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 [FEE REQUIRED]

                       FOR THE FISCAL YEAR ENDED  DECEMBER 31, 1997

                                       OR
[    ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
          EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
FOR THE TRANSITION PERIOD FROM                   TO

                        COMMISSION FILE NUMBER   0-24594

                       WEST COAST REALTY INVESTORS, INC.
             (Exact name of registrant as specified in its charter)

     DELAWARE                           95-4246740
      State or other jurisdiction of         (IRS Employer
      incorporation or organization          Identification)

         5933 WEST CENTURY BLVD., 9TH FLOOR, LOS ANGELES, CA 90045-5454
         (Address of principal executive offices)           (Zip Code)
      Registrant's telephone number, including area code    (310) 670-0800

          Securities registered pursuant to Section 12(b) of the Act:
    Title of each class            Name of each exchange on which registered
          NONE                     NONE

          Securities registered pursuant to Section 12(g) of the Act:
                     SHARES OF COMMON STOCK $.01 PAR VALUE
                                (Title of class)

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

     Indicate by check mark if disclosure of delinquent filers pursuant to  Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best  of  the  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 the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date:   2,345,825 shares outstanding,
as of  March 1, 1998

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                                    PART I

Certain statements in the Annual Report on Form 10-K, particularly under Items 1
through 8, constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995 (the "Reform Act").  Such
forward-looking statements involve known and unknown risks, uncertainties, and
other factors which may cause the actual results, performance or achievements of
the Company to be materially different from any future results, performance or
achievements, expressed or implied by such forward-looking statements.


ITEM 1.   BUSINESS

   West Coast Realty Investors, Inc. (the "Company"), was organized in October
1989 under the laws of the State of Delaware.   The Company qualifies as a Real
Estate Investment Trust ("REIT") for federal and state income tax purposes.  The
Company is advised by West Coast Realty Advisors, Inc. (the  "Advisor"),  a
wholly-owned subsidiary of Associated Financial Group, Inc.   The Advisor will
oversee the  investments  of the Company, subject to the direction of the
Company's Board of Directors.

 The Company was organized for the purpose of investing in,  holding,  and
managing income-producing retail or commercial properties located primarily in
California and on the west coast of the United States. Properties have been and
will be acquired for cash or on a moderately leveraged basis with aggregate
mortgage indebtedness not to exceed fifty percent of the purchase price of all
properties on a combined basis, or eighty percent individually.

   The Company's principal goals are to:

     1.   Invest in properties which will preserve and protect capital;
     2.   Provide shareholders with cash dividends, a portion of which will not
          constitute taxable income;
     3.   Provide capital gains through potential appreciation of properties;
          and
     4.   Provide market liquidity through transferable shares of stock.

The ownership and operation  of any income-producing real  estate is subject  to
those risks  inherent in  all real  estate investments,  including national  and
local economic  conditions, the  supply and  demand for  similar types  of  real
property, competitive marketing  conditions, zoning  changes, possible  casualty
losses, and increases in real estate taxes, assessments, and operating expenses,
as well as others.

    The Company is  subject to competitive  conditions that exist  in the  local
market where it operates rental real estate.  These conditions are discussed  in
Item 2: Properties.

   In addition to specific competitive conditions, the Company is subject to the
usual  competitive  factors  that  are  common  in  real  estate  including  new
construction, changes in the economy, and  vacancy factors at other rental  real
estate locations.

    The Company is operated by the Advisor, subject to the terms of the  Amended
Advisory Agreement dated January 1, 1992, which was renewed until June 30,  1998
by a  majority  vote of  the  shareholders,  and will  thereafter  be  renewable
annually with the approval of a majority  of the shareholders.  The Company  has
no employees, and all administrative services are provided by the Advisor.

                                   2

<PAGE>

ITEM 2.   PROPERTIES

BLOCKBUSTER VIDEO BUILDING

   On February 26, 1991, the Company purchased a commercial building, located
in Huntington Beach, California.

  Constructed in 1991, the building is one-story, has a total of 5,200 rentable
square feet and is located on an 18,225 square foot parcel of land.    The
building is 100% occupied by one  tenant, Blockbuster Video, through 2001, on a
triple net lease.   The tenant's lease calls for rental payments of $11,180 per
for the years one through five (1991-1995) and $13,416 per month for years six
through ten (1996-2000).  This is equivalent to $2.15 and $2.58 per square foot,
respectively.   This lease requires the tenant  to  pay  insurance,  taxes,
maintenance, and all other operating costs.  During 1997, property taxes, paid
by the tenant as part of its lease, were approximately $18,000.

    The  Building was  originally acquired  for all  cash in  1991 for  a  total
acquisition cost of $1,676,210. However, in February 1994, the Company  financed
the Building by incurring  mortgage debt secured by  the Building for  $600,000.
The loan is amortized over a  twenty-five year period and  is due in ten  years.
The monthly payment is currently $4,934 per month with the interest rate set  to
be adjusted at the end of the fifth year of  the loan to 350 basis points  above
the five-year Treasury Bond yield.  The current rate is 8.25%.

    The  building and  improvements  are depreciated  over  31.5 years  using  a
straight-line method for both financial and income tax reporting purposes.   The
financial and income tax bases for the property are the same.  In the opinion of
the General  Partner, the  property  is adequately  insured.   The  property  is
managed by West  Coast Realty  Management, Inc.  ("WCRM"), an  affiliate of  the
corporate General Partner.

   The building  is located in Orange  County, California, which has  maintained
one of the lowest unemployment rates in California, based on its stable base  of
employers ranging from big businesses to smaller retailers.  Management is aware
that future planned closures of military bases and aerospace firms could  soften
the business environment in the Orange  County area.  The Advisor, believes  the
tenant has the ability to meet its lease obligation.

FRESNO VILLAGE SHOPPING CENTER BUILDING

   On May 14,  1993, the Company purchased  a free standing commercial  building
located in a shopping center in Fresno, California.

     Total  consideration paid  for  the  property was  $1,414,893.    Long-term
financing used to  acquire the property  was $665,000 and  matures on August  1,
2003.   Payments  are  made  at  the rate  of  8.25%  with  a  twenty-five  year
amortization schedule.  In July 1998,  the interest rate on the loan will adjust
to 3.00% above the five-year Treasury Bond yield at that time.

     The  Fresno Property was  a newly  developed retail  building (the  "Fresno
Building") with construction completed  in April 1993.   The Fresno Building  is
located at 1614 North  Blackstone, Fresno, California.   The Fresno Building  is
located close to  the center of  Fresno, California on  the northeast corner  of
Blackstone and McKinley.  Fresno is  located in Central California.  The  Fresno
Building is located on a lot size of 23,855 square feet, with a building size of
8,915 square feet.  The exterior of  the Fresno Building consists of stucco  and
glass construction.

                                    3

<PAGE>

      The Fresno Building is  100% occupied by two  tenants --    Wherehouse
Entertainment, Inc. ("The Wherehouse" - a music and video retailer), and  RTO,
Inc. (which stands for "Rent  To Own" - a home furnishing and appliance rental
company) (collectively "Tenants").

      The  building and  improvements  are depreciated  over  39 years  using  a
straight-line method for both financial and income tax reporting purposes.   The
financial and tax bases  for the property are  the same. In  the opinion of  the
Advisor, the property is adequately insured.  The property is managed by WCRM.

      As part  of a  larger neighborhood  shopping center  anchored by  a  major
department store, all  of the  tenants are dependent  upon the  vitality of  the
consumer market in the general area.  Although there are other shopping  centers
in the area, being located in a densely populated area north of downtown Fresno,
and across the  street from a  large community college,  the high daily  traffic
count provides a large customer base  for all the retail and service  businesses
in the  general  area.   Although  all areas  of  Central California  have  been
affected by  the  economic  slowdown, it  has  not  significantly  impacted  the
occupancy of the Center.

    The Wherehouse entered into a ten  year lease which commenced April 1,  1993
and  was  to  continue  through  March  31,  2003.    The  Wherehouse   occupies
approximately 6,000 square feet of the Fresno Building.

     Prior  to the modification  of The  Wherehouse lease,  as described  below,
monthly rental payments were to be as follows:

April, 1993 to March, 1998;                  $7,680 per month
                                             (1.28/sq.ft./month)
April, 1998 to March 2003;                   $8,820 per month
                                             (1.41/sq.ft./month)

    As possible additional rent, The Wherehouse was scheduled to pay the Company
3% of gross sales after applying a  formula that involves recapture of rent  and
expenses that The Wherehouse would pay as a triple net lease tenant.  There were
no amounts due on this additional rent through December, 1997.

   On August 2,  1995, The Wherehouse filed for  protection under Chapter 11  of
the U.S. Bankruptcy Code.   The Wherehouse continued to  pay its rent under  the
terms of the original lease through January 1997.  In November 1996, the Company
and The Wherehouse agreed to the terms of  a new lease, subject to the  approval
of the Bankruptcy Court.  Under the terms  of the First Amendment to Lease  (the
"Amendment")  dated  November  30,  1996,  commencing  February  1,  1997,   The
Wherehouse's lease was converted from a  "net" lease to a  "gross" lease.  At  a
minimum, the Company will be  paid rent of $54,000  per year ($4,500 per  month)
until January 31, 1998  unless the Wherehouse exercises  its one time option  to
terminate the lease  on March 31,  1998.  If  the lease is  not terminated,  the
Company will be paid $82,800 per  year ($6,900 per month) thereafter to  January
31, 2003.   The Amendment also  provides that commencing  January 20, 1997,  the
gross rent will be adjusted to an amount equal  to 6.5% of gross sales from  the
previous eleven months, but  such rent shall  never be less  than the rent  paid
during the said period.  On April 20, 1998 and each three months thereafter, the
gross rent will be adjusted to an amount equal  to 8.2% of gross sales from  the
previous calendar quarter, but the rent shall  never be less than the rent  paid
during the said quarter.  At this time, the Company does not feel that the gross
rent calculation will  exceed the minimum  rental amount payable  in 1998.   The
Wherehouse will also pay for any percentage increase in property taxes over  and
above the amount  assessed for  calendar year  1996, on  its pro  rata share  of
occupied space of the property.  The terms and conditions pertaining to  options
to renew the lease remain unmodified and are described below.

                                      4

<PAGE>

    As a result of the Amendment, the monthly rent payments (based on minimum
rental amounts) was decreased from $1.28 per square foot to $.75 per square foot
(or $4,500 per month) effective February 1, 1997.   In  addition, the Company
expects to absorb an additional $18,000 in operating  expenses  that  were
previously allocated  to The  Wherehouse.   The total decrease in income as a
result of the Amendment is therefore estimated to be $38,160 per year until
February 1, 1998 when the total decrease will be reduced to $28,800 per year.
Based on  approximately 2.2  million shares of the Company outstanding as of
December 31, 1997, the Amendment decreased distributable income by approximately
$.01 to $.02 per share per year in 1996 and 1997, and thus was not material to
the operating results of the Company.

OPTO-22 BUILDING

   On September 15, 1993, the Company acquired the property described below (the
"OPTO-22 Property"  or "Building").   The funds used to acquire the OPTO-22
Property were obtained from the sale of the Company's shares and from seller-
provided financing in connection with the acquisition of the OPTO-22 Property.

    The OPTO-22 Property  is located within the master-planned Huntington  Beach
Industrial Park at 15461  Springdale (at the  intersection of Springdale  Street
and McFadden Avenue), Huntington  Beach, California. The  Building was built  in
1977, and was occupied by a  company named OPTO-22 from  1979 through 1992.   In
August 1992, OPTO-22 subleased the Building to Claremont High School, a  private
school, whose sublease expires in April 1997.   The Building was deeded over  to
the Seller in  May 1993  by the  John Lusk  Corporation via  a Deed  in Lieu  of
Foreclosure.

    Situated on approximately 3.34 acres  of fee land, the Building is  concrete
tilt-up construction.   The  Building has  approximately 25,866  square feet  of
fully improved office area,  24 foot high clearance,  is fully sprinklered,  and
has two overhead  truck doors  as well as  one exterior,  two-bay truck  loading
well.   In addition,  the site  contains ample  parking with  approximately  201
spaces, and has three separate driveway entrances for ingress and egress.

    The Huntington Beach Industrial Park is a master-planned development of  the
Lusk Company.   This industrial park  contains over 1.5  million square feet  of
space, and benefits  from its  close proximity  to labor  markets and  desirable
housing as well as access to the San  Diego (405) Freeway.  Also located  within
one mile  are  the  Westminster  Mall, Golden  West  Community  College,  and  a
McDonnell Douglas Corporation facility.

    The Building  was previously occupied by  OPTO-22, the primary lease,  which
took occupancy in 1979, and subleased  the Building to Claremont High School  in
August 1992.   OPTO-22's  lease on  the Building  ended at  the same  time  that
Claremont High School's sublease ended with  OPTO-22.  The primary lease on  the
property currently called  for rent  of $19,709.41  per month.   Claremont  High
School currently pays a sublease rent $3,690.59 per month higher than  OPTO-22's
rent.

                                       5

<PAGE>

    The lease on the OPTO-22 building expired on April 30, 1997.  OPTO-22, the
tenant, and Claremont School, the sub-tenant, both vacated the premises on
September 10, 1997.  West Coast Realty Investors, Inc. has settled with OPTO-22
for the amounts owed by OPTO-22 to West Coast Realty Investors, Inc. for rent
and for deferred maintenance.  OPTO-22 has paid the amounts owed to West Coast
Realty Investors, Inc. in accordance with the terms and conditions of a
Settlement Agreement dated October 31, 1997 and the parties have released one
another from any further claims as provided in said agreement.  The Company
effectively was compensated for rental income from May 1997 to October 15, 1997.
The Company also received $115,000 to be applied towards repair or various
deferred maintenance items.  These repair funds were substantially complete as
of March 15, 1998.

   The Company is currently attempting to locate a tenant to enter into a  long-
term lease for the Property.  If its efforts are successful, the Company expects
to spend an  additional $200,000  to $300,000 in  additional funds  to meet  the
requirements of a tenant to refurnish  the Property.  The Company believes  that
the rental revenue it was receiving under the  old OPTO-22 lease was 15% to  20%
below current market rates;  thus, if a  new tenant can  be positioned into  the
property, the  Company  could experience  an  increase  in cash  flow  from  the
property.  However, the Company may  need to slightly decrease distributions  to
investors in  the first  and/or second  quarters of  1998 due  to the  effective
vacancy at the property since October 15, 1997.

