<PAGE>

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

                                   FORM 10-Q

(Mark One)

 X  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
--- SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]

For the quarterly period ended September 30, 1996

                                       OR

    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
--- SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

Commission file number 33-20018



                   PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

                                 in respect of


                   PRUCO LIFE OF NEW JERSEY VARIABLE CONTRACT
                             REAL PROPERTY ACCOUNT
                ------------------------------------------------------
                (Exact name of Registrant as specified in its charter)


         New Jersey                                       22-2426091
-------------------------------                ---------------------------------
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)



              213 Washington Street, Newark, New Jersey 07102-2992
              ----------------------------------------------------
              (Address of principal executive offices) (Zip Code)

                               (800) 445-4571
              ----------------------------------------------------
              (Registrant's Telephone Number, including area code)


    Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.         YES  X   NO
                                                      ---     ---
<PAGE>
 
        PRUCO LIFE OF NEW JERSEY VARIABLE CONTRACT REAL PROPERTY ACCOUNT
                                  (Registrant)

                                     INDEX
                                                                            PAGE
                                                                            ----
PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

         A.   PRUCO LIFE OF NEW JERSEY VARIABLE CONTRACT REAL PROPERTY 
              ACCOUNT

              Statements of Net Assets - September 30, 1996 (Unaudited) 
              and December 31, 1995                                            3

              Statements of Operations (Unaudited) -Nine and Three Months
              Ended September 30, 1996 and 1995                                3

              Statements of Changes in Net Assets -Nine Months Ended
              September 30, 1996 (Unaudited) and Year Ended 
              December 31, 1995                                                4

              Notes to the Financial Statements (Unaudited)                    5

         B.   THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP

              Statements of Assets and Liabilities - September 30, 1996
              (Unaudited) and December 31, 1995                                7

              Statements of Operations (Unaudited) -Nine and Three Months
              Ended September 30, 1996 and 1995                                8

              Statements of Changes in Net Assets -Nine Months Ended
              September 30, 1996 (Unaudited) and Year Ended 
              December 31, 1995                                                9

              Statements of Cash Flows (Unaudited) -Nine Months Ended
              September 30, 1996 and 1995                                     10

              Schedule of Investments - September 30, 1996 (Unaudited)
              and December 31, 1995                                           11

              Notes to the Financial Statements (Unaudited)                   14

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                            17

PART II - OTHER INFORMATION

Item 1.       Legal Proceedings                                               20

Item 2.       Changes in Securities                                           20

Item 3.       Defaults Upon Senior Securities                                 20

Item 4.       Submission of Matters to a Vote of Security Holders             20

Item 5.       Other Information                                               20

Item 6.       Exhibits and Reports on Form 8-K                                20

PART III - SIGNATURES                                                         21


                                       2

<PAGE>

                            FINANCIAL STATEMENTS OF
        PRUCO LIFE OF NEW JERSEY VARIABLE CONTRACT REAL PROPERTY ACCOUNT

                            STATEMENTS OF NET ASSETS

<TABLE>
<CAPTION>
                                                                  SEPTEMBER 30, 1996
                                                                      (UNAUDITED)      DECEMBER 31, 1995
                                                                  ------------------   -----------------
<S>                                                               <C>                  <C>
Investment in shares of The Prudential
  Variable Contract Real Property Partnership                     $        7,764,194   $       7,455,048
                                                                  ------------------   -----------------
                                                                  ------------------   -----------------
NET ASSETS, representing:
Equity of Contract Owners                                         $        6,514,145   $       6,563,711
Equity of Pruco Life Insurance Company of
  New Jersey                                                               1,250,049             891,337
                                                                  ------------------   -----------------

                                                                  $        7,764,194   $       7,455,048
                                                                  ------------------   -----------------
                                                                  ------------------   -----------------

Share Value at end of Period                                      $            16.41   $           15.75
                                                                  ------------------   -----------------
                                                                  ------------------   -----------------
</TABLE>

                               STATEMENTS OF OPERATIONS
                                     (UNAUDITED)

<TABLE>
<CAPTION>
                                                                 NINE MONTHS                      THREE MONTHS
                                                                    ENDED                             ENDED
                                                                 SEPTEMBER 30,                     SEPTEMBER 30,
                                                        ----------------------------       ---------------------------
                                                             1996           1995                1996           1995
                                                        -------------  -------------       ------------   ------------
<S>                                                     <C>            <C>                 <C>            <C>

INVESTMENT INCOME:

Net Investment Income from Partnership Operations       $     457,396  $     415,270       $     149,313  $     152,422

EXPENSES:
Asset Based Charges to Contract Owners (Note 3)                29,223         27,903               9,767          9,617
                                                        -------------  -------------       -------------  -------------

NET INVESTMENT INCOME                                         428,173        387,367             139,546        142,805
                                                        -------------  -------------       -------------  -------------

NET UNREALIZED (LOSS)/GAIN ON INVESTMENTS IN PARTNERSHIP     (129,221)        90,180             (65,582)       108,888
NET REALIZED LOSS ON SALE OF INVESTMENTS IN PARTNERSHIP       (19,029)             0                (528)             0
                                                        -------------  -------------       -------------  -------------

NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS                               $     279,923  $     477,547       $      73,436  $     251,693
                                                        -------------  -------------       -------------  -------------
                                                        -------------  -------------       -------------  -------------
</TABLE>


            SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 5 THROUGH 6.


                                       3
<PAGE>

                            FINANCIAL STATEMENTS OF
        PRUCO LIFE OF NEW JERSEY VARIABLE CONTRACT REAL PROPERTY ACCOUNT

                      STATEMENTS OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
                                              NINE MONTHS
                                                 ENDED
                                          SEPTEMBER 30, 1996       YEAR ENDED
                                              (UNAUDITED)      DECEMBER 31, 1995
                                          -------------------  -----------------
<S>                                       <C>                  <C>              
OPERATIONS:

Net Investment Income                     $           428,173  $         538,224

Net Unrealized (Loss)/Gain on Investments
  in Partnership                                     (129,221)            27,210
Net Realized Loss on Sale of Investments
  in Partnership                                      (19,029)                 0
                                          -------------------  -----------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS                             279,923            565,434
                                          -------------------  -----------------

CAPITAL TRANSACTIONS:

Net (Withdrawals)/Contributions by
  Contract Owners                                    (286,316)            45,403

Net Contributions/(Withdrawals) by Pruco
  Life Insurance Company of New Jersey                315,539             (7,712)
                                          -------------------  -----------------
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL TRANSACTIONS                    29,223             37,691
                                          -------------------  -----------------

TOTAL INCREASE IN NET ASSETS              $           309,146  $         603,125


NET ASSETS:
Beginning of period                       $         7,455,048  $       6,851,923
                                          -------------------  -----------------
End of period                             $         7,764,194  $       7,455,048
                                          -------------------  -----------------
                                          -------------------  -----------------
</TABLE>


            SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 5 THROUGH 6.


