmental Indemnity Agreement between Wellington
                  Apartments, L.L.C., a subsidiary of Wilshire Enterprises,
                  Inc., and Merrill Lynch Mortgage Lending, Inc. dated February
                  27, 2003. (Incorporated by reference to the similarly numbered
                  exhibit to the Company's Annual Report on Form 10-K for the
                  year ended December 31, 2002.)

10.25             Indemnity and Guaranty Agreement between Wellington
                  Apartments, L.L.C., a subsidiary of Wilshire Enterprises,
                  Inc., and Merrill Lynch Mortgage Lending, Inc. dated February
                  27, 2003. (Incorporated by reference to the similarly numbered
                  exhibit to the Company's Annual Report on Form 10-K for the
                  year ended December 31, 2002.)

                                       63
<PAGE>

10.26             Multifamily Deed of Trust, Security Agreement, Assignment of
                  Rents and Fixture Filing between Wellington Apartments,
                  L.L.C., a subsidiary of Wilshire Enterprises, Inc., and
                  Merrill Lynch Mortgage Lending, Inc. dated February 27, 2003.
                  (Incorporated by reference to the similarly numbered exhibit
                  to the Company's Annual Report on Form 10-K for the year ended
                  December 31, 2002.)

10.27             The Company agrees to furnish to the Commission upon request
                  any other agreements with respect to long term debt.

10.28             Agreement dated March 17, 2004 between Wilshire Enterprises,
                  Inc. and Crow Creek Energy L.L.C. to sell the U.S. Oil and Gas
                  business. (Incorporated by reference to the similarly numbered
                  exhibit to the Company's Annual Report on Form 10-K for the
                  year ended December 31, 2003.)

10.29             Contract of sale dated January 23, 2004 between Wilshire
                  Enterprises, Inc. and Economic Properties 2004 L.L.C. for the
                  sale of eleven properties in Jersey City, New Jersey.
                  (Incorporated by reference to the similarly numbered exhibit
                  to the Company's Annual Report on Form 10-K for the year ended
                  December 31, 2003.)

10.30             Employment agreement between the Company and Philip Kupperman
                  dated as of July 1, 2002. (Incorporated by reference to
                  Exhibit 10.1 to the Company's Current Report on Form 8-K dated
                  September 4, 2002.)

10.31             Severance Letter Agreement between the Company and Sherry
                  Wilzig Izak dated as of March 29, 2004. (Incorporated by
                  reference to the similarly numbered exhibit to the Company's
                  Annual Report on Form 10-K for the year ended December 31,
                  2003.)

10.32             Employment agreement between the Company and Daniel C. Pryor
                  dated as of April 24, 2004.

10.33             Employment letter between the Company and Seth H. Ugelow dated
                  as of June 1, 2004.

10.34             Purchase agreement and escrow instructions between Biltmore
                  Club Apartments, L.L.C. (a subsidiary of Wilshire Enterprises,
                  Inc.) and GDG Partners L.L.C. dated February 2, 2005.

10.35             Purchase agreement between Wilshire Enterprises, Inc. and
                  Interstate East Management, Inc. dated March 23, 2005.

16.1              Letter from E&Y to the Securities and Exchange Commission
                  dated June 25, 2004. (Incorporated by reference to Exhibit
                  16.1 to the Company's Current Report on Form 8-K dated May 14,
                  2004.)

16.2              Letter from E&Y to the Securities and Exchange Commission
                  dated July 19, 2004. (Incorporated by reference to Exhibit
                  16.1 to the Company's Current Report on Form 8-K dated July
                  19, 2004.)

21                List of significant subsidiaries of the Registrant.
                  (Incorporated by reference to the similarly numbered exhibit
                  to the Company's Annual Report on Form 10-K for the year ended
                  December 31, 2003.)

23.1              Consent of J.H. Cohn LLP, Independent Registered Public
                  Accounting Firm.

23.2              Consent of Ernst & Young, LLP, Independent Registered Public
                  Accounting Firm.

24                Power of attorney.

                                       64
<PAGE>

31.1              Certification of the Chief Executive Officer Pursuant to
                  Section 302 of Sarbanes-Oxley Act of 2002.

31.2              Certification of the Chief Financial Officer Pursuant to
                  Section 302 of Sarbanes-Oxley Act of 2002.

32.1              Certification of the Chief Executive Officer Pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002.

32.2              Certification of the Chief Financial Officer Pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002.




                                       65
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) 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.

                           WILSHIRE ENTERPRISES, INC.
                           (Registrant)

Date:  March 31, 2005             /s/ S. Wilzig Izak
       --------------             ---------------------------------------------
                              By: S. Wilzig Izak
                              Chairman of the Board and Chief Executive Officer

                                   /s/ Seth H. Ugelow
                                   ------------------
                              By:  Seth H. Ugelow
                                   Chief Financial Officer

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

<TABLE>
<S>                                                                   <C>
DIRECTORS:

By:                        *                                          Date:    March 31, 2005
         --------------------------------------
         Miles Berger

By:                        *                                           Date:    March 31, 2005
         ---------------------------------------
         Milton Donnenberg

By:      /s/ S. Wilzig Izak                                            Date:    March 31, 2005
         --------------------------------------
         S. Wilzig Izak

By:                        *                                           Date:    March 31, 2005
         --------------------------------------
         Eric J. Schmertz, Esq.

By:                        *                                           Date:    March 31, 2005
         --------------------------------------
         Ernest Wachtel

By:                        *                                           Date:    March 31, 2005
         --------------------------------------
         Martin Willschick

OFFICERS:

By:      /s/ S. Wilzig Izak                                            Date:    March 31, 2005
         --------------------------------------
         S. Wilzig Izak
         Chairman of the Board and Chief Executive Officer

By:      /s/ Daniel C. Pryor                                           Date:    March 31, 2005
         --------------------------------------
         Daniel C. Pryor
         President and Chief Operating Officer

By:      /s/ Seth H. Ugelow                                            Date:    March 31. 2005
         --------------------------------------
         Seth H. Ugelow
         Chief Financial Officer
</TABLE>

* Signed under power of attorney dated March 30, 2005 and filed herewith as
Exhibit 24.



                                       66
<PAGE>


                                  EXHIBIT INDEX

EXHIBIT #         DESCRIPTION
---------         -----------

10.32             Employment agreement between the Company and Daniel C. Pryor
                  dated as of April 24, 2004.

10.33             Employment letter between the Company and Seth H. Ugelow dated
                  as of June 1, 2004.

10.34             Purchase agreement and escrow instructions between Biltmore
                  Club Apartments, L.L.C. (a subsidiary of Wilshire Enterprises,
                  Inc.) and GDG Partners L.L.C. dated February 2, 2005.

10.35             Purchase agreement between Wilshire Enterprises, Inc. and
                  Interstate East Management, Inc. dated March 23, 2005.

16.1              Letter from E&Y to the Securities and Exchange Commission
                  dated June 25, 2004. (Incorporated by reference to Exhibit
                  16.1 to the Company's Current Report on Form 8-K dated May 14,
                  2004.)

16.2              Letter from E&Y to the Securities and Exchange Commission
                  dated July 19, 2004. (Incorporated by reference to Exhibit
                  16.1 to the Company's Current Report on Form 8-K dated July
                  19, 2004.)

23.1              Consent of J.H. Cohn LLP, Independent Registered Public
                  Accounting Firm.

23.2              Consent of Ernst & Young, LLP, Independent Registered Public
                  Accounting Firm.

24                Power of attorney.

31.1              Certification of the Chief Executive Officer Pursuant to
                  Section 302 of Sarbanes-Oxley Act of 2002.

31.2              Certification of the Chief Financial Officer Pursuant to
                  Section 302 of Sarbanes-Oxley Act of 2002.

32.1              Certification of the Chief Executive Officer Pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002.

32.2              Certification of the Chief Financial Officer Pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002.


                                       67