    The OPTO-22 Building was acquired from Glendale Federal Bank (the "Seller")
- an unrelated third party.  In determining the propriety of the investment  in
the Building, the Advisor  reviewed 1991 and 1992  sales information on  several
similar properties in the vicinity.  Based on the sales price of $2,350,000, the
OPTO-22's acquisition  price  was approximately  $38.90  per square  foot.    In
contrast, the comparative sales in  the area ranged from  $42 to $65 per  square
foot, with the average  of all the building  equal to $45 per  square foot.   In
addition, the Advisor took note that the monthly rental being paid by OPTO-22 is
less than the current market rents in the area, especially in comparison to  the
sub-lease rent being paid to OPTO-22 by Claremont High School for this property.
Based on (1) comparison of  the price per square  foot of the OPTO-22  Building,
and the comparative  recent sales price  per square foot  of several  properties
comparable in quality to the OPTO-22 Building, and (2) the comparison of current
rental revenue on the building to current  market rental rates for the area,  it
is the opinion of the Advisor that the acquisition price of the OPTO-22 Building
is reasonable.

      The OPTO-22  Building is  managed by  West Coast  Realty Management,  Inc.
("WCRM") (the "Property Manager"),  an affiliate of the  Company.  WCRM  charges
the Company 3% of the gross rents collected as a management fee for managing the
Property, as allowed by  the Property Management Agreement.   In the opinion  of
the Advisor, the OPTO-22 Building is adequately insured.  Although the tenant is
obligated by their leases to  pay property taxes, the  property tax in 1997  was
approximately  $24,000.

      Total consideration for the OPTO-22 Building paid by the Company  was
approximately $2,500,000.  The total acquisition cost included $2,350,000 paid
to the  Seller, approximately  $7,000 in  legal, appraisal, audit and closing
costs, and a $143,000 Acquisition Fee paid to Descolin,  Incorporated, an
affiliate of the Advisor.  Financing of $1,750,000 was obtained from the Seller,
with the remainder of the acquisition costs, approximately $779,000, paid in
cash.  The  $1,750,000 financing was in the form  of a ten year note, that is
being amortized over a thirty year period.  The note has an adjustable interest
rate that began at approximately 7.0%, and will adjust to three hundred  basis
points (3.00%) above the Federal Reserve Board Eleventh District Cost of Funds
Rate every year.  Payments on the note are currently $12,795 per month.

                                       6

<PAGE>

    The purchase price was arrived at through arms-length negotiations with  the
Seller.  The source of funds  for the purchase were  proceeds from the sales  of
the Company's Shares, and Seller-provided financing (the Seller is a large  bank
and lender).

      The computation  of  depreciation is  based on  the  cost of  the  OPTO-22
Property, including Acquisition Fees and  Acquisition Expenses.  The  allocation
of the cost of the OPTO-22 Property to the various asset is estimated, based  on
allocations in  the  appraisal report.    Depreciation  will be  computed  on  a
straight -line basis over the component useful life of the assets.

NORTH PALM STREET

       On March 4, 1994,  the Company acquired  an  industrial/research  and
development building located in Brea, California.

    The Building was acquired for total consideration of $2,248,343.   Seller
financing of $1,000,000 was provided in order to allow for the purchase.  This
financing was in the form of two purchase money notes for $500,000 each, with
one due an payable March 4, 1995 and the other due March 4, 1996.  Payments were
interest only at the rate of 8% and totaled $6,667 per month.   The seller
financing was refinanced in February 1995 with a $1,000,000 promissory note at a
variable rate amortized over 25 years, secured by a Deed of Trust on the Brea
property, interest rate is 9.5% until March 1, 2000 (and each succeeding March
1st) when the interest rate adjusts to the Moody's corporate bond index daily
rate plus 0.125%, monthly principal and interest payments vary depending upon
interest rates and are currently $8,737, and due March 1, 2020.

    Constructed in 1989, the building contains approximately 42,000  rentable
square feet, and is located within a master-planned business park.  The building
was leased to  two tenants.   M.L.E., which occupied 27,831 square feet, is a
contract office furniture supplier.   M.L.E., which has been in business since
1982, commenced their lease on February 1, 1991, and the lease terminates on May
31, 1999.   The lease calls for payments of $11,143 per month.    Surgical
Technologies ("Surgical"), which occupied 14,100 square feet, provides contract
sterilization, assembly, and packaging of medical devices.   Surgical's lease
runs from December 15, 1993 to December 14, 1999, with lease payments equal to
$6,819 per month through December 14,1998 and $7,077 per month through December
14, 1999.  Both  the M.L.E. and Surgical leases are triple net.

   The building is located in Brea, California in an established industrial area
of North Orange County.  Many of the economic factors pertaining to the  OPTO-22
and Blockbuster Video Buildings pertain to this property as well.

   The building and improvements are depreciated over 39 years using a straight-
line method for both financial and income tax reporting purposes.  The financial
and tax bases for the property are the same. In the opinion of the Advisor,  the
property is adequately insured.  The property is managed by WCRM.

    On October 31, 1997, the Company ("Seller") sold the North Palm Street
Property to a unrelated buyer.  The sale was unsolicited and was partially
contingent on the Seller utilizing the Internal Revenue Service Code Section
S1031 to facilitate a tax free exchange.  The total sales price was $2,515,860
in cash.  The Seller paid the existing first deed of trust, which as of October
31, 1997 totaled $971,305.   The Buyer agreed to contribute an additional
$15,000 to pay the mortgage loan's early prepayment penalty.

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RIVERSIDE MARKETPLACE

  On November 29, 1994, the Company  purchased a six-plex cinema located in  the
Riverside Marketplace in  Riverside, California.   Construction of the  property
was completed June 15, 1994, and it is located in a newly developed retail  area
containing various restaurants and retailers.   The tenant is Sanborn  Theaters,
Inc. which does business under the name of SoCal Cinemas.  The tenant's lease is
for twenty years, and is scheduled to expire on  December 31, 2014.   The  lease
is a triple-net lease.  The lease also has some provisions for the sharing of  a
certain percentage of gross sales, including concessions.

   The property was acquired for $3,655,500.  Long term financing of  $1,200,000
in the form of a first trust deed and note was used to facilitate the  purchase.
The note is amortized  over a fifteen year  period at the rate  of 9.25% and  is
fully due and payable November 8, 2004.

  The six screen theater has seating for 1,586 and contains 30,493 square  feet.
There is parking available for 483 cars in an adjacent parking lot.

   The building and improvements are depreciated over 39 years using a straight-
line method for both financial and income tax reporting purposes.  The financial
and tax bases for the property are the same. In the opinion of the Advisor,  the
property is adequately insured.  The property is managed by WCRM.

SAFEGUARD BUSINESS SYSTEMS

     On May 22, 1995, the Company acquired the Safeguard  Business Systems
Property, a two story office building located in Tustin, California.  The sole
tenant of the property is Safeguard Business Systems, which occupies 100% of the
property.   The tenant is involved in the providing office supply and data
services to small businesses.

     The property has 40,000 rentable square feet, and was built to suit for
Safeguard Business Systems in 1986.  The tenant current lease commenced October
1, 1994 and is scheduled to terminate eleven years from that date (September 30,
2005).  The lease has provisions for annual rental increases with the rent for
the initial year (10/1/94 - 9/30/95) set at $43,333 per month, and $44,633 for
the second  year (10/1/95-9/30/96), and $45,972 for the third year (10/1/96-
9/30/97).  The average monthly rent over the life of the lease is $50,914.

      Total consideration paid for the property was $4,862,094.  Long-term
financing of $2,300,000, in the form of a first trust deed and note,  was used
to facilitate the purchase.  The note is amortized over a fifteen year period at
a fixed rate of 9.625%, and is fully due and payable February 1, 2005.

   The building and improvements are depreciated over 39 years using a straight-
line method for both financial and income tax reporting purposes.  The financial
and tax bases for the property are the same. In the opinion of the Advisor,  the
property is adequately insured.  The property is managed by WCRM.

                                   8

<PAGE>

TECHNOLOGY DRIVE PROPERTY

      On October 31, 1995, the Company  acquired  a  single  story  light
industrial/research & development located in Fremont, California.  The property
is a one story building that contains 58,727 divisible  rentable square feet
located on 3.47  acres.  The primary tenant of the property is CMS Welding &
Machining.  The tenant is a manufacturer of welded vacuum chambers used in the
processing of semi-conductors.  Its lease runs from November 2, 1993 to February
28, 2005, with various levels of rent scheduled to be paid.  From April 1,  1995
to August 31, 1996, the  scheduled rent is $30,976  per month, and $32,596  from
September 1, 1996 to February 1, 1999.  The average rent scheduled on the lease,
beginning with the first  day of the Company's  ownership (October 31, 1995)  is
$32,191 per month.   The lease in a "triple net" lease, requiring CMS Welding  &
Machining to pay insurance, taxes, maintenance and all other operating costs.

    The  tenant has  subleased 20,000  square  feet of  its space  to  Macrotron
Systems.  This sublease  runs from March 1,  1995 to March  1, 1998.   Macrotron
pays its  rent directly  to the  Company,  and CMS  Welding &  Machining's  rent
obligation is reduced accordingly.

   The total consideration paid for the property was $3,747,611.  Financing of
$2,192,897 was assumed from the seller in connection with the transaction.  This
debt is fully amortized over a twenty year period at a fixed rate promissory
note secured by a Deed of Trust on the Fremont property, interest rate equals
the 20-year Treasury rate at loan close plus 1.65% or 8.24%, monthly principal
and interest payments are currently $18,898.  The original balance of the loan
was $2,200,000 and was funded July 1, 1995.  The loan is fully due and payable
on August 1, 2015.

      The building and improvements are depreciated  over  39 years  using  a
straight-line method for both financial and income tax reporting purposes.  The
financial and tax bases for the property are the same.  In the opinion of the
Advisor, the property is adequately insured.  The property is managed by WCRM.

JAVA CITY PROPERTY

    On August 2, 1996, the Company acquired the investment described below  (the
"Java City Property" or  the "Property").   The funds to  acquire the Java  City
Property were available as the result of the sale of the Company's Shares in the
previous offering, and the  receipt of proceeds from  bank financing assumed  in
connection with the acquisition.

      The Java  City Property  consists  of two  single story  light  industrial
buildings located in  the Northgate Industrial  Park in Sacramento,  California.
The addresses of the  two properties are 717  and 721 West Del  Paso Road.   The
building sites are in the northern part of Sacramento, with access to Interstate
80, Interstate 5, and other major freeways.

                                     9

<PAGE>

     The buildings are located on a site of approximately 62,173 square feet.
Total building square footage for both buildings is approximately 20,000 square
feet.  The subject lot is zoned M-1 industrial by the City of Sacramento.   This
zoning allows for a variety of uses, including the existing use.  721 West Del
Paso Road consists of 8,964 total square feet and  717  West Del Paso Road
consists of 11,035 total square feet.  Per the provisions of the current lease,
721 West Del Paso consists of 4,347 rental square feet of warehouse space and
4,293 rental square feet of office space.   Per the provisions of the current
lease, 717 West Del Paso consists of 5,398 rentable square feet of warehouse
space and 5,802 of rental square feet of office space.   The properties  were
originally constructed in 1988. The  buildings are constructed using concrete
footings (foundation and slab), wood frame wall designs, and flat/tar gravel
roofs.  The building has sprinklers for fire prevention and safety.  There  is
adequate parking in  the general business park area for cars that utilize the
Property.

     The primary tenant of the Property is Cucina Holdings, Inc.  The company
owns  and  operates  forty-one Java City  Bakery Cafes and five  La Petite
Boulangerie cafes.  The Company is popularly known as "Java City". Java City
outlets are  located in various areas of  California  and  Arizona,  and  are
generally in high-visibility, high-traffic locations.   These outlets sell high
quality, specialty  coffees  in  a pleasant  retail  environment  setting.    In
addition, these outlets  sell a  selection of  sandwiches and  baked goods  that
complement the sale of  coffee.  Java City  also operates a wholesale  operation
that serves approximately seven hundred  customer accounts located primarily  in
Northern California.  The Company's  wholesale customers  include  supermarkets,
gourmet shops,  convenience  stores, restaurants,  universities,  airports,  and
offices,  some  of  which  resell  the  coffee  in  whole  bean  form  for  home
consumption, while others brew and sell coffee beverages.  Approximately 86%  of
the Company's  sales  are from  its  retail cafe  operations  and 14%  from  its
wholesale operations.   The tenant was  effectively formed in  1993 when  Cucina
Holdings, a corporation formed by current  management and InterWest Partners  (a
Menlo Park  Based venture  capital  firm), purchased  the  assets of  la  Petite
Boulangerie from a private investor group in June 1993, and then purchased  Java
City in September 1993.  Cucina Holdings  and Java City are privately held,  and
not publicly traded companies.

    The total consideration paid by the Company for the Java City properties was
$1,828,500.  The total acquisition cost included $1,725,000 paid to the Sellers,
$25,323 in legal, appraisal and closing  costs, and $78,177 in Acquisition  Fees
paid to the Advisor.

     Java City leases 100% of the rentable square feet in the two buildings
located on the Property.   Each building has a separate lease, and both leases
are triple net leases.  Both leases expire on August 1, 2003 and there are no
options for extension or purchase of  the Property.   Java City operates its
administrative offices, coffee bean processing, warehousing facilities, and  a
Java City retail outlet out of these two buildings.

    The computation of depreciation for the Java City Property is based on the
cost of the Property, including Acquisition Fees and Acquisition Expenses.  The
allocation of the cost of the Property to various asset categories is estimated,
based on allocations  in the appraisal  report.  Depreciation is computed on a
straight-line basis over 39  years for both financial and income tax reporting
purposes.

                                     10

<PAGE>

TYCOM PROPERTY

   On  January 17, 1997, the  Company acquired the  Tycom Property--a two  story
building, with  underground  parking, located  at  17862 Fitch  Street,  Irvine,
California.  Total building square footage  is approximately 63,225 square  feet
(both floors). The  property has 164  striped parking spaces.   The building  is
approximately twelve years old.  There  are significant new tenant  improvements
that were substantially complete  at time of acquisition  that will enhance  the
building  for  office   usage.     These  improvements   include  improved   air
conditioning, Americans  with  Disabilities  Act  compliance,  a  complete  fire
sprinkler system, new electrical, new restrooms, and new carpet.

    The  sole tenant  of the  Property  is Tycom  Corporation ("Tycom"  or  "the
Tenant").  Tycom, a privately held company, is a manufacturer of drill bits  and
assorted items used by the semi-conductor and dental industries, and has been in
business for  approximately ten  years.   The  Tenant initially  purchased  this
building and  has  invested  approximately  $1.4  million  in  improvements  and
renovations.   Tycom sold  the building  to Brutten/Reynolds/Shidler  Investment
Corp. (the property's seller) on December 19,  1996 for an unknown amount.   The
Tenant began occupying  the building  on December 19,  1996, at  which time  the
provisions of the  lease became  effective.   The term  of the  lease is  eleven
years, and  is  intended to  be  a "triple-net"  lease  with the  Tenant  paying
virtually all  taxes, insurance,  utilities, and  other operating  costs of  the
Property.  The base rent is $37,302.75 per month.

     Total  consideration  paid  by the  Company  for  the  Tycom  Property  was
$4,907,441.  Financing was  utilized in connection with  the acquisition of  the
Tycom Property.  A short-term 9.25% promissory note for $2,300,000 was  provided
by First  National Bank  of San  Diego.   The note  provides for  interest  only
payments of $17,729 and is due in full February  1, 1998.  The Company plans  on
replacing this financing prior to the due date with a first trust deed  mortgage
from a bank.

   The computation of depreciation for the  Tycom Property is based on the  cost
of the property, including Acquisition Fees and Expenses.  The allocation of the
cost of  the  Property  to  various asset  categories  is  estimated,  based  on
allocations in the appraisal  report.  Depreciation is  computed on a  straight-
line basis over 39 years,   the estimated component  useful life of the  assets.
The financial and tax basis for  the property are the same.   In the opinion  of
the Advisor, the  Property is adequately  insured.  The  Property is managed  by
West Coast Realty Management.

ROSEVILLE PROPERTY

    On November  26, 1997, the Company  acquired the investment described  below
(the "Roseville  Property"  or  the  "Property").  The funds to acquire  the
Roseville property resulted from the Section 1031 tax free exchange of the Brea
property (as described above), plus additional proceeds resulting from the sale
of the Company's Shares in the current offering.  No debt financing was used in
connection with the Roseville acquisition.

     The Property is located on a lot size of .87 acres (approximately 37,900
square feet). This site is part of a larger shopping center which includes well-
known retailers such as Costco, Toys 'R Us, Shell Gasoline, Ross Dress For Less,
and McDonald's Restaurants.  The total lot size is approximately 8.66  acres
(378,000 square feet).   There are 61 parking spaces assigned to this site, with
the Property also enjoying the use  of hundreds of other parking spaces  located
within the larger shopping center.  The building size totals 5,133 square feet.

                                    11

<PAGE>

    The sole tenant of the Property  is Applebee's Restaurant.  Applebee's is  a
well-known, national franchise of sit-down casual restaurants.  This  particular
Applebee's  was developed by, and  acquired from, Christian Knox (an  individual
and unrelated third party), and the  restaurant franchise is owned and  operated
by him in a sale-leaseback arrangement.   Mr. Knox has seven Applebees and  nine
Burger King franchises, as evidence of his experience in this industry.

    The lease of the Property commenced after the issuance of the Certificate of
Occupancy in September 1997.  The lease is a 20 year triple net lease, including
provisions for  collection of  common  area charges  that  are assessed  by  the
shopping center owner.   Lease payments are $14,333.33  per month ($172,000  per
year) with rental increases  scheduled every five  years at the  rate of 12  /%.
The lease commenced on  December 1, 1997.   Future minimum  lease payments on  a
calendar year basis are noted below:

          1997                               $     14,333
          1998-2001                               172,000
          2002                                    179,167
          2003-2006                               193,500
          2007                                    201,563
          2008-2011                               217,688
          2012                                    226,758
          2013-2016                               244,898
          2017 (through September 1)              163,266

    Mr. Knox has personally guaranteed the lease and has provided  documentation
demonstrating a personal net worth in excess of $10 million.

     The Roseville  Property is managed  by West Coast  Realty Management,  Inc.
("WCRM"), an affiliate of the Company.  WCRM charges the Company 3% of the gross
rents collected  as a  management fee,  as allowed  by the  Property  Management
Agreement.  Property taxes in the  first full year of operations, are  estimated
to be $20,000 (approximately 1% of the sales price).

      Total consideration  paid by  the Company  for the  Roseville property  is
$1,976,484.   This cost  includes  the $1,950,000  sales  price payable  to  the
Seller/Operator, $12,500 in estimated legal, appraisal, and closing costs, and a
$16,000 Acquisition  Fee payable  to  the Advisor.    In addition,  $14,333  was
received from the Seller/Operator as a security deposit.  The sale was paid  for
from approximately $1,500,000 received from the disposition of the Brea property
(as described  above),  with  the  balance  (approximately  $567,000)  from  the
proceeds resulting  from  the  sale  of the  Company's  shares  in  the  current
offering.

    The purchase price was determined through arms-length negotiations with  the
Seller/Operator.

     The computation of depreciation for the Roseville Property is based on  the
cost of the property, including Acquisition  Fees and Expenses.  The  allocation
of the cost of the Property to  various asset categories is estimated, based  on
allocations in  the  appraisal report.    Depreciation  will be  computed  on  a
straight-line basis over 39 years,   the estimated component useful life of  the
assets.
                                     12

<PAGE>

CORONA PROPERTY

    On December  31, 1997, the Company  acquired the investment described  below
(the "Corona Property"  or the  "Property").  The  funds to  acquire the  Corona
Property resulted from  proceeds received  in connection  with the  sale of  the
Company's Shares in the current offering.  No debt financing was used to acquire
the Corona Property.

      The Corona  Property is  located at  363 American  Circle, Corona  in  the
Riverside County section of Southern California.   The Property is located  near
the 91 Freeway and the Maple Street exit.   There is easy access to the  freeway
and surrounding areas.   The  Property is  in the  middle of  an industrial  and
warehouse/development  area.     There  is   a  mixture   of  light   industrial
manufacturing,  office,  industrial,  and  research/development  space  in   the
immediate area.

    The Property is located on a lot size  of 77,101 square feet.  The  Property
is a  two-story warehouse/industrial  building containing  approximately  37,330
square feet.  The construction involves concrete footings, foundation and  slab,
with a flat tar/gavel roof.  Parking is adequate and within applicable  building
codes, with some parking available in the Building's basement.  The Building  is
eight years old

     The sole tenant of  the Property is  American National Manufacturing,  Inc,
(the "Tenant").  The  tenant entered into a  triple net lease  on June 1,  1997.
The  tenant  manufactures  foundations   and  convertible  beds,  and   contract
manufacturing of beds of all types.  This triple net lease expires May 31, 2002,
with a five year option to renew.   Future minimum rent under the current  lease
is as follows:

     January 1, 1998 - May 31, 1998          $14,932
     June 1, 1998 - May 31, 1999              15,679
     June 1, 1999 - May 31, 2000              16,425
     June 1, 2000 - May 31, 2001              17,172
     June 1, 2001 - May 31, 2002              17,918

     The Property was acquired  from an unrelated  third party, American  Circle
Limited, A California Limited Partnership (the "Seller").

      The Corona  Property is  managed  by West  Coast Realty  Management,  Inc.
("WCRM"), an affiliate of the Company.  WCRM charges the Company 3% of the gross
rents collected  as a  management fee,  as allowed  by the  Property  Management
Agreement.  Property taxes in  the first full year  of operations which are  the
obligation of the tenant, are estimated at approximately $19,000  (approximately
1% of the sales price).

      Total  consideration paid  by  the Company  for  the Corona  Property  was
$1,896,949.   This cost  includes  the $1,800,000  sales  price payable  to  the
Seller, approximately $20,000  in legal, appraisal,  and closing  costs, and  an
$94,000 acquisition  fee payable  to  the Advisor.    In addition,  $92,000  was
received from the Seller in the transfer of   prepaid rents.  The sale was  paid
for from the proceeds  resulting from the  sale of the  Company's shares in  the
current offering.

                                     13

<PAGE>

    The  purchase price was determined  through an arms-length negotiation  with
the Seller.  The total cost  of $51.11 per square  foot is comparable to  recent
sales in the  area for similar  properties.  Four  sales were  surveyed and  the
price per square  foot ranged from  $48.00 to $57.37,  with the weighted  square
foot average being $51.42.  Considering  the state of the recovering economy  in
the area and the long term lease in place with a relatively stable and desirable
tenant, the price paid for the Property is considered reasonable.

    The computation of depreciation for the Corona Property is based on the cost
of the property, including Acquisition Fees and Expenses.  The allocation of the
cost of  the  Property  to  various asset  categories  is  estimated,  based  on
allocations in  the  appraisal report.    Depreciation  will be  computed  on  a
straight-line basis over 39 years,   the estimated component useful life of  the
assets.

LAUFEN TILE DISTRIBUTION CENTER

     On January 14, 1998,  the Company acquired  the investment described  below
(the "Laufen Property"  or the  "Property").  The  funds to  acquire the  Laufen
Property resulted from  proceeds received  in connection  with the  sale of  the
Company's Shares in the current offering.  No debt financing was used to acquire
the Laufen Property.

    The Laufen Property is located at 9970 and 9980 Horn Road, Sacramento in the
Rancho Cordova section of Sacramento, which  is located in Northern  California.
The Property is located near the U.S. 50 (El Dorado) and Interstate 80 Freeways.
There is easy access to freeways and surrounding areas.  The Property is located
in an  industrial area  which has  recently been  under strong  demand by  local
businesses.

    The property is located on a lot size of 151,153 square feet, which consists
of two adjacent parcels.  The  Property contains two separate, one-story  24,000
square foot buildings,  with a total  of 48,000 square  feet.  The  construction
involves concrete footings,  foundation and slab,  with a  flat tar/gavel  roof.
There are  38  parking  spaces on  the  site.   The  Buildings  were  originally
constructed in 1976.

    The sole tenant of the property  is Laufen International, Inc.  The  Company
is a floor tile manufacturer with North American headquarters locate din  Tulsa,
Oklahoma.  Laufen is owned  by a parent company  located in Germany. Laufen  has
been occupying the  property since 1987.   Under the  provisions of the  current
lease future minimum rent is as follows:

     January 1, 1998 - January 31, 1998      $ 17,242
     February 1, 1998 - January 31, 1999       18,391
     February 1, 1999 - January 31, 2000       18,502
     February 1, 2000 - January 31, 2001       19,570
     February 1, 2001 - January 31, 2002       20,265
     February 1, 2002 - January 31, 2003       21,188

    The lease is a triple-net lease, with the tenant responsible for reimbursing
the Company for  91.67% of the  property taxes, insurance and common area  costs
that are incurred in connection with the Property.

    The Property was acquired from  an unrelated third party, the Huarte  Family
Trust (the "Seller").

                                     14

<PAGE>

      The Laufen  Property is  managed  by West  Coast Realty  Management,  Inc.
("WCRM"), an affiliate of the Company.  WCRM charges the Company 3% of the gross
rents collected  as a  management fee,  as allowed  by the  Property  Management
Agreement.  Property taxes in the first  full year of operations, which are  the
obligation  of   the  tenant   are  estimated   to  be   approximately   $21,000
(approximately 1% of the sales price).

      Total  consideration paid  by  the Company  for  the Laufen  Property  was
$2,141,200.   This cost  includes  the $2,020,000  sales  price payable  to  the
Seller, approximately  $20,000 in  legal, appraisal,  and closing  costs, and  a
approximately  a  $108,000   acquisition  fee  payable   to  the  Advisor   (the
distribution  of    amounts  between  acquisition  fees  and  costs  are   still
approximate at this point).  The sale  was paid for from the proceeds  resulting
from the sale of the Company's shares in the current offering.

    The  purchase price was determined  through an arms-length negotiation  with
the Seller.  The total cost  of $44.61 per square  foot is comparable to  recent
sales in the area  for similar properties.   Eight sales  were surveyed and  the
price per square foot ranged  from $45.00 to $51.00.   Considering the state  of
the recovering economy  in the  area and the  long term  lease in  place with  a
relatively stable  and desirable  tenant, the  price paid  for the  Property  is
considered reasonable.

    The computation of depreciation for the Corona Property is based on the cost
of the property, including Acquisition Fees and Expenses.  The allocation of the
cost of  the  Property  to  various asset  categories  is  estimated,  based  on
allocations in  the  appraisal report.    Depreciation  will be  computed  on  a
straight-line basis over 39 years,   the estimated component useful life of  the
assets.

SUMMARY

   Tenants representing 10% or  more of the Company's total consolidated  rental
revenue are as follows:

     Safeguard accounted for 20% of the total consolidated rental revenue of the
     Company.
     Tycom accounted for 16% of the total consolidated rental revenue of the
     Company.
     Riverside Marketplace Theaters accounted for 16% of the total consolidated
     rental revenue of the Company.
     CMS Welding & Machinery (Fremont property) accounted for 15% of the total
     consolidated rental revenue of the Company.

                                 15

<PAGE>

   The acquisition costs and dates of acquisition were as follows:

              Description                   Acquisition      Acquisition
                                              Cost and          Date
                                            Improvements

Blockbuster Video Building                   $1,676,210       02/26/91
Fresno Village Shopping Center                1,414,893       05/14/93
OPTO-22 Building                              2,500,001       09/15/93
Brea Property - SOLD ON OCTOBER 31, 1997         ---          03/04/94
Riverside Marketplace Theaters                3,655,500       11/29/94
Safeguard Building                            4,862,094       05/22/95
Technology Drive                              3,747,611       10/31/95
Java City Properties                          1,828,500       08/02/96
Tycom                                         4,907,441       01/17/97
Roseville Property                            1,976,484       10/31/97
Corona Property                               1,896,949       12/31/97

                                             28,465,682
Subsequent to year end (12/31/97):
Laufen Tile Property                          2,141,200       01/15/98

   Total Acquisition Cost & Improvements     30,606,882


As mentioned  in the  narrative  above,  all properties  were 100%  occupied  by
their respective tenants (or  in the case of  Technology Drive, tenant and  sub-
tenant), expect for the OPTO-22 property. The Company is currently attempting to
locate a tenant to enter into a long-term lease for the OPTO-22 Property.


ITEM 3.   LEGAL PROCEEDINGS

     None.

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

     None.


                                     16

<PAGE>

                                    PART II

ITEM  5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY
          AND RELATED STOCKHOLDER MATTERS


   The Company has completed four offerings of shares.  The first offering of
1,500,000 shares commenced on April 20, 1990 and was completed on November 18,
1991 with 268,791 shares sold for $2,672,586 in  gross proceeds.   The second
offering of 2,000,000 shares commenced on May 14, 1992 and was completed on May
14, 1994 with 368,524 shares sold for $3,681,147 in gross proceeds.  The third
offering of 2,000,000 shares commenced on June 3, 1994 and was completed in May
1996 with 813,841 shares sold for $8,132,169 in gross proceeds.   The fourth
offering of 1,500,000 shares commenced in May 1996, and 704,746 shares had been
sold resulting in $7,033,450 in gross proceeds as of December 31, 1997.

   At December 31, 1997, there were 2,163,561 shares of Common Stock outstanding
and 1,150 stockholders of record.   There is no present trading market for the
shares and none is expected to develop.  For a period of approximately two years
following the  completion of this offering, the Company intended to use a
crossing  arrangement pursuant to which Associated Securities Corp.   (the
"Crossing Agency")  will match buy-and-sell orders  for shares at negotiated
markups or commissions.

   The Company has established a dividend reinvestment plan (the "Plan") for its
Shareholders.   Shares acquired under the Plan during the offering  will  be
purchased at the $10.00 offering price.  After the completion of the offering
period, the Plan will acquire existing shares through the Crossing Agency at a
maximum price  of  $10.00  per share, if a sufficient number of shares are
available at such price.

     Dividends totaling $1,488,950, $1,128,597 and $804,595 in 1997, 1996 and
1995 were declared for Shareholders of record, who owned shares on the first day
of each month, and paid in the quarter following the record date.  The 1997 and
1996 dividend distributions are summarized below:

                                   17

<PAGE>

Dividends declared during 1997 were as follows:
                      OUTSTANDING           AMOUNT             TOTAL
RECORD DATE              SHARES            PER UNIT           DIVIDEND
January 1, 1997        1,550,607           $0.0666           $103,270
February 1, 1997       1,671,442            0.0666            111,318
March 1, 1997          1,671,442            0.0666            111,318
April 1, 1997          1,810,916            0.0666            120,606
May 1, 1997            1,815,579            0.0666            120,918
June 1, 1997           1,815,579            0.0666            120,918
July 1, 1997           1,815,579            0.0666            120,918
August 1, 1997         1,974,143            0.0666            131,478
September 1, 1997      1,968,143            0.0666            131,078
October 1, 1997        1,968,143            0.0666            131,078
November 1, 1997       2,147,524            0.0666            143,025
December 1, 1997       2,147,524            0.0666            143,025
TOTAL                                                      $1,488,950

Dividends declared during 1996 were as follows:
                      OUTSTANDING           AMOUNT             TOTAL
RECORD DATE              SHARES            PER UNIT           DIVIDEND
January 1, 1996        1,325,404            0.0600            $ 79,524
February 1, 1996       1,371,794            0.0600              82,308
March  1, 1996         1,401,664            0.0600              84,100
April 1, 1996          1,413,736            0.0666              94,155
May 1, 1996            1,445,236            0.0666              96,253
June 1, 1996           1,448,836            0.0666              96,492
July 1, 1996           1,448,836            0.0666              96,492
August 1, 1996         1,448,836            0.0666              96,492
September 1, 1996      1,498,246            0.0666              99,784
October 1, 1996        1,498,246            0.0666              99,784
November 1, 1996       1,500,651            0.0666              99,943
December 1, 1996       1,550,607            0.0666             103,270
TOTAL                                                       $1,128,597


Dividends declared during 1995 were as follows:
                      OUTSTANDING           AMOUNT             TOTAL
RECORD DATE              SHARES            PER UNIT           DIVIDEND
January 1, 1995          911,986           $0.060            $ 54,719
February 1, 1995         945,136            0.060              56,708
March 1, 1995          1,009,084            0.060              60,545
April 1, 1995          1,069,217            0.060              64,153
May 1, 1995            1,109,374            0.060              66,562
June 1, 1995           1,109,874            0.060              66,592
July 1, 1995           1,116,891            0.060              67,013
August 1, 1995         1,151,911            0.060              69,115
September 1, 1995      1,204,517            0.060              72,271
October 1, 1995        1,225,398            0.060              73,524
November 1, 1995       1,261,859            0.060              75,712
December 1, 1995       1,294,683            0.060              77,681
TOTAL                                                        $804,595

                                      18

<PAGE>

      Dividends are based on income from operations before  depreciation  and
amortization, with appropriate allowances made for the reinvestment of dividends
into additional shares and the repayment of note principal.   Dividends are
determined by management based on cash flows and the liquidity position of the
Company.  It is the intention of management to declare monthly dividends subject
to the maintenance of reasonable reserves.

ITEM 6.   SELECTED FINANCIAL DATA

     The selected financial data should be read in conjunction  with  the
financial statements and related notes and Item 7-- "Management Discussion and
Analysis of Financial Condition and Results of Operations" appearing elsewhere
in this report.

<TABLE>
<CAPTION>
                               1997        1996       1995        1994       1993
<S>                            <C>         <C>         <C>         <C>        <C>
Operations for the years
ended December 31:
     Revenues               $3,217,492  $2,474,627  $1,813,126   $903,167  $ 362,566
     Net Income                978,978     705,636     649,605    247,068    158,490
     Net Income/Share*             .53         .49         .58        .35        .38
     Dividends/Share*             .799        .779         .72        .74        .53
Financial position at
December 31:
    Total Assets            29,839,091  23,571,838  21,392,898 13,228,888  7,483,308
    Long-term Debt          11,194,832  10,078,793   9,539,180  5,161,355  2,405,526
    Stockholders' Equity    17,852,963  12,904,891  11,234,837  7,756,140  4,925,260

</TABLE>
[FN]
*Net income per Share and Dividends per Share were based on the weighted average
number of Shares outstanding.


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

Certain  statements  in  the  Management  Discussion  and  Analysis   constitute
"forward-looking statements"  within  the  meaning  of  the  Private  Securities
Litigation Reform  Act  of  1995  (the  "Reform  Act").    Such  forward-looking
statements involve known  and unknown  risks, uncertainties,  and other  factors
which may cause the actual results,  performance or achievements of the  Company
to be materially different from any future results, performance or achievements,
expressed of implied by such forward-looking statements.

RESULTS OF OPERATIONS - 1997 VS. 1996

    Operations for the year ended December  31, 1997 represented a full year  of
rental operations for all properties expect  Tycom Property which was owned  for
eleven months, the  Roseville Property  which was owned  for one  month and  the
Corona Property which was purchased on December 31, 1997.

                                     19

<PAGE>

ITEM 7.   MANAGEMENT DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

    The net income for the year ended December 31, 1997 ($978,978) was higher
than the  year ended December 31, 1996 ($705,636) due to the raising  of
additional funds and investment of such funds in additional income  producing
properties.  The Company did not have any adverse events that significantly
impacted net income during the year ended December 31, 1997, except the OPTO-22
property which  has  been unleased  since  October 15,  1997.   The Company is
attempting to locate a tenant to enter into a long-term lease for the property.
All tenants were current on their lease obligations.

    Rental revenue increased $707,036 (30%) due to a full year's ownership of
the Java City property,  eleven months ownership of the Tycom property and one
month ownership of the Roseville property during 1997 less two month's fewer
ownership of the Brea property, as compared to a  five month ownership for the
Java City Property and no ownership for both the Tycom and Roseville properties
in 1996).  Interest income increased $35,829 (37%) due to higher cash balances
maintained during the year ended December 31, 1997 as compared to the year ended
December 31, 1996.

     On October 31, 1997, the Company ("Seller") sold the North Palm Street
Property to a  unrelated buyer. The total sales price  was $2,515,860 in cash.
The Seller paid the existing first deed of trust, which as of October 31, 1997
totaled $971,305.   The Company recognized a $262,168 gain  on the sale of the
North Palm Street property in Brea, California.

    Operating expenses increased $75,460 (25%) due to the additional  properties
owned during the  year.  Interest  expense increased $167,796  (19%) due to  the
additional debt incurred in connection with property acquisition and refinancing
activities.  Despite the amount of debt financing, the Company remains below the
50% debt maximum allowed by the Company's by-laws (debt was 39% of property cost
(as defined in the by-laws) as  December 31, 1997).  General and  administrative
costs increased $112,300 (50%) due to higher overhead expenses and Advisory  fee
expenses related to the  Company's increased size.   General and  administrative
costs as a percentage of revenue increased from  9.4% in 1996 to 10.7% in  1997.
Much of this increase is due to $186,439 that the Advisor was paid in 1997 as  a
result of the  revised provisions of  the Advisor agreement.   Depreciation  and
amortization expense increased $113,967 (32%) as the result of the ownership  of
additional properties during 1997 as compared to 1996.

    The weighted average number of shares outstanding during 1997 was  1,839,018
versus 1,447,366 in 1996. Despite the greater number of shares outstanding,  the
net income per  share increased from  $.49 in  1996 to $.53  in 1997.   If  this
figure is analyzed using flow  of funds - that  is net income plus  depreciation
expense - then the amount in 1997 was $.79 per share vs. $.75 in 1996.

      The improvement  in the  per share  figures is  attributable to  a  larger
percentage of  the Company's  assets being  invested  in income  producing  real
estate during 1997, as opposed to investments in relatively lower yielding money
market investments.

                                   20

<PAGE>

ITEM 7.   MANAGEMENT DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

     During the year ended December 31, 1997, the Company declared dividends
totaling $1,488,950, compared to dividends of  $1,128,597 declared for the year
ended December 31, 1996.  Cash basis income for the year ended December 31, 1997
was $1,459,406.    This was derived by adding depreciation and amortization
expense to net income.    Thus, cash distributions this year  were  greater
($35,104) than cash basis net income.  In contrast, distributions in 1996 were
greater ($62,060) than cash basis income.  The Company continues to qualify
as a REIT.

    In summary,  the operating performance of the Company continued to improve
as additional funds were raised, additional  property  was acquired, and all
properties were operating profitably, expect the OPTO-22 property.  The Company
is currently attempting to locate a tenant to enter into a long-term lease for
the OPTO-22 property.

RESULTS OF OPERATIONS - 1996 VS. 1995

    Operations for the year ended December  31, 1996 represented a full year  of
rental operations for all properties expect  Java City which was owned for  only
five months.

    The net  income for the year ended December  31, 1996 ($705,636) was  higher
than the  year  ended  December  31,  1995 ($649,605)  due  to  the  raising  of
additional funds and  investment of such  funds in  additional income  producing
properties.  The  Company did  not have  any adverse  events that  significantly
impacted net income during the year ended December 31, 1996, and all  properties
that have been purchased by the Company have operated at levels equal to current
expectations.  All tenants were current on their lease obligations.

    Rental revenue  increased $685,354 (41%) due to  a full year's ownership  of
the Technology Drive and Safeguard Building  properties (as compared to  partial
year ownership in 1995), and partial year ownership for the Java City  property.
Interest income decreased $23,853 (25%) due to a new escrow release procedure on
the current offering where  new investor funds come  into the Company  quarterly
rather than  daily,  thus lowering  the  amount  of excess  cash  available  for
investment.

       Operating expenses  increased  $133,179  (78%) as  a  reflection  of  the
additional properties  owned  during  the  year.    Interest  expense  increased
$260,947 (42%) as  a reflection of  the additional debt  incurred in  connection
with property acquisition  and refinancing activities.   Despite  the amount  of
debt, the Company  remains below  the maximum 50%  debt maximum  allowed by  the
Company's by-laws (debt was 48% of property cost (as defined in the by-laws)  as
December 31, 1996).  General and  administrative costs increased $106,587  (91%)
due to higher accounting, taxes, and general insurance expense costs related  to
the Company's increased size.  General  and administrative costs increased as  a
percentage of revenue going  from 6.5% in 1996  to 9.0% in 1996.   Much of  this
increase is due to $74,361 that the Advisor was paid in 1996 due to the  revised
provisions of  the Advisor  agreement.   No advisor  fees were  earned in  1995.
Depreciation and amortization expense increased $104,757 (41%) as the result  of
the ownership of additional properties during 1995 as compared to 1996.

     The  average number of  shares outstanding  during 1996  was 1,447,366  vs.
1,117,494 in 1995. Partly because of  the greater number of shares  outstanding,
the net income per share decreased from $.58 in 1995  to $.49 in 1996.  If  this
figure is analyzed using flow  of funds - that  is net income plus  depreciation
expense - then the amount in 1996 was $.75 per share vs. $.80 in 1995.

                                    21

<PAGE>

ITEM 7.   MANAGEMENT DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

    The decrease in the per share figures is largely due to the imposition of
the Advisory Fee in 1996 ($74,361) which effectively decreased net income and
flow of funds per share by $.05 per share.  However, it should be noted that
although the full Advisory fee is recognized on the Statement of Income,  the
Advisor agreed to waive collection of $44,061 (59%) of these fees in 1996, and
may elect to waive collection of all or a portion of the fees in the future.
The Advisor's wavier of these fees has been treated as an infusion of  equity
into the Company, rather than as a reduction in expenses.

In addition to the added Advisory Fee Expense, the Company had a fairly large
drop in interest income.   This was due to relatively lower interest rates in
place for most  of 1996 as compared to 1995, and a slower level of new fund
raising from the sale  of shares in 1996 as compared to 1995.  $3,633,687 was
raised in net proceeds in 1995, while only $2,124,626 was raised in 1996. Thus,
the Company had less funds on hand awaiting investment in 1996 than in 1995.

     During the  year ended December  31, 1996, the  Company declared  dividends
totaling $1,128,597, compared  to dividends of  $804,595 declared  for the  year
ended December 31, 1995.  Cash basis income for the year ended December 31, 1996
was $1,066,537.    This was  derived  by adding  depreciation  and  amortization
expense to  net  income.    Thus, cash  distributions  this  year  were  greater
($40,898) than cash basis net income.   In contrast, distributions in 1995  were
less ($101,154) than cash basis income.  In either event, the Company  continues
to qualify as a REIT.

     In  summary then, the  operating performance  of the  Company continued  to
improve as additional funds were raised,  additional property was acquired,  and
all properties were operating profitably.

LIQUIDITY AND CAPITAL RESOURCES

     During the  year ended December  31, 1997, the  Company declared  dividends
totaling $1,488,950.  Dividends are determined by management based on cash flows
and the liquidity position of the Company.  It is the intention of management to
declare dividends, subject to the maintenance of reasonable reserves.

    During the  year ended December 31, 1997,  the Company raised an  additional
$5,331,605 in net proceeds as the  result of the sale  of shares from its  third
and fourth  public offering.   In  1996, the  Company raised  $2,048,954 in  net
proceeds as the result  of the sale of  shares from a  combination of its  third
offering and  fourth offering.  The Company  used the  net proceeds  from  these
offerings to purchase additional income-producing properties  and to add to  the
cash reserve balances of the Company.

    Management uses cash as its primary measure of the Company's liquidity.  The
amount of cash that represents adequate  liquidity for a real estate  investment
company, is dependent on several factors.  Among them are:

     1.   Relative risk of the Company's operations;
     2.   Condition of the Company's properties;
     3.   Stage in the Company's operating cycle (e.g., money-raising,
          acquisition, operating or disposition phase); and
     4.   Shareholders dividends.

                                    22

<PAGE>

ITEM 7.   MANAGEMENT DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

    The Company is adequately liquid and management believes it has the  ability
to generate  sufficient cash  to meet  both short-term  and long-term  liquidity
need, based upon the above four factors.

The first factor refers to the risk  of the Company's investments.  At  December
31, 1997, the Company's excess funds were invested in a short-term money  market
fund.  The  Company acquires rental  property either entirely  for cash or  with
moderate financing.   During the  year ended  December 31,  1997, notes  payable
pertaining to  property acquisitions  by the  Company increased  by  $2,312,500,
while cash used in principal repayments  of notes totaled $1,196,461.   Although
the notes are set up on an  amortization schedule allowing for the repayment  of
principal over  time, most  of the  principal on  the notes  is due  in  balloon
payments that come due  in the years 2003  through 2007.   The Company is  aware
that the balloon payments  must be avoided through  refinancing of the loans  or
the sale of the property(ies) in order to protect the interests of the Company's
shareholders. (Please  refer to  "Properties" information  in  Item 2  for  more
detail as  to leverage).     Furthermore, most  of the  properties' tenants  are
nationally  known  retailers  or  well-established  businesses  under  long-term
leases.

    The second factor refers to the condition of the Company's properties.   The
Company's  properties  are  in  good  condition  without  significant   deferred
maintenance obligations and are leased under "triple-net" leases, which  reduces
the Company's risk pertaining to excessive maintenance and operating costs.

     The third  factor refers to  operating cycle.   The Company  was liquid  at
year-end since  the Company  is still  operating in  the "money-raising"  stage.
Virtually all funds raised were invested in a short-term money market fund.   At
year-end, the Company has allocated  approximately $580,000 towards a  "reserve"
fund  (3%  of  gross  funds  raised,  as  disclosed  in  the  Company's   latest
prospectus),  $210,000  of cash  to be paid  for current  mortgage and  accounts
payable commitments, $257,000 in tenant security deposits and prepaid rents, and
the  balance--approximately  $1,050,000--expected  to  be  invested  in   future
property acquisitions.   The Company's  operations generated  $1,459,406 in  net
operating cash flow in 1997 (net  income plus depreciation expense).  Thus,  the
Company is  generating  significant amounts  of  cash flow  and  could  withhold
payment of all or a portion of dividends, if necessary, in order to rebuild cash
balances.

     The  fourth factor  refers to  distribution of  dividends to  shareholders.
Dividends to shareholders were made at a level consistent with the small  amount
of net income available after application  of expenses.  The Advisor is  careful
not to  make distributions  in excess  of  the available  income.   The  Advisor
expects to increase the level of  dividends as additional funds are raised,  and
overhead expenses are spread over a larger base of investors' funds.

      Inflation and  changing  prices have  not had  a  material effect  on  the
Company's operations.  Operations in the near future may be materially  affected
as and when the Company acquires additional property.

       The Company currently has no material capital commitments.

    The Tax Reform Acts of 1986 and 1987 and the Revenue Reconciliation Acts  of
1990 and 1993 did not have a material impact on the Company's operations.

                                   23

<PAGE>

ITEM 7.   MANAGEMENT DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

CASH FLOWS 1997 VS. 1996

      Cash resources  increased $82,663  during 1997  compared to  the  $567,172
increase in 1996.  This was the result of normal amounts of investing, financing
and operating activities that were expected to take place during the year.  Cash
provided by  operating  activities  increased by  $2,135,855  with  the  largest
contributor being  $1,704,659 in  cash  basis income.    In contrast,  1996  saw
$819,783 in  cash  being  provided by  operating  activities  due  primarily  to
$1,066,537 in cash  basis income.   Cash used in  investing activities for  1997
totaled $6,170,565 due to $8,686,425 used  to the purchase the Tycom,  Roseville
and Corona  properties,  offset  by $2,515,860  due  to  the sale  of  the  Brea
property.   In  contrast,  during  1996  the sole  use  of  cash  for  investing
activities was $1,828,500 expended for the  purchase of the Java City  property.
During 1997, $4,117,373 was provided by financing activities.  This increase was
the result of $4,666,531 in net proceeds  from the sale of additional shares  in
the Company and  $2,312,500 increase  in notes  payable in  connection with  the
purchase of the Tycom property.   These cash resources were offset by  dividends
declared and paid  of $1,791,710 and  payments on notes  payable of  $1,196,461.
This continues the Company's trend of paying virtually all the cash basis income
out to investors in the form of  quarterly dividends.  In contrast, 1996's  cash
provided by financing activities  was $1,575,889 due  to $2,048,954 in  proceeds
from the  sale of  additional shares,  and a  $755,000 gross  increase in  notes
payable, offset by dividends paid and declared of $1,052,925.

CASH FLOWS 1996 VS. 1995

    Cash resources increased $567,172 during 1996 compared to $954,193  increase
in 1995.   This was the  result of normal  amounts of  investing, financing  and
operating activities that  were expected to  take place during  the year.   Cash
provided  by  operating  activities  increased  by  $819,783  with  the  largest
contributor being  $1,066,537 in  cash  basis income.    In contrast,  1995  saw
$2,373,143 in cash  being provided by  operating activities due  to $905,749  in
cash basis  income  and  $1,240,190 being  received  from  the  sale  government
securities (such securities were purchased in  1993 primarily).  $1,128,597  was
declared as dividends during 1996; this  is noted as a  large use of cash  under
financing activities.  This  continues the Company's  trend of paying  virtually
all the cash basis income out to  investors in the form of quarterly  dividends.
Over the  last three  years, cash  basis income  has totaled  $2,337,592,  while
dividend declarations  have  totaled  $2,311,572 (98%  of  cash  basis  income).
Financing activities provided an additional $1,575,889 in cash resources to  the
Company via the  sale of  additional shares in  the Company  ($2,124,626 in  net
proceeds), and $724,465 in financing obtained in connection with the acquisition
of refinancing of properties, less dividends  paid of $1,128,597.  In  contrast,
1995's cash provided by financing activities was $7,228,140 due to $3,633,687 in
proceeds from the sale of additional shares, and a $4,469,647 gross increase  in
notes payable, net  of dividends  paid of $745,172.   The  sole use  of cash  in
investing activities in 1996 was $1,828,500 expended for the acquisition of  one
property during the year.   $755,000 of the  funds necessary for obtaining  this
property was obtained from debt financing.  In contrast, $8,647,090 were used to
purchase additional rental properties in 1995 with $4,469,647 in debt  financing
used to facilitate the purchases.

                                    24

<PAGE>

ITEM 7.   MANAGEMENT DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

NEW ACCOUNTING PRONOUNCEMENTS

Statement of Financial Accounting Standards No.  130  (SFAS No. 130)  "Reporting
Comprehensive Income," issued  by the  Financial Accounting  Standards Board  is
effective for financial  statements with fiscal  years beginning after  December
15, 1997.  Earlier application is permitted.  SFAS No. 130 establishes standards
for reporting and display of comprehensive  income and its components in a  full
set of general-purpose financial statements.  The Company has not determined the
effect on its  financial position  or results of  operations, is  any, from  the
adoption of this statement.

Statement of Financial Accounting Standards No. 131 (SFAS No. 131),  "Disclosure
about Segments  of  an  Enterprise  and  Related  Information,"  issued  by  the
Financial Accounting Standards Board is effective for financial statements  with
fiscal years beginning after December 15, 1997.  The new standard requires  that
public business enterprises report certain information about operating  segments
in complete sets  of financial statements  of the enterprises  and in  condensed
financial statements  of  interim  periods issued  to  shareholders.    It  also
requires that public business enterprises report certain information about their
products and services,  the geographic  areas in  which they  operate and  their
major customers.   The Company has  not determined the  effect on its  financial
position or results of operations, if any, from the adoption of this statement.

                                     25

<PAGE>


ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                                                       PAGE

     Report of Independent Certified Public Accountants              27

     Balance Sheets - December 31, 1997 and 1996                     28

     Statements of Income for the years ended
          December 31, 1997, 1996 and 1995                           29

     Statements of Stockholders' Equity for the years ended
          December 31, 1997, 1996 and 1995                           30

     Statements of Cash Flows for the years ended
          December 31, 1997, 1996 and 1995                           31-32

     Summary of Accounting Policies                                  33-34

     Notes to Financial Statements                                   35-42

     Financial Statement Schedules

          Schedule III - Real Estate and Accumulated Depreciation    49-50

          Schedule IV - Mortgage Loans on Real Estate                51-52


                                    26

<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

West Coast Realty Investors, Inc.
Los Angeles, California

We have  audited the  accompanying consolidated  balance  sheets of  West  Coast
Realty Investors,  Inc.,  as of  December  31, 1997  and  1996 and  the  related
statements of income, stockholders' equity, and cash flows for each of the three
years ended December 31, 1997.  We have also audited the schedules listed in the
accompanying  index.    These  financial   statements  and  schedules are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements and schedules based on our audits.

We conducted our audits in accordance with  generally  accepted   auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about  whether the financial statements and schedules are
free of material misstatement.   An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements and
schedules.  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  financial statements referred to  above present fairly,  in
all material respects, the  financial position of  West Coast Realty  Investors,
Inc., at December 31, 1997 and 1996, and  the results of its operations and  its
cash flows for each of  the three years ended  December 31, 1997, in  conformity
with generally accepted accounting principles.

Also in our opinion, the schedules present fairly, in all material respects, the
information set forth therein.


BDO SEIDMAN, LLP
Los Angeles, California
March 12, 1998
                                       27

<PAGE>
<TABLE>
                       WEST COAST REALTY INVESTORS, INC.
                                 BALANCE SHEETS

<CAPTION>

December 31,                                               1997           1996
<S>                                                        <C>            <C>
ASSETS
Rental real estate, less accumulated
   depreciation (Notes 2 and 3)                     $27,322,612    $21,118,203
Cash and cash equivalents                             2,099,857      2,017,194
Deferred rent                                           288,411        247,948
Loan origination fees, net of
accumulated amortization of $51,603 and $40,248          89,260        102,622
Other assets                                             38,951         85,871

Total assets                                        $29,839,091    $23,571,838

LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
   Accounts payable                                    $130,076        $13,922
   Due to related party (Note 4)                        187,267         46,285
   Dividends payable (Note 7)                               ---        302,760
   Security deposits and prepaid rent                   366,921        124,734
   Other liabilities                                    107,032        100,453
   Notes payable (Note 5)                            11,194,832     10,078,793

Total liabilities                                    11,986,128     10,666,947

COMMITMENTS

STOCKHOLDERS' EQUITY
Common stock, $.01 par-shares authorized,
5,000,000 shares issued, 2,163,561 and 1,550,607
outstanding in 1997 and 1996                             21,635         15,506
Additional paid-in capital                           19,313,678     13,861,763
Retained earnings                                   (1,482,350)      (972,378)

Total stockholders' equity                           17,852,963     12,904,891

Total liabilities and stockholders' equity          $29,839,091    $23,571,838

</TABLE>
[FN]
     See accompanying summary of accounting policies and notes to financial
                                  statements.

                                       28

<PAGE>
<TABLE>
                       WEST COAST REALTY INVESTORS, INC.
                              STATEMENTS OF INCOME
<CAPTION>

Years ended December 31,                  1997           1996           1995
<S>                                        <C>            <C>            <C>
REVENUES
   Rental (Notes 2 and 3)             $2,822,398     $2,377,530     $1,692,176
   Gain on sale of property              262,168            ---            ---
   Interest                              132,926         97,097        120,950

                                       3,217,492      2,474,627      1,813,126
COSTS AND EXPENSES
   Operating                             378,318        302,858        169,679
   Interest expense                    1,048,774        880,978        620,031
   General and administrative            336,554        224,254        117,667
   Depreciation and amortization         474,868        360,901        256,144

                                       2,238,514      1,768,991      1,163,521

NET INCOME                              $978,978       $705,636       $649,605

NET INCOME PER SHARE (Note 7)               $.53           $.49           $.58

</TABLE>
[FN]
     See accompanying summary of accounting policies and notes to financial
                                  statements.

                                      29

<PAGE>
<TABLE>
                        WEST COAST REALTY INVESTORS, INC.
                       STATEMENTS OF STOCKHOLDERS' EQUITY
                  YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

<CAPTION>
                                                  Common  Stock     Additional  Distributions
                                               Shares       Amount    Paid-in    in Excess of
                                                                       Capital      Earnings
<S>                                              <C>          <C>         <C>        <C>
BALANCE, January 1, 1995                        911,986      $ 9,120 $ 8,141,447   $(394,427)

Issuance of stock for cash, net of costs
and sales commissions of $423,603               410,418        4,104   3,629,583          ---

Net income for the year                             ---          ---         ---      649,605

Dividends declared  ($.72 per share-Note 7)         ---          ---         ---    (804,595)

BALANCE, December 31, 1995                    1,322,404       13,224  11,771,030    (549,417)

Issuance of stock for cash, net of costs
and sales commissions of $246,599               228,203        2,282   2,046,672          ---

Net income for the year                             ---          ---         ---      705,636

Equity contribution by Affiliates through
expense reimbursements (Note 4f )                   ---          ---      44,061          ---

Dividends declared  ($.779 per share-Note 7)        ---          ---         ---  (1,128,597)

BALANCE, December 31, 1996                    1,550,607       15,506  13,861,763    (972,378)

Issuance of stock for cash, net of costs        612,954        6,129   5,325,476          ---
and sales commissions of $691,928

Net income for the year                             ---          ---         ---      978,978

Equity contribution by Affiliates through
expense reimbursements (Note 4f )                   ---          ---     126,439          ---

Dividends declared  ($.799 per share-Note 7)        ---          ---         ---  (1,488,950)

BALANCE, December 31, 1997                    2,163,561      $21,635 $19,313,678 $(1,482,350)

</TABLE>
[FN]
     See accompanying summary of accounting policies and notes to financial
                                  statements.

                                       30

<PAGE>
<TABLE>
                        WEST COAST REALTY INVESTORS, INC.
                            STATEMENTS OF CASH FLOW

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

<CAPTION>

Years ended December 31,                          1997        1996         1995
<S>                                               <C>          <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income                                      $978,978    $705,636     $649,605
Adjustments to reconcile net income to  net
cash provided by operating activities:
  Gain on sale of property                     (262,168)         ---          ---
  Depreciation and amortization                  474,868     360,901      256,144
  Interest expense on amortization of  loan
       origination fees                            2,007      21,161       11,454
Increase (decrease) from changes in
operating assets and liabilities:
     Government securities                           ---         ---    1,240,190
     Accounts receivable                        (40,463)   (115,800)     (62,784)
     Other assets                                 46,920    (45,277)       30,469
     Accounts payable                            116,154    (11,497)       10,731
     Due to related party                        140,982   (121,029)      130,378
     Security deposits and prepaid rent          242,187      15,666       71,823
     Other liabilities                             6,579      10,022       35,133

Net cash provided by operating activities      1,706,044     819,783    2,373,143

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchases of rental real estate            (8,780,874) (1,828,500)  (8,647,090)
  Proceeds from sale of rental real estate     2,375,120         ---          ---

Net cash (used in) investing activities      (6,405,754) (1,828,500)  (8,647,090)

</TABLE>

                                   31

<PAGE>
<TABLE>

                       A WEST COAST REALTY INVESTORS, INC.
                        STATEMENTS OF CASH FLOW (CONT.)

<CAPTION>

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS


Years ended December 31,                           1997         1996           1995
<S>                                                 <C>          <C>            <C>
CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from issuance of common stock, net      5,331,605    2,048,954     3,633,687
Equity  contribution  by  Affiliates  through
expense reimbursements                             126,439       44,061           ---
Dividends                                      (1,791,710)  (1,052,925)     (745,172)
Proceeds from notes payable                      2,312,500      755,000     4,469,647
Payments on notes payable                      (1,196,461)    (215,387)      (91,822)
Decrease (Increase) in loan origination fees           ---      (3,814)      (38,200)

Net cash provided by financing activities        4,782,373    1,575,889     7,228,140

NET INCREASE IN CASH AND CASH EQUIVALENTS           82,663      567,172       954,193

CASH AND CASH EQUIVALENTS, beginning of year     2,017,194    1,450,022       495,829

CASH AND CASH EQUIVALENTS,  end of year         $2,099,857   $2,017,194    $1,450,022

</TABLE>
[FN]
     See accompanying summary of accounting policies and notes to financial
                                  statements.

                                       32

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         SUMMARY OF ACCOUNTING POLICIES

BUSINESS       West Coast Realty Investors, Inc. (the "Company"), is a
               corporation formed on October 26, 1989 under the laws of the
               State of Delaware.  The Company exists as a Real Estate
               Investment Trust ("REIT") under Sections 856 to 860 of the
               Internal Revenue Service Code.  The Company has complied with all
               requirements imposed on REIT's for the 1997, 1996 and 1995 tax
               years; however qualification as a REIT for future years is
               dependent upon future operations of the Company.  The Company was
               organized to acquire interests in income-producing residential,
               industrial, retail or commercial properties located primarily in
               California and the west coast of the United States.  The Company
               intends to acquire property for cash on a moderately leveraged
               basis with aggregate mortgage indebtedness not to exceed fifty
               percent of the purchase price of all properties on a combined
               basis, or eighty percent individually and intends to own and
               operate such properties for investment over an anticipated
               holding period of five to ten years.

RENTAL REAL    Assets are  stated  at  lower  of  cost net  realizable  value.
ESTATE AND     Depreciation is  computed using  the straight-line  method over
DEPRECIATION   their estimated useful lives of 31.5  to 39 years for financial
               and income tax reporting purposes.

               In the  event that  facts and  circumstances indicate  that the
               cost  of   an  asset   may  be   impaired,  an   evaluation  of
               recoverability  would  be  performed.    If  an  evaluation  is
               required,  the   estimated  future   undiscounted   cash  flows
               associated with  the asset  would be  compared to  the carrying
               amount  to  determine  if  a  write-down  to  market  value  is
               required.

RENTAL         Rental revenue is  recognized on  a straight-line basis  to the
INCOME         extent that rental revenue is deemed  collectible.  Where there
               is uncertainty of  collecting higher scheduled  rental amounts,
               due to the tendency  of tenants to renegotiate  their leases at
               lower amounts, rental income  is recognized as  the amounts are
               collected.

INVESTMENTS    Investments classified  as trading  securities are  recorded at
               market value.  Unrealized  gains or losses are  included in the
               statements of income.

LOAN           Loan origination fees  are capitalized  and amortized  over the
ORIGINATION    life of the loan.
FEES

CASH AND       The Company  considers cash  in the  bank, liquid  money market
CASH           funds, and  all  highly liquid  certificates  of deposit,  with
EQUIVALENTS    original maturities of  three months  of less,  to be  cash and
               cash equivalents.

                                     33

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         SUMMARY OF ACCOUNTING POLICIES

USE  OF          The preparation  of financial  statements in  conformity with
ESTIMATES        generally accepted accounting  principles requires management
                 to make  estimates and  assumptions that affect  the reported
                 amounts  of   assets  and   liabilities  and   disclosure  of
                 contingent  assets  and  liabilities   at  the  date  of  the
                 financial statements and the reported amounts of revenues and
                 expenses during the  reporting period.   Actual results could
                 differ from those estimates.

RECLASSIFICATIONS  For comparative purposes, certain prior year amounts have
                   been reclassified to conform to the current  year
                   presentation.

EARNINGS (LOSS)   On March 3, 1997, the FASB issued Statement of Financial
PER SHARE         Accounting Standards No. 128, "Earnings Per Share" (SFAS
                  128).  This pronouncement provides a different method of
                  calculating earnings per share than is currently used in
                  accordance with APB 15, "Earnings Per Share".  SFAS 128
                  provides for the calculation of Basic and Diluted earnings
                  per share.  Basic earnings per share includes no dilution and
                  is computed by dividing income available to common
                  shareholders by the weighted average number of common shares
                  outstanding for the period.  Diluted earnings per share
                  reflects the potential dilution of securities that could
                  share in the earnings of the entity, similar to fully diluted
                  earnings per share.  Except where the provisions of the
                  Securities and Exchange Commission's Staff Accounting
                  Bulletin No. 98 are applicable, common share equivalents have
                  been excluded in all years presented in the Statements of
                  Operations when the effect of their inclusion would be anti-
                  dillutive. SFAS 128 is effective for fiscal years and interim
                  periods after December 15, 1997.  The Company has adopted
                  this pronouncement during the fiscal year ended December 31,
                  1997.  The adoption of SFAS 128 does not effect earnings per
                  share for fiscal year ended December 31, 1997 and prior
                  years.

NEW ACCOUNTING   Statement of  Financial Accounting  Standards No. 130   (SFAS
PRONOUNCEMENTS   No.  130) "Reporting  Comprehensive  Income,"  issued  by the
                 Financial  Accounting   Standards  Board   is  effective  for
                 financial  statements  with   fiscal  years  beginning  after
                 December 15, 1997.   Earlier application is  permitted.  SFAS
                 No. 130  establishes standards  for reporting and  display of
                 comprehensive  income and  its components  in a  full  set of
                 general-purpose financial  statements.   The Company  has not
                 determined the effect on its financial position or results of
                 operations, is any, from the adoption of this statement.

                 Statement of Financial Accounting Standards No. 131 (SFAS No.
                 131), "Disclosure about Segments of an Enterprise and Related
                 Information," issued  by  the Financial  Accounting Standards
                 Board is effective for financial statements with fiscal years
                 beginning after December 15, 1997.  The new standard requires
                 that public  business enterprises  report certain information
                 about  operating  segments  in  complete  sets  of  financial
                 statements  of the  enterprises  and  in  condensed financial
                 statements of  interim periods  issued  to shareholders.   It
                 also requires that public business enterprises report certain
                 information about their products and services, the geographic
                 areas in which  they operate and their  major customers.  The
                 Company  has  not  determined  the  effect on  its  financial
                 position or results of  operations, if any, from the adoption
                 of this statement.

                                      34

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         NOTES TO FINANCIAL STATEMENTS

NOTE 1 - GENERAL

On October 30, 1989, West Coast Realty Advisors, Inc. (the "Advisor"),
purchased 1,000 shares of the Company's common stock for $10,000.  On
August 30, 1990, the Company reached its minimum initial offering funding
level of $1,000,000.  As of December 31, 1997 the Company has raised
$21,595,947 in capital.

Sales commissions and wholesaling fees, representing 7% of the gross proceeds
from the  sale  of common shares,  were paid to Associated Securities Corp.
("ASC"), a member of the National Association of  Securities  Dealers, Inc.
("NASD") and an affiliate of the Advisor.

Dividends are declared and accrued based approximately  upon  the  previous
quarter's income from operations before depreciation and amortization.

NOTE 2 - RENTAL PROPERTIES

The Company owns the following income-producing properties
                                                                ORIGINAL
LOCATION (PROPERTY NAME)          DATE PURCHASED             ACQUISITION
                                                                    COST

Huntington Beach, California
(Blockbuster)                   February 26, 1991           $ 1,676,210
Fresno, California                 May 14, 1993               1,414,893
Huntington Beach, California
(OTPO-22)                       September 15, 1993            2,500,001
Riverside, California           November 29, 1994             3,655,500
Tustin, California
(Safeguard)                        May 22, 1995               4,862,094
Fremont, California
(Technology Drive)               October 31, 1995             3,747,611
Sacramento, California
(Java City)                       August 2, 1996              1,828,500
Irvine, California
(Tycom)                          January 17, 1997             4,907,441
Roseville, California
(Applebee's)                     October 31, 1997             1,976,484
Corona, California              December 31, 1997             1,896,949

                                      35

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         NOTES TO FINANCIAL STATEMENTS

NOTE 2 - RENTAL PROPERTIES (CONTINUED)
The major categories of property are:

DECEMBER 31,                                  1997                  1996

Land                                  $  9,449,150          $  7,401,126
Buildings and improvements              19,016,532            14,532,025

                                        28,465,682            21,933,151
Less accumulated depreciation            1,143,073               814,948

Net rental properties                $  27,332,612         $  21,118,203

During 1997, the Company acquired three properties.  The Statement of Operations
includes rental income for the acquired properties from the dates of acquisition
to December 31, 1997.

On October 31, 1997, the Company ("Seller") sold the North Palm Street Property
to a unrelated buyer. The total sales price was $2,515,860 in cash.  The Seller
paid the existing first deed of trust, which as of October 31, 1997 totaled
$971,305.   The Company recognized a $262,168 gain on the sale of the North Palm
Street property in Brea, California.

A significant portion of the Company's rental revenue was earned from tenants
whose individual rents represented more than 10% of total rental revenue.
Specifically:

     Four tenants accounted for 20%, 16%, 16% and 15%,  respectively, in 1997;
     Five tenants accounted for 23%, 19%, 18% , 12% and 10%,  respectively, in
     1996;
     Four tenants accounted for 24%, 20%, 15% and 10%,  respectively, in 1995;

The following unaudited pro  forma information are  presented to illustrate  the
effect of the three  properties acquired in during  1997 and 1996, as  discussed
above, and the property acquired in  1998,  as discussed in  Note 10, as if  the
acquisitions occurred on January 1st of each year presented.

  PRO FORMAS FOR THE YEARS
           ENDED                              1997                  1996
        DECEMBER 31,

Revenues:
 Rental Income                        $  3,241,702          $  3,321,089
 Gain on sale of property                  214,128               204,519

                                         3,455,830             3,525,608
Costs and Expenses:
Operating                                  353,869               313,090
Interest                                   980,241             1,020,428
General & Administrative                   336,554               528,441
Depreciation & Amortization                543,761               224,254

                                         2,214,425             2,086,213

Net Income                              $1,241,405            $1,439,395

Net Income per Share                         $0.67                 $0.74


                                       36

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         NOTES TO FINANCIAL STATEMENTS


NOTE 3- FUTURE MINIMUM RENTAL INCOME

As of December 31, 1997, future minimum rental income under the existing leases
that have remaining noncancelable terms in excess of one year are as follows:

                                        DECEMBER 31,1997

      1998 .................................$2,822,600
      1999 ..................................2,864,178
      2000 ..................................2,906,830
      2001 ..................................2,834,342
      2002 ..................................2,704,149
      Thereafter .......................... 11,772,647

      Total                                $25,904,746

Future minimum rental income does not include lease renewals or new leases that
may result after a noncancelable-lease expires.

NOTE 4 - RELATED PARTY TRANSACTIONS

The Advisor has an agreement with the Company to provide advice on investments
and to administer  the day-to-day operations of the Company.  At December 31,
1997, the Advisor owned 22,556 shares of the Company.   Property management
services for  the  Company's  properties are provided by West Coast Realty
Management, Inc. ("WCRM"), an affiliate of the Advisor.

Certain officers and directors of the Company are also officers and directors
of the Advisor and its affiliates.

The following related party transactions are included in the statement of income

     (a)  In accordance with the advisory agreement, syndication fees earned by
     the Advisor totaled $262,833, $82,864 and $150,429 in 1997, 1996 and 1995.

     (b)  Overhead expenses reimbursed to the Advisor totaled $24,000, $12,000
     and $12,000 in 1997, 1996 and 1995.

     (c)  Sales commissions paid in accordance with the selling agreement to ASC
     totaled $429,095 $163,735 and $301,706 for 1997, 1996 and 1995.

     (d)  Fees related to the purchase, sale or refinancing of real estate
     totaled $384,719, $78,177 and $444,795 in 1997, 1996 and 1995 (Note 2).
     These fees are split, in accordance with the advisory agreement, between
     the Advisor and an affiliate.

     (e) Property management fees earned by WCRM totaled $106,576, $103,052 and
     $46,947 in 1997, 1996 and 1995.

     (f) Advisory fees earned by WCRA totaled $186,439 and $74,361 in 1997 and
     1996.  WCRA waived collection of $126,439 and $44,061 in 1997 and 1996
     respectively, of  these  fees  which are included in additional paid-in
     capital.

                                      37

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         NOTES TO FINANCIAL STATEMENTS

NOTE 4 - RELATED PARTY TRANSACTIONS (CONTINUED)

     (f)  The Corporation had related party accounts payable as follows:

                                                 1997                  1996
DECEMBER 31,

   Associated Securities Corp.                  6,152                   396
   West Coast Realty Management                23,192                24,839
   West Coast Realty Advisors                 157,923                21,050

                                             $187,267               $46,285


NOTE 5 - NOTES PAYABLE

Notes payable are made up of the following:

DECEMBER 31,                                               1997           1996

8.25% promissory note secured by a Deed of Trust
on the Fresno Property, monthly principal and interest
payments are $5,244 due August 1, 2003 ...............  $ 616,219    $ 628,471

Variable rate promissory note secured by a Deed
of Trust on the OPTO-22 property, interest rate
adjustments are monthly and are based on the 11th
District cost of funds rate plus 3% (7.963% at
December 31, 1997), and may never go below 6.5%
or above 11.0%, monthly principal and interest
payments are $12,723, due October 1, 2003 ............. 1,688,870    1,708,362

8.25% promissory note secured by a Deed of Trust on
the Blockbuster property, interest rate adjusts
to the 5-year Treasury rate plus 350 basis points
on February 1, 1999, monthly principal and interest
payments are $4,934, due February 1, 2004 ..............  556,403      569,132

9.25% promissory note secured by a Deed of Trust
on the Riverside property, monthly principal and
interest payments are $9,988, due November 8, 2004 ..   1,167,149    1,177,055

Variable rate promissory note secured by a Deed of Trust
on the Brea property, interest rate is 9.5% until March 1,
2000 (and each succeeding March 1st) when interest rate
adjusts to the Moody's corporate bond index daily rate
plus 0.125%, monthly principal and interest payments
vary depending upon interest rates and are currently
$8,737, due March 1, 2020 ...............................     ---      981,338

                                   38

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         NOTES TO FINANCIAL STATEMENTS


NOTE 5 - NOTES PAYABLE (CONT.)

DECEMBER 31,                                               1997          1996

9.625% promissory note secured by a Deed of Trust
on the Safeguard property, monthly principal and
interest payments are $24,191, due February 1,
2005 ...............................................   $2,069,004   $2,155,575

8.24% promissory note secured by a Deed of Trust
on the Fremont property, interest rate equaled the 20-year
Treasury rate plus 1.65% at loan closing, monthly principal
and interest payments are currently $18,898, due
August 1, 2015 ....................................     2,090,456    2,140,311

10% promissory note secured by a Deed of Trust on the
Java City property, monthly principal and interest payments
are $3,413, due November 1, 2001......................    329,083      336,272

8% promissory note secured by a Deed of Trust on the
Java City property, monthly principal and interest payments
are $3,126, due June 1, 2018..........................    375,540      382,277

Variable rate promissory note secured by a Deed of Trust on the
Tycom property, interest rate  margin is 1.9% over the 3 month
LIBOR with right of conversion after the first year (7.65% at
December 31, 1997), monthly payments of principal and
interest are $17,469, due June 30, 2007                 2,302,108          ---

                                                      $11,194,832  $10,078,793

The fair value of the notes are approximately $11,127,609 calculated by
discounting the expected future cash outflows on the notes to the present based
on current lending rates which are the approximate industry lending rates on
these type of properties and these locations.

The aggregate annual future maturities at December 31, 1997 are as follows:

      YEAR ENDING                                        DECEMBER 31, 1997

      1998 ..................................              $ 257,341
      1999 ..................................                277,629
      2000 ..................................                300,845
      2001 ..................................                328,143
      2002 ..................................                649,352
      Thereafter ..........................                9,381,522

      Total                                              $11,194,832

                                    39

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         NOTES TO FINANCIAL STATEMENTS

NOTE 6 - DIVIDEND REINVESTMENT PLAN

The Company has established a Dividend Reinvestment Plan (the "Plan") whereby
cash dividends will, upon election of the shareholders, be used to purchase
additional shares of the Company.  The shareholders' participation in the Plan
may be terminated at any time.

NOTE 7 - NET INCOME AND DIVIDENDS PER SHARE

Net Income Per Share was computed  using  the weighted  average  number  of
outstanding shares of 1,839,018, 1,447,366 and 1,117,494 for 1997, 1996 and
1995.

Dividends declared during 1997 were as follows:

                      OUTSTANDING           AMOUNT             TOTAL
RECORD DATE              SHARES            PER UNIT           DIVIDEND

January 1, 1997        1,550,607           $0.0666           $103,270
February 1, 1997       1,671,442            0.0666            111,318
March 1, 1997          1,671,442            0.0666            111,318
April 1, 1997          1,810,916            0.0666            120,606
May 1, 1997            1,815,579            0.0666            120,918
June 1, 1997           1,815,579            0.0666            120,918
July 1, 1997           1,815,579            0.0666            120,918
August 1, 1997         1,974,143            0.0666            131,478
September 1, 1997      1,968,143            0.0666            131,078
October 1, 1997        1,968,143            0.0666            131,078
November 1, 1997       2,147,524            0.0666            143,025
December 1, 1997       2,147,524            0.0666            143,025

TOTAL                                                      $1,488,950


Dividends declared during 1996 were as follows:

                      OUTSTANDING           AMOUNT             TOTAL
RECORD DATE              SHARES            PER UNIT           DIVIDEND

January 1, 1996        1,325,404            0.0600           $  79,524
February 1, 1996       1,371,794            0.0600              82,308
March  1, 1996         1,401,664            0.0600              84,100
April 1, 1996          1,413,736            0.0666              94,155
May 1, 1996            1,445,236            0.0666              96,253
June 1, 1996           1,448,836            0.0666              96,492
July 1, 1996           1,448,836            0.0666              96,492
August 1, 1996         1,448,836            0.0666              96,492
September 1, 1996      1,498,246            0.0666              99,784
October 1, 1996        1,498,246            0.0666              99,784
November 1, 1996       1,500,651            0.0666              99,943
December 1, 1996       1,550,607            0.0666             103,270

TOTAL                                                       $1,128,597

                                   40

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         NOTES TO FINANCIAL STATEMENTS

NOTE 7 - NET INCOME AND DIVIDENDS PER SHARE (CONTINUED)

Dividends declared during 1995 were as follows:

                      OUTSTANDING           AMOUNT             TOTAL
RECORD DATE              SHARES            PER UNIT           DIVIDEND

January 1, 1995          911,986           $0.060            $ 54,719
February 1, 1995         945,136            0.060              56,708
March 1, 1995          1,009,084            0.060              60,545
April 1, 1995          1,069,217            0.060              64,153
May 1, 1995            1,109,374            0.060              66,562
June 1, 1995           1,109,874            0.060              66,592
July 1, 1995           1,116,891            0.060              67,013
August 1, 1995         1,151,911            0.060              69,115
September 1, 1995      1,204,517            0.060              72,271
October 1, 1995        1,225,398            0.060              73,524
November 1, 1995       1,261,859            0.060              75,712
December 1, 1995       1,294,683            0.060              77,681

TOTAL                                                        $804,595


Dividends are paid in the fiscal quarter following the record date.

The Company has followed the practice of making distributions to shareholders in
amounts approximately equal to its cash basis net income.  Since cash flows  are
sheltered from tax  by depreciation and  amortization expense, distributions  to
shareholders are in excess  of net income.   Accordingly, certain  distributions
result in a nontaxable  return of capital.   Distributions per beneficial  share
are reportable by shareholders on their  individual income tax returns as  shown
below:

YEARS ENDED DECEMBER 31,         1997       1996        1995

Taxable ordinary income         $0.385      $0.487     $0.549
Nontaxable return of capital     0.414      0.292       0.171

                                $0.799     $0.779      $0.720


NOTE 8 - TAXES ON INCOME

For the taxable years 1997 and 1996, the Company elected to be treated as a REIT
on the filings of  the 1997 and 1996  tax returns, and will  elect the same  for
1998.

                                        41

<PAGE>

                       WEST COAST REALTY INVESTORS, INC.
                         NOTES TO FINANCIAL STATEMENTS


NOTE 9 - STATEMENT OF CASH FLOWS

The Company had a noncash financing activity  related  to  unpaid  dividends
declared of $-0-, $302,996 and $226,649 for 1997, 1996 and 1995.

Cash paid for interest during the year ended December 31, 1997, 1996 and 1995
was $1,043,192, $857,042, and $569,746.

NOTE 10 - SUBSEQUENT EVENTS

(a) From January 5 to January 16, 1998, a total of $1,907,287 in proceeds from
the sale  of shares in the Company's current offering were released from  an
escrow account, and 191,362 shares were issued to investors.

(b)  On January 15, 1998, the Company acquired an industrial building located
in Sacramento, California for  $2,020,000.  The  acquisition was accomplished
with use of the proceeds from the Company's current offering.


                                    42

<PAGE>


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

          None.


                                    43

<PAGE>

                                  PART  III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

   The Company is  managed by West Coast  Realty Advisors, Inc., ("Advisor"),  a
California corporation.  The Shareholders are entitled to decide certain matters
by a majority vote  of Shares at a  Shareholders' meeting at  which a quorum  is
present, or by a written consent of a majority of the Shares without a  meeting.
The Company's  directors may  also make  certain decisions  without  Shareholder
approval.

   Resumes of the Company's and Advisor's principal officers and directors,  and
a description of the Advisor are set forth in the following paragraphs.

WEST COAST REALTY ADVISORS, INC.

   West Coast Realty Advisors, Inc. (WCRA) is a California corporation formed on
May 10, 1983 for the purpose of structuring  real estate programs and to act  as
general partner  or  Advisor  for  such  programs.   WCRA  is  a  subsidiary  of
Associated Financial Group, Inc.

   The officers and directors of the Company and the Advisor are as follows:

          NAME                    COMPANY                   ADVISOR
 Philip N. Gainsborough       Chairman of the           Chairman of the
                               Board/Director            Board/Director

 W. Thomas Maudlin, Jr.      President/Director        President/Director

    Neal E. Nakagiri           Executive Vice            Executive Vice
                            President/Secretary       President/Secretary

    Michael G. Clark                Vice                   Treasurer
                            President/Treasurer

      George Young                Director                    N/A

     Steve Bridges                Director                    N/A

    James W. Coulter              Director                    N/A



   The biographies for the above individuals are noted below:

                                     44

<PAGE>

   PHILIP  N. GAINSBOROUGH (Born 1938)  is Chairman of  the Board of  Directors,
President and Director of Associated Financial Group, Inc.  He has been, and  he
currently serves as, Chairman of the Board of Directors, President and  Director
of Associated Securities Corp. since its  inception in 1982.   Mr.  Gainsborough
is also currently the Chairman  of the Board of  Directors and Director of  West
Coast Realty Advisors, Inc., and West Coast Realty Management, Inc.  He is  also
Chairman of the  Board of  Directors, a Director  and President   of  Associated
Planners Partnership Services, Inc., and Associated Planners Insurance Services,
Inc.  In addition, from January 1981 to the present, he has served as  President
of Gainsborough Financial Consultants, Inc.,  a financial planning firm  located
in  Los  Angeles,  California.     From  January  1981  to  December  1982,  Mr.
Gainsborough served  as  a  Registered Principal  of  Private  Ledger  Financial
Services, Inc.   From January 1977  to December 1980,  he was  employed by  E.F.
Hutton & Co. as a Registered Representative.  Mr. Gainsborough is a graduate  of
the University of Southern California.

   W. THOMAS MAUDLIN JR. (Born 1936) is  a Director and President of West  Coast
Realty Advisors, Inc., and a Director of West Coast Realty Management, Inc.   He
has been  active  in  the  real  estate area  for  over  33  years,  serving  as
co-developer of high-rise office  buildings and shopping  centers.  Mr.  Maudlin
has structured transactions for syndicators in apartment housing, including sale
leasebacks, all-inclusive trust deeds, buying and restructuring transactions  to
suit a particular buyer,  and as a buyer  acting as a principal.   From 1980  to
present, he has been  involved in the development  of real property in  numerous
parts of Southern California.   Mr. Maudlin is a  graduate of the University  of
Southern California.

     NEAL NAKAGIRI  (Born  1954) serves  as  Executive Vice  President,  General
Counsel, Chief Operating  Officer and Secretary  of Associated Financial  Group,
Inc.  He is Vice President for two subsidiaries, Associated Securities Corp. and
Associated Planners Investment Advisory, Inc.  He joined the "Associated"  group
of companies in March 1985.   He was Vice  President of Compliance with  Morgan,
Olmstead, Kennedy & Gardner from 1984 to 1985.  He was First Vice President  and
Director of Compliance with Jefferies and Co., Inc.  from 1981 to 1984.  He  was
Vice President and Director of Compliance at W & D Securities, Inc. from 1980 to
1983.   He was  an  Investigator with  the  National Association  of  Securities
Dealers, Inc. from 1976 to 1980.   He has a B.A.  degree in Economics from  UCLA
(1976) and a J.D. from Loyola Law School of Los Angeles (1991).  He is a  member
of the California Bar  and the Compliance and  Legal Division of the  Securities
Industry Association.

   MICHAEL G. CLARK (Born 1956) is Senior Vice President/Treasurer of Associated
Financial Group, Inc., Associated Planners Investment Advisory, Inc., Associated
Planners Insurance  Services, Inc.,  Associated Planners  Partnership  Services,
Inc., West Coast Realty Advisors, Inc.,  and Associated Securities Corp.   Prior
to joining Associated Financial  Group in 1986, Mr.  Clark served as  Controller
for Quest Resources, a Los Angeles-based syndicator and operator of  alternative
energy projects from October 1984 to March 1986, and as Assistant Controller for
Valley Cable  T.V. from  March 1982  through September  1984.   In addition,  he
served as an auditor for Arthur  Young & Co. in Los  Angeles, from July 1978  to
March 1982.   Mr. Clark is  a graduate of  the University  of California,  Santa
Barbara and has a Masters of Science degree in Management from California  State
University at Northridge.

                                    45

<PAGE>

   GEORGE YOUNG (Born  1937) Since 1972 has been  president of his own  company,
now named  Internet  Link Corporation.    The firm  specializes  in  integrating
Internet and Intranet  communications into the  productive life of  enterprises.
They host  and  develop  sites on  the  World  Wide Web;  integrate  e-mail  and
interactive data  retrieval applications;  and  provide content  management  and
consulting services.   Internet  Link Corporation  is affiliated  with  Netscape
Communications,  Pacific  Bell  Internet   Services  and  InterNex   Information
Services.  Mr. Young is a graduate of the University of Southern California.

   STEVE BRIDGES (Born 1951) has  served as Executive Vice President of  Pacific
Building Industries, a general building contractor from January 1995 to present.
From July 1986 to January 1995,  Mr. Bridges served as Executive Vice  President
of Pathfinder Mortgage, a mortgage brokerage firm, and was responsible for  loan
production and financing of  construction loans.  From  July 1984 to July  1986,
Mr. Bridges was the President of  The Muller Company, a real estate  development
company, and was  responsible for the  management of  that company,  developing,
financing, and joint  venture relationships, the  development of 800,000  square
feet of industrial and commercial real estate, and partnership management.   Mr.
Bridges is a graduate of the University of Southern California.

   JAMES  W. COULTER (Born 1938)  has since 1988 been  a principal in Coulter  &
Company, a firm which provides brokerage  services and invests in real  property
with an emphasis in retail, industrial and office properties.  From 1981 to 1988
Mr. Coulter was  a Vice  President of  the investment  division of  Bishop-Hawk,
Inc., a  firm which  specializes in  commercial  real estate.   He  started  the
investment division in Sacramento.  Prior  to 1981, Mr. Coulter was involved  in
real estate investments, property management and  development, and served as  an
officer of a real estate investment  trusts.  Mr. Coulter  is a graduate of  and
has a Masters of Business Administration degree from the University of  Southern
California.

Gainsborough, Maudlin, Clark, Coulter,  Young and Bridges  have served in  their
positions with the Company since inception.  Nakagiri was named Secretary of the
Company in  June 1996,  replacing Mr.  William  T. Haas,  who retired  from  the
Company.

ITEM 11.  EXECUTIVE COMPENSATION

   During 1997,  the Registrant paid  no direct or indirect compensation to  the
Company's officers.

   The Registrant has no annuity, pension or retirement plans, or existing  plan
or arrangement pursuant to which compensatory  payments are proposed to be  made
in the future to directors or officers.

   The Company's Independent  Directors are entitled to  receive up to $500  for
each meeting that they attend or participate  in via telephone.  During 1997,  a
total of $2,000 was paid.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
          AND MANAGEMENT

     As disclosed  in the  Prospectus,  the Advisor  made  a commitment  to  the
Company to purchase an amount of Shares, at the public offering price of $10 per
Share, which in  aggregate is equal  to the lesser  of 10% of  the adjusted  net
worth of the Company, upon completion of the initial offering, or $200,000.   As
of December 31,  1997, the Advisor  had purchased $225,561  worth of shares,  or
approximately 1.05% of the adjusted net worth.

                                   46

<PAGE>

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The Registrant was  organized in October  1989 as  a Delaware  corporation.
Its Advisor is West Coast Realty Advisors, Inc.  Certain officers and  directors
of the Registrant are officers  and directors of the  Advisor as well (See  Item
10--  "Directors  and  Executive  Officers  of  the  Registrant").  The  Advisor
purchased 1,075 shares of common  stock for a net  amount of $10,000 in  October
1989 upon  formation of  the Company  and subsequently  purchased an  additional
21,481 shares of common stock for a net amount of $215,561.

     Other  transactions  involving  the   Registrant,  the  Advisor,  and   its
affiliates are summarized below:

     1.   As compensation for its services rendered in evaluation and  selection
of properties to the Company, the Advisor or Descolin Incorporated ("Descolin"),
an affiliate of the Advisor, are entitled  to an acquisition fee that shall  not
exceed 6% of  gross proceeds  allocated towards  the purchase  of any  property.
Descolin is wholly-owned  by W. Thomas  Maudlin, Jr.,  the Company's  president.
During the year  ended December 31,  1997, the Company  paid the Advisor  and/or
Descolin $384,719 related to the purchase of real estate.

     2.   The majority  of  the common  stock  was sold  by  representatives  of
Associated Securities Corp. ("ASC"),  an affiliate of the  Advisor.  During  the
year ended December  31, 1997, commissions  paid to ASC  for the  sale of  these
shares totaled $429,095 and  are included in additional  paid-in capital on  the
Company's balance sheet.

     3.   For property  management  services,  the Advisor  engaged  West  Coast
Realty Management, Inc. ("WCRM"), an affiliate of the Advisor.  During the  year
ended December 31, 1997,  the Company incurred  $106,576 of property  management
fees.

                                      47

<PAGE>

                                   PART IV


ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
          AND REPORTS ON FORM 8-K

(A)  1.   FINANCIAL STATEMENTS

     The following financial statements of West Coast Realty Investors, Inc.
are included in PART II, ITEM 8:

                                                            Page
      Report of Independent Certified Public Accountants ...............27
      Balance Sheets -- December 31, 1997 and 1996..................... 28
      Statements of Income for the years ended
            December 31, 1997, 1996 and 1995............................29
      Statements of Stockholders' Equity for the years ended
            December 31, 1997, 1996 and 1995............................30
      Statements of Cash Flows for the years ended
            December 31, 1997, 1996 and 1995.........................31-32
      Summary of Accounting Policies ................................33-34
      Notes to Financial Statements..................................35-42

      2. FINANCIAL STATEMENT SCHEDULES

      Schedule III      --   Real Estate and Accumulated Depreciation ..49-50
      Schedule IV --   Mortgage Loans on Real Estate .................. 51-52

      All other schedules have been omitted because they are either not
      required, not applicable, or the information has been otherwise supplied.

(B)   REPORTS ON FORM 8-K

      None.

(C)   EXHIBITS

      None.

                                      48

<PAGE>
<TABLE>

SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION      DECEMBER 31, 1997
INFORMATION REQUIRED BY RULE 12-28 IS AS FOLLOWS:

<CAPTION>
                                                                    Gross Amount at
                                                                          which
                                                               Carried at Close of Period
                            Initial   Cost      Cost                                                                     Life on
                                   Building  Capitalized                                                                  which
                                      &      Subsequent        Building                                               Depreciaton is
                                   Improve-  Acquisition          &                                  Year                Computed
                                              Improve-         Improve-     Total    Accumulated Construction    Date  Building &
Description  Emcumbrances  Land      ments     ments    Land    ments       Cost     Depreciation  Completed   Acquired Improvements

<S>               <C>       <C>       <C>       <C>      <C>      <C>         <C>        <C>          <C>         <C>      <C>
Retail
Building,
Huntington    $ 556,403 $1,005,965   $ 670,245   0  $1,005,965  $ 670,245 $1,676,210  $ 146,295      1991        2/91    31.5
Beach, CA

Retail Bldg.,
Shopping
Center,         616,219    553,648     861,245   0     553,648    861,245  1,414,893    102,138      1993        5/93    39.0
Fresno, CA

Industrial
Building
Huntington    1,688,870  1,132,159   1,367,842   0   1,132,159  1,367,842  2,500,001    150,522      1976        9/93    39.0
Beach, CA

Entertainment
Center
Riverside, CA 1,167,149    768,667   2,886,833   0     768,667  2,886,833  3,655,500    228,234      1994       11/94    39.0

Office
Building
Tustin, CA    2,069,004  1,089,796   3,772,298   0   1,089,796  3,772,298  4,862,094    249,867      1986       5/95     39.0

Light
Industrial
Bldg,         2,090,456  1,228,262   2,519,349   0   1,228,262  2,519,349  3,747,611    137,279      1993       10/95    39.0
Fremont, CA

Light
Industrial
Bldg.
Sacramento, CA  329,083    489,182     609,397   0     489,182    609,397  1,098,579     21,493      1988       8/96     39.0

Light
Industrial
Bldg.
Sacramento, CA  375,540    325,024     404,896   0     325,024    404,896    729,920     14,280      1988       8/96     39.0

Light
Industrial    2,302,108  1,570,000   3,337,440   0   1,570,000  3,337,440  4,907,440     88,538      1978       1/97     39.0
Bldg.
Irvine, CA

Restaurant
Facility            ---    586,000   1,390,484   0     586,000  1,390,484  1,976,484      4,427      1997       10/97    39.0
Roseville, CA

Light
Industrial          ---    700,447   1,196,502   0     700,447  1,196,502  1,896,949        ---      1988       12/97    39.0
Bldg.
Corona, CA

TOTAL      $ 11,194,832 $9,449,150 $19,016,532   0 $9,449,150 $19,016,532 $28,465,682 $1,143,073


</TABLE>

                                             49

<PAGE>


SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION (CONTINUED)

DECEMBER 31, 1997

A reconciliation of the total cost for the years ending
December 31, 1995, 1996 and 1997 follows:

Balance at January 1, 1995 .......    $  11,457,561
1995 Additions ..................         8,647,091
Balance at December 31, 1995 .....       20,104,652
1996 Additions ..................         1,828,500
Balance at December 31, 1996             21,933,152
1997 Additions                            8,780,873
1997 Disposition                        (2,248,343)
Balance at December 31, 1997 .....      $28,465,682



A reconciliation of accumulated depreciation for the years ending
December 31, 1995, 1996 and 1997 follows:

Balance at December 31, 1994 ......    $    200,582
1995 Depreciation ................          253,905
Balance at December 31, 1995 ......         454,487
1996 Depreciation ................          360,461
Balance at December 31, 1996                814,948
1997 Depreciation                           463,513
1997 Disposition                          (135,388)
Balance at December 31, 1997 ......    $  1,143,073

                                          50

<PAGE>
<TABLE>

SCHEDULE IV - MORTGAGE LOANS ON REAL ESTATE                  DECEMBER 31, 1997
INFORMATION REQUIRED BY RULE 12-29 IS AS FOLLOWS:

<CAPTION>

                           Final       Periodic                                   Delinquent
                Interest Maturity      Payment      Prior     Face     Carrying   Principal/
Description       Rate     Date         Terms       Liens    Amount     Amount     Interest
<S>               <C>       <C>          <C>         <C>       <C>         <C>        <C>
Retail Building                     Equal Monthly
Fresno, CA       8.25%   8/1/2003    Payments to     None    $665,000    $616,219    None
First Deed of Trust                    Maturity
                                   Balloon Payment
                                      due 8/2003

Industrial Building                Variable Monthly
Huntington      Variable 10/1/2003   Payments to     None  $1,750,000  $1,688,870    None
Beach, California                      Maturity
First Deed of Trust                Balloon Payment
                                     due 10/2003

Retail Building                    Variable Monthly
Huntington      Variable 2/1/2004    Payments to     None    $600,000    $556,403    None
Beach, California                  Maturity; 25 yr
First Deed of Trust                 Amortization;
                                   Balloon Payment
                                      due 2/2004

Entertainment Center                Equal Monthly
Riverside, CA    9.25%   11/8/2004    Payments;      None  $1,200,000  $1,167,149    None
First Deed of Trust                   Amortized
                                     over 28 yrs,
                                      3 months;
                                   Balloon Payment
                                     due 11/2004

Office Building                      Fixed Rate;
Tustin, CA       9.625%  2/2/2005      15 year       None  $2,300,000  $2,069,004    None
First Deed of Trust                 Amortization;
                                   Balloon Payment
                                      due 2/2005

Light Industrial Bldg.              Fixed Monthly
Fremont, CA      8.240%  8/1/2015      Payments      None  $2,200,000  $2,090,456    None
First Deed of Trust                    20 years
                                     Amortization

Light Industrial Bldg.               Fixed Monthly
Sacramento, CA  10.000%  11/1/2001     Payments      None    $350,000    $329,083    None
First Deed of Trust                    25 years
                                     Amortization

Light Industrial Bldg.               Fixed Monthly
Sacramento, CA   8.000%  6/1/2018      Payments      None    $405,000    $375,540    None
First Deed of Trust                    25 years
                                     Amortization

Light Industrial                  Variable Monthly
Bldg.           Variable 7/1/2007    Payments to     None   2,312,500   2,302,108    None
Irvine, CA                        Maturity; 25 year
First Deed of Trust                  Amortization

                                                           11,782,500  11,194,832


</TABLE>

                                        51

<PAGE>

A reconciliation or mortgage loans payable for the years
ending December 31, 1995, 1996, and 1997 follows:

Balance at January 1, 1995                    $ 5,161,355
1995 Additions      . .                         4,469,647
1995 Paydowns ........................           (91,822)
Balance at December 31, 1995 .........          9,539,180
1996 Additions      . .                           755,000
1996 Paydowns ........................          (215,387)
Balance at December 31, 1996  .                10,078,793
1997 Additions                                  2,312,500
1997 Paydowns        ..                       (1,196,461)
Balance at December 31, 1997 .........        $11,194,832


                                      52

<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of the 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.


                       WEST COAST REALTY INVESTORS, INC.



                              W. THOMAS MAUDLIN JR.
                 (Director, President and Principal Executive Officer)



                              PHILIP N. GAINSBOROUGH
                       (Chairman of the Board of Directors)


                              MICHAEL G. CLARK
              (Vice President/Treasurer, Controller, and Principal
                              Financial Officer)


                              GEORGE YOUNG
                               (Director)

  Date: March 13, 1998


                                       53