                                       4
<PAGE>

                     NOTES TO THE FINANCIAL STATEMENTS OF
      PRUCO LIFE OF NEW JERSEY VARIABLE CONTRACT REAL PROPERTY ACCOUNT
                               SEPTEMBER 30, 1996
                                  (UNAUDITED)


NOTE 1:  GENERAL

Pruco Life of New Jersey Variable Contract Real Property Account (the "Real
Property Account") was established on October 30, 1987 by resolution of the
Board of Directors of Pruco Life Insurance Company of New Jersey ("Pruco Life of
New Jersey"), an indirect wholly-owned subsidiary of The Prudential Insurance
Company of America ("The Prudential"), as a separate investment account pursuant
to New Jersey law.  The assets of the Real Property Account are segregated from
Pruco Life of New Jersey's other assets.  The Real Property Account is used to
fund benefits under certain variable life insurance and variable annuity
contracts issued by Pruco Life of New Jersey.  On April 29, 1988, Pruco Life of
New Jersey  contributed $100,000 to commence operations of the Real Property
Account.

The assets of the Real Property Account are invested in The Prudential Variable
Contract Real Property Partnership (the "Partnership").  The Partnership is a
general partnership organized under New Jersey law on April 29, 1988, through
agreement among The Prudential, Pruco Life Insurance Company, and Pruco Life of
New Jersey, to provide a means for assets allocated to the real property option
under certain variable life insurance and variable annuity contracts issued by
the respective companies to be invested in a commingled pool. On April 29, 1988,
the Real Property Account initially contributed $100,000 to the Partnership.

The Partnership has a policy of investing at least 65% of its assets in direct
ownership interests in income-producing real estate and participating mortgage
loans.

NOTE 2:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         A.   BASIS OF ACCOUNTING

         The financial statements are prepared on a current value basis due to
         the fact that the unit values under Contracts participating in the
         Partnership are determined using the current value basis of
         investments (see General Note to the Partnership financials).  These
         unaudited financial statements reflect all adjustements which are, in
         the opinion of management, necessary to a fair statement of the
         results for the interim period presented.  All such adjustments are of
         a normal recurring nature.

         B.   INVESTMENT IN PARTNERSHIP INTEREST

         The investment in the Partnership is based on the Real Property
         Account's proportionate interest of the Partnership's current value,
         as discussed in Note 1 to the Partnership's financial statements.  At
         September 30, 1996  the Real Property Account's interest in the
         Partnership, based on current value equity was 4.0% or 473,226 shares.

         C.   INCOME RECOGNITION

         The Real Property Account recognizes its proportionate share of the
         Partnership's net investment income on a daily basis, as consistent
         with the Partnership Agreement.  The Net Gain/(Loss) on Investment in
         Partnership reflected on the Statements of Operations represents the
         Real Property Account's proportionate share of the Net Gain/(Loss) on
         Investments recognized by the Partnership.


                                          5

<PAGE>
NOTE 3:  ASSET BASED CHARGES

Mortality risk and expense risk charges and charges for administration are
applied daily against the net assets representing equity of Contract owners
investing in the Real Property Account, at an effective annual rate as shown
below for each of Pruco Life of New Jersey's separate accounts investing in the
Real Property Account:

--------------------------------------------------------------------------------
         Variable Insurance Account                             0.35%
         Variable Appreciable Account                           0.60%
         Single Premium Variable Life Account                   1.25%
         Single Premium Variable Annuity Account                1.25%
--------------------------------------------------------------------------------

NOTE 4:  TAXES

Income and capital gains and losses of the Partnership are attributed, for
federal income tax purposes, to the Partners in the Partnership, including Pruco
Life of New Jersey, in respect of the Real Property Account.  The operations of
the Real Property Account form a part of, and are taxed with, the operations of
Pruco Life of New Jersey.  Under the Internal Revenue Code, all ordinary income
and capital gains allocated to the Contract owners are not taxable to Pruco Life
of New Jersey.  As a result, the net asset values of the Real Property Account
are not affected by federal income taxes on the ordinary income and capital
gains and losses attributable to the Real Property Account.

Note 5: Related Party

Several actions have been brought against Pruco Life of New Jersey, on behalf of
those persons who purchased life insurance policies based on complaints about
sales practices engaged in by The Prudential and Pruco Life of New Jersey and
agents appointed by The Prudential and Pruco Life of New Jersey.  The
Prudential has agreed to indemnify Pruco Life of New Jersey for any and all
losses resulting from such litigation.


                                          6

<PAGE>

          THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP

                     STATEMENTS OF ASSETS AND LIABILITIES



<TABLE>
<CAPTION>
                                                        SEPTEMBER 30, 1996
                                                           (UNAUDITED)           DECEMBER 31, 1995
                                                        ------------------       ------------------
<S>                                                     <C>                      <C>
ASSETS:

Properties at estimated market value
  (cost $173,936,527 and $191,981,608
   respectively) (Note 1)                               $      146,758,519       $      164,695,033
Interest in properties at estimated market value
  (cost $6,133,157 and $6,133,157
   respectively) (Note 1)                                        5,900,000                5,800,000
Cash and cash equivalents                                       26,632,940               14,223,265
Marketable securities                                           20,109,286               10,532,155
Other assets and accounts receivable
  (net of allowance for uncollectible
   amounts of $15,169 and $18,896 respectively)                  1,986,573                1,743,305
                                                        ------------------       ------------------

Total Assets                                            $      201,387,318       $      196,993,758
                                                        ------------------       ------------------
                                                        ------------------       ------------------

LIABILITIES AND PARTNERS' EQUITY:

Obligation under capital lease                          $        3,881,705       $        3,882,421
Accounts payable and accrued expenses                            1,870,578                2,142,614
Due to affiliates (Note 2)                                         684,143                  682,795
Other liabilities                                                  557,009                  664,069
                                                        ------------------       ------------------

Total liabilities                                                6,993,435                7,371,899
                                                        ------------------       ------------------

Partners' Equity                                               194,393,883              189,621,859
                                                        ------------------       ------------------

Total Liabilities and Partners' Equity                  $      201,387,318       $      196,993,758
                                                        ------------------       ------------------
                                                        ------------------       ------------------

Number of shares outstanding at end of period                   11,848,275               12,036,684
                                                        ------------------       ------------------
                                                        ------------------       ------------------

Share Value at end of period                                        $16.41                   $15.75
                                                        ------------------       ------------------
                                                        ------------------       ------------------

</TABLE>


          SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 14 THROUGH 17.


                                      7
<PAGE>

          THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP

                           STATEMENTS OF OPERATIONS
                                 (UNAUDITED)

<TABLE>
<CAPTION>
                                                              NINE MONTHS ENDED            THREE MONTHS ENDED
                                                                SEPTEMBER 30,                 SEPTEMBER 30,
                                                        ----------------------------   ---------------------------
                                                             1996           1995           1996          1995
                                                        -------------  -------------   ------------  -------------
<S>                                                     <C>            <C>             <C>           <C>
INVESTMENT INCOME:

Rent from properties                                    $  17,065,460  $  14,031,856      5,351,519  $   5,028,614
Income from interest in properties                            456,115        472,096        128,431        161,647
Interest from short-term investments                        1,469,594      2,157,742        625,313        598,780
                                                        -------------  -------------   ------------  -------------
                                                           18,991,169     16,661,694      6,105,263      5,789,041
                                                        -------------  -------------   ------------  -------------

EXPENSES:

Investment management fee (Note 2)                          1,848,541      1,730,668        625,132        587,984
Real estate tax expense                                     1,749,737      1,429,863        498,357        354,233
Administrative expenses                                     1,462,289      1,246,642        423,564        407,094
Operating expenses                                          2,053,641      1,276,795        703,785        444,876
Interest expense                                              372,344        345,434        117,089        115,145
                                                        -------------  -------------   ------------  -------------
                                                            7,486,552      6,029,402      2,367,927      1,909,332
                                                        -------------  -------------   ------------  -------------
NET INVESTMENT INCOME                                      11,504,617     10,632,292      3,737,336      3,879,709
                                                        -------------  -------------   ------------  -------------
REALIZED AND UNREALIZED LOSS/GAIN ON
    INVESTMENTS:
  Net proceeds from real estate investment sold            14,697,789              0              0              0
  Less cost of real estate investment sold                 18,638,949              0         12,195              0
  Realization of prior quarters' unrealized loss on
    real estate investments sold                           (3,462,522)             0              0              0
                                                        -------------  -------------   ------------  -------------
NET LOSS REALIZED ON REAL ESTATE
    INVESTMENTS SOLD                                         (478,638)             0        (12,195)             0

NET UNREALIZED LOSS ON INVESTMENTS                         (3,253,955)     2,265,212     (1,717,062)     2,766,811
                                                        -------------  -------------   ------------  -------------

NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS                               $   7,772,024  $  12,897,504      2,008,079  $   6,646,520
                                                        -------------  -------------   ------------  -------------
                                                        -------------  -------------   ------------  -------------
</TABLE>


          SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 14 THROUGH 17.


                                       8

<PAGE>

          THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP

                     STATEMENTS OF CHANGES IN NET ASSETS


                                       NINE MONTHS
                                          ENDED
                                    SEPTEMBER 30, 1996          YEAR ENDED
                                        (UNAUDITED)         DECEMBER 31, 1995
                                    ------------------      ------------------
OPERATIONS:

Net Investment Income               $       11,504,617      $       14,720,271
Net Realized and Unrealized
  Gain/(Loss) on Investments                (3,732,593)                661,623
                                    ------------------      ------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS                    7,772,024              15,381,894
                                    ------------------      ------------------

CAPITAL TRANSACTIONS:

Withdrawals by partners
  (188,409 and 204,350,
    shares respectively)                    (3,000,000)             (3,000,000)
                                    ------------------      ------------------
NET DECREASE IN NET ASSETS RESULTING
FROM CAPITAL TRANSACTIONS                   (3,000,000)             (3,000,000)
                                    ------------------      ------------------

TOTAL INCREASE IN NET ASSETS                 4,772,024              12,381,894

NET ASSETS:

  Beginning of period                      189,621,859             177,239,965
                                    ------------------      ------------------
  End of period                     $      194,393,883      $      189,621,859
                                    ------------------      ------------------
                                    ------------------      ------------------


          SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 14 THROUGH 17.


                                       9
<PAGE>

          THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP

                           STATEMENTS OF CASH FLOWS
                                 (UNAUDITED)

<TABLE>
<CAPTION>
                                                                   NINE MONTHS          NINE MONTHS
                                                                      ENDED                ENDED
                                                                SEPTEMBER 30, 1996   SEPTEMBER 30, 1995
                                                                ------------------   ------------------
<S>                                                             <C>                  <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net increase in net assets resulting from operations            $        7,772,024   $       12,897,504
Adjustments to reconcile net increase in net assets
  resulting from operations to net cash from
  operating activities:
    Net realized and unrealized loss (gain) on investments               3,732,593           (2,265,212)
    Changes in assets and liabilities:
      (Increase) Decrease in other assets
         and accounts receivable                                          (243,269)             843,917
      Decrease in obligation under capital lease                              (716)              (5,947)
      (Decrease) Increase in accounts payable
         and accrued expenses                                             (272,036)             483,498
      Decrease in due to affiliates                                          1,348               21,170
      (Decrease) Increase in other liabilities                            (107,060)               8,335
                                                                ------------------   ------------------
Net cash from operating activities                                      10,882,884           11,983,265
                                                                ------------------   ------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Net proceeds from real estate investments sold                        14,697,789                    0
  Acquisition of property                                                        0          (15,758,699)
  Capital improvements on real estate owned                               (593,866)            (562,085)
  Capital improvements on interest in properties                                 0              (24,415)
                                                                ------------------   ------------------

  Net cash from investing activities                                    14,103,923          (16,345,199)
                                                                ------------------   ------------------

 CASH FLOWS FROM FINANCING ACTIVITIES:

Withdrawals                                                             (3,000,000)          (3,000,000)
(Purchase) Sale in marketable securities                                (9,577,131)           6,802,196
                                                                ------------------   ------------------

  Net cash from financing activities                                   (12,577,131)           3,802,196
                                                                ------------------   ------------------

Net increase in cash and cash equivalents                               12,409,676             (559,738)

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD                         14,223,265           33,093,237
                                                                ------------------   ------------------

CASH AND CASH EQUIVALENTS - END OF PERIOD                       $       26,632,941   $       32,533,499
                                                                ------------------   ------------------
                                                                ------------------   ------------------

SUPPLEMENTAL INFORMATION:
  Interest paid                                                 $          376,450   $          376,450
                                                                ------------------   ------------------
                                                                ------------------   ------------------
</TABLE>


          SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 14 THROUGH 17.


                                      10
<PAGE>

          THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP

                            SCHEDULE OF INVESTMENTS

<TABLE>
<CAPTION>
                                                             SEPTEMBER 30, 1996
                                                                (UNAUDITED)                        DECEMBER 31, 1995
-----------------------------------------------------------------------------------------------------------------------------
INVESTMENT IN PROPERTIES (PERCENT OF NET ASSETS)                               75.5%                                   86.9%
                                                                           Estimated                               Estimated
                                                                              Market                                  Market
Location                Description                         Cost               Value                Cost               Value
-----------------------------------------------------------------------------------------------------------------------------
<S>                     <C>                       <C>                 <C>                   <C>               <C>
Azusa, CA               Warehouse                 $            0      $            0      $   18,546,247      $   15,083,725
Lisle, IL               Office Building               17,524,421          10,400,000          17,524,421          11,600,000
Atlanta, GA             Garden Apartments             15,388,924          13,400,000          15,371,495          12,600,000
Pomona, CA (a)          Warehouse                     23,416,959          17,712,001          23,205,172          17,127,292
Roswell, GA             Retail Shopping Center        31,720,254          29,035,206          31,688,912          32,055,216
Morristown, NJ          Office Building               18,783,206          10,130,970          18,664,969           9,572,688
Bolingbrook, IL         Warehouse                      8,948,030           7,100,000           8,948,028           7,400,000
Farmington Hills, MI    Garden Apartments             13,617,552          14,522,602          13,594,950          14,200,000
Flint, MI               Office Building                7,714,484           5,807,501           7,616,842           6,539,368
Raleigh, NC             Garden Apartments             15,758,699          16,850,000          15,758,699          17,200,000
Nashville, TN           Office Building                8,428,890           8,800,239           8,431,680           8,686,551
Oakbrook Terrace, IL    Office Complex                12,635,106          13,000,000          12,630,193          12,630,193
                                                  --------------      --------------      --------------      --------------
                                                  $  173,936,527      $  146,758,519      $  191,981,608      $  164,695,033
                                                  --------------      --------------      --------------      --------------
                                                  --------------      --------------      --------------      --------------
</TABLE>
(a) Includes land under capital lease of $3,412,636 representing the present
value of minimum future lease payments at the inception of the lease.

<TABLE>
<CAPTION>
INVESTMENT IN INTEREST IN PROPERTIES (PERCENT OF NET ASSETS)                    3.0%                                    3.1%
                                                                           Estimated                               Estimated
                                                                              Market                                  Market
Location                Description                         Cost               Value                Cost               Value
-----------------------------------------------------------------------------------------------------------------------------
<S>                     <C>                       <C>                 <C>                 <C>                 <C>
Jacksonville, FL        Warehouse/Distribution         1,317,453           1,250,000           1,317,453           1,225,000
Jacksonville, FL        Warehouse/Distribution         1,002,448           1,000,000           1,002,448             975,000
Jacksonville, FL        Warehouse/Distribution         1,442,894           1,300,000           1,442,894           1,300,000
Jacksonville, FL        Warehouse/Distribution         2,370,362           2,350,000           2,370,362           2,300,000
                                                  --------------      --------------      --------------      --------------
                                                  $    6,133,157      $    5,900,000      $    6,133,157      $    5,800,000
                                                  --------------      --------------      --------------      --------------
                                                  --------------      --------------      --------------      --------------

<CAPTION>

CASH AND CASH EQUIVALENTS (PERCENT OF NET ASSETS)                              13.7%                                    7.5%
(see pages 12 and 13 for detail)                                           Estimated                               Estimated
                                                            Face              Market                Face              Market
Description                                               Amount               Value              Amount               Value
-----------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>                 <C>                 <C>                 <C>
Commercial Paper and Cash                         $   26,727,579      $   26,632,940      $   14,282,697      $   14,223,265
                                                  --------------      --------------      --------------      --------------
                                                  --------------      --------------      --------------      --------------

<CAPTION>

MARKETABLE SECURITIES (PERCENT OF NET ASSETS)                                  10.3%                                    5.6%
(see pages 12 and 13 for detail)                                           Estimated                               Estimated
                                                            Face              Market                Face              Market
Description                                               Amount               Value              Amount               Value
-----------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>                 <C>                 <C>                 <C>
Marketable Securities                             $   19,970,000      $   20,109,286      $   10,480,000      $   10,532,155
                                                  --------------      --------------      --------------      --------------
                                                  --------------      --------------      --------------      --------------

OTHER ASSETS                                                                   (2.5%)                                  (3.1%)
(net of liabilities)                                                  $   (5,006,862)                         $   (5,628,594)
                                                                      --------------                          --------------
                                                                      --------------                          --------------

TOTAL NET ASSETS                                                      $  194,393,883                          $  189,621,859
                                                                      --------------                          --------------
                                                                      --------------                          --------------
</TABLE>


          SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 14 THROUGH 17.


                                      11
<PAGE>

          THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP

                           SCHEDULE OF INVESTMENTS

<TABLE>
<CAPTION>
                                                                          SEPTEMBER 30, 1996
                                                                              (UNAUDITED)
                                                                 ----------------------------------
CASH AND CASH EQUIVALENTS (PERCENT OF NET ASSETS)
                                                                                              13.7%
                                                                                          Estimated
                                                                           Face              Market
DESCRIPTION                                                              Amount               Value
---------------------------------------------------------------------------------------------------
<S>                                                             <C>                 <C>
Commercial Paper (with stated rate and maturity date)

Citicorp, 5.95%, October 1, 1996                                $       272,000     $       271,955
US West Communications, 5.32%, October 4, 1996                        2,130,000           2,111,114
Countrywide Home Loan, 5.40%, October 7, 1996                         2,200,000           2,190,760
General Electric Capital Corp, 5.32%, October 9, 1996                 2,200,000           2,195,448
IBM Credit Corp. 5.31%, October 9, 1996                               2,200,000           2,195,457
Coporate Asset Funding, 5.27%, October 10, 1996                       1,430,000           1,419,324
Household Finance Corp, 5.32%, October 10, 1996                       2,270,000           2,264,968
Riverwoods Funding Corp, 5.32%, October 10, 1996                      1,700,000           1,696,232
Allied-Signal Inc, 5.32%, October 11, 1996                            2,200,000           2,194,798
Cargill Inc, 5.37%, October 16, 1996                                  2,000,000           2,000,000
Bell Atlantic Network Funding Corp, 5.39%, October 21, 1996           2,200,000           2,200,000
Aristar Inc, 5.38%, November 11,1996                                    559,000             555,826
Credit Suisse First Boston Inc, 5.33%, November 4, 1996               2,270,000           2,256,557
Duracell Inc, 5.35%, November 7, 1996                                   715,000             710,537
First Data Corp, 5.43%, December 16, 1996                             1,000,000             988,385
                                                                ---------------     ---------------

TOTAL COMMERCIAL PAPER                                               25,346,000          25,251,361

TOTAL CASH                                                            1,381,579           1,381,579
                                                                ---------------     ---------------

TOTAL CASH AND CASH EQUIVALENTS                                 $    26,727,579     $    26,632,940
                                                                ---------------     ---------------
                                                                ---------------     ---------------
<CAPTION>

MARKETABLE SECURITIES (PERCENT OF NET ASSETS)                                                 10.3%
                                                                                          Estimated
                                                                           Face              Market
DESCRIPTION                                                              Amount               Value
---------------------------------------------------------------------------------------------------
<S>                                                             <C>                 <C>
Commercial Paper (with stated rate and maturity date)

General Motors Acceptance Corp, 5.76%, March 18, 1997                 1,200,000           1,201,344
Sears Discover Credit Corp, 7.81%, March 18, 1997                     1,150,000           1,185,255
Ford Motor Credit, 6.03%, May 5, 1997                                 1,400,000           1,405,337
Ford Motor Credit, 6.03%, May 5, 1997                                   350,000             354,159
Ford Motor Credit, 9.15%, May 5, 1997                                   500,000             515,010
Key Bank NA, 5.26%, May 14, 1997                                        900,000             899,130
Associates Corp of North America, 7.05%, June 30, 1997                  600,000             621,099
Bank One Columbus, 5.26%, July 1, 1997                                1,110,000           1,108,812
Associates Corp of North America, 5.88%, August 15, 1997              1,230,000           1,230,744
Key Bank of New York, 5.33%, September 4, 1997                        1,300,000           1,298,933
AVCO Financial ServicesInc.,7.50%,  November 11, 1996                   850,000             858,490
PEPSICO Inc.,7.00%, November 15, 1996                                   500,000             508,358
American Express Centurion Bank, 5.52%, November 22, 1996             1,880,000           1,880,000
Caterpillar Financial Services, 5.72%, November 29, 1996              1,200,000           1,201,560
General Motors Acceptance Corp., 7.75% ,December 10, 1996               850,000             872,657
Chrysler Financial Copr., 5.16%, December 17, 1996                    1,000,000             996,300
PNC Bank, 5.39%, January 6, 1997                                      2,200,000           2,206,564
Sears Roebuck Acceptance Corp, 7.48%, February 19, 1997                 100,000             102,187
Sears Roebuck Acceptance Corp,7.72%, February 27, 1997                  800,000             817,318
Dean Wiitter Discover & Co., 5.57%, March 6, 1997                       500,000             500,387
Associates Corp of North America, 4.48%, October 15, 1996               350,000             345,642
                                                                ---------------     ---------------

Total Commercial Paper                                          $    19,970,000     $    20,109,286
                                                                ---------------     ---------------
                                                                ---------------     ---------------
</TABLE>


          SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 14 THROUGH 17.


                                      12
<PAGE>

          THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP

                           SCHEDULE OF INVESTMENTS


<TABLE>
<CAPTION>
                                                                          DECEMBER 31, 1995
                                                                 ----------------------------------
CASH AND CASH EQUIVALENTS (PERCENT OF NET ASSETS)                                              7.5%
                                                                                          Estimated
                                                                           Face              Market
DESCRIPTION                                                              Amount               Value
---------------------------------------------------------------------------------------------------
<S>                                                              <C>                 <C>
Commercial Paper (with stated rate and maturity date)

Morgan Stanley Group, Inc., 6.10%, January 2, 1996               $    1,146,000      $    1,146,000
Engelhard Corp., 6.25%, January 3, 1996                               1,038,000           1,038,000
Finova Capital Corp., 5.95%, January 4, 1996                            800,000             792,198
Philip Morris Companies Inc., 5.80%, January 5, 1996                    505,000             504,430
Gannett Co. Inc., 5.85%, January 9, 1996                              1,700,000           1,696,409
Hanson Finance, 5.80%, January 12, 1996                                 354,000             352,175

Riverwoods Funding Corp., 5.78%, January 12, 1996                     1,189,000           1,183,273
Finova Capital Corp., 5.97%, January 16, 1996                           780,000             771,980
Smith Barney Inc., 5.79%, January 18, 1996                            1,628,000           1,618,836
Fleet Financial Group, 5.75%, January 30, 1996                        1,700,000           1,689,139
Countrywide Funding Corp., 5.82%, February 14, 1996                   1,500,000           1,488,128
                                                                 --------------      --------------

TOTAL COMMERCIAL PAPER                                               12,340,000          12,280,568


TOTAL CASH                                                            1,942,697           1,942,697
                                                                 --------------      --------------

TOTAL CASH AND CASH EQUIVALENTS                                  $   14,282,697      $   14,223,265
                                                                 --------------      --------------
                                                                 --------------      --------------
<CAPTION>

MARKETABLE SECURITIES (PERCENT OF NET ASSETS)                                                  5.6%
                                                                                          Estimated
                                                                           Face              Market
DESCRIPTION                                                              Amount               Value
---------------------------------------------------------------------------------------------------
<S>                                                              <C>                 <C>
Commercial Paper (with stated rate and maturity date)

Associates Corp. of North America, 8.75%, February 1, 1996       $      410,000      $      416,810
General Motors Acceptance Corp., 8.75%, February 1, 1996                650,000             658,860
General Motors Acceptance Corp., 8.95%, February 5, 1996                350,000             356,370
General Motors Acceptance Corp., 4.75%, February 14, 1996               430,000             426,212
General Motors Acceptance Corp., 6.01%, February 22, 1996               240,000             240,057
Household Finance Corp., 5.75%, April 19, 1996                        2,000,000           1,996,520
Ford Motor Credit Corp., 6.24%, April 22, 1996                          500,000             500,658
Society National Bank Cleveland, 6.00%, April 25, 1996                  150,000             149,295
International Lease Finance Corp., 5.00%, May 28, 1996                1,000,000             992,120
Transamerica Financial Corp., 8.55%, June 15, 1996                      400,000             409,284
John Deere Capital Corp., 6.16%, July 22, 1996                        1,000,000           1,002,267
Sears Roebuck Acceptance Corp., 8.55%, August 1, 1996                 1,000,000           1,039,335
Key Bank of New York, N.A., 5.43%, September 6, 1996                  1,000,000             999,210
Bank One Columbus, 5.56%, September 12, 1996                          1,000,000             999,297
Associates Corp. of North America, 4.48%, October 15, 1996              350,000             345,860
                                                                 --------------      --------------

Total Commercial Paper                                           $   10,480,000      $   10,532,155
                                                                 --------------      --------------
                                                                 --------------      --------------
</TABLE>


              SEE NOTES TO FINANCIAL STATEMENTS ON PAGES 14 THROUGH 17.


                                          13
<PAGE>
                         NOTES TO FINANCIAL STATEMENTS OF
              THE PRUDENTIAL VARIABLE CONTRACT REAL PROPERTY PARTNERSHIP
                                  SEPTEMBER 30, 1996
                                     (UNAUDITED)

    GENERAL

    On April 29, 1988, The Prudential Variable Contract Real Property
    Partnership (the "Partnership"), a general partnership organized under New
    Jersey law, was formed through an agreement among The Prudential Insurance
    Company of America ("The Prudential"), Pruco Life Insurance Company ("Pruco
    Life"), and Pruco Life Insurance Company of New Jersey ("Pruco Life of New
    Jersey").  The Partnership was established as a means by which assets
    allocated to the real estate investment option under certain variable life
    insurance and variable annuity contracts issued by the respective companies
    could be invested in a commingled pool.  The partners in the Partnership
    are The Prudential Insurance Company of America,  Pruco Life and the Pruco
    Life of New Jersey.

    The Partnership has a policy of investing at least 65% of its assets in
    direct ownership interests in income-producing real estate and
    participating mortgage loans.

    The Partnership's investments are valued on a daily basis, consistent with
    the Partnership Agreement.  On each day during which the New York Stock
    Exchange is open for business, the net assets of the Partnership are valued
    using the current value of its investments as described in Note 1B  below,
    plus an estimate of net income from operations reduced by any liabilities
    of the Partnership.

    The periodic adjustments to property values described in Note 1B  below and
    the corrections of previous estimates of net income are made on a
    prospective basis. There can be no assurance that all such adjustments and
    estimates will be made timely.

    Shares of the Partnership are sold to The Prudential Variable Contract Real
    Property Account, the Pruco Life Variable Contract Real Property Account,
    and the Pruco Life of New Jersey Variable Contract Real Property Account,
    (the "Real Property Accounts") at the current share value of the
    Partnership's net assets.  Share value is calculated by dividing the
    current value of net assets of the Partnership as determined below by the
    number of shares outstanding.  A Contract owner participates in the
    Partnership through interests in the Real Property Accounts.

NOTE 1:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

              A:   General - The financial statements included herein have been
                        prepared in accordance with generally accepted
                        accounting principles for interim financial
                        information.  Accordingly, they do not include all of
                        the information and footnotes required by generally
                        accepted accounting principles for complete financial
                        statements. In the opinion of management, all
                        adjustments (consisting of normal recurring
                        adjustments) considered necessary for a fair
                        presentation have been included. Operating results for
                        the nine months ended September 30, 1996 are not
                        necessarily indicative of the results that may be
                        expected for the year ended December 31, 1996. For
                        further information, refer to the financial statements
                        and notes thereto included in each Partner's December
                        31, 1995 Annual Report on Form 10-K.

              B:   Real Estate Owned and Interest in Properties - The
                        Partnership's investments in real estate owned and
                        interest in properties are initially valued at their
                        purchase price.  Thereafter, current values are based
                        upon appraisal reports prepared by independent real
                        estate appraisers (members of the Appraisal Institute
                        or an equivalent organization)  which are ordinarily
                        obtained  on an annual basis.

                        The Chief Appraiser of the Prudential Comptroller's
                        Department Valuation Unit is responsible to assure that
                        the valuation process provides independent and accurate
                        current value estimates. In the interest of maintaining
                        and monitoring the independence and the accuracy of the
                        appraisal process, the Comptroller of The Prudential
                        has appointed a third party firm to act as the
                        Appraisal Management Firm.  The Appraisal Management
                        Firm, among other responsibilities, approves the
                        selection and scheduling of external appraisals;
                        develops a standard package of information to be
                        supplied to the appraisers; reviews and provides
                        comments on all external appraisals and  a sample of
                        internal appraisals; assists in developing policy and
                        procedures and assists in the evaluation of the
                        performance and competency of external appraisers. The
                        property valuations are reviewed quarterly by The


                                       14

<PAGE>

                        Prudential Comptroller's Department Valuation Unit and
                        the Chief Appraiser and adjusted if there have been any
                        significant changes related to the property since the
                        most recent independent appraisal.

                        The purpose of an appraisal is to estimate the market
                        value of a property as of a specific date.  Estimated
                        market value has been defined as the most probable
                        price for which the appraised property will sell in a
                        competitive market under all conditions requisite to
                        fair sale, with the buyer and seller each acting
                        prudently, knowledgeably, and for self interest, and
                        assuming that neither is under undue duress. This
                        estimate of current value generally is a correlation of
                        three approaches, all of which require the exercise of
                        subjective judgement. The three approaches are: (1)
                        current cost of reproducing a property less
                        deterioration and functional and economic obsolescence;
                        (2) discounting of a series of income streams and
                        reversion at a specified yield or by directly
                        capitalizing a single-year income estimate by an
                        appropriate factor; and (3) value indicated by recent
                        sales of comparable properties in the market. In the
                        reconciliation of these three approaches, the one most
                        heavily relied upon is the one most appropriate for the
                        type of property in the market.

              C:   Revenue Recognition - Rent from properties consists of all
                        amounts earned under tenant operating leases including
                        base rent, recoveries of real estate taxes and other
                        expenses and charges for miscellaneous services
                        provided to tenants.  Revenue from leases which provide
                        for scheduled rent increases is recognized as billed.

              D:   Cash Equivalents - The Partnership considers all highly
                        liquid investments with an original maturity of three
                        months or less when purchased to be cash equivalents.
                        Cash equivalents are carried at estimated market value.

              E:   Marketable Securities - Marketable securities are highly
                        liquid investments with maturities of more than three
                        months when purchased and are carried at estimated
                        market value.

              F:   Federal Income Taxes - The Partnership is not a taxable
                        entity under the provisions of the Internal Revenue 
                        Code.  The income and capital gains and losses of the
                        Partnership are attributed, for federal income tax 
                        purposes, to the Partners in the Partnership.  The 
                        Partnership may be subject to state and local taxes 
                        in jurisdictions in which it operates.

NOTE 2:  TRANSACTIONS WITH AFFILIATES

         Pursuant to an investment management agreement, The Prudential charges
         the Partnership a daily investment management fee at an annual rate of
         1.25% of the average daily gross asset valuation of the Partnership.
         For the nine months ended September 30, 1996 and 1995 management fees
         incurred by the Partnership were $1,848,541 and $1,730,668
         respectively.

         The Partnership also reimburses The Prudential for certain
         administrative services rendered by The Prudential.  The amounts
         incurred for the nine months ended September 30, 1996 and 1995 were
         $88,693 and $93,221 respectively and are classified as administrative
         expenses in the statements of operations.

         The Partnership owns a 50% interest in four warehouse/distribution
         buildings in Jacksonville, Florida (the Unit warehouses). The
         remaining 50% interest is owned by The Prudential and one of its
         subsidiaries.  The Partnership has contracted with PREMISYS Real
         Estate Services, Inc. (PREMISYS), an affiliate of The Prudential to
         provide property management services at the Unit warehouses.  The
         property management fees earned by PREMISYS for the nine months ended
         September 30, 1996 and 1995 were $14,965 and $14,712 respectively.

NOTE 3:  COMMITMENT FROM PARTNER

         On January 9, 1990, The Prudential committed to fund up to $100
         million to enable the Partnership to take advantage of opportunities
         to acquire attractive real property investments whose cost is greater
         than the Partnership's available cash.  Contributions to the
         Partnership under this commitment are utilized for property
         acquisitions and returned to Prudential on an ongoing basis from
         Contract owners' net contributions. Also, the amount of the commitment
         is reduced by $10 million for every $100 million in current value net
         assets of the Partnership.  The amount available under this commitment
         as of September 30, 1996 is approximately $ 50.9 million.


                                    15

<PAGE>

NOTE 6:  PER SHARE INFORMATION (FOR A SHARE OUTSTANDING THOUGHOUT THE PERIOD)

<TABLE>
<CAPTION>
                                 01/01/96     07/01/96    01/01/95    01/01/94     01/01/93     01/01/92    01/01/91    01/01/90
                                    TO          TO           TO          TO           TO           TO          TO          TO
                                 09/30/96     09/30/96    12/31/95    12/31/94     12/31/93     12/31/92    12/31/91    12/31/90
                                 --------     --------    --------    --------     --------     --------    --------    --------
<S>                               <C>        <C>           <C>         <C>          <C>        <C>           <C>         <C>
Rent from properties             $  1.4335   $  0.4516    $  1.6387   $  1.2754    $  1.1659   $  1.0727    $  0.9899   $  0.9479
Income from interest in
 properties                      $  0.0383   $  0.0108    $  0.0527   $  0.1838    $  0.2139   $  0.1970    $  0.1791   $  0.1533
Interest on mortgage loans       $  0.0000   $  0.0000    $  0.0000   $  0.0082    $  0.0755   $  0.0711    $  0.0663   $  0.0654
Interest from short-term
 investments                     $  0.1235   $  0.0527    $  0.2199   $  0.1226    $  0.0549   $  0.0653    $  0.1151   $  0.1202
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------

INVESTMENT INCOME                $  1.5953   $  0.5151    $  1.9113   $  1.5900    $  1.5102   $  1.4061    $  1.3504   $  1.2868
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------

Investment management fee        $  0.1553   $  0.0527    $  0.1936   $  0.1786    $  0.1673   $  0.1642    $  0.1669   $  0.1591
Real estate tax expense          $  0.1470   $  0.0421    $  0.1602   $  0.1399    $  0.1465   $  0.1488    $  0.1168   $  0.1010
Administrative expenses          $  0.1228   $  0.0357    $  0.1484   $  0.1103    $  0.1187   $  0.1046    $  0.0946   $  0.0910
Operating expenses               $  0.1725   $  0.0594    $  0.1546   $  0.1332    $  0.1209   $  0.1241    $  0.0948   $  0.0776
Interest expense                 $  0.0313   $  0.0099    $  0.0381   $  0.0255    $  0.0236   $  0.0215    $  0.0193   $  0.0186
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------

EXPENSES                         $  0.6289   $  0.1998    $  0.6949   $  0.5875    $  0.5770   $  0.5632    $  0.4924   $  0.4473
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------

NET INVESTMENT INCOME            $  0.9664   $  0.3153    $  1.2164   $  1.0025    $  0.9332   $  0.8429    $  0.8580   $  0.8395
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------
Net realized loss on
 investments sold               ($  0.0402) ($  0.0011)   $  0.0000   $ (0.0966)   $ (0.1816)  $  0.0000    $  0.0000   $  0.0000
Net unrealized gain/(loss)
 on investments                 ($  0.2729) ($  0.1451)   $  0.0581   $  0.2169    $  0.0152   $ (1.1359)   $ (0.7770)  $ (0.1543)
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------
NET REALIZED AND UNREALIZED
GAIN/(LOSS) ON INVESTMENTS      ($  0.3131) ($  0.1462)   $  0.0581   $  0.1203    $ (0.1664)  $ (1.1359)   $ (0.7770)  $ (0.1543)
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------
Net increase/(decrease) in
 share value                     $  0.6533   $  0.1695    $  1.2745   $  1.1228    $  0.7668   $ (0.2930)   $  0.0810   $  0.6852

Share Value at beginning
 of period                       $ 15.7537   $ 16.2375    $ 14.4792   $ 13.3564    $ 12.5896   $ 12.8826    $ 12.8016   $ 12.1164
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------

Share Value at end of period     $ 16.4070   $ 16.4070    $ 15.7537   $ 14.4792    $ 13.3564   $ 12.5896    $ 12.8826   $ 12.8016
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------
                                 ---------   ---------    ---------   ---------    ---------   ---------    ---------   ---------
Ratio of expenses to average
 net assets                          3.92%       1.23%        4.62%       4.27%        4.44%       4.47%        3.81%       3.58%

Ratio of net investment income
 to average net assets               6.02%       1.95%        8.08%       7.29%        7.17%       6.69%        6.63%       6.72%

Number of shares outstanding
 at end of period (000's)           11,848      11,848       12,037      12,241       13,031      14,189       14,993      16,175


</TABLE>

All calculations are based on average month-end shares outstanding where
applicable.

Per share information presented herein is shown on a basis consistent with the
financial statements as discussed in Note 1G.


                                          16
<PAGE>

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

All of the assets of The Prudential Variable Contract Real Property Account (the
"Real Property Account") are invested in The Prudential Variable Contract Real
Property Partnership (the "Partnership").  Correspondingly, the liquidity,
capital resources and results of operations for the Real Property Account are
contingent upon those of the Partnership.  Therefore, all of management's
discussion of these items is at the Partnership level.  The partners in the
Partnership are The Prudential Insurance Company of America, Pruco Life
Insurance Company and Pruco Life Insurance Company of New Jersey.

(a) Liquidity and Capital Resources

At September 30, 1996, the Partnership's liquid assets consisting of cash and
cash equivalents and marketable securities totaled $46,742,226.  This is an
increase of $21,986,806 from liquid assets at December 31, 1995, of $24,755,420.
The increase is primarily due to (1) $14,697,789 in cash received from the sale
of the Azusa, CA warehouse, (2) operations of the Partnership's properties, and
(3) interest income received from short-term investments.  These are partially
offset by withdrawals by the partners of  $3 million.

The Partnership had established a $10 million annually renewable line of credit
with First Fidelity Bank, N.A. to be drawn upon as needed for potential
liquidity needs.  The line of credit had never been drawn upon. Management did
not anticipate any future needs for this credit facility and decided to
terminate the line of credit as of October 31, 1995.  The Prudential has
committed to fund up to $100 million to enable the Partnership to acquire real
estate investments.  Contributions to the Partnership under this commitment are
utilized for property acquisitions and returned to The Prudential on an ongoing
basis from Contract owners' net contributions.  The amount of the commitment is
reduced by $10 million for every $100 million in current value net assets of the
Partnership.  The amount available for future investments is approximately 
$50.9 million as of September 30, 1996.

The Partnership will ordinarily invest 10-15% of its assets in cash and
short-term obligations to maintain liquidity; however, its investment policy
allows up to 30% investment in cash and short-term obligations.  At September
30, 1996, 22.56% of the Partnership's assets consisted of cash and cash
equivalents and marketable securities.  This is in excess of the target range
because proceeds from the sale, mentioned above, are being retained in the
Partnership in anticipation of three potential acquisitions.  The Partnership is
scheduled to close on a 77,000 square foot office building in Portland, OR, in
December 1996, for an estimated purchase price of $10.8 million.  In addition,
two industrial forward commitments are scheduled to close in mid 1997, one in
Denver, CO for an estimated purchase price of $10.4 million, and the other in
Salt Lake City, UT for an estimated price of $7 million.  The partners withdrew
$3 million in March, 1996.  Additional withdrawals may be made during the
remainder of 1996 based upon the needs of the Partnership including potential
property acquisitions and dispositions and capital expenditures.  At September
30, 1996, and currently, the Partnership has adequate liquidity.  Management
anticipates that ongoing cash flow from operations will satisfy the
Partnership's needs over the next three months and the foreseeable future.

During the quarter ended September 30, 1996, the Partnership expended
approximately $264,000 in capital expenditures for tenant alterations, leasing
commissions and land improvements. The most significant of these expenses was
approximately $166,000 at the industrial property in Pomona, CA relating to a
renewal leasing commission and tenant alterations for the Treasure Chest.  Other
significant capital expended included building improvements of approximately
$31,000 at the Morristown, NJ office building, tenant improvements and leasing
commissions of approximately $36,000 for Shepherd's Staff Christian Book Store,
a new tenant at the Roswell, GA retail center, and major landscaping and parking
structure improvements of approximately $23,000 at the Farmington Hills, MI
apartment complex.

Projected capital expenditures for the remainder of 1996 total approximately
$136,500, which consists of tenant alterations, leasing commissions and land
improvements.  Approximately $65,000 of the tenant alterations and leasing
commissions pertain to tenant renewals at the Pomona, CA industrial property.


                                          17
<PAGE>

Approximately $51,000 of the tenant alterations and leasing commissions are
budgeted for vacancies  and approximately $10,500 of land improvements are
budgeted for the site's traffic improvements at the Roswell, GA retail center.
In addition, approximately $10,000 of the tenant alterations and leasing
commissions are budgeted for the remaining vacancies at the Morristown, NJ
office building.  These projected capital expenditures are dependent upon
successfully executing new tenant leases or tenant renewals.

(b.1) Results of Operations - Portfolio

The following is a brief comparison of the Partnership's total portfolio results
of operations and realized and unrealized losses for the nine months ended
September 30, 1996 and 1995.

The Partnership's total net investment income for the first nine months of 1996
was $11,504,617, an increase of $872,325 (8.2%) from $10,632,292 for the
corresponding period of 1995.  This was largely due to income of approximately
$2,381,756 from one apartment and two office building acquisitions that
occurred during the second half of 1995, and an increase of approximately
$108,000 in income from ongoing property operations.  These amounts were
partially offset by a decrease of approximately $894,000 in unrelated property
activity, and discontinued income of approximately $723,000 due to the sale of
a warehouse that occurred in April, 1996.

The Partnership's income unrelated to specific properties was a loss of
$815,473, a decrease of $894,387 from income of  $78,914 for the corresponding
period of 1995.  Components of unrelated property activity are $1,469,594  in
interest income from short-term investments, $436,526 in administrative
expenses, and the investment management fee of $1,848,541.  During the nine
months ended September 30, 1996, the Partnership experienced a decrease of
$688,148 in short-term investment income, an increase of $88,366 in
administrative expenses, and an increase of $117,873 in the investment
management fee.

During the nine months ended September 30, 1996, the Partnership experienced 
realized and unrealized losses of $478,638 and $3,253,955, respectively, 
totaling $3,732,593, on its real estate investments.  The realized loss is 
the result of the sale of the Azusa, CA warehouse.  The unrealized loss is 
the result of a decrease of approximately $3 million in the estimated market 
value of the Roswell, GA retail center, and a decrease of approximately 
$1.2 million in the estimated market value of the industrial property in 
Lisle, IL. These decreases are partially offset by an increase of  
approximately $800,000 in the market value of an apartment complex in 
Atlanta, GA.  The explanations for these changes are detailed in the 
following paragraphs.

(b.2) Results of Operations - Property

The following is a brief comparison of the Partnership's property results of
operations and realized and unrealized losses, by investment type, for the nine
months ended September 30, 1996 and 1995.

Income from property operations from office buildings for the first nine months
of 1996 was $4,522,065, an increase of $1,725,118 (61.7%) from $2,796,947 for
the corresponding period in 1995.  This was primarily the result of the
acquisition of two office buildings, in Nashville, TN and Oakbrook Terrace,
IL. These properties accounted for $1,694,560 (60.6%) of the increase in income
from office building property operations. Excluding the results of the acquired
properties, income from property operations increased $30,558 (1.1%). Revenue at
the properties held for the comparable period increased by $109,222, while
expenses increased for the comparable period by $78,664.

The five office buildings owned by the Partnership experienced net unrealized 
losses of $1,108,100 for the first nine months of 1996.  The office 
buildings in Lisle, IL and Flint, MI had unrealized losses totaling 
$2,029,517 for the first nine months on 1996.  Their occupancy rates at 
September 30, 1996 were 100% and 81% respectively, representing no change in 
the Lisle, IL office building, and a decrease of 15% for the Flint, MI office 
building, as compared to December 31, 1995.  The Flint, MI building is 
expected to be sold

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<PAGE>

at the end of October, 1996, at an anticipated sale price of $5.5 million.  The
office buildings in Morristown, NJ, Oakbrook Terrace, IL, and Nashville, TN had
unrealized gains totaling $921,417.  Their occupancy rates at September 30, 1996
were 89%, 99%, and 100%, respectively, representing decreases for the
Morristown, NJ (6%), and Oakbrook, IL (1%) office buildings, and an increase
in the Nashville, TN (1%) building from December 31, 1995.  All vacant office
space is being marketed as of September 30, 1996.

Income from property operations for apartment complexes for the first nine
months of 1996 was $3,016,868, an increase of $841,225 (38.7%) from $2,175,643
for the corresponding  period in 1995.  This was primarily the result of the
acquisition of an apartment complex in Raleigh, NC, which accounted for $687,195
(31.6%) of the increase of the total apartment complexes' property operations.
Excluding the results of the acquired property, income from property operations
increased $154,030 (7.1%).  Revenue from the properties held for the comparable
period increased by $88,672. Expenses decreased for the comparable period by
$65,358.

The three apartment complexes owned by the Partnership experienced net
unrealized gains of $732,571 for the first nine months of 1996.  The apartment
complexes in Atlanta, GA and  Farmington Hills, MI had unrealized gains totaling
$1,082,571 for the first nine months of 1996.  Their occupancy rates at
September 30, 1996 were 98% and 92%, respectively, representing an increase of
1% in the Atlanta, GA apartment complex, and a decrease of 6% in the Farmington
Hills, MI apartment complex, from December 31, 1995.  The Raleigh, NC apartment
complex had an unrealized loss of $350,000.  Occupancy at this property
decreased from 96% at December 31, 1995 to 95% at September 30, 1996.  All
vacant apartments are being marketed as of September 30, 1996.

Income from property operations at the Roswell, GA retail center for the first
nine months of 1996 was $2,354,740, a decrease of  $190,722 (7.5%) from
$2,545,462 for the corresponding period in 1995.  Revenue at the properties
held for the comparable period decreased by $169,115, while expenses increased
by $21,607.

The retail center experienced an unrealized loss of  $3,051,348 for the first
nine months of 1996.  The occupancy rate at September 30, 1996 was 98%, a
decrease from the 100% occupancy rate at December 31, 1995. The decrease in
occupancy rates is due to a newly developed competitor entering the Roswell, GA
retail center market.  This property is marketing the vacant space as of
September 30, 1996.

Income from property operations for industrial properties for the first nine
months of 1996 was $1,970,302, a decrease of $592,928 (23.1%) from $2,563,230
for the corresponding period in 1995. This was primarily the result of the
sale of a warehouse in Azusa, CA which accounted for $723,353 (28.2%) of the
decrease.   Excluding the results of the property sold, income from property
operations increased by $130,425 (5.1%).  Revenue at the properties held for the
comparable period increased by $160,730.  Expenses increased for the comparable
period by $30,305.

The two industrial properties owned by the Partnership experienced unrealized
gains of  $72,922 for the first nine months of 1996.  The warehouse in Pomona,
CA had an unrealized gain of $372,922, while the Bolingbrook, IL warehouse had
an unrealized loss of $300,000.  Their occupancy rates at September 30, 1996
were both 100%, unchanged from December 31, 1995.  The warehouse in Azusa, CA
which was sold in April, 1996, resulted in a realized loss of $478,638.  The
gross sale price of the property was $15,250,000, and net proceeds received were
$14,697,789.

Income from interest in properties relates to the Partnership's 50%
co-investment in the Jacksonville, FL unit warehouses.  Income from interest in
properties decreased by $15,981 (3.4%) from $472,096 for the three quarters of
1995 to $456,115 for the corresponding period of 1996.  For the first nine
months of 1996 the co-investment had unrealized gains of $100,000.  The
occupancy rate for the warehouses at September 30, 1996 was 85%, representing a
decrease of 15% from December 31, 1995.  This was due to the loss of a major
tenant.


                                          19
<PAGE>

                                       PART II


ITEM 1.  LEGAL PROCEEDINGS

         None.

ITEM 2.  CHANGES IN SECURITIES

         None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         None.

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

         Contract owners participating in the Real Property Account have no
         voting rights with respect to the Real Property Account.

ITEM 5.  OTHER INFORMATION

         None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         4.1  Variable Life Insurance Contract filed as Exhibit A(5) to 
              Form N-8B-2, Registration Statement No. 2-81243, filed 
              January 10, 1983, and incorporated herein by reference.

         4.2  Revised Variable Appreciable Life Insurance Contract with fixed
              death benefit, filed as Exhibit 1.A.(5)(c) to Post-Effective 
              Amendment No. 5 to Form S-6, Registration Statement No. 2-89780,
              filed July 11, 1986, and incorporated herein by reference.

         4.3  Revised Variable Appreciable Life Insurance Contract with variable
              death benefit, filed as Exhibit 1.A.(5)(d) to Post-Effective 
              Amendment No. 5 to Form S-6, Registration Statement No. 2-89780, 
              filed July 11, 1986, and incorporated herein by reference.

         4.4  Single Premium Variable Annuity Insurance Contract, filed as 
              Exhibit 4(i) to Form N-4, Registration Statement No. 2-99-916, 
              Filed August 28, 1985, and incorporated herein by reference.

         4.5  Flexible Premium Variable Life Insurance Contract, filed as 
              Exhibit 1.A.(5) to Form S-6, Registration Statement No. 2-99537,
              Filed August 8, 1985, and incorporated herein by reference.


                                       20
<PAGE>

                                   SIGNATURES

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





                   PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
                                 in respect of
                       Pruco Life of New Jersey Variable
                         Contract Real Property Account
          ------------------------------------------------------------




Date:   November 8, 1996                    By: /s/ Esther H. Milnes
       ------------------                      -----------------------

                                            Esther H. Milnes
                                            President





Date:   November 8, 1996                    By: /s/ Linda S. Dougherty
       ------------------                      -----------------------

                                            Linda Dougherty
                                            Vice President, Comptroller and
                                            Chief Accounting Officer


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