PS PARTNERS IV LTD, 10-K405, 1996-03-25

PS PARTNERS IV LTD
10-K405, 1996-03-25
TRUCKING & COURIER SERVICES (NO AIR)

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<PAGE>

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

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [Fee Required]

For the fiscal year ended December 31, 1995
-----------------
or
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [No Fee Required]

For the transition period from ________________ to __________________

Commission File Number 0-14475
-------

PS PARTNERS IV, LTD
------------------------------------------------------
(Exact name of registrant as specified in its charter)

California 95-3931619
- ------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)

600 N. Brand Boulevard
Glendale, California 91203-1241
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (818) 244-8080
--------------

Securities registered pursuant to Section 12(b) of the Act:
NONE

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

Units of Limited Partnership Interest
-------------------------------------
(Title of class)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

Yes X No
----- -----

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to the
Form 10-K. [X]

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

DOCUMENTS INCORPORATED BY REFERENCE
NONE
<PAGE>

PART I

ITEM 1. BUSINESS.
--------

General
- -------
PS Partners IV, Ltd. (the "Partnership") is a publicly held limited
partnership formed under the California Uniform Limited Partnership Act.
Commencing in December 1984, 128,000 units of limited partnership interest (the
"Units") were offered to the public in an interstate offering. The offering was
completed in July 1985.

The Partnership was formed to invest in and operate existing self-service
facilities offering storage space for personal and business use (the "mini-
warehouses") and to invest up to 40% of the net proceeds of the offering
in and operate existing office and industrial properties. The Partnership's
investments were made through general partnerships with Storage Equities, Inc.,
now known as Public Storage, Inc. ("PSI"), a real estate investment trust
organized as a corporation under the laws of California. For tax administrative
efficiency, the original general partnerships with PSI were consolidated into a
single general partnership effective December 31, 1990.

In 1995, there were a series of mergers among Public Storage Management,
Inc. (which was the Partnership's mini-warehouse operator), Public Storage, Inc.
and their affiliates (collectively, "PSMI"), culminating in the November 16,
1995 merger (the "PSMI Merger") of PSMI into Storage Equities, Inc. In the
PSMI Merger, Storage Equities, Inc.'s name was changed to Public Storage, Inc.
and it acquired substantially all of PSMI's United States real estate operations
and became the operator of the Partnership's mini-warehouse properties.

The Partnership's general partners (the "General Partners") are PSI and B.
Wayne Hughes ("Hughes"). PSI became a co-general partner in September 1993,
when PSI acquired the interest of PSI Associates, Inc. ("PSA"), an affiliate of
PSMI, relating to PSA's general partner capital contribution in the Partnership.
Hughes has been a general partner of the Partnership since its inception.
Hughes is the chairman of the board and chief executive officer of PSI, and
Hughes and members of his family (the "Hughes Family") is the major shareholder
of PSI. The Partnership is managed, and its investment decisions are made by
Hughes and the executive officers and directors of PSI. The limited partners
of the Partnership have no right to participate in the management or conduct of
its business affairs.

The Partnership's mini-warehouse properties are managed by PSI and the
Partnership's commercial properties are managed by Public Storage Commercial
Properties Group, Inc. ("PSCP"), pursuant to Management Agreements. PSI has a
95% economic interest and the Hughes Family has a 5% economic interest in PSCP.
PSI believes that it is the largest operator of mini-warehouse facilities in the
United States.

PSI's current relationship with the Partnership includes (i) the joint
ownership of 35 of the Partnership's 36 properties, (ii) PSI is a co-general
partner along with Hughes, who is chairman of the board and chief executive
officer of PSI, (iii) as of February 29, 1996, PSI owned approximately 42.35% of
the Partnership's limited partnership units and (iv) PSI is the operator of the
Partnership's mini-warehouse facilities and owns approximately 95% of the
Partnership's commercial property operator (PSCP).

Investments in Facilities
- -------------------------

The Partnership owns interests in 36 properties; 35 of such properties are
held in a general partnership comprised of the Partnership and PSI. The
Partnership originally acquired interests in 40 properties. Three of those
properties were sold to the original seller during 1987 and another property was
purchased during 1988. In addition, two properties, which secured mortgage
notes were foreclosed upon in January 1991 by the lender. Reference is made to
the table in Item 2 for a summary of information about the Partnership's
properties.

The Partnership believes that its operating results have benefited from
favorable industry trends and conditions. Notably, the level of new mini-
warehouse construction has decreased since 1988 while consumer demand has
increased. In addition, in recent years consolidation has occurred in the
fragmented mini-warehouse industry.

2
<PAGE>

Mini-warehouses
---------------

Mini-warehouses, which comprise the majority of the Partnership's
investments, are designed to offer accessible storage space for personal and
business use at a relatively low cost. A user rents a fully enclosed space
which is for the user's exclusive use and to which only the user has access on
an unrestricted basis during business hours. On-site operation is the
responsibility of resident managers who are supervised by area managers. Some
mini-warehouses also include rentable uncovered parking areas for vehicle
storage. Leases for mini-warehouse space may be on a long-term or short-term
basis, although typically spaces are rented on a month-to-month basis. Rental
rates vary according to the location of the property and the size of the storage
space.

Users of space in mini-warehouses include both individuals and large and
small businesses. Individuals usually employ this space for storage of, among
other things, furniture, household appliances, personal belongings, motor
vehicles, boats, campers, motorcycles and other household goods. Businesses
normally employ this space for storage of excess inventory, business records,
seasonal goods, equipment and fixtures.

Mini-warehouses in which the Partnership has invested generally consist of
three to seven buildings containing an aggregate of between 326 to 5,231 storage
spaces, most of which have between 25 and 400 square feet and an interior height
of approximately 8 to 12 feet.

The Partnership experiences minor seasonal fluctuations in the occupancy
levels of mini-warehouses with occupancies higher in the summer months than in
the winter months. The Partnership believes that these fluctuations result in
part from increased moving activity during the summer.

The Partnership's mini-warehouses are geographically diversified and are
generally located in heavily populated areas and close to concentrations of
apartment complexes, single family residences and commercial developments.
However, there may be circumstances in which it may be appropriate to own a
property in a less populated area, for example, in an area that is highly
visible from a major thoroughfare and close to, although not in, a heavily
populated area. Moreover, in certain population centers, land costs and zoning
restrictions may create a demand for space in nearby less populated areas.

As with most other types of real estate, the conversion of mini-warehouses
to alternative uses in connection with a sale or otherwise would generally
require substantial capital expenditures. However, the Partnership does not
intend to convert its mini-warehouses to other uses.

Commercial Properties
- ---------------------

The Partnership initially owned five commercial properties: four low-rise
office buildings and one business park. One of the office buildings and the
business park, both located in Los Angeles, California, secured debt which was
in default. On January 10, 1991, the lender foreclosed upon the properties in
full settlement of the related debt. Two of the remaining three office buildings
owned by the Partnership are located in San Antonio, Texas. One office building
consists of four two-story office structures connected by landscaped walkways
and atriums with approximately 156,300 net rentable square feet. The other
property is a two-story office building with approximately 43,400 net rentable
square feet. The Partnership also owns a three-story atrium style office
building in Houston, Texas that has a two-level parking garage.

Investment Objectives and Polices; Sale or Financing of Investments
- -------------------------------------------------------------------

The Partnership's objectives are to (i) preserve and protect invested
capital, (ii) maximize the potential for appreciation in value of its
properties, (iii) provide Federal income tax deductions so that during the early
years of property operations a portion of cash distributions may be treated as a
return of capital for tax purposes, and therefore, may not represent taxable
income to the limited partners and (iv) provide for cash distributions from
operations.

The Partnership will terminate on December 31, 2038, unless earlier
dissolved. Under the terms of the general partnership agreement with PSI, as of
December 31, 1995, PSI has the right to require the Partnership to sell all of
the joint venture properties (see Item 12(c)). The Partnership originally
anticipated selling or financing their properties within five to eight years
after acquisition, i.e, between 1992 and 1995. However, as was originally
indicated in the prospectus relating to the Partnership's offering of Units, the
actual time of financing or sale was subject to delay. Since the completion of
the Partnership's offering in 1985, significant changes have taken place in the
financial and real estate markets that must be

3
<PAGE>

taken into account in considering the timing of any proposed sale or financing,
including: (i) the increased construction of mini-warehouses from 1984 to 1988,
which has increased competition, (ii) the general deterioration of the real
estate market (resulting from a variety of factors, including changes in tax
laws), which has significantly affected property values and decreased sales
activities, (iii) the reduced sources of real estate financing. Although
conditions have improved, these developments have resulted in a reduced market
for the sale and financing of commercial real estate, making this, in the view
of the Partnership, a less than optimal time to liquidate the real estate assets
of the Partnership.

The General Partners believe that a liquidation within the period
originally estimated would not be likely to achieve the Partnership's investment
objectives. The General Partners will continue to evaluate the advisability of
the sale or financing of the Partnership's properties. Among the factors the
General Partners would consider are the amount that might be realized from a
sale or financing, the real estate and financing markets at the time and the
prospects for changes in those markets. Currently, the General Partners do not
intend to sell any properties or liquidate the Partnership since they believe
that property values are increasing, although no assurances can be given as to
any future property values.

Operating Strategies
- --------------------

The Partnership's mini-warehouses are operated by PSI under the "Public
Storage" name, which the Partnership believes is the most recognized name in the
mini-warehouse industry. The major elements of the Partnership's operating
strategies are as follows:

. Capitalize on Public Storage's name recognition. PSI, together with its
predecessor, has more than 20 years of operating experience in the mini-
warehouse business. PSI has informed the Partnership that it is the
largest mini-warehouse facility operator in the United States in terms of
both number of facilities and rentable space operated. In the past eight
years, in excess of $56 million has been expended promoting the "Public
Storage" name. PSI believes that its marketing and advertising programs
improve its competitive position in the market. PSI believes that it is
the only mini-warehouse operator regularly using television advertising
in several major markets around the country, and its in-house Yellow
Pages staff designs and places advertisements in approximately 700
directories. In addition, PSI offers a toll-free referral system, 800-
44-STORE, which services approximately 100,000 calls per year from
potential customers inquiring as to the nearest Public Storage mini-
warehouse.

. Maintain high occupancy levels and increase realized rents. Subject to
market conditions, the Partnership generally seeks to achieve average
occupancy levels in excess of 90% and to eliminate promotions prior to
increasing rental rates. Average occupancy for the Partnership's mini-
warehouses has decreased from 90% in 1994 to 89% in 1995. Realized
monthly rents per square foot increased from $.55 in 1994 to $.57 in
1995. The Partnership has increased rental rates in many markets where
it has achieved high occupancy levels and eliminated or minimized
promotions.

. Systems and controls. PSI has an organizational structure and a
property operation system, "CHAMP" (Computerized Help and Management
Program), which links its corporate office with each mini-warehouse.
This enables PSI to obtain daily information from each mini-warehouse and
to achieve efficiencies in operations and maintain control over its space
inventory, rental rates, promotional discounts and delinquencies.
Expense management is achieved through centralized payroll and accounts
payable systems and a comprehensive property tax appeals department, and
PSI has an extensive internal audit program designed to ensure proper
handling of cash collections.

. Professional property operation. In addition to the approximately 120
support personnel at the Public Storage corporate offices, there are
approximately 2,700 on-site personnel who manage the day-to-day
operations of the mini-warehouse in the Public Storage system. These on-
site personnel are supervised by 107 district managers, 14 regional
managers and three divisional managers (with an average of 12 years'
experience in the mini-warehouse industry) who report to the president of
the mini-warehouse property operator (who has 11 years of experience with
the Public Storage organization). PSI carefully selects and extensively
trains the operational and support personnel and offers them a
progressive career path. See "Property Operator."

4
<PAGE>

Property Operators
- ------------------

The Partnership's mini-warehouse properties are managed by PSI and the
Partnership's commercial properties are managed by PSCP pursuant to Management
Agreements.

Under the supervision of the Partnership, PSI and PSCP coordinate the
operation of the facilities, establish rental policies and rates, direct
marketing activity and direct the purchase of equipment and supplies,
maintenance activity, and the selection and engagement of all vendors, supplies
and independent contractors.

PSI and PSCP engage, at the expense of the Partnership, employees for the
operation of the Partnership's facilities, including resident managers,
assistant managers, relief managers, and billing and maintenance personnel.
Some or all of these employees may be employed on a part-time basis and may also
be employed by other persons, partnerships, REITs or other entities owning
facilities operated by PSI or PSCP.

In the purchasing of services such as advertising (including broadcast
media advertising) and insurance, PSI and PSCP attempt to achieve economies by
combining the resources of the various facilities that they operate. Facilities
operated by PSI and PSCP have historically carried comprehensive insurance,
including fire, earthquake, liability and extended coverage.

PSI has developed systems for space inventory, accounting and handling
delinquent accounts, including a computerized network linking PSI operated
facilities. Each project manager is furnished with detailed operating
procedures and typically receives facilities management training from PSI. Form
letters covering a variety of circumstances are also supplied to the project
managers. A record of actions taken by the project managers when delinquencies
occur is maintained.

The Partnership's facilities are typically advertised via signage, yellow
pages, flyers and broadcast media advertising (television and radio) in
geographic areas in which many of the Partnership's facilities are located.
Broadcast media and other advertising costs are charged to the Partnership's
facilities located in geographic areas affected by the advertising. From time
to time, PSI or PSCP adopt promotional programs, such as temporary rent
reductions, in selected areas or for individual facilities.

For as long as the respective Management Agreement is in effect, PSI has
granted the Partnership a non-exclusive license to use two PSI service marks and
related designs (and PSCP has granted the Partnership a non-exclusive license to
use a PSI service mark and related designs), including the "Public Storage"
name, in conjunction with rental and operation of facilities managed pursuant to
the Management Agreement. Upon termination of the respective Management
Agreement, the Partnership would no longer have the right to use the service
marks and related designs except as described below. The General Partners
believe that the loss of the right to use the service marks and related designs
could have a material adverse effect on the Partnership's business.

Each Management Agreement provides that the Management Agreement may be
terminated without cause upon 60 days written notice, by the Partnership and
upon seven years notice by PSI or PSCP, as the case may be. Each Management
Agreement may also be terminated at any time by either party for cause, but if
terminated for cause by the Partnership, the Partnership retains the right to
use the service marks and related designs until a date seven years after such
termination.

Competition
- -----------

Competition in the market areas in which the Partnership operates is
significant and affects the occupancy levels, rental rates and operating
expenses of certain of the Partnership facilities. Competition may be
accelerated by any increase in availability of funds for investment in real
estate. Recent increases in plans for development of mini-warehouses is
expected to further intensify competition among mini-warehouse operators in
certain market areas. In addition to competition from mini-warehouses operated
by PSI, there are three other national firms and numerous regional and local
operators. The Partnership believes that the significant operating and
financial experience of PSI's executive officers and directors and the "Public
Storage" name, should enable the Partnership to continue to compete effectively
with other entities.

5
<PAGE>

Other Business Activities
- -------------------------

A corporation owned by the Hughes Family reinsures policies against losses
to goods stored by tenants in the Partnership's mini-warehouses. The
Partnership believes that the availability of insurance reduces the potential
liability of the Partnership to tenants for losses to their goods from theft or
destruction. This corporation receives the premiums and bears the risks
associated with the insurance.

A corporation, in which PSI has a 95% economic interest and the Hughes
Family has a 5% economic interest, sells locks, boxes and tape to tenants to be
used in securing their spaces and moving their goods. PSI believes that the
availability of locks, boxes and tape for sale promotes the rental of spaces.

Employees
- ---------

There are 120 persons who render services on behalf of the Partnership.
These persons include resident managers, assistant managers, relief managers,
district managers, and administrative personnel. Some or all of these employees
may be employed on a part-time basis and may also be employed by other persons,
partnerships, REITs or other entities owning facilities operated by PSI or PSCP.

ITEM 2. PROPERTIES.
----------

The following table sets forth information as of December 31, 1995, about
properties owned by the Partnership. All but one of these properties were
acquired jointly with PSI and were contributed to a general partnership
comprised of the Partnership and PSI.

<TABLE>
<CAPTION>
Net Number Approximate
Rentable of Date of % of
Location Square Feet Spaces Acquisition Ownership
- ------------------------ ----------- ------ ----------- ---------
<S> <C> <C> <C> <C>
ARIZONA
Scottsdale 44,300 555 07/12/85 50.9%
70th St.
CALIFORNIA
Milpitas 54,700 701 12/24/85 50.0
Pecten Ct.
N. Hollywood 28,900 500 06/07/85 50.0
Raymer St.
N. Hollywood 50,000 829 10/04/85 50.0
Whitsett Ave.
Pleasanton 71,800 583 12/17/85 50.0
Santa Rita Rd.
San Diego 50,800 640 07/11/85 50.0
Kearny Mesa Rd.
CONNECTICUT
Hartford 47,000 430 10/17/85 50.0
Roberts St.
INDIANA
Ft. Wayne 58,900 431 07/06/88 100.0
Illinois Rd.
Indianapolis 59,200 5,231 10/31/85 50.0
Elmwood
Indianapolis 59,200 539 10/31/85 50.0
Pike Plaza Rd.
KANSAS
Wichita 44,200 348 10/09/85 49.9
Carey Lane
</TABLE>

6
<PAGE>

<TABLE>
<CAPTION>
Net Number Approximate
Rentable of Date of % of
Location Square Feet Spaces Acquisition Ownership
- ------------------------ ----------- ------ ----------- ---------
<S> <C> <C> <C> <C>
Wichita 64,200 426 10/09/85 49.9
E. Harry
Wichita 40,800 326 10/09/85 49.9
E. Kellogg
Wichita 47,100 377 10/09/85 49.9
E. MacArthur
Wichita 107,600 814 10/09/85 49.9
S. Rock Road
Wichita 63,300 566 10/09/85 49.9
S. Tyler Rd.
Wichita 55,700 412 10/09/85 49.9
S. Woodlawn
Wichita 53,200 451 10/09/85 49.9
W. Maple
KENTUCKY
Florence 53,800 449 04/30/85 50.0
Tanner Lane
MISSOURI
Joplin 56,200 452 10/09/85 49.9
S. Range Line
NEW HAMPSHIRE
Manchester 61,600 536 05/20/85 50.0
S. Willow II
NORTH CAROLINA
Concord 41,000 454 07/26/85 50.0
Highway 29
OHIO
Cincinnati 53,100 502 04/30/85 50.0
Colerain Ave.
Cincinnati 50,100 464 04/30/85 50.0
E. Kemper
Columbus 62,800 526 10/04/85 50.0
Ambleside Dr.
Columbus 56,900 456 09/25/85 50.0
Sinclair Rd.
Perrysburg 62,800 518 10/29/85 50.0
Helen Drive
OREGON
Milwaukie 50,600 494 05/17/85 49.8
McLoughlin II
Portland 35,100 451 10/02/85 50.0
SE 82nd St.
PENNSYLVANIA
Philadelphia 50,500 442 09/12/85 50.0
Tacony St.
TEXAS
Austin 66,700 852 04/18/85 50.0
S. First St.
</TABLE>

7
<PAGE>

<TABLE>
<CAPTION>
Net Number Approximate
Rentable of Date of % of
Location Square Feet Spaces Acquisition Ownership
- ------------------------ ----------- ------ ----------- ---------
<S> <C> <C> <C> <C>
Houston 130,600 11 07/10/85 66.7
(a) Barkers Landing
San Antonio 156,300 88 10/04/85 66.7
(a) Park Ten Place
San Antonio 43,400 12 10/04/85 66.7
(a) Park Terrace
WASHINGTON
Tacoma 47,300 524 05/23/85 50.0
Phillips Rd. S.W.
WISCONSIN
Madison 71,700 413 09/18/85 50.0
Copps Avenue
</TABLE>

- ----------------------------
(a) low-rise office building

The weighted average occupancy levels for the mini- warehouse and office
building facilities were 89% and 97%, respectively, in 1995 compared to 90% and
95%, respectively, in 1994. In 1995 the monthly realized rent per square foot
for the mini-warehouse and office building facilities averaged $.57 and $.88,
respectively, compared to $.55 and $.82, respectively, in 1994.

Substantially all of the Partnership's facilities were acquired prior to
the time that it was customary to conduct extensive environmental investigations
in connection with the property acquisitions. During the fourth quarter of
1995, an independent environmental consulting firm completed environmental
assessments on the Partnership's properties to evaluate the environmental
condition of, and potential environmental liabilities of such properties. Based
on the assessments, the Partnership believes that there are no known
environmental remediation requirements at this time. Although there can be no
assurance, the Partnership is not aware of any environmental contamination of
its facilities which individually or in the aggregate would be material to the
Partnership's overall business, financial condition, or results of operations.

ITEM 3. LEGAL PROCEEDINGS.
-----------------

No material legal proceeding is pending against the Partnership.

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

No matters were submitted to a vote of security holders during the fourth
quarter of 1995.

8
<PAGE>

PART II

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

The Partnership has no common stock.

The Units are not listed on any national securities exchange or quoted on
the NASDAQ System, and there is no established public trading market for the
Units. Secondary sales activity for the Units has been limited and sporadic.
The General Partners monitor transfers of the Units (a) because the admission of
the transferee as a substitute limited partner requires the consent of the
General Partners under the Partnership's Amended and Restated Agreement of
Limited Partnership, (b) in order to ensure compliance with safe harbor
provisions to avoid treatment as a "publicly traded partnership" for tax
purposes and (c) because PSI has purchased Units. However, the General Partners
do not have information regarding the prices at which all secondary sale
transactions in the Units have been effectuated. Various organizations offer to
purchase and sell limited partnership interests (including securities of the
type such as the Units) in secondary sales transactions. Various publications
such as The Stanger Report summarize and report information (on a monthly,
bimonthly or less frequent basis) regarding secondary sales transactions in
limited partnership interests (including the Units), including the prices at
which such secondary sales transactions are effectuated.

In addition, Dean Witter Reynolds Inc., ("Dean Witter"), the dealer-
manager for the Partnership's initial offering of Units, has certain information
with regard to sale transactions in the Units.

Exclusive of the General Partners' interest in the Partnership, as of
December 31, 1995, there were approximately 3,234 record holders of Units.

The Partnership makes quarterly distributions of all "Cash Available for
Distribution" and will make distributions of "Cash from Sales or Refinancing".
Cash Available for Distribution is cash flow from all sources less cash
necessary for any obligations or capital improvements, or reserves.

Reference is made to Items 6 and 7 hereof for information on the amount of
such distributions.

9
<PAGE>

ITEM 6. SELECTED FINANCIAL DATA.
------------------------

<TABLE>
<CAPTION>
For the Year Ended December 31,
----------------------------------------------------
1995 1994 1993 1992 1991
------- ------ ------ ------ -------
(In thousands, except per Unit data)
<S> <C> <C> <C> <C> <C>
Revenues $14,563 $13,972 $13,589 $12,644 $11,992

Depreciation and amortization 3,229 3,109 3,473 3,178 3,136

Net income (loss) 992 874 303 155 (72)

Limited partners' share 497 587 58 (140) (428)

General partners' share 495 287 245 295 356

Limited partners' per unit data (a)

Net income $ 3.88 $ 4.59 $ .45 $ (1.09) $ (3.34)

Cash distributions (b) (d) $ 34.10 $ 19.60 $ 17.00 $ 20.66 $ 25.11

As of December 31,
- ------------------
Cash and cash equivalents $ 464 $ 1,712 $ 1,344 $ 306 $ 956

Total assets (c) 61,270 64,733 66,238 68,285 71,307
</TABLE>

(a) Limited partners' per unit data is based on the weighted average number of
units outstanding during the year. (128,000 units).
(b) The General Partners distributed, concurrent with the distributions for the
fourth quarter of 1991, a portion of the operating reserve of the
Partnership estimated to be $9.00 per Unit.
(c) In January 1991 two of the Partnership's properties were foreclosed upon by
the mortgage lender, reducing assets and secured notes payable by
$9,535,000.
(d) The General Partners distributed, concurrent with the distributions for the
third quarter of 1995, a portion of the operating reserve of the
Partnership's estimated to be $6.26 per Unit.

10
<PAGE>

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

Results of Operations
- ---------------------

YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31, 1994:

The Partnership's net income in 1995 was $992,000 compared to $874,000 in
1994, representing an increase of $118,000, or 14%. The increase was primarily
due to improved property operations at the Partnership's real estate facilities,
partially offset by increases in depreciation and administrative expenses, and
minority interest in income for those properties held in joint ventures with
PSI.

Property net operating income (rental income less cost of operations and
management fees and excluding depreciation expense) increased approximately
$483,000 or 6% in 1995 compared to 1994, as rental income increased by $564,000,
or 4%, and cost of operations (including management fees) increased by $81,000.

Rental income for the Partnership's mini-warehouse operations was
$11,159,000 in 1995 compared to $10,838,000 in 1994, representing an increase of
$321,000, or 3%. The increase in rental income was primarily attributable to
increased rental rates at the Partnership's facilities. The weighted average
occupancy levels at the mini-warehouse facilities were 89% and 90% in 1995 and
1994, respectively. The monthly average realized rent per square foot for the
mini-warehouse facilities were $.57 in 1995 compared to $.55 in 1994. Costs of
operations (including management fees) increased $14,000, to $4,190,000 in 1995
from $4,176,000 in 1994. Accordingly, for the Partnership's mini-warehouse
operations, property net operating income increased by $307,000 or 5% from
$6,662,000 in 1994 to $6,969,000 in 1995.

Rental income for the Partnership's business park operations was $3,328,000
in 1995 compared to $3,085,000 in 1994, representing an increase of $243,000 or
8%. The increase in rental income is primarily attributable to increases in
both occupancy levels, as well as average realized rent per square foot. The
weighted average occupancy levels at the business park facilities were 97% in
1995 compared to 95% in 1994. The monthly average realized rent per square foot
for the business park facilities was $.88 in 1995 compared to $.82 in 1994.
Cost of operations (including management fees) increased $67,000 or 3% to
$2,173,000 in 1995 from $2,106,000 in 1994. Accordingly, for the Partnership's
business park facilities, property net operating income increased by $176,000 or
18% from $979,000 in 1994 to $1,155,000 in 1995.

In 1995, an independent environmental consulting firm completed
environmental assessments on the Partnership's properties. The Partnership has
included approximately $37,000 in administrative expense in relation to these
assessments.

Minority interest in income for those properties held in joint ventures
with PSI increased $214,000, or 6%, to $3,804,000 from $3,590,000. This
increase was primarily due to increased property operations at the Partnership's
real estate facilities held in joint venture with PSI.

YEAR ENDED DECEMBER 31, 1994 COMPARED TO YEAR ENDED DECEMBER 31, 1993:

The Partnership's net income in 1994 was $874,000 compared to $303,000 in
1993, representing an increase of $571,000, or 188%. The increase was primarily
due to improved property operations at the Partnership's real estate facilities,
partially offset by increases in minority interest in income for those
properties held in joint ventures with PSI.

Property net operating income (rental income less cost of operations and
management fees and excluding depreciation expense) increased approximately
$378,000 or 5% in 1994 compared to 1993, as rental income increased by $361,000,
or 3%, and cost of operations (including management fees) decreased by $17,000.

Rental income for the Partnership's mini-warehouse operations was
$10,838,000 in 1994 compared to $10,303,000 in 1993, representing an increase of
$535,000, or 5%. The increase in rental income was primarily attributable to
increased rental rates at the mini-warehouse facilities. The weighted average
occupancy levels at the mini-warehouse facilities were 90% in 1994 and in 1993.
The monthly average realized rent per square foot for the mini-

11
<PAGE>

warehouse facilities were $.55 in 1994 compared to $.52 in 1993. Costs of
operations (including management fees) decreased $6,000, to $4,176,000 in 1994
from $4,182,000 in 1993. Accordingly, for the Partnership's mini-warehouse
operations, property net operating income increased by $541,000 or 9% from
$6,121,000 in 1993 to $6,662,000 in 1994.

Rental income for the Partnership's business park operations was $3,085,000
in 1994 compared to $3,259,000 in 1993, representing a decrease of $174,000 or
5%. The decrease in rental income is primarily attributable to decreased
operations at the Houston, Texas facility (see below). The weighted average
occupancy levels at the business park facilities were 95% in 1994 compared to
99% in 1993. The monthly average realized rent per square foot for the business
park facilities was $.82 in 1994 compared to $.83 in 1993. Cost of operations
(including management fees) decreased $11,000 or 1% to $2,106,000 in 1994 from
$2,117,000 in 1993. Accordingly, for the Partnership's business park
facilities, property net operating income decreased by $163,000 or 14% from
$1,142,000 in 1993 to $979,000 in 1994.

During 1994, leases expired on units comprising approximately 50% of the
available square footage at the Houston/Barkers Landing office building, which
is owned jointly by the Partnership and PSI. The Partnership actively marketed
the facility and was successful in obtaining new leases on the vacated space,
however, tenant improvements and leasing costs were incurred in connection with
leasing the vacated space. At December 1994, 97% of the available square
footage at this facility had been leased.

Minority interest in income for those properties held in joint ventures
with PSI increased $209,000, or 6%, to $3,590,000 from $3,381,000. This
increase was primarily due to increased property operations at the Partnership's
real estate facilities held in joint venture with PSI.

Liquidity and Capital Resources
- -------------------------------

The Partnership has adequate sources of cash to finance its operations,
both on a short-term and a long-term basis, primarily by internally generated
cash from property operations combined with cash on-hand at December 31, 1995
totaling $464,000.

Cash flows from operating activities ($8,077,000 for the year ended
December 31, 1995) have been sufficient to meet all current obligations of the
Partnership. Total capital improvements were $998,000, $1,271,000 and $490,000
in 1995, 1994 and 1993, respectively. The increase in capital improvements in
1994 and 1995 was primarily due to the tenant improvements required at the
Houston, Texas business park to obtain new leases. During 1996, the Partnership
anticipates incurring approximately $1,774,000 of capital improvements
(including PSI's joint venture share of $723,000). The anticipated increase in
capital improvements in 1996 is mainly due to $975,000 of budgeted improvements
at the Partnership's business parks; specifically, to include renovations to
common areas, roof replacements and tenant improvements on vacated spaces.
During 1995, the Partnership's property manager commenced a program to enhance
the visual appearance of the mini-warehouse facilities managed by it. Such
enhancements will include new signs, exterior color schemes, and improvements to
the rental offices. Included in the 1996 capital improvement budget are
estimated costs of $121,000 for such enhancements.

The Partnership expects to continue making quarterly distributions. Total
distributions paid to the General Partners and the limited partners (including
per Unit amounts) for 1995 and prior years were as follows:

<TABLE>
<CAPTION>
Total Per Unit
--------- --------
<S> <C> <C>
1995 $4,899,000 $34.10
1994 2,816,000 19.60
1993 2,442,000 17.00
1992 2,968,000 20.66
1991 3,607,000 25.11
1990 3,144,000 21.89
1989 3,097,000 21.56
1988 3,769,000 26.23
1987 3,770,000 26.23
1986 3,593,000 25.00
</TABLE>

12
<PAGE>

During the fourth quarter of 1990, the Partnership made a special
distribution totaling $1,077,000 ($7.50 per Unit), representing cash reserves
held. The General Partners distributed, concurrently with the distributions for
the fourth quarter of 1991, a portion of the operating reserve estimated at
$9.00 per Unit. The General Partners also distributed, concurrently with the
distributions for the third quarter of 1995, a portion of the operating reserve
estimated at $6.26 per Unit. Future distribution levels will be based upon cash
flows available for distributions (cash flows from operations less capital
improvements, distributions to minority interest and necessary cash reserves).
Assuming no material change in property operations, the 1996 distribution level
may decrease compared to the 1995 on-going distribution level of $27.84 per Unit
due to the significant increase in capital improvements expected in 1996.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
-------------------------------------------

The Partnership's financial statements are included elsewhere herein.
Reference is made to the Index to Consolidated Financial Statements and
Financial Statement Schedules in Item 14(a).

ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
----------------------------------------------------
None.

13
<PAGE>

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE PARTNERSHIP.
---------------------------------------------------

The Partnership has no directors or executive officers.

The Partnership's General Partners are PSI and B. Wayne Hughes. PSI,
acting through its directors and executive officers, and Mr. Hughes manage and
make investment decisions for the Partnership. The Partnership's properties are
operated by PSI and PSCP, a subsidiary of PSI.

The names of all directors and executive officers of PSI, the offices held
by each of them with PSI, and their ages and business experience during the past
five years are as follows:

<TABLE>
<CAPTION>
Name Positions with PSI
- --------------------- ---------------------------------------------------
<S> <C>
B. Wayne Hughes Chairman of the Board and Chief Executive Officer
Harvey Lenkin President and Director
Ronald L. Havner, Jr. Senior Vice President and Chief Financial Officer
Hugh W. Horne Senior Vice President
Obren B. Gerich Senior Vice President
Marvin M. Lotz Senior Vice President
Mary Jayne Howard Senior Vice President
David Goldberg Senior Vice President and General Counsel
John Reyes Vice President and Controller
Sarah Hass Vice President and Secretary
Robert J. Abernethy Director
Dann V. Angeloff Director
William C. Baker Director
Uri P. Harkham Director
Berry Holmes Director
</TABLE>

B. Wayne Hughes, age 62, a general partner of the Partnership, has been a
director of PSI since its organization in 1980 and was President and Co-Chief
Executive Officer from 1980 until November 1991 when he became Chairman of the
Board and sole Chief Executive Officer. Mr. Hughes has been a director of
Storage Properties, Inc. ("SPI"), a real estate investment trust whose
investment adviser is PSI, since 1989. Since 1990, Mr. Hughes has been Chairman
of the Board of Public Storage Properties X, Inc., Public Storage Properties XI,
Inc., Public Storage Properties XII, Inc., Public Storage Properties XIV, Inc.,
Public Storage Properties XV, Inc., Public Storage Properties XVI, Inc., Public
Storage Properties XVII, Inc., Public Storage Properties XVIII, Inc., Public
Storage Properties XIX, Inc., Public Storage Properties XX, Inc., Partners
Preferred Yield, Inc., Partners Preferred Yield II, Inc. and Partners Preferred
Yield III, Inc. (collectively, the "Public Storage Properties REITs"), real
estate investment trusts organized by affiliates of PSMI. Mr. Hughes has been
active in the real estate investment field for over 25 years.

Harvey Lenkin, age 59, became President and a director of PSI in November
1991. He has been President of the Public Storage Properties REITs since 1990.
He was President of PSMI from January 1978 until September 1988, when he became
Chairman of the Board of PSMI and assumed overall responsibility for investment
banking and investor relations. In 1989, Mr. Lenkin became President and a
director of SPI.

Ronald L. Havner Jr., age 38, a certified public accountant, became an
officer of PSI in 1990, Chief Financial Officer in November 1991 and Senior Vice
President of PSI in November 1995. He was an officer of PSMI from 1986 to 1995
and Chief Financial Officer of PSMI and its affiliates from 1991 to November
1995. Mr. Havner has been an officer of SPI since 1989 and Chief Financial
Officer of SPI since November 1991. He has been a Vice President of the Public
Storage Properties REITS since 1990 and was Controller from 1990 to November
1995 when he became Chief Financial Officer.

14
<PAGE>

Hugh W. Horne, age 51, has been a Vice President of PSI since 1980 and was
Secretary of PSI from 1980 until February 1992 and became Senior Vice President
of PSI in November 1995. He was an officer of PSMI from 1973 to November 1995.
Mr. Horne has been a Vice President of SPI since 1989 and of the Public Storage
Properties REITs since 1993. He is responsible for managing all aspects of
property acquisition for PSI.

Obren B. Gerich, age 56, a certified public accountant and certified
financial planner, has been a Vice President of PSI since 1980 and became Senior
Vice President of PSI in November 1995. He was Chief Financial Officer of PSI
until November 1991. Mr. Gerich was an officer of PSMI from 1975 to November
1995. Mr. Gerich has been Vice President and Secretary of SPI since 1989 and
was Chief Financial Office of SPI until November 1991. He has been Vice
President and Secretary of the Public Storage Properties REITS since 1990 and
was Chief Financial Officer until November 1995.

Marvin M. Lotz, age 53, has had overall responsibility for Public Storage's
mini-warehouse operations since 1988. He became a Senior Vice President of PSI
in November 1995. Mr. Lotz was an officer of PSMI with responsibility for
property acquisitions from 1983 until 1988.

Mary Jayne Howard, age 50, has had overall responsibility for Public
Storage's commercial property operations since December 1985. She became a
Senior Vice President of PSI in November 1995.

David Goldberg, age 46, joined PSMI's legal staff in June 1991, rendering
services on behalf of PSI and PSMI. He became a Senior Vice President and
General Counsel of PSI in November 1995. From December 1982 until May 1991, he
was a partner in the law firm of Sachs & Phelps, then counsel to PSI and PSMI.

John Reyes, age 35, a certified public accountant, joined PSMI in 1990 and
has been the Controller of PSI since 1992. He became a Vice President of PSI in
November 1995. From 1983 to 1990, Mr. Reyes was employed by Ernst & Young.

Sarah Hass, age 40, became Secretary of PSI in February 1992. She became a
Vice President of PSI in November 1995. She joined PSMI's legal department in
June 1991, rendering services on behalf of PSI and PSMI. From 1987 until May
1991, her professional corporation was a partner in the law firm of Sachs &
Phelps, then counsel to PSI and PSMI, and from April 1986 until June 1987, she
was associated with that firm, practicing in the area of securities law. From
September 1979 until September 1985, Ms. Hass was associated with the law firm
of Rifkind & Sterling, Incorporated.

Robert J. Abernethy, age 55, is President of American Standard Development
Company and of Self-Storage Management Company, which develop and operate mini-
warehouses. Mr. Abernethy has been a director of PSI since its organization.
He is a member of Johns Hopkins University and of the Los Angeles County
Metropolitan Transportation Authority and a former member of the board of
directors of the Metropolitan Water District of Southern California.

Dann V. Angeloff, age 60, is President of the Angeloff Company, a corporate
financial advisory firm. The Angeloff Company has rendered, and is expected to
continue to render, financial advisory and securities brokerage services for
PSI. Mr. Angeloff is the general partner of a limited partnership that owns a
mini-warehouse operated by PSI and which secures a note owned by PSI. Mr.
Angeloff has been a director of PSI since its organization. He is a director of
Compensation Resource Group, Datametrics Corporation, Nicholas/Applegate Growth
Equity Fund, Nicholas/Applegate Investment Trust, Royce Medical Company, Seda
Specialty Packaging Corp., and SPI.

William C. Baker, age 62, became a director of PSI in November 1991. From
April 1993 through May 1995, Mr. Baker was President of Red Robin International,
Inc., an operator and franchiser of casual dining restaurants in the United
States and Canada. Since January 1992, he has been Chairman and Chief Executive
Officer of Carolina Restaurant Enterprises, Inc., a franchisee of Red Robin
International, Inc. From 1976 to 1988, he was a principal shareholder and
Chairman and Chief Executive Officer of Del Taco, Inc., an operator and
franchiser of fast food restaurants in California. Mr. Baker is a director of
Santa Anita Realty Enterprises, Inc., Santa Anita Operating Company and Callaway
Golf Company.

Uri P. Harkham, age 47, became a director of PSI in March 1993. Mr.
Harkham has been the President and Chief Executive Officer of the Jonathan
Martin Fashion Group, which specializes in designing, manufacturing and
marketing

15
<PAGE>

women's clothing, since its organization in 1976. Since 1978, Mr. Harkham has
been the Chairman of the Board of Harkham Properties, a real estate firm
specializing in buying and managing fashion warehouses in Los Angeles and
Australia.

Berry Holmes, age 65, is a private investor. Mr. Holmes has been a
director of PSI since its organization. He was President and a director of
Financial Corporation of Santa Barbara and Santa Barbara Savings and Loan
Association through 1983 and was a consultant with Santa Barbara Savings and
Loan Association during 1984. Mr. Holmes is a director of SPI.

Pursuant to Articles 16 and 17 of the Partnership's Amended Certificate and
Agreement of Limited Partnership (the "Partnership Agreement"), a copy of which
is included in the Partnership's prospectus included in the Partnership's
Registration Statement, File No. 2-92009, each of the General Partners
continues to serve until (i) death, insanity, insolvency, bankruptcy or
dissolution, (ii) withdrawal with the consent of the other general partner and a
majority vote of the limited partners, or (iii) removal by a majority vote of
the limited partners.

Each director of PSI serves until he resigns or is removed from office by
PSI, and may resign or be removed from office at any time with or without cause.
Each officer of PSI serves until he resigns or is removed by the board of
directors of PSI. Any such officer may resign or be removed from office at any
time with or without cause.

There have been no events under any bankruptcy act, no criminal
proceedings, and no judgments or injunctions material to the evaluation of the
ability of any director or executive officer of PS I A during the past five
years.

ITEM 11. EXECUTIVE COMPENSATION.
----------------------

The Partnership has no subsidiaries, directors or officers. See Item 13
for a description of certain transactions between the Partnership and the
General Partners and their affiliates.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
---------------------------------------------------------------

(a) At February 29, 1996, PSI owned 5% or more of the Units of the
Partnership:

<TABLE>
<CAPTION>
Title Amount of Percent
of Name and Address of Beneficial of
Class Beneficial Owner Ownership Class
- ----------- --------------------------- ---------- --------
<S> <C> <C> <C>
Units of Public Storage, Inc.
Limited 600 North Brand Blvd.
Partnership Glendale, California 91203 54,209 42.35%
Interest
</TABLE>

The Partnership is not aware of any other beneficial owners of more than
5% of the Units.

(b) The Partnership has no officers and directors.

The General Partners (or their predecessor-in-interest) have contributed
$646,000 to the capital of the Partnership representing 1% of the aggregate
capital contributions and as a result participate in the distributions to the
limited partners and in the Partnership's profits and losses in the same
proportion that the general partners' capital contribution bears to the total
capital contribution. Information regarding ownership of the Units by PSI, a
General Partner, is set forth under section (a) above. The directors and
executive officers of PSI, as a group, do not own any Units.

(c) The Partnership knows of no contractual arrangements, the operation of
the terms of which may at a subsequent date result in a change in control of the
Partnership, except for articles 16, 17 and 21.1 of the Partnership's Amended
Certificate and Agreement of Limited Partnership, a copy of which is included in
the Partnership's prospectus

16
<PAGE>

included in the Partnership's Registration Statement File No. 2-92009. Those
articles provide, in substance, that the limited partners shall have the right,
by majority vote, to remove a general partner and that a general partner may
designate a successor with the consent of the other general partner and a
majority of the limited partners.

The Partnership owns interests in 36 properties, 35 of such properties are
held in a general partnership comprised of the Partnership and PSI. Under the
terms of the partnership agreement relating to the ownership of the properties,
PSI has the right to compel a sale of each property at any time after seven
years from the date of acquisition at not less than its independently determined
fair market value provided the Partnership receives its share of the net sales
proceeds solely in cash. As of December 31, 1995, PSI has the right to require
the Partnership to sell all of the joint venture properties on these terms.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
----------------------------------------------
The Partnership Agreement provides that the General Partners and their
affiliates are entitled to the following compensation:

1. Incentive distributions equal to 10% of Cash Flow from Operations.
2. Provided the limited partners have received distributions equal to
100% of their investment plus a cumulative 8% per year (not
compounded) on their investment (reduced by distributions other than
from Cash Flow from Operations), subordinated incentive distributions
equal to 15% of remaining Cash from Sales or Refinancings.
3. Provided the limited partners have received distributions equal to
100% of their capital contributions plus a cumulative 6% per year (not
compounded) on their investment (reduced by distributions other than
distributions from Cash Flow from Operations), brokerage commissions
at the lesser of 3% of the sales price of a property or 50% of a
competitive commission.

During 1995, approximately $490,000 was paid to PSI with respect items 1,
2, and 3 above. The Partnership owns interests in 36 properties; 35 of such
properties are held in a general partnership comprised of the Partnership and
PSI.

The Partnership has Management Agreements with PSI (as successor-in-
interest to PSMI) and PSCP. Under the Management Agreements, the Partnership
pays PSI (and previously paid PSMI) a fee of 6% of the gross revenues of the
mini-warehouse spaces operated for the Partnership and pays PSCP a fee of 5% of
the gross revenues of the Partnership's non-mini-warehouse space. During 1995,
the Partnership paid or accrued fees of $586,000 to PSMI, $85,000 to PSI and
$168,000 to PSCP pursuant to the Management Agreements.

17
<PAGE>

PART IV

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

(a) List of Documents filed as part of the Report.
1. Financial Statements: See Index to Consolidated Financial
Statements and Financial Statement Schedules.
2. Financial Statement Schedules: See Index to Consolidated
Financial Statements and Financial Statement Schedules.
3. Exhibits: See Exhibit Index contained herein.

(b) Reports on Form 8-K:
None

(a) Exhibits: See Exhibit Index contained herein.

18
<PAGE>

PS PARTNERS IV, LTD.
INDEX TO EXHIBITS

3.1 Amended Certificate and Agreement of Limited Partnership. Previously filed
with the Securities and Exchange Commission as Exhibit A to the
Partnership's Prospectus included in Registration Statement No. 2-92009 and
incorporated herein by reference.

10.1 Amended Management Agreement dated February 21, 1995 between Storage
Equities, Inc. and Public Storage Management , Inc. Previously filed with
the Securities and Exchange Commission as an exhibit to the Partnership's
Annual Report on Form 10-K for the year ended December 31, 1994 and
incorporated herein by reference.

10.2 Amended Management Agreement dated February 21, 1995 between Storage
Equities, Inc. and Public Storage Commercial Properties Group, Inc.
Previously filed with the Securities and Exchange Commission as an exhibit
to the Partnership's Annual Report on Form 10-K for the year ended December
31, 1994 and incorporated herein by reference.

10.3 Participation Agreement dated as of December 26, 1984, among Storage
Equities, Inc., the Partnership, Public Storage, Inc., B. Wayne Hughes and
Kenneth Q. Volk, Jr. Previously filed with the Securities and Exchange
Commission as an exhibit to Storage Equities, Inc. Annual Report on Form
10-K for the year ended December 31, 1984 and incorporated herein by
reference.

27 Financial data schedule. Filed herewith.

19
<PAGE>

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Partnership has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

PS PARTNERS IV, LTD.
Dated: March 25, 1996 By: Public Storage, Inc., General Partner

By: /s/ B. Wayne Hughes
--------------------------------------
B. Wayne Hughes, Chairman of the Board

By: /s/ B. Wayne Hughes
--------------------------------------
B. Wayne Hughes, General Partner

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

<TABLE>
<CAPTION>
Signature Capacity Date
- --------------------------- ------------------------------- ---------------
<S> <C> <C>
/s/ B. Wayne Hughes Chairman of the Board and Chief March 25, 1996
- --------------------------- Executive Officer of Public
B. Wayne Hughes Storage, Inc. and General
Partner (principal executive
officer)

/s/ Harvey Lenkin President and Director March 25, 1996
- --------------------------- of Public Storage, Inc.
Harvey Lenkin

/s/ Ronald L. Havner, Jr. Senior Vice President and Chief March 25, 1996
- --------------------------- Financial Officer of Public
Ronald L. Havner, Jr. Storage, Inc.
(principal financial officer)

/s/ John Reyes Vice President and Controller of March 25, 1996
- --------------------------- Public Storage, Inc.
John Reyes (principal accounting officer)

/s/ Robert J. Abernethy Director of Public Storage, Inc. March 25, 1996
- ---------------------------
Robert J. Abernethy

/s/ Dann V. Angeloff Director of Public Storage, Inc. March 25, 1996
- ---------------------------
Dann V. Angeloff

/s/ William C. Baker Director of Public Storage, Inc. March 25, 1996
- ---------------------------
William C. Baker

/s/ Uri P. Harkham Director of Public Storage, Inc. March 25, 1996
- ---------------------------
Uri P. Harkham

/s/ Berry Holmes Director of Public Storage, Inc. March 25, 1996
- ----------------------------
Berry Holmes
</TABLE>

20
<PAGE>

PS PARTNERS IV, LTD.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULES

(Item 14 (a))

<TABLE>
<CAPTION>
Page
References
----------
<S> <C>
Report of Independent Auditors F-1

Consolidated Financial Statements and Schedules:

Consolidated Balance Sheets as of December 31, 1995 and 1994 F-2

For the years ended December 31, 1995, 1994 and 1993:

Consolidated Statements of Income F-3

Consolidated Statements of Partners' Equity F-4

Consolidated Statements of Cash Flows F-5

Notes to Consolidated Financial Statements F-6 - F-8

Schedule

III - Real Estate and Accumulated Depreciation F-9 - F-12
</TABLE>

All other schedules have been omitted since the required information is not
present or not present in amounts sufficient to require submission of the
schedule, or because the information required is included in the consolidated
financial statements or the notes thereto.

21
<PAGE>

Report of Independent Auditors

The Partners
PS Partners IV, Ltd.

We have audited the consolidated balance sheets of PS Partners IV, Ltd. as of
December 31, 1995 and 1994 and the related consolidated statements of income,
partners' equity, and cash flows for each of the three years in the period ended
December 31, 1995. Our audits also included the financial statement schedule
listed in the Index at Item 14(a). These financial statements and schedule are
the responsibility of the Partnership's management. Our responsibility is to
express an opinion on these financial statements and schedule based on our
audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of PS
Partners IV, Ltd. at December 31, 1995 and 1994, and the consolidated results of
its operations and its cash flows for each of the three years in the period
ended December 31, 1995, in conformity with generally accepted accounting
principles. Also, in our opinion, the related financial statement schedule,
when considered in relation to the basic financial statements taken as a whole,
presents fairly in all material respects the information set forth therein.

ERNST & YOUNG LLP

Los Angeles, CA
March 11, 1996

F-1
<PAGE>

PS PARTNERS IV, LTD.
CONSOLIDATED BALANCE SHEETS
December 31, 1995 and 1994

<TABLE>
<CAPTION>
1995 1994
------------ ------------
<S> <C> <C>
ASSETS

Cash and cash equivalents $ 464,000 $ 1,712,000

Rent and other receivables 55,000 46,000

Real estate facilities, at cost:
Land 19,957,000 19,957,000
Buildings and equipment 71,328,000 70,330,000
------------ ------------
91,285,000 90,287,000

Less accumulated depreciation (30,692,000) (27,463,000)
------------ ------------
60,593,000 62,824,000

Other assets 158,000 151,000
------------ ------------

$ 61,270,000 $ 64,733,000
============ ============

LIABILITIES AND PARTNERS' EQUITY

Accounts payable $ 1,128,000 $ 1,019,000

Advance payments from renters 418,000 459,000

Minority interest in general partnerships 37,887,000 37,511,000

Partners' equity:
Limited partners' equity, $500 per
unit, 128,000 units authorized,
issued and outstanding 21,536,000 25,404,000
General partners' equity 301,000 340,000
------------ ------------

Total partners' equity 21,837,000 25,744,000
------------ ------------

$ 61,270,000 $ 64,733,000
============ ============
</TABLE>

See accompanying footnotes.

F-2
<PAGE>

PS PARTNERS IV, LTD.
CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31, 1995, 1994, and 1993

<TABLE>
<CAPTION>
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
REVENUE:

Rental income $14,487,000 $13,923,000 $13,562,000
Interest income 76,000 49,000 27,000
----------- ----------- -----------
14,563,000 13,972,000 13,589,000
----------- ----------- -----------

COSTS AND EXPENSES:

Cost of operations 5,524,000 5,476,000 5,521,000
Management fees 839,000 806,000 778,000
Depreciation and amortization 3,229,000 3,109,000 3,473,000
Administrative 175,000 117,000 133,000
----------- ----------- -----------
9,767,000 9,508,000 9,905,000
----------- ----------- -----------

Income before minority interest 4,796,000 4,464,000 3,684,000

Minority interest in income 3,804,000 3,590,000 3,381,000
----------- ----------- -----------

NET INCOME $ 992,000 $ 874,000 $ 303,000
=========== =========== ===========

Limited partners' share of net income
(loss) ($3.88, $4.59, and $.45 per
unit in 1995, 1994, and 1993,
respectively) $ 497,000 $ 587,000 $ 58,000
General partners' share of net income 495,000 287,000 245,000
----------- ----------- -----------
$ 992,000 $ 874,000 $ 303,000
=========== =========== ===========
</TABLE>

See accompanying footnotes.

F-3
<PAGE>

PS PARTNERS IV, LTD.
CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY
For the years ended December 31, 1995, 1994, and 1993

Limited General
Partners Partners Total
----------- --------- -----------
<S> <C> <C> <C>
Balances at December 31, 1992 $29,444,000 $ 381,000 $29,825,000

Net income 58,000 245,000 303,000

Distributions (2,176,000) (266,000) (2,442,000)
----------- --------- -----------

Balances at December 31, 1993 27,326,000 360,000 27,686,000

Net income 587,000 287,000 874,000

Distributions (2,509,000) (307,000) (2,816,000)
----------- --------- -----------

Balances at December 31, 1994 25,404,000 340,000 25,744,000

Net income 497,000 495,000 992,000

Distributions (4,365,000) (534,000) (4,899,000)
----------- --------- -----------

Balances at December 31, 1995 $21,536,000 $ 301,000 $21,837,000
=========== ========= ===========
</TABLE>

See accompanying notes.

F-4
<PAGE>

PS PARTNERS IV, LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 1995, 1994, and 1993

<TABLE>
<CAPTION>
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
Cash flows from operating activities:

Net income $ 992,000 $ 874,000 $ 303,000

Adjustments to reconcile net income to net cash provided by
operating activities:

Depreciation and amortization 3,229,000 3,109,000 3,473,000
(Increase) decrease in rent and other receivables (9,000) 40,000 16,000
(Increase) decrease in other assets (7,000) (5,000) 86,000
Increase (decrease) in accounts payable 109,000 (8,000) (295,000)
(Decrease) increase in advance payments from renters (41,000) (24,000) (3,000)
Minority interest in income 3,804,000 3,590,000 3,381,000
----------- ----------- -----------

Total adjustments 7,085,000 6,702,000 6,658,000
----------- ----------- -----------

Net cash provided by operating activities 8,077,000 7,576,000 6,961,000
----------- ----------- -----------

Cash flows from investing activities:

Additions to real estate facilities (998,000) (1,271,000) (490,000)
----------- ----------- -----------

Net cash used in investing activities (998,000) (1,271,000) (490,000)
----------- ----------- -----------

Cash flows from financing activities:

Distributions to holder of minority interest (3,428,000) (3,121,000) (2,991,000)
Distributions to partners (4,899,000) (2,816,000) (2,442,000)
----------- ----------- -----------

Net cash used in financing activities (8,327,000) (5,937,000) (5,433,000)
----------- ----------- -----------

Net (decrease) increase in cash and cash equivalents (1,248,000) 368,000 1,038,000

Cash and cash equivalents at the beginning of the year 1,712,000 1,344,000 306,000
----------- ----------- -----------

Cash and cash equivalents at the end of the year $ 464,000 $ 1,712,000 $ 1,344,000
=========== =========== ===========

</TABLE>

See accompanying notes.

F-5
<PAGE>

PS PARTNERS IV, LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1995

1. Summary of Significant Accounting Policies and Partnership Matters
------------------------------------------------------------------

Description of Partnership
--------------------------

PS Partners IV, Ltd. (the "Partnership") was formed with the proceeds
of an interstate public offering. PSI Associates II, Inc. ("PSA"), an
affiliate of Public Storage Management, Inc., organized the Partnership
along with B. Wayne Hughes ("Hughes"). In September 1993, Storage
Equities, Inc., now known as Public Storage Inc. ("PSI") acquired the
interest of PSA relating to its general partner capital contribution in the
Partnership and was substituted as a co-general partner in place of PSA.

In 1995, there were a series of mergers among Public Storage
Management, Inc. (which was the Partnership's mini-warehouse operator),
Public Storage, Inc. and their affiliates (collectively, "PSMI"),
culminating in the November 16, 1995 merger (the "PSMI Merger") of PSMI
into Storage Equities, Inc. In the PSMI Merger, Storage Equities, Inc.'s
name was changed to Public Storage, Inc. and it acquired substantially all
of PSMI's United States real estate operations and became the operator of
the Partnership's mini-warehouse properties.

The Partnership has invested in existing mini-warehouse storage
facilities which offer self-service storage spaces for lease, usually on a
month-to-month basis, to the general public. The Partnership also invested
in existing office buildings and a business park facility which offer
industrial and office space for lease.

The Partnership has ownership interests in 36 properties; 35 of which
are owned jointly through 23 general partnerships (the "Joint Ventures")
with PSI. For tax administrative efficiency, the Joint Ventures were
subsequently consolidated into a single general partnership. The
Partnership is the managing general partner of the Joint Ventures, which
ownership interests in the Joint Ventures ranges from 49.8% to 66.7%.

Basis of Presentation
---------------------

The consolidated financial statements include the accounts of the
Partnership and the Joint Ventures. PSI's ownership interest in the Joint
Ventures is shown as minority interest in general partnerships in the
accompanying consolidated balance sheets. All significant intercompany
balances and transactions have been eliminated.

Minority interest in income represents PSI's share of net income with
respect to the Joint Ventures. Under the terms of the partnership
agreement all depreciation and amortization with respect to each Joint
Venture is allocated solely to the Partnership until the limited partners
recover their initial capital contribution. Thereafter, all depreciation
and amortization is allocated solely to PSI until it recovers its initial
capital contribution. All remaining depreciation and amortization is
allocated to the Partnership and PSI in proportion to their ownership
percentages. No amounts have been allocated to PSI with respect to the
above provision.

Under the terms of the partnership agreements, for property
acquisitions in which PSI issued convertible securities to the sellers for
its interest, PSI's rights to receive cash flow distributions from the
partnerships for any year after the first year of operation are
subordinated to cash distributions to the Partnership equal to a cumulative
annual 7% of its cash investment (not compounded). These agreements also
specify that upon sale or refinancing of a property for more than its
original purchase price, distribution of proceeds to PSI is subordinated to
the return to the Partnership of the amount of its cash investment and the
7% distribution described above.

In addition to the above provisions, PSI has the right to compel the
sale of each property in the general partnerships at any time after seven
years from the date of acquisition at not less than its independently
determined fair market value provided the Partnership receives its share of
the net sales proceeds solely in cash. PSI's right to require the
Partnership to sell all of the jointly owned properties became exercisable
during 1992.

F-6
<PAGE>

PS PARTNERS IV, LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1995

1. Summary of Significant Accounting Policies and Partnership Matters
------------------------------------------------------------------
(continued)
-----------

Depreciation and Amortization
-----------------------------

The Partnership depreciates the buildings and equipment on the
straight-line method over estimated useful lives of 25 and 5 years,
respectively. Leasing commissions relating to business park properties are
expensed when incurred.

Revenue Recognition
-------------------

Property rents are recognized as earned.

Allocation of Net Income or Loss
--------------------------------

The General Partners' share of net income or loss consists of an
amount attributable to their 1% capital contribution and an additional
percentage of cash flow (as defined, see Note 3) which relates to the
General Partners' share of cash distributions as set forth in the
Partnership Agreement. All remaining net income or loss is allocated to
the limited partners.

Per Unit Data
-------------

Per unit data is based on the number of limited partnership units
(128,000) outstanding during the year.

Cash Distributions
------------------

The Partnership Agreement provides for quarterly distributions of cash
flow from operations (as defined). Cash distributions per unit were
$34.10, $19.60 and $17.00 for 1995, 1994 and 1993, respectively.

Cash and Cash Equivalents
-------------------------

For financial statement purposes, the Partnership considers all highly
liquid investments purchased with a maturity of three months or less to be
cash equivalents.

Environmental Cost
------------------

Substantially all of the Partnership's facilities were acquired prior
to the time that it was customary to conduct extensive environmental
investigations in connection with the property acquisitions. During the
fourth quarter of 1995, an independent environmental consulting firm
completed environmental assessments on the Partnership's properties to
evaluate the environmental condition of, and potential environmental
liabilities of such properties. The Partnership has included approximately
$37,000 in administrative expense in relation to these assessments. Based
on the assessments, the Partnership believes there are no environmental
remediation requirements at this time. Although there can be no assurance,
the Partnership is not aware of any environmental contamination of its
facilities which individually or in the aggregate would be material to the
Partnership's overall business, financial condition, or results of
operations.

2. Real Estate Facilities
----------------------

At December 31, 1995, two real estate facilities (owned jointly with
PSI) with an aggregate net book value of $5,764,000 secure indebtedness of
PSI assumed or incurred in connection with the acquisition of the real
estate facilities. Such indebtedness ($4,033,000) is not reflected in the
accompanying consolidated balance sheets since it does not represent an
obligation of the Partnership. PSI repaid this debt in January 1996.

3. General Partners' Equity
------------------------

The General Partners have a 1% interest in the Partnership. In
addition, the General Partners have a 10% interest in cash distributions
attributable to operations, exclusive of distributions attributable to
sales and financing proceeds.

F-7
<PAGE>

PS PARTNERS IV, LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1995

3. General Partners' Equity (continued)
------------------------------------

Proceeds from sales and refinancings will be distributed entirely to
the limited partners until the limited partners recover their investment
plus a cumulative 8% annual return (not compounded); thereafter, the
General Partners have a 15% interest in remaining proceeds.

4. Related Party Transactions
--------------------------

PSI operates the Partnership's mini-warehouses for a "management fee"
equal to 6% of gross revenue (as defined) and Public Storage Commercial
Properties Group, Inc. ("PSCP") operates the commercial properties for a
"management fee" of 5% of gross revenue (as defined).

PSI has a 95% economic interest and Hughes and family members of
Hughes have a 5% economic interest in PSCP.

5. Leases
------

The Partnership has invested primarily in existing mini-warehouse
storage facilities which offer self-service storage spaces for lease to the
general public. Leases for such space are usually on a month-to-month
basis.

The Partnership has also invested in commercial properties which are
operated as business parks. Leases for such space are generally long-term
non-cancelable operating leases. At December 31, 1995, the minimum rents
receivable under such non-cancelable leases are as follows:

<TABLE>
<S> <C>
1996 $3,124,000
1997 2,139,000
1998 1,622,000
1999 864,000
2000 363,000
Thereafter 3,000
----------

$8,115,000
==========
</TABLE>

6. Taxes Based on Income
---------------------

Taxes based on income are the responsibility of the individual
partners and, accordingly, the Partnership's consolidated financial
statements do not reflect a provision for such taxes.

Taxable net income was $585,000, $382,000 and
$423,000 for the years ended December 31, 1995, 1994 and 1993,
respectively. The difference between taxable income and book income is
primarily related to timing differences in depreciation expense.

F-8
<PAGE>

PS PARTNERS IV, LTD.
SCHEDULE III - REAL ESTATE
AND ACCUMULATED DEPRECIATION

<TABLE>
<CAPTION>
Initial Cost Costs Gross Carrying Amount
subsequent At December 31, 1995
---------------------- to acquisition ------------------------------------------------
Date Encum- Building & Building & Building & Accumulated
Acquired Description brances Land Improvement Improvements Land Improvements Total Depreciation
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Mini-
warehouses
4/85 Austin/S. First - 778,000 1,282,000 152,000 778,000 1,434,000 2,212,000 609,000

4/85 Cincinnati/
E. Kemper - 232,000 1,573,000 180,000 232,000 1,753,000 1,985,000 738,000

4/85 Cincinnati/
Colerain - 253,000 1,717,000 217,000 253,000 1,934,000 2,187,000 816,000

4/85 Florence/
Tanner Lane - 218,000 1,477,000 179,000 218,000 1,656,000 1,874,000 700,000

5/85 Tacoma/
Phillips Rd. - 396,000 1,204,000 148,000 396,000 1,352,000 1,748,000 563,000

5/85 Milwaukie/
McLoughlin II - 458,000 742,000 253,000 458,000 995,000 1,453,000 407,000

7/85 San Diego/
Kearney Mesa Rd - 783,000 1,750,000 266,000 783,000 2,016,000 2,799,000 837,000

5/85 Manchester/
S. Willow II - 371,000 2,129,000 (262,000) 371,000 1,867,000 2,238,000 799,000

6/85 N. Hollywood/
Raymer - 967,000 848,000 227,000 967,000 1,075,000 2,042,000 446,000

7/85 Scottsdale/
70th St. - 632,000 1,368,000 176,000 632,000 1,544,000 2,176,000 632,000

7/85 Concord/Hwy 29 - 150,000 750,000 176,000 150,000 926,000 1,076,000 364,000

10/85 N. Hollywood/
Whitsett (A) - 1,524,000 2,576,000 193,000 1,524,000 2,769,000 4,293,000 1,129,000

10/85 Portland/SE
82nd St. - 354,000 496,000 197,000 354,000 693,000 1,047,000 281,000
</TABLE>

F-9
<PAGE>

PS PARTNERS IV, LTD.
SCHEDULE III - REAL ESTATE
AND ACCUMULATED DEPRECIATION

<TABLE>
<CAPTION>
Initial Cost Costs Gross Carrying Amount
subsequent At December 31, 1995
---------------------- to acquisition ------------------------------------------------
Date Encum- Building & Building & Building & Accumulated
Acquired Description brances Land Improvement Improvements Land Improvements Total Depreciation
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
9/85 Madison/Copps
Ave. - 450,000 1,150,000 275,000 450,000 1,425,000 1,875,000 590,000

9/85 Columbus/
Sinclair - 307,000 893,000 118,000 307,000 1,011,000 1,318,000 408,000

9/85 Philadelphia/
Tacony St. - 118,000 1,782,000 132,000 118,000 1,914,000 2,032,000 786,000

10/85 Perrysburg/
Helen Dr. - 110,000 1,590,000 (195,000) 110,000 1,395,000 1,505,000 573,000

10/85 Columbus/Ambleside - 124,000 1,526,000 (207,000) 124,000 1,319,000 1,443,000 546,000

10/85 Indianapolis/
Pike Place - 229,000 1,531,000 154,000 229,000 1,685,000 1,914,000 683,000

10/85 Indianapolis/
Beach Grove - 198,000 1,342,000 122,000 198,000 1,464,000 1,662,000 588,000

10/85 Hartford/Roberts - 219,000 1,481,000 251,000 219,000 1,732,000 1,951,000 694,000

10/85 Wichita/ S.
Rock Rd. - 501,000 1,478,000 (89,000) 642,000 1,248,000 1,890,000 531,000

10/85 Wichita/ E. Harry - 313,000 1,050,000 (138,000) 313,000 912,000 1,225,000 381,000

10/85 Wichita/ S.
Woodlawn - 263,000 905,000 (178,000) 263,000 727,000 990,000 312,000

10/85 Wichita/ E.
Kellogg - 185,000 658,000 (159,000) 185,000 499,000 684,000 214,000

10/85 Wichita/ S. Tyler - 294,000 1,004,000 (15,000) 294,000 989,000 1,283,000 377,000

10/85 Wichita/ W. Maple - 234,000 805,000 (210,000) 234,000 595,000 829,000 257,000

10/85 Wichita/
Carey Lane - 192,000 674,000 (143,000) 192,000 531,000 723,000 222,000
</TABLE>

F-10
<PAGE>

PS PARTNERS IV, LTD.
SCHEDULE III - REAL ESTATE
AND ACCUMULATED DEPRECIATION

<TABLE>
<CAPTION>
Initial Cost Costs Gross Carrying Amount
subsequent At December 31, 1995
---------------------- to acquisition ------------------------------------------------
Date Encum- Building & Building & Building & Accumulated
Acquired Description brances Land Improvement Improvements Land Improvements Total Depreciation
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
10/85 Wichita/E.
Macarthur - 220,000 775,000 (202,000) 220,000 573,000 793,000 247,000

10/85 Joplin/ S.
Range Line - 264,000 904,000 (79,000) 264,000 825,000 1,089,000 328,000

12/85 Milpitas - 1,623,000 1,577,000 203,000 1,623,000 1,780,000 3,403,000 711,000

12/85 Pleasanton/
Santa Rita (A) - 1,226,000 2,078,000 193,000 1,226,000 2,271,000 3,497,000 897,000

7/88 Fort Wayne - 101,000 1,524,000 (24,000) 101,000 1,500,000 1,601,000 458,000

Business
parks

7/85 Timberway - 2,221,000 12,179,000 2,510,000 2,221,000 14,689,000 16,910,000 6,849,000

10/85 One Park Ten - 2,365,000 6,215,000 2,815,000 2,365,000 9,030,000 11,395,000 3,606,000

10/85 Park terrace - 943,000 2,477,000 723,000 943,000 3,200,000 4,143,000 2,113,000
----------------------------------------------------------------------------------------------------

TOTAL - $19,816,000 $63,510,000 $7,959,000 $19,957,000 $71,328,000 $91,285,000 $30,692,000
====================================================================================================
</TABLE>

(A) This property is pledged as a collateral on the minority interest's
borrowing with respect to such property.

F-11
<PAGE>

PS PARTNERS IV, LTD.
A CALIFORNIA LIMITED PARTNERSHIP
REAL ESTATE RECONCILIATION
SCHEDULE III (CONTINUED)

(B) The following is a reconciliation of cost and related accumulated
depreciation.

GROSS COST CARRYING RECONCILIATION

<TABLE>
<CAPTION>
Years Ended
December 31,
----------------------------------------
1995 1994 1993
---------------------------------------
<S> <C> <C> <C>
Balance at beginning of
the period $90,287,000 $89,016,000 $88,526,000

Additions during the period:
Improvements, etc. 998,000 1,271,000 490,000

Deductions during the period: - - -
---------------------------------------

Balance at the close of the
period $91,285,000 $90,287,000 $89,016,000
=======================================
</TABLE>

ACCUMULATED DEPRECIATION RECONCILIATION

<TABLE>
<CAPTION>
Years Ended
December 31,
---------------------------------------
1995 1994 1993
---------------------------------------
<S> <C> <C> <C>
Balance at beginning of the $27,463,000 $24,354,000 $20,881,000
period

Additions during the period:
Depreciation 3,229,000 3,109,000 3,473,000

Deductions during the period: - - -
---------------------------------------

Balance at the close of the
period $30,692,000 $27,463,000 $24,354,000
=======================================
</TABLE>

F-12

<PAGE>

<ARTICLE> 5

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 464,000
<SECURITIES> 0
<RECEIVABLES> 55,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 519,000
<PP&E> 91,285,000
<DEPRECIATION> (30,692,000)
<TOTAL-ASSETS> 61,270,000
<CURRENT-LIABILITIES> 1,546,000
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 21,837,000
<TOTAL-LIABILITY-AND-EQUITY> 61,270,000
<SALES> 14,487,000
<TOTAL-REVENUES> 14,563,000
<CGS> 6,363,000
<TOTAL-COSTS> 6,363,000
<OTHER-EXPENSES> 3,404,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 992,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 992,000
<EPS-PRIMARY> 3.88
<EPS-DILUTED> 0

</TABLE>