UNITED STATES 
SECURITIES AND EXCHANGE COMMISSION 
Washington, D.C. 20549
SCHEDULE 13G
Under the Securities Exchange Act of 1934 
(Amendment No.___3____)*
Koll Real Estate Group Inc. 
 (Name of Issuer)

Common Stock**
 (Title Of Class of Securities)

500434303
(CUSIP Number)

Check the following box if a fee is being paid with this statement .  
(A fee is not required only if the filing person: (1) has a previous 
statement on file reporting beneficial ownership of more than five 
percent of the class of securities described in Item 1; and (2) has 
filed no amendment subsequent thereto reporting beneficial ownership of 
five percent or less of such class.) (See Rule 13d-7). 

*The remainder of this cover page shall be filled out for a reporting person's 
initial filing on this form with respect to the subject class of securities, 
and for any subsequent amendment containing information which would alter the 
disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be 
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section 
of the Act but shall be subject to all other provisions of the Act (however, see
the Notes).

**The amount reflected in Item 9 of the cover page reflects new common stock 
issued in 1997 as a result of conversion of convertible bonds ("the 
convertible bonds") (CUSIP 500434204). 


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



CUSIP NO. 500434303 _____________
13G
PAGE 1


1  NAME OF REPORTING PERSON
   S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON

     Merrill Lynch & Co., Inc.

2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*                            
     Joint Filing
     (a) 
     (b)
3 SEC USE ONLY 


4 CITIZENSHIP OR PLACE OF ORGANIZATION

     Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH

5 SOLE VOTING POWER

    None
 
6 SHARED VOTING POWER
 
    1,038,259     

7 SOLE DISPOSITIVE POWER

    None


8 SHARED DISPOSITIVE POWER
    1,038,259           

9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
    
    1,038,259
               

10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*


11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
    
    1.71%           

12 TYPE OF REPORTING PERSON*

 HC, CO

*SEE INSTRUCTION BEFORE FILLING OUT!





SCHEDULE 13G


Item 1 (a)		Name of Issuer:


            Koll Real Estate Group Inc. 


Item 1 (b)		Address of Issuer's  Principal Executive Offices:

            4343 Von Karmen Ave.
            Newport Beach, CA 92660


Item 2 (a)		Names of Persons Filing:

            Merrill Lynch & Co., Inc.
            Merrill Lynch, Pierce, Fenner & Smith Incorporated

Item 2 (b)		Address of Principal Business Office, or, if None, Residence:

            Merrill Lynch & Co., Inc.
            World Financial Center, North Tower
            250 Vesey Street
            New York, New York  10281

            Merrill Lynch, Pierce, Fenner & Smith Incorporated 
            World Financial Center, North Tower
            250 Vesey Street
            New York, New York  10281

Item 2 (c)		Citizenship:

            See Item 4 of Cover Pages

Item 2 (d)		Title of Class of Securities:
			
            Common Stock

Item 2 (e)		CUSIP Number:  
                                           
            500434303
 
Item 3

Merrill Lynch & Co., Inc. ("ML&Co.") is a parent holding company, in accord
ance with Section 240.13d-1(b)(ii)(G).  Merrill Lynch, Pierce, Fenner & Smith 
Incorporated ("MLPF&S") is a broker-dealer registered under Section 15 of the
Securities Exchange Act of 1934. 





a)   Amount Beneficially Owned:  
	
See Item 9 of Cover Pages.  Pursuant to Section 240.13d-4, ML&Co. and MLPF&S 
(the "Reporting Persons") disclaim beneficial ownership of the securities of 
Koll Real Estate Group Inc. referred to herein, and the filing of this 
Schedule 13G shall not be construed as an admission that the Reporting 
Persons are, for the purposes of Section 13(d) or 13(g) of the Securities 
Exchange Act of 1934,  the beneficial owner of any of the securities of 
Koll Real Estate Group Inc. referred to herein other than in the case of such
held by MLPF&S in proprietary accounts.


	(b)   Percent of Class:  

			See Item 11 of Cover Pages

	(c)   Number of shares as to which such person has:

	          (i)     sole power to vote or to direct the vote:   

			See Item 5 of Cover Pages

	         (ii)     shared power to vote or to direct the vote: 

			See Item 6 of Cover Pages

	         (iii)    sole power to dispose or to direct the disposition of: 

			See Item 7 of Cover Pages

	         (iv)   shared power to dispose or to direct the disposition of:

			See Item 8 of Cover Pages

Item 5	Ownership of Five Percent or Less of a Class.

   Not Applicable

Item 6	Ownership of More than Five Percent on Behalf of Another Person.

			Not Applicable

Item 7	Identification and Classification of the Subsidiary Which Acquired the 
Security Being Reported on by the Parent Holding Company.

   See Exhibit A

Item 8	Identification and Classification of Members of the Group.

   Not Applicable

Item 9	Notice of Dissolution of Group.

   Not Applicable





Item 10	Certification.

	By signing below each of the undersigned certifies that, to the best of their 
knowledge and belief, the securities referred to above were acquired in the
ordinary course of business and were not acquired for the purpose of and do
not have the effect of changing or influencing the control of the issuer of 
such securities and were not acquired in connection with or as a participant
in any transaction having such purposes or effect.

Signature.

