SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    FORM 10-K

                                   (Mark One)
           ( X ) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                  For the Fiscal Year Ended September 30, 1997
                                       OR
          ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
           For the transition period from ______________to ___________

                          Commission file number 0-9218

                             SUPER 8 MOTELS II, LTD.
             (Exact name of registrant as specified in its charter)

                              California 94-2574309
             (State or other jurisdiction of    (I.R.S. Employer iden-
               incorporation or organization)      tification No.)

                   2030 J Street, Sacramento, California 95814
               (Address of principal executive offices) (Zip Code)
       Registrant's telephone number, including area code: (916) 442-9183

        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 such shorter  period that the registrant
has been  required to file such  reports) and (2) has been subject to the 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. [x]

State the aggregate market value of  the voting stock held  by non-affiliates of
the registrant.
                               Inapplicable.


                       DOCUMENTS INCORPORATED BY REFERENCE
                                      None




                                      -1-

<PAGE>
                                     PART I

Item 1.  BUSINESS

General Development of Business

     Super 8 Motels II, Ltd. (the  "Partnership") is a limited partnership which
was  organized  under  the  Uniform  Limited  Partnership  Act of the  State  of
California on May 7, 1979. The Managing  General  Partner of the  Partnership is
Grotewohl Management Services, Inc., a California corporation which is 50% owned
by Philip B.  Grotewohl.  The Associate  General  Partner of the  Partnership is
Robert  J.  Dana.   The  Associate   General   Partner  does  not  have  general
responsibility  in connection with the management of the business affairs of the
Partnership.  The Managing General Partner and the Associate General Partner are
sometimes hereinafter referred to as the "General Partners."

     Through two intrastate  offerings of units of limited partnership  interest
in the Partnership (the "Units"), the Partnership sold 7,000 Units at a price of
$1,000 per Unit.

     The net proceeds of the two offerings were expended for the acquisition and
development of two properties  located in Santa Rosa,  California,  and Ontario,
California.  A fee interest was acquired in the Ontario property and a leasehold
interest was acquired in the Santa Rosa property.  Motel operations commenced on
November 12, 1980 at the Santa Rosa property, and on May 29, 1981 at the Ontario
property. The Ontario property was sold on February 14, 1990.

     There is hereby incorporated by reference herein the information  regarding
the  Partnership's  motel  property  contained  in Part I, Item 2 of this report
under the caption "Properties."

Narrative Description of Business

     The  Partnership's  business is to operate its motel property and to engage
in any and all general business  activities related or incidental  thereto.  The
Partnership's motel is operated pursuant to a franchise originally acquired from
Super 8 Motels, Inc. through Super 8 Management  Corporation as a subfranchisor,
under the name "Super 8 Motel."

     Super 8 Motels,  Inc. is a South Dakota  corporation which was organized in
1972. Its first franchised motel commenced operation in 1974 and, as of November
30,  1997,  it had a total of 1,619  franchised  motels  having an  aggregate in
excess of 98,000 guest rooms in  operation.  On April 30, 1993,  Super 8 Motels,
Inc. became a wholly-owned  subsidiary of Hospitality  Franchise  Systems,  Inc.
("HFS").  In  addition  to  Super  8  Motels,  HFS is  also  the  franchisor  of
hospitality properties under the Howard Johnson,  Ramada, Voyager Lodge, Knights
Inn, Winngate Inn, Travelodge and Days Inn tradenames.

     Motels  franchised  by Super 8 Motels,  Inc. are budget motels in that they
offer room rates near the lower end of the room rate scale in each area in which
they are  located.  Such lower  rates are made  possible by the  elimination  of
certain features present in many higher-priced facilities, such as meeting rooms
and  large  lobbies;  by  not  operating  restaurants  or  cocktail  lounges  in
connection  with the  motels;  and by  utilizing  uniform  construction  methods
(adapted only  slightly to fit specific  locales)  which have been  developed by
Super 8 Motels, Inc. and a standardized design which facilitates maintenance and
minimizes overhead expense.

                                      -2-
<PAGE>

     Super  8  Motels  offer  accommodations  at the  upper  end,  in  terms  of
facilities and prices, of the budget segment of the lodging industry. Generally,
Super 8 Motels offer larger rooms and higher quality  furniture and  furnishings
than motels franchised under the tradenames Motel 6, Regal 8 and E-Z 8. Rates in
the Super 8 Motels tend to exceed those offered by the chains mentioned above.

     By  terms  of the  franchise  agreement  with  Super 8  Motels,  Inc.,  the
Partnership  pays monthly  franchise fees equal to 4% of its gross room revenues
and  contributes  an  additional  1%  of  its  gross  room  revenues  to a  fund
administered  by Super 8  Motels,  Inc.  to  finance  the  national  advertising
program. The Partnership has no equity or other interest in Super 8 Motels, Inc.

     Brown & Grotewohl (the "Manager"),  a California general  partnership which
is an affiliate of the Managing  General  Partner,  directs the operation of the
Partnership's  motel.  The Manager  supervises  and  directs  the  Partnership's
employees  having  direct   responsibility  for  the  operation  of  the  motel,
establishes  room  rates,   and  directs  the  promotional   activities  of  the
Partnership's  employees.  It directs the purchase of replacement  equipment and
supplies,  maintenance  activity and the engagement or selection of all vendors,
suppliers and independent contractors. The motel staff, under the supervision of
the Manager,  is responsible  for,  among other things,  performing all service,
administrative  and bookkeeping  duties in connection with the motel,  including
all collections and all  disbursements to be paid out of funds generated by such
operations or otherwise supplied by the Partnership.

     The Partnership  employs (on a part-time  basis) one secretarial  employee,
four Partnership and motel administrative employees, one marketing employee, and
five accounting employees at its Sacramento,  California office. Included in the
above list is David P. Grotewohl, son of Philip Grotewohl,  whom the Partnership
employs as Director of Operations  and as an attorney.  Mark  Grotewohl,  son of
Philip Grotewohl, is employed as Director of Marketing.

Santa Rosa, California

     The motel located in Santa Rosa,  California,  which  consists of 100 guest
rooms,  commenced  operations on November 12, 1980. The average  occupancy rates
and average  room rates for the period  from  October 1, 1994 to  September  30,
1997, are as follows:

                             1994 - 1995    1995 - 1996    1996 - 1997
                             -----------    -----------    -----------
Average Occupancy Rate           54%            53%            60%
Average Room Rate              $42.33         $44.49         $45.65













                                      -3-

<PAGE>

     The  following  existing  lodging  facilities  provide  direct or  indirect
competition to the Partnership's Santa Rosa motel:

                                                      APPROXIMATE
                                                     DISTANCE FROM
                                    NUMBER OF        PARTNERSHIP'S      
             FACILITY                ROOMS         MOTEL (IN MILES)    
        -----------------------     ---------       ----------------
        Motel 6                        100              Adjacent
        Motel 6                        119             0.5 miles
        Los Robles Inn                  90             0.5 miles
        Sandman Motel                  112             0.5 miles
        Ramada Inn                      50             0.5 miles
        Holiday Inn Express             95             1.0 mile
        Days Inn                       160             1.5 miles
        TraveLodge                      60             2.0 miles
        Best Western Garden Inn        100             3.0 miles

     The  Partnership  employs (on a full-time or part-time  basis) one manager,
seven desk clerks, nine laundry and housekeeping employees,  and one maintenance
worker at the Santa Rosa motel.

     The  Santa  Rosa  motel  draws its  business  from a  variety  of  sources,
including corporate  travelers,  vacationers and tourists,  convention attendees
and sports teams.  The Santa Rosa motel has no single customer the loss of which
would have a materially adverse effect on the motel's operations.

Item  2.  PROPERTIES

     On January 8, 1980, the Partnership acquired by long-term lease a parcel of
approximately  three  acres of  unimproved  land  located  at 2632 N.  Cleveland
Avenue, Santa Rosa,  California,  adjacent to U.S. Highway 101. Effective May 1,
1981, the lease was amended to delete an area  comprising  approximately  32,600
square feet from the lease. A restaurant facility was subsequently built on this
deleted portion.

     The term of the lease  extends  until  August  31,  2015,  with a  possible
extension of the term for up to an additional  15 years through  exercise by the
Partnership of three five-year renewal options. Base rental payments are subject
to adjustment at three-year  intervals to reflect  changes in the Consumer Price
Index.  The base rent is $8,398 per month from  September 1, 1997 through August
31,  2000.  Such rent is net to the lessor of  property  taxes and  assessments,
utilities and other expenses relating to the land.

     In  April  1980,  construction  of the  Partnership's  100-room  motel  was
commenced  on the site.  The  motel  opened  for  operations  immediately  after
construction was completed on November 12, 1980.









                                      -4-

<PAGE>
 Item 3.  LEGAL PROCEEDINGS

     On October  27, 1997 a complaint  was filed in the United  States  District
Court,  Eastern District of California by the registrant,  Grotewohl  Management
Services,  Inc. (a general  partner of the  registrant)  and four other  limited
partnerships  (together with the  registrant,  the  "Partnerships")  as to which
Grotewohl  Management  Services,  Inc. serves as general partner (i.e.,  Super 8
Motels,  Ltd.,  Super 8 Motels III, Ltd.,  Super 8 Economy Lodging IV, Ltd., and
Famous Host Lodging V, L.P.),  as plaintiffs.  The complaint names as defendants
Everest/Madison   Investors,   LLC,  Everest  Lodging  Investors,  LLC,  Everest
Properties,  LLC, Everest  Partners,  LLC,  Everest  Properties II, LLC, Everest
Properties,  Inc., W. Robert  Kohorst,  David I. Lesser,  The Blackacre  Capital
Group, L.P.,  Blackacre Capital Management Corp.,  Jeffrey B. Citron,  Ronald J.
Kravit,  and Stephen B. Enquist.  The factual basis  underlying the  plaintiffs'
causes  of  actions  pertains  to  tender  offers  directed  by  certain  of the
defendants  to limited  partners  of the  Partnerships,  and to  indications  of
interest made by certain of the  defendants  in  purchasing  the property of the
Partnerships.  The complaint  requests the following  relief:  (i) a declaration
that each of the defendants has violated Sections 13(d),  14(d) and 14(e) of the
Securities  Exchange  Act of  1934  (the  "Exchange  Act"),  and the  rules  and
regulations  promulgated by the Securities and Exchange  Commission  thereunder;
(ii) a declaration that certain of the defendants have violated Section 15(a) of
the  Exchange  Act and the  rules  and  regulations  thereunder;  (iii) an order
permanently enjoining the defendants from (a) soliciting tenders of or accepting
for purchase  securities of the  Partnerships,  (b) exercising any voting rights
attendant to the securities already acquired,  (c) soliciting  proxies,  and (d)
violating  Sections 13 or 14 of the  Exchange  Act or the rules and  regulations
promulgated  thereunder;  (iv) an order enjoining certain of the defendants from
violating  Section  15(a) of the  Exchange  Act and the  rules  and  regulations
promulgated  thereunder;  (v) an order  directing  certain of the  defendants to
offer to each person who sold securities to such defendants the right to rescind
such sale; and (vi) a declaration that the Partnerships  need not provide to the
defendants  a list  of  limited  partners  in  the  Partnerships  or  any  other
information  respecting the Partnerships  which is not publicly  available.  The
plaintiffs  have not yet  received an answer of the  defendants  respecting  the
complaint.

     On October  28,  1997 a complaint  was filed in the  Superior  Court of the
State of California,  Sacramento  County by Everest Lodging  Investