SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549


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

                                    FORM 8-K

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

                                 CURRENT REPORT

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


                                 August 19, 1999
                        --------------------------------
                        Date of report (Date of earliest
                                 event reported)


                      WILSHIRE REAL ESTATE INVESTMENT INC.
             (Exact name of registrant as specified in its charter)



        Maryland                     0-23911                   52-2081138
- ------------------------     ----------------------     ------------------------
    (State or other          Commission File Number         (I.R.S. Employer
    jurisdiction of                                      Identification Number)
     incorporation)


                    1301 S.W. 17th Street, Portland, OR 97201
- --------------------------------------------------------------------------------
               (Address of principal executive offices)(Zip Code)




                                 (503) 223-5600
               Registrant's telephone number, including area code




                   Wilshire Real Estate Investment Trust Inc.
                   1776 SW Madison Street, Portland, OR 97205
- --------------------------------------------------------------------------------
          (Former name or former address, if changed since last report)


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Item 5.           OTHER EVENTS.

         Wilshire  Real  Estate   Investment  Inc.  (the   "Company")   recently
determined to become  internally  managed as a result of the  Company's  concern
that its third party manager, Wilshire Realty Services Corporation ("WRSC"), and
WRSC's parent,  Wilshire  Financial  Services Group Inc. ("WFSG") were no longer
able to provide  management  services and this has resulted in a dispute between
the Company,  on the one hand, and WRSC and WFSG, on the other.  Until recently,
the Company's business and investment affairs have been managed by WRSC pursuant
to  a  management   agreement  and  the  Company  has  received  managerial  and
administrative services from WRSC thereunder.  Accordingly,  during this period,
the Company has had no employees and instead has relied on WRSC for  management,
facilities, reporting and other services. WRSC itself is a shell company and has
no employees.  WFSG provided  managerial and administrative  services to WRSC to
allow it to fulfil its obligations under the management agreement.

         Beginning in the Fall of last year,  the  independent  directors of the
Company  became  increasingly  concerned  with  WRSC's  ability to  perform  its
obligations under the management agreement,  initially as a result of the severe
financial  difficulties  experienced  by  WFSG  and  its  subsequent  bankruptcy
restructuring. Relations among the companies continued to decline as the Company
was not allowed to fully  participate in the  restructuring  of WFSG and did not
obtain any  representation  on WFSG's board of directors despite a 14% ownership
interest.  On August 19, 1999,  the Company was notified that WFSG had suspended
its Chief Executive  Officer,  Andrew  Wiederhorn,  and its President,  Lawrence
Mendelsohn,  from their  duties as employees  of WFSG and its  subsidiaries  and
terminated their employment with WFSG and its subsidiaries purportedly for cause
on September 3, 1999. Mr.  Wiederhorn and Mr. Mendelsohn were also terminated as
Chief  Executive  Officer and President of WRSC. The Company and its independent
directors have long  considered that Mr.  Wiederhorn and Mr.  Mendelsohn are key
personnel on which the stability and future growth of the Company (and WFSG) are
dependent.  As the principal  architects of the development of both WFSG and the
Company,  Mr.  Wiederhorn and Mr.  Mendelsohn  are intimately  familiar with its
strengths and weaknesses,  have a firm  understanding of the complex real estate
and  financial  markets  in  which  the  Company  operates,   have  longstanding
relationships within the industry (and in particular with the Company's lenders)
and are exceedingly  familiar with the Company's assets (including its portfolio
of  subordinated  mortgage-backed  securities)  and its  liabilities  (including
short-term repurchase agreements). Accordingly, the independent directors of the
Company  believe that  termination of Mr.  Wiederhorn  and Mr.  Mendelsohn had a
material  adverse effect on WRSC's ability to perform its obligations  under the
management agreement.

         On August 20, 1999,  the Company filed a lawsuit  against  WFSG,  WRSC,
Wilshire Credit  Corporation  ("WCC"),  a 50.01 percent  subsidiary of WFSG, and
Wilshire  Management Leasing Company ("WML"), a wholly-owned  subsidiary of WFSG
in the  Circuit  of the State of Oregon for  Multnomah  County and on August 23,
1999 amended its complaint,  alleging that (i) the facilities sharing agreement,
dated as of February 19, 1999,  among the Company,  WFSG, WRSC, WCC and WML (the
"Facilities  Sharing Agreement") had become operative as a result of the default
by WRSC  under the  management  agreement  and (ii) the  suspension  of  Messrs.
Wiederhorn and  Mendelsohn  and the decision by WFSG to deny Messrs.  Wiederhorn
and Mendelsohn access to WFSG's facilities, personnel and equipment violates the
terms of the Facilities Sharing Agreement.  The Facilities Sharing Agreement had
been  entered  into by the parties to provide for an orderly  transition  in the
event that the management  agreement was no longer operative and the Company was
becoming internally rather than externally managed. Under the Facilities Sharing
Agreement,  WFSG, WRSC and others agreed to continue to provide certain services
to the  Company  for two years in return for the payment of the pro rata cost of
providing  such services.  On September 22, 1999,  WFSG and WRSC filed papers in
the above litigation  alleging various  affirmative  defenses and counterclaims,
including  allegations that the Facilities  Services  Agreement is not in effect
and is unenforceable and that the Company breached the management agreement.

         On September 22, 1999,  the Company sent a letter to WRSC reserving its
rights with respect to prior declarations of default and formally gave notice of
non-renewal and termination  for cause of the management  agreement.  The letter
outlined  various  breaches  by WRSC  including  failing  to  provide  competent
management,  failing to  provide  services  and  facilities  and taking  actions
contrary to the interests of the Company. Notwithstanding the foregoing, the

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Company has sought to discuss the parties' disagreements with a view to reaching
an amicable  arrangement  for  severing the  relationships  between WFSG and the
Company.  There are preliminary meetings scheduled to occur this week. There can
be no assurance  that these  discussions  will result in a  resolution  of these
disagreements.


Item 7.           FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
                  EXHIBITS.

None

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                                   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 hereunto duly authorized.


                                       WILSHIRE REAL ESTATE
                                         INVESTMENT INC.






Date: September 29, 1999               By:  /s/ Lawrence A. Mendelsohn
                                       -------------------------------------
                                            Lawrence A. Mendelsohn
                                            President


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