After reasonable inquiry and to the best of my knowledge and belief, each of
the undersigned certifies that the information set forth in this statement is
true, complete and correct.


Merrill Lynch & Co., Inc.
____________________
Date:

Andrea Lowenthal
Signature:

____________________
Name: Andrea Lowenthal
______________________
Title: Attorney-in-Fact * 



Merrill Lynch, Pierce, Fenner & Smith Incorporated
			
_____________________
Date:

Andrea Lowenthal 
Signature:
______________________
Name: Anrdrea Lowenthal

______________________
Title: Attorney in Fact**



* Executed pursuant to a Power of Attorney dated November 17, 1995, a copy of
which is attached hereto as Exhibit B.

** Executed pursant to a Power of Attorney dated November 17, 1995, a copy of
whcih is attached hereto as Exhibit C.



                  Exhibit A to Schedule 13G

     One of the persons filing this report, Merrill Lynch & Co., Inc., is a 
Delaware corporation with its prinicpal place of business at World Financial
Center, North Tower, 250 Vesey Street, New York, New York ("ML&Co."), and a
parent holding company pursuant to Section 240 13d-1(b)(1)(ii)(G).  The 
relevant subsidiaries of ML&Co. are Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("MLPF&S"), a Delaware corportation with its principal place of
business at World Financial Center, North Tower, 250 Vesey Street, New York,
is a wholly owned direct subsidiary of ML&Co. and a broker-dealer registered
pursuant to the Securities Exchange Act of 1934.





                       Exhibit B to Scehdule 13G
 
                           Power of Attorney 


     The undersigned, Merrill Lynch & Co., (the "Corporation") a corporation
duly organized under the laws of Delaware, with its principal place of business
at World Financial Center, North Tower, 250 Vesey Street, New York, New York,
10281 does hereby make, constitite and appoint Richard B. Alsop, Richard D. 
Kreuder and Andrea Lowenthal, Gregory T. Russo, or any other individual from 
time to time elected or appointed as secretary or an assistant secretary of the
Corporation, acting severally, each of whose address is Merrill Lynch & Co.,
Inc., World Financial Center, North Tower, 250 Vesey Street, New York, New 
York, 10281 as its true and lawful attorneys-in fact, for it and in its name,
place and stead (i) to execute on behalf of the Corporation and cause to be 
filed and/or delivered, as required under Section 13(d) of the Securities
Exchange Act of 1934 (the"Act") and the regulations thereunder, any number,
as appropriate, of original copies, or electronic filings of the Securities and
Exchange Commission Schedule 13D or Schedule 13G Beneficial Ownership Reports
(together with any amendments and joint filing agreements under Rule 13d-1(f)
(1) of the Act, as may be required thereto) to be filed and/or delivered
with the respect to any equity security (as defined in Rule 13d-1-(d)
under the Act) beneficially owned by the undersigned and which must be reported
by the undersigned pursuant to Section 13(d) of the Act and the regulations
thereunder, (ii) and generally to take such other actions and perform such other
things necessary to effectuate the foregoing as fully in all respects as if the
undersigned could do it if personally present.  This Power of Attorney shall 
remain in effect until revoked, in writing, by the undersigned.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney, 
this 25th day of February, 1995.



               MERRILL LYNCH & Co., Inc.

               By:         /s/ David H. Komansky
               Name:   David H. Komansky
               Title:  President and Chief Operating Officer








               Exhibit C to Schedule 13G


                    Power of Attorney 

The undersigned, Merrill Lynch, Pierce, Fenner & Smith Incorporated, (the 
"Corporation") a corporation duly organized under the laws of Delaware,  with
its principal place of business at World Financial Center, North Tower, 250 
Vesey Street, New York, New York 10281 does hereby make, constitute and 
appoint Richard B. Alsop, Richard D. Kreuder, Andrea Lowenthal, Gregory T.
Russo, or  any other individual from time to time elected or appointed as 
secretary or an assistant secretary of the Corporation, acting severally, 
each of whose address is Merrill Lynch & Co., Inc., World Financial Center,
North Tower, 250 Vesey Street, New York, New York, 10281 as its attornies-in-
fact, for it and in its name, place and stead (i) to execute on behalf of the 
Corporation and cause to be filed and/or delivered, as required under
Section 13(d) of the Securities Exchange Act of 1934 (the "Act") and the 
regulations thereunder, any number, as appropriate, of original, copies, 
or electronic filings of the Securities and Exchange Commission Schedule 13D or
Schedule 13G Beneficial Ownership Reports (together with any amendments and 
joint filing agreements under Rule 13d-1(f) (1) of the Act, as may be 
required thereto) to be filed and/or delivered with respect to any equity 
security (as defined in Rule 13d-1(d) under the Act) beneficially owned by
the undersigned and which must be reported by the undersigned pursuant to 
Section (d) of the Act and the regulations thereunder, (ii) and generally to
take such other actions and perform such other things necessary to effectuate
the foregoing as fully in all respects as if the undersigned could do
if personally present.  This Power of Attorney shall remain in 
effect until revoked, in writing, by the undersigned.

    IN WITNESS WHREOF, the undersigned has executed this Power of Attorney, 
this 25th day of February, 1995.


MERRILL LYNCH, PIERCE, FENNER & SMITH  INCORPORATED


By:         /s/ David H. Komansky
Name:     David H. Komansky
Title:    President and Chief Operating Officer