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, 1996
                         ------------------------
                                       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:  2-95034LA
                       ----------------

ARMORED  STORAGE  INCOME  INVESTORS  LIMITED  PARTNERSHIP  (an  Arizona  Limited
Partnership)
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

           Arizona                                       86-0503193
-------------------------------                ---------------------------------
(State or other jurisdiction of                (IRS Employer Identification No.)
 incorporation or organization)

 3839 N. 3rd St., Ste. 108, Phoenix, Arizona                     85012
 -------------------------------------------             -----------------------
 (Address of principal executive office)                       (Zip Code)
Registrant's telephone number, including area code:  (602) 230-1655
                                                     --------------
Securities registered pursuant to Section 12(b) of the Act:

   Title of each class                 Name of each exchange on which registered
        None                                                 None
------------------------------------   -----------------------------------------
Securities registered pursuant to Section 12(g) of the Act:

       Limited Partnership Units
-----------------------------------------
         (Title of Class)

  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 this
Form 10-K.
  X
-----
  Indicated  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
                                             ---    ---

As of March 1, 1997, 15,000 Limited  Partnership  Units were  outstanding.  Such
Limited Partnership Units were sold at $500 per Unit. However, no market for the
Limited  Partnership  Units of the Registrant exists and therefore the aggregate
market  value of the  Units  held by  non-affiliates  of the  Registrant  is not
determinable.

Documents Incorporated by Reference
-----------------------------------
The  Registrant's  Prospectus dated March 9, 1985 filed pursuant to Rule 424 (c)
under the  Securities Act of 1933 as amended is  incorporated  by reference into
Parts I, II and III of this report  pursuant to Rule 12b-23 under the Securities
Exchange Act of 1934.
<PAGE>
                                     PART I

Item 1.  Business
         --------

(a) General Development of Business
    -------------------------------

Armored Storage Income Investors  Limited  Partnership  (the  "Registrant") is a
limited  partnership  formed on  December 4, 1984 under the laws of the State of
Arizona to acquire,  develop,  own and operate  self-storage  facilities using a
minimum of mortgage  indebtedness.  The  Registrant  sold  $7,500,000 in Limited
Partnership Interests to the public pursuant to a Registration Statement on Form
S-18 under the Securities Act of 1933 (Registration Statement No. 2-95034LA), as
amended.  The offering commenced on March 8, 1985 and terminated on February 28,
1986.

(b)  Financial Information About Industry Segments
     ---------------------------------------------

The  Registrant  operates  in  only  one  industry  segment,   the  acquisition,
development,  operation and holding for investment of  self-storage  facilities.
Information  relating  to  the  Registrant's  revenues,   operating  profit  and
identifiable assets attributable  thereto for the fiscal year ended December 31,
1996 is set forth under Item 8 below.

(c)  Narrative Description of Business
     ---------------------------------

The  Self-Service   Storage  Association  (SSSA)  estimates  that  approximately
one-half of the population relocates every three years. Urban areas are becoming
more  congested,  houses are getting  smaller and people are  requiring  outside
storage space to meet their needs.  Business owners, too, are feeling the crunch
as the  square  foot cost of office  space  increases.  They need an  affordable
alternative  to using  expensive  office  space for the  storage of records  and
supplies.

Self-storage  is an  innovation  responding to the needs of the  community.  The
facilities  owned and operated by the Registrant are designed to offer low cost,
accessible  and secure  storage space for business and personal use. In addition
to indoor units,  special parking areas are available for convenient  storage of
recreational vehicles.  Computerized entry systems and on-site, live-in managers
provide an extra  measure of security.  The  facilities  of the  Registrant  are
designed for a comfortable architectural blend with the surrounding residential,
commercial and retail areas.

The  Partnership's   principal   investment   objectives  are:  (i)  to  provide
distributions of Cash Flow from operations; (ii) realize capital appreciation of
the  Partnership's  Properties;  (iii)  to  preserve  and  protect  the  Limited
Partner's capital; and, (iv) to develop a geographically  diversified investment
portfolio  of  self-storage  properties.  There can be no  assurance  that these
objectives will be attained.
<PAGE>
Markets and Competition.
------------------------
The Phoenix and  Albuquerque  markets  have one of the greatest  saturations  of
storage  facilities  per  capita in the  country.  To meet the  competition  the
Registrant  is, and intends to  continue,  taking  steps to  maximize  efficient
operations and to differentiate its facilities from the competition.

General Risks of Real Estate Ownership.
---------------------------------------
The Registrant's  investments are subject to the risks generally incident to the
ownership of real property.  These risks include the uncertainty of cash flow to
meet fixed obligations, adverse changes in national economic conditions, changes
in the  relative  demand for space in the locale of the  facility  (and thus the
relative  price which can be charged),  adverse local market  conditions  due to
changes in general or local economic conditions or neighborhood values,  changes
in interest rates and in the availability, cost and terms of mortgage funds, the
financial condition of tenants and sellers of properties, changes in real estate
tax rates and other operating  expenses,  governmental rules and fiscal policies
including  possible  proposals  for  rent  controls,  as  well  as  acts of God,
uninsured losses and other factors.

Seasonality. The business of the Registrant is not generally subject to seasonal
------------
variations.

Employees.  The Registrant has no full-time employees.
----------

(d) Financial Information About Foreign and Domestic Operations and Export Sales
    ----------------------------------------------------------------------------

The  registrant  does not derive any revenue from foreign  operations  or export
sales.

Item 2.  Description of Property
         -----------------------

The Partnership has three self-storage  facilities,  two of which are located in
Phoenix, Arizona and one located in Albuquerque, New Mexico.

Bell Road, Phoenix, Arizona
---------------------------
The Partnership  owns a three-story  enclosed  self-storage  facility at 1025 E.
Bell  Road,   Phoenix,   Arizona  ("Bell  Road").   This  facility  consists  of
approximately  81,500 gross square feet, built on 1.5 acres of land. The storage
facility  includes 807 indoor  spaces,  54 safety  deposit  boxes,  and 114 mail
boxes.  The property was acquired from an affiliate of the General  Partner at a
cost of $2,249,632  of which  $2,049,632  was  allocated  for the building,  and
$200,000  allocated for the land. The purchase price represented the affiliate's
cost in the land and  improvements.  The facility was acquired in November  1985
while still in the developmental  stage and became  operational in January 1986.
As of January 31, 1997, the facility had an occupancy level of 87%.
<PAGE>
63rd Avenue and McDowell
------------------------
The Partnership owns a self-storage facility at 63rd Avenue and McDowell Road in
Phoenix,  Arizona ("63rd Avenue"). This facility consists of 76,325 gross square
feet of rentable space consisting of eight separate single level buildings built
on 3.9 acres of land. A two-story  building  houses the office and the manager's
apartment.  The Registrant acquired the facility in December 1986 for a purchase
price of $2,300,000. As of January 31, 1997, the facility had an occupancy level
of 75%.

Tramway - Albuquerque, New Mexico
---------------------------------
The Partnership  owns a three-story  enclosed  facility  located at 12920 Indian
School Road, at the intersection of Tramway Boulevard in Albuquerque, New Mexico
("Tramway").  This facility consists of approximately  82,000 gross square feet,
built on 1.2 acres of land. The Partnership  purchased the undeveloped  property
from an affiliate of the General Partner in October 1985 for a purchase price of
$298,566,  which  represented the affiliate's cost in the land.  Construction of
the  facility  was  completed  in  September  1987  at a cost  of  approximately
$1,691,501. As of January 31, 1997, the facility had an occupancy level of 80%.

Additional  information relative to the Properties is provided elsewhere in this
report and is incorporated herein by reference.

Item 3.  Legal Proceedings.
         ------------------

The Registrant is not subject to any material pending legal proceedings.

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

No matters were submitted to a vote of Limited  Partnership  Unit Holders during
the fourth quarter of the fiscal year covered by this report.


                                     PART II

Item 5.  Market for the  Registrant's  Common Equity and Related Security Holder
         -----------------------------------------------------------------------
Matters
-------

(a) Market  Information.  No market for Limited  Partnership  Units exists or is
expected to develop.

(b)  Holders.  The  approximate  number of holders of the  Registrant's  Limited
Partnership Units as of the close of business on December 31, 1996 was 1067.

(c)  Dividends.  During the years ended  December 31, 1991 through 1994,  and in
1996 the Partnership  made  distributions  of cash to the Limited  Partners.  No
distributions  were  made in  1995.  The  source  of the  distributions  were as
follows:
<TABLE>
<CAPTION>
                           1991       1992       1993       1994       1995        1996
                         --------   --------   --------   --------   --------    --------
<S>                      <C>        <C>        <C>        <C>        <C>         <C>     
From net income          $ 77,324   $143,644   $152,881   $209,961   $    -0-    $375,000
From partners' capital    122,638    131,339    147,119     90,039        -0-         -0-
                         --------   --------   --------   --------   --------    --------

                         $199,962   $274,983   $300,000   $300,000   $    -0-    $375,000
                         ========   ========   ========   ========   ========    ========
</TABLE>
<PAGE>
The Registrant will make annual distributions,  to the extent available, of Cash
Available  for  Distribution.  There is,  however,  no  assurance  as to when or
whether such cash will be available for distribution to the Limited Partners.

Cash Available for Distribution is generally the  Partnership's  Excess Reserves
and Cash Flow after  reduction for any additions to reserves,  and after payment
of all operating cash expenses.

To the extent  available,  Cash Available for  Distribution  for any Partnership
fiscal  year  will be  distributed  95% to the  Limited  Partners  and 5% to the
General  Partner.  As  referred  to in Item 11,  the  general  partner  is to be
allocated a minimum of 1% of the cash available for distribution.

If in any period the General Partner determines that Partnership working capital
reserves are in excess of the amount deemed necessary for Partnership operations
(such  excess  being  called  "Excess  Reserves"),  such Excess  Reserves may be
distributed as Cash Available for Distribution.

Cash Available for  Distribution  will be distributed to the Limited Partners of
record as of the end of the applicable period in the ratio which the Units owned
by such Limited  Partner bears to the total Units owned by all Limited  Partners
entitled to such distribution.

Item 6.  Selected Financial Data
         -----------------------

The following  selected  financial data should be read in  conjunction  with the
financial  statements  and notes thereto  included  under Item 8 of this report.
This  data  is not  covered  by the  opinion  of  independent  certified  public
accountants.
<TABLE>
<CAPTION>
                                                            For the Period

                                    Jan. 1, 1989    Jan. 1, 1990  Jan. 1, 1991  Jan. 1, 1992
Statement of                             Thru           Thru          Thru          Thru
Income Information:                 Dec 31, 1989    Dec 31, 1990  Dec 31, 1991  Dec 31, 1992
                                    ------------    ------------  ------------  ------------
<S>                                  <C>            <C>           <C>           <C>       
Total Revenues                       $  622,689     $  747,517    $  832,283    $  896,654
Net Income (Loss)                    $ ( 94,487)    $   34,052    $   81,394    $  151,204
Net Income (Loss) Per
Limited Partnership Unit             $   ( 6.24)    $     2.16    $     5.15    $     9.58


                                    Jan  1, 1993  Jan  1, 1994   Jan 1, 1995   Jan 1, 1996
Statement of                            Thru          Thru          Thru          Thru
Income Information:                 Dec 31, 1993  Dec 31, 1994   Dec 31, 1995  Dec 31, 1996
                                    ------------  ------------   ------------  ------------

Total Revenues                       $  898,749   $   976,287    $ 1,095,127   $ 1,125,211
Net Income (Loss)                    $  160,927   $   221,012    $   317,140   $   450,554
Net Income (Loss) Per
Limited Partnership Unit             $    10.19   $     14.00    $     20.08   $     28.54
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                            As of         As of         As of         As of
Balance Sheet Information:                  Dec 31, 1989  Dec 31, 1990  Dec 31, 1991  Dec 31, 1992
                                            ------------  ------------  ------------  ------------
<S>                                          <C>          <C>           <C>           <C>        
         Total Assets                        $ 6,453,651  $ 6,466,880   $ 6,351,974   $ 6,209,730
         Long-Term Debt                      $   941,533  $   937,265   $   932,765   $   926,704
         Partners' Capital                   $ 5,425,004  $ 5,459,056   $ 5,338,640   $ 5,211,911
         Distributions Per Unit              $    -0-     $    -0-      $     13.34   $     18.33

                                            As of         As of         As of         As of
                                            Dec 31, 1993  Dec 31, 1994  Dec 31, 1995  Dec 31, 1996
                                            ------------  ------------  ------------  ------------
         Total Assets                        $ 6,054,998  $  5,973,592  $  5,396,037  $  5,461,547
         Long-Term Debt                      $   917,325  $    904,267           -0-           -0-

         Partners' Capital                   $ 5,069,808  $  4,987,790  $  5,304,930  $  5,376,696
         Distributions Per Unit              $     20.00  $      20.00           -0-         25.00
</TABLE>

Item 7.  Management's Discussion and Analysis of Financial Condition and Results
         -----------------------------------------------------------------------
         of Operations
         -------------

(a)(1) and (a)(2)  Liquidity and Capital Resources
                   -------------------------------

The  Registrant  was  organized  in  December  1984 and its  offering of Limited
Partnership  Units was declared  effective March 8, 1985. The entire offering of
$7,500,000 was sold during the offering period.

The cash  balance at December  31, 1996 of $426,865  will be used  primarily  as
working capital reserves and, when appropriate, for distributions to the Limited
Partners.  It is anticipated  that capital  resources  will increase  during the
coming year with a corresponding  increase in the Registrant's  liquidity as the
facilities increase in occupancy.

The registrant has acquired and developed all of its properties,  therefore,  no
significant  additional outlays of funds are expected beyond those items already
budgeted.

(a)(3)  Results of Operations
        ---------------------

The Partnership's three operating facilities and dates opened are as follows:

         Facility                   Date Opened
         --------                   -----------
         Bell Road                  January 1986
         63rd Avenue                December 1986
         Tramway                    September 1987

In 1996 the Registrant's  facilities  generated  $1,118,127 in rental income, an
increase of 4.5% over 1995. Occupancy figures are summarized as follows:

                           Average Occupancy       High    Low    12/31/96
                           -----------------       ----    ---    --------
Bell Road                          85%              91%    81%       87%
63rd Avenue                        76%              78%    74%       74%
Tramway                            82%              87%    74%       80%
<PAGE>
Rental income  increased even through average  occupancies  dropped  slightly at
each facility.  A mini building boom in storage facilities is partly responsible
for the decrease in occupancy rates.  Revenues are expected to increase slightly
in 1997 as demand for storage space remains high.

Expenses  relating to property  operations were $393,953 in 1996,  approximately
$12,000 less than 1995. Partnership  administration expenses were slightly lower
as well for 1996. Expenses in 1997 should be similar to those in prior years.

Net cash  generated  from  operations  of  $649,549  was used to make the annual
distribution and to rebuild cash reserves. As rent increases take effect and the
facilities  continue  to achieve  higher  occupancies,  cash flow will  increase
accordingly.

Inflation has historically been a contributing  factor to the increase in rental
income levels and capital appreciation of income producing real estate. The most
significant  trends or  uncertainties  having  an  impact  on the  Partnership's
revenues are those associated with inflation, changes in demand for self-storage
spaces  and  fluctuations  in  rental  and  occupancy  rates of the  Partnership
properties. The modest inflation levels of the past several years have kept rent
increases to a minimum.  We continue to monitor the  properties  performance  to
maximize   long-term   capital   appreciation   which  is  consistent  with  the
Partnership's objectives.


Item 8:  Financial Statements and Supplementary Data.
         --------------------------------------------

See Index to Financial Statements and Schedules attached hereto.

Item 9.  Changes  In  and  Disagreements  With  Accountants  on  Accounting  and
         -----------------------------------------------------------------------
         Financial Disclosures None
         --------------------------

Item 10. Directors and Executive Officers of the Registrant
         --------------------------------------------------

The Registrant is managed by its General  Partner,  Armored  Storage One Limited
Partnership.  Armored  Storage  One  Limited  Partnership  is managed by Armored
Management,  L.L.C,  the  members  of which are Carl R.  Spiekerman  and Dale D.
Ulrich.

The  Partnership  entered into an agreement  with  QuestCor,  Inc. to manage the
Partnership's  self-storage  facilities.  The terms of the agreement are for one
year and shall be  renewed on a  month-to-month  basis  unless and until  either
party  terminates the agreement.  The agreement  provides that the manager shall
receive,  as compensation for services,  the greater of $1000 per month or 6% of
the  actual  gross  cash  receipts  from the  prior  month for each of the three
facilities it manages.
<PAGE>
The   Partnership   entered   into  an  agreement   with   QuestCor  to  provide
administrative services to the Partnership, such as investor relations, database
management   (including   data  processing  of  investor   subscriptions,   fund
distributions,   ownership  changes,   and  subscription   input),   accounting,
preparation and/or  coordinating the preparation of periodic  regulatory reports
and tax  related  forms.  The term of the  agreement  is for one year and  shall
continue on a month-to-month basis unless either party terminates the agreement.
The  agreement  provides  that  QuestCor  shall receive a fixed fee of $4500 per
month  as  compensation  for its  services.  Additionally,  QuestCor  bills  the
Partnership for its cost of participation in the annual partnership audit.

(a)      Identification of Directors
         ---------------------------
Carl R.  Spiekerman  and Dale D.  Ulrich  are the  managing  members  of Armored
Management  L.L.C.  Mr.  Spiekerman,  53,  is the  sole  shareholder  and  Chief
Executive Officer of The Environmental  Group, Inc., a Phoenix based real estate
development  firm. Mr.  Spiekerman holds a Bachelor's Degree from the University
of Puget Sound, Tacoma, Washington, and a Master's Degree from the University of
Washington. Mr. Ulrich, 43, is a C.P.A. and a shareholder of QuestCor Inc. He is
also a panel  trustee for the  District of Arizona  Bankruptcy  Court and former
president of the Arizona Society of CPA's.  Mr. Ulrich  graduated from Marquette
University, Milwaukee, Wisconsin.

(b)      Identification of Executive Officers
         ------------------------------------
         None

(c)      Significant Employees
         ---------------------
         None

(d)      Family Relationships
         --------------------
         None

(e)      Legal Proceedings
         -----------------
         None


Item 11. Executive Compensation
         ----------------------

The General Partner, and its affiliates,  earned fees, commissions,  and expense
reimbursements, as permitted in the Limited Partnership Agreement, as follows:
<TABLE>
<CAPTION>
                                For the Year Ended:        12/31/96   12/31/95   12/31/94
                                                           --------   --------   --------
<S>                                                          <C>        <C>        <C>  
Direct expenses relating to administration of the 
Partnership which were reimbursed or are to be 
reimbursed to the Managing General Partner, or
affiliates thereof                                           None       $6000      $5500

General Partner's distributive share of cash
cash available for distribution                              $3788(1)    None      $3030

Real estate commission upon the sale of Partnership
property payable to the General Partner                      None (2)    None       None

General Partner's share of sale or refinancing
proceeds                                                     None (3)    None       None
</TABLE>
<PAGE>
(1)Cash  Available for  Distribution,  if any, shall be  Distributed  95% to the
Limited  Partners,  and 5% to the General  Partner,  with the General  Partner's
share subordinated to a 10% annual cumulative, noncompounded return with respect
to the Limited Partners' Adjusted Capital Contributions.

If at any  time  the  allocation  and  distribution  provisions  of the  Limited
Partnership  Agreement do not result in the  allocation or  distribution  to the
General  Partners of an aggregate of at least one percent (1%) of the item being
allocated or  distributed,  the Limited  Partnership  Agreement  states that the
General Partners are to be allocated or distributed so much more of such item as
will cause the General  Partners to be allocated or distributed one percent (1%)
thereof.

(2)The General Partner,  or an affiliate,  is entitled to receive a subordinated
real estate  commission  in an amount not to exceed the lesser of  one-half  the
amount  customarily  charged by others  rendering  similar services or 3% of the
sale price.

(3)Sale or  refinancing  proceeds  will be  distributed  to Limited  Partners in
accordance  with their  Capital  Accounts in an amount  equal to their  Adjusted
Capital  Contributions,  then to the Limited  Partners in an amount,  if any, by
which actual Distributions of Cash Available for Distribution were less than the
preferred 10% return,  then to the General Partner, a subordinated  unpaid 5% of
Cash Available for  Distribution,  and the remaining 85% to the Limited Partner,
and 15% to the General Partner.


Item 12. Security Ownership of Certain Beneficial Owners and Management
         --------------------------------------------------------------

At  December  31,  1996  there  was  one  owner  of more  than 5% of the  voting
securities of the  Registrant.  Public Storage,  Inc. 701 Western Avenue,  Suite
200, Glendale, CA 91201, owned 1,058 limited partnership units constituting 7.1%
of all outstanding units.

At December 31, 1996 Dale D. Ulrich,  a member of the managing  general partner,
owned  132  limited  partnership  units,   constituting  less  than  1%  of  the
outstanding units.

There are no arrangements  known to the Registrant,  the operation of which may,
at a subsequent date, result in a change in control of the Registrant.

Item 13. Certain Relationships and Related Transactions
         ----------------------------------------------

During the years ended  December 31, 1996,  1995 and 1994 QuestCor  received the
following compensation:
                                1996      1995      1994
                             -------   -------   -------

Property management          $68,426   $63,807   $57,547
Partnership administration   $54,000   $54,000   $54,000
Audit assistance             $ 5,000   $ 5,000   $ 5,000
<PAGE>
                                     PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
         ---------------------------------------------------------------

(a)(1) and (a)(2) List of Financial  Statements  and Schedules as a Part of this
                  --------------------------------------------------------------
                  Report
                  ------
                  
Reports of Independent Certified Public Accountants

FINANCIAL STATEMENTS
         Balance sheet
         Statement of operations
         Statement of changes in partners' equity
         Statement of cash flows
         Notes to financial statements



(a)(3)            List of Exhibits Filed as Part of this Report
                  None

(b)               Reports on Form 8-K
                  None
<PAGE>
                                   SIGNATURES
                                   ----------


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

                                        ARMORED STORAGE INCOME INVESTORS
                                        LIMITED PARTNERSHIP

                                        By:      Armored Storage One Limited 
                                                 Partnership

                                        Its:     General Partner



Dated: 3/21/97                          By:  /s/ Carl R. Spiekerman
     -----------                             -----------------------------------
                                             Carl R. Spiekerman,
                                             Member, Armored Management L.L.C.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been  signed  below by the  following  person  in the  capacity  on the date
indicated.

   Signature                       Title                              Date
   ---------                       -----                              ----


/s/ Carl R. Spiekerman    for Armored Management, L.L.C.             3/21/97
------------------------  Managing General Partner of               ---------
Carl R. Spiekerman        Armored Storage One Limited
                          Partnership, the General   
                          Partner of the Registrant  
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                              FINANCIAL STATEMENTS

                                DECEMBER 31, 1996
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                              FINANCIAL STATEMENTS

                                DECEMBER 31, 1996








                                    CONTENTS

                                                                            Page

Independent auditor's report                                                 1


Financial statements:

    Balance sheets                                                           2

    Statements of operations                                                 3

    Statements of changes in partners' equity                                4

    Statements of cash flows                                                5-6

    Notes to financial statements                                           7-11
<PAGE>
To the Partners of
Armored Storage Income Investors
    Limited Partnership
Phoenix, Arizona


                          INDEPENDENT AUDITOR'S REPORT

           We have audited the  accompanying  balance sheets of Armored  Storage
Income  Investors  Limited  Partnership as of December 31, 1996 and 1995 and the
related  statements of operations,  changes in partners' equity,  and cash flows
for each of the  three  years in the  period  ended  December  31,  1996.  These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements 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 financial  statements  referred to above present
fairly,  in all material  respects,  the financial  position of Armored  Storage
Income Investors  Limited  Partnership as of December 31, 1996 and 1995, and the
results of its  operations and its cash flows for each of the three years in the
period ended December 31, 1996 in conformity with generally accepted  accounting
principles.





TOBACK CPAs, P.C.
Phoenix, Arizona
February 4, 1997
                                                                               1
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                                 BALANCE SHEETS

                           DECEMBER 31, 1996 AND 1995


                                     ASSETS

                                                         1996           1995
                                                     -----------    -----------
Rental property and equipment:
    Land (Note 3)                                    $ 1,139,828    $ 1,139,828
    Building (Note 3)                                  5,856,762      5,856,762
    Furniture and fixtures (Note 3)                       74,576         74,576
                                                     -----------    -----------
                                                       7,071,166      7,071,166
    Less accumulated depreciation                     (2,049,667)    (1,854,441)
                                                     -----------    -----------
                                                       5,021,499      5,216,725

Cash and cash equivalents                                426,865        156,104
Accounts receivable, net of allowance
    of $13,018 and $21,684                                13,018         21,684
Other assets                                                 165          1,524
                                                     -----------    -----------

       Total assets                                  $ 5,461,547    $ 5,396,037
                                                     ===========    ===========


                        LIABILITIES AND PARTNERS' EQUITY

Accounts payable and accrued expenses                $    40,701    $    51,514
Unearned rent                                             44,150         39,593
                                                     -----------    -----------
    Total liabilities                                     84,851         91,107
                                                     -----------    -----------

Commitments (Note 5)

Partners' equity (Note 6):
    General partner                                       52,244         33,504
    Limited partners; 15,000 units outstanding         5,324,452      5,271,426
                                                     -----------    -----------
                                                       5,376,696      5,304,930
                                                     -----------    -----------

       Total liabilities and partners' equity        $ 5,461,547    $ 5,396,037
                                                     ===========    ===========

                          The accompanying notes are an
                  integral part of these financial statements.
                                                                               2
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                            STATEMENTS OF OPERATIONS

                  YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994


                                             1996          1995          1994
                                          ----------    ----------    ----------

Rental income                             $1,118,127    $1,070,463    $  964,399
Interest income                                7,084        24,664        11,888
                                          ----------    ----------    ----------

                                           1,125,211     1,095,127       976,287
                                          ----------    ----------    ----------

Expenses:
    Property operations                      393,958       406,069       378,120
    Partnership administration                84,114        87,566        83,985
    Depreciation and amortization            196,585       197,365       206,530
    Interest                                    --          86,987        86,640
                                          ----------    ----------    ----------

                                             674,657       777,987       755,275
                                          ----------    ----------    ----------

Net income                                $  450,554    $  317,140    $  221,012
                                          ==========    ==========    ==========

Net income allocated to
    general partner                       $   22,528    $   15,857        11,051

Net income allocated to
    limited partners                         428,026       301,283       209,961
                                          ----------    ----------    ----------

Net income                                $  450,554    $  317,140    $  221,012
                                          ==========    ==========    ==========

Net income allocated to limited
    partners per limited
    partnership unit (Note 6)             $    28.54    $    20.08    $    14.00
                                          ==========    ==========    ==========

Distributions per
    limited partnership unit              $    25.00    $     --      $    20.00
                                          ==========    ==========    ==========

Number of limited partnership
    units outstanding                         15,000        15,000        15,000
                                          ==========    ==========    ==========

                          The accompanying notes are an
                  integral part of these financial statements.
                                                                               3
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                    STATEMENTS OF CHANGES IN PARTNERS' EQUITY

                  YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994


                                       General        Limited
                                       partner        partners        Total
                                     -----------    -----------    -----------

Balance, December 31, 1993                 9,626      5,060,182      5,069,808

   Distributions to partners              (3,030)      (300,000)      (303,030)

   Net income                             11,051        209,961        221,012
                                     -----------    -----------    -----------

Balance, December 31, 1994                17,647      4,970,143      4,987,790

   Distributions to partners                --             --             --

   Net Income                             15,857        301,283        317,140
                                     -----------    -----------    -----------

Balance, December 31, 1995                33,504      5,271,426      5,304,930

   Distributions to partners              (3,788)      (375,000)      (378,788)

   Net income                             22,528        428,026        450,554
                                     -----------    -----------    -----------

Balance, December 31, 1996
                                     $    52,244    $ 5,324,452    $ 5,376,696
                                     ===========    ===========    ===========

                          The accompanying notes are an
                  integral part of these financial statements.
                                                                               4
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                            STATEMENTS OF CASH FLOWS

                  YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
                                                   1996           1995           1994
                                               -----------    -----------    -----------
<S>                                            <C>            <C>            <C>        
Cash flows from operating activities:
   Cash received from customers                $ 1,131,350    $ 1,075,200    $   962,847
   Cash paid to suppliers and
      service providers                           (488,885)      (483,484)      (461,749)
   Interest received                                 7,084         25,723         11,799
   Interest paid                                      --          (86,987)       (86,640)
                                               -----------    -----------    -----------

      Net cash provided
        by operating activities                    649,549        530,452        426,257
                                               -----------    -----------    -----------

Cash flows from investing activities:
   Proceeds from maturities of
      certificates of deposit                         --          218,142        428,402
   Purchase of certificates of deposit                --             --         (434,346)
   Purchase of rental property and equipment          --          (20,950)        (8,835)
                                               -----------    -----------    -----------

      Net cash provided by (used in)
        investing activities                          --          197,192        (14,779)
                                               -----------    -----------    -----------

Cash flows from financing activities:
   Principal payments on
      note payable to bank                            --         (904,267)       (13,058)
   Distributions to partners                      (378,788)          --         (303,030)
                                               -----------    -----------    -----------

      Net cash used in financing activities       (378,788)      (904,267)      (316,088)
                                               -----------    -----------    -----------

Increase (decrease) in cash
   and cash equivalents                            270,761       (176,623)        95,390

Cash and cash equivalents, beginning               156,104        332,727        237,337
                                               -----------    -----------    -----------

Cash and cash equivalents, ending              $   426,865    $   156,104    $   332,727
                                               ===========    ===========    ===========
</TABLE>
                          The accompanying notes are an
                  integral part of these financial statements.
                                                                               5
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                      STATEMENTS OF CASH FLOWS (CONTINUED)

                  YEARS ENDED DECEMBER 31, 1996, 1994 AND 1994
<TABLE>
<CAPTION>
                                                     1996         1995         1994
                                                  ---------    ---------    ---------
<S>                                               <C>          <C>          <C>      
Reconciliation of net income to net cash
  provided by operating activities:
     Net income                                   $ 450,554    $ 317,140    $ 221,012
     Adjustments to reconcile net income
        to net cash provided by operating
        activities:
          Depreciation and amortization             196,585      197,365      206,530
          Changes in assets and liabilities:
            Decrease (increase) in certificates
               of deposits accrued interest            --          1,059          (89)
            Decrease (increase)
               in accounts receivable                 8,666        5,316      (14,866)
            (Decrease) increase
               in accounts payable
               and accrued expenses                 (10,813)      10,151          356
            Increase (decrease)
               in unearned rent                       4,557         (579)      13,314
                                                  ---------    ---------    ---------

Net cash provided by operating activities         $ 649,549    $ 530,452    $ 426,257
                                                  =========    =========    =========
</TABLE>
                          The accompanying notes are an
                  integral part of these financial statements.
                                                                               6
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS


 1.   Partnership organization:

      Armored Storage Income Investors Limited Partnership (the Partnership) was
         organized  under  the  laws of the  State  of  Arizona  pursuant  to an
         agreement  of limited  partnership  filed  December  4,  1984,  for the
         purpose of acquiring,  developing,  owning and  operating  self-service
         storage  facilities  in Arizona  and New Mexico.  The  initial  general
         partners  were  Armored  Storage,  Inc.,  an Arizona  corporation  (the
         Managing General Partner) and Armored Storage One Limited  Partnership,
         an Arizona limited partnership. The Partnership commenced full activity
         on January 9, 1985. During 1986, the Partnership  completed an offering
         of limited  partnership units wherein 15,000 limited  partnership units
         were purchased by investors for $7,500,000.  In December, 1987, Armored
         Storage,  Inc.  withdrew from the  Partnership  and Armored Storage One
         Limited  Partnership  then  became the  Managing  General  Partner  and
         assumed  the  partner's  capital  account of Armored  Storage,  Inc. In
         February,   1994,  Armored  Management  Limited  Liability  Corporation
         (L.L.C.)  was  appointed  the  general  partner of Armored  Storage One
         Limited Partnership.

 2.   Summary of significant accounting policies:

      Rental property and equipment:

      Rental property and equipment are stated at cost. Depreciation is provided
         on the straight-line method over the following estimated useful lives:

                                                   Years
                                                   -----

           Buildings                                30
           Furniture and fixtures                    5

      Rental income:

      The Partnership  generates  rental  income  from   month-to-month   rental
         agreements for space at its self-storage  facilities.  Rental income is
         recognized on the accrual basis.

      Accounts  receivable are recorded for rental  payments that are delinquent
         at year end. An  allowance  is recorded  for  management's  estimate of
         uncollectible  rental  receivables.  After  a  receivable  is  90  days
         delinquent, the contents of the unit are sold and the proceeds are used
         to reduce the receivable balance.

      Income taxes:

      The Partnership does not record a provision for income taxes as any income
         or loss from the  partnership is recognized by the individual  partners
         for tax reporting purposes.
                                                                               7
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


 2.   Summary of significant accounting policies, continued:

      Cash and cash equivalents:

      For reporting in the statements of cash flows, the  Partnership  considers
         all  certificates  of deposit and money market funds  purchased  with a
         maturity of three months or less to be cash equivalents.

      Concentration of risk:

         Periodically  during the year, the Company  maintains cash in financial
         institutions   in  excess  of  the  amounts   insured  by  the  federal
         government.

      Advertising costs:

      Advertising costs are charged to operations as incurred.

      Accounting estimates:

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

 3.   Rental property and equipment:

      Rental property and equipment consist of the following:

                                                           1996             1995
                                                     ----------       ----------
Land:
   Phoenix - Bell Road                               $  214,058       $  214,058
   Phoenix - 63rd Avenue                                606,222          606,222
   Albuquerque - Tramway Boulevard                      319,548          319,548
                                                     ----------       ----------
                                                      1,139,828        1,139,828
                                                     ----------       ----------
Buildings:
   Phoenix - Bell Road                                2,214,474        2,214,474
   Phoenix - 63rd Avenue                              1,810,050        1,810,050
   Albuquerque - Tramway Boulevard                    1,832,238        1,832,238
                                                     ----------       ----------
                                                      5,856,762        5,856,762
                                                     ----------       ----------
Furniture and fixtures:
   Phoenix - Bell Road                                   32,624           32,624
   Phoenix - 63rd Avenue                                 24,853           24,853
   Albuquerque - Tramway Boulevard                       17,099           17,099
                                                     ----------       ----------
                                                         74,576           74,576
                                                     ----------       ----------

                                                     $7,071,166       $7,071,166
                                                     ==========       ==========
                                                                               8
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)

 4.   Note payable, bank:

      During 1995, the note payable, bank, which consisted of a mortgage secured
         by a deed of trust and  assignment of rents on the 63rd Avenue  Storage
         Facility was paid in full. The remaining related loan acquisition costs
         were also fully amortized during 1995.

 5.   Commitments and related party transactions:

      The Partnership entered into an agreement with Chris Cap  Corporation  dba
         QuestCor,  Inc.  (QuestCor)  to manage the  Partnership's  self-storage
         facilities. The term of the agreement is for one year through December,
         1997,  to be renewed on a  month-to-month  basis  unless  either  party
         terminates the agreement. The agreement provides that the manager shall
         receive, as compensation for services,  the greater of $1,000 per month
         or 6% of the gross cash  receipts  from the prior month for each of the
         three facilities it manages.

      The Partnership  entered  into  an  agreement  with  QuestCor  to  provide
         administrative services to the Partnership, such as investor relations,
         database   management    (including   data   processing   of   investor
         subscriptions, fund distributions,  ownership changes, and subscription
         input), accounting,  preparation and coordination of the preparation of
         periodic  regulatory  reports  and tax related  forms.  The term of the
         agreement is for one year through December,  1997 and shall continue on
         a  month-to-month  basis unless either party  terminates the agreement.
         The agreement  provided for payment by the  Partnership  to Questcor of
         $4,500  per  month in  1996,  1995  and  1994 as  compensation  for its
         services.  Additionally,  the Partnership  pays QuestCor  approximately
         $5,000 per year for  providing  assistance  in the  annual  Partnership
         audit.  A 50%  member  of  Armored  Management,  L.L.C.  is  also a 50%
         shareholder of QuestCor.

 5.   Commitments and related party transactions, continued:

      The following are the  approximate  fees paid to  QuestCor,  Inc.  for the
         years ended December 31, 1996, 1995 and 1994:

                                                1996        1995        1994
                                              -------     -------     -------

          Property management                 $68,000     $64,000     $58,000
          Partnership administration           54,000      54,000      54,000
          Audit assistance                      5,000       5,000       5,000

      During the year ended  December  31,  1995,  an  affiliate  of the General
         Partner received $6,000,  in direct expense  reimbursements  associated
         with a market study of the facilities.
                                                                               9
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


 6.   Partners' equity:

      The limited partnership  agreement provides that profits,  losses and cash
         available for distribution shall be allocated as follows:

      Allocation of net income:

      Net income is to be allocated to the limited partners, ninety-five percent
         (95%) in accordance  with their capital  percentages and to the general
         partner,  five percent  (5%),  until such time as the limited  partners
         have received in cash from all sources  (other than cash  available for
         distribution)  an amount equal to one hundred  percent  (100%) of their
         capital thereafter to the Limited Partners,  eighty-five  percent (85%)
         in  accordance  with  their  capital  percentages,  and to the  general
         partner, fifteen percent (15%).

      Allocation of net loss:

      Net losses are  to be  allocated  to  the  limited  partners,  ninety-nine
         percent (99%) in accordance  with their capital  percentages and to the
         general  partner,  one  percent  (1%),  until such time as the  limited
         partners have received  distributions  of cash from all sources  (other
         than cash available for distribution) in an amount equal to one hundred
         percent  (100%)  of  their  capital  contributions;  thereafter  to the
         limited  partners,  eighty-five  percent (85%) in accordance with their
         capital percentages and to the general partner, fifteen percent (15%).

      Cash available for distribution:

      All cash available for  distribution, if any,  realized by or available to
         the Partnership,  shall be distributed no less frequently than annually
         in the following percentages: (1) to the limited partners,  ninety-five
         percent (95%) in accordance with their capital percentages;  and (2) to
         the general  partner five percent  (5%)  subordinated  to a ten percent
         (10%)  annual  cumulative  noncompounded  return  with  respect  to the
         limited partner's adjusted capital  contributions  determined as of the
         first day of each calendar  quarter,  which  distribution  must be made
         before the general partner is entitled to participate in cash available
         for distribution.

      Cash available for  distribution is generally the  Partnership's  net cash
         flow less amounts set aside as reserves.

      During 1995, the  Partnership  paid in full its  outstanding  note payable
         with a  bank.  As a  result,  the  Partnership  did  not  make  partner
         distributions during 1995.

      If in any period the general partner  determines that Partnership  working
         capital  reserves  are in excess of the  amount  deemed  necessary  for
         Partnership operations, such excess reserves may be distributed as cash
         available for distribution.
                                                                              10
<PAGE>
                        ARMORED STORAGE INCOME INVESTORS
                               LIMITED PARTNERSHIP

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


6.    Partners' equity, continued:

      If, at any time, the allocation and distribution provisions of the Limited
         Partnership  Agreement do not result in the allocation or  distribution
         to the general partners of an aggregate of at least one percent (1%) of
         the item  being  allocated  or  distributed,  the  limited  partnership
         agreement  states  that  the  general  partner  is to be  allocated  or
         distributed so much more of such item as will cause the general partner
         to be allocated or distributed one percent (1%) thereof.

 7.   Partnership administration and property operations:

         Included in partnership  administration and property operations are the
following expenses:

                                              1996          1995          1994
                                            --------      --------      --------
Partnership administration:
    Accounting fees                         $ 20,891      $ 19,182      $ 18,615

Property operations:
    Advertising                               15,187        21,900        16,682
    Management fees                           68,426        63,807        57,547
    Property taxes                            78,081        84,239        80,208
    Repairs and maintenance                   19,055        24,804        14,109
    Utilities                                 59,464        50,143        56,855
    Wages and payroll taxes                  100,062        92,173        88,665

                                                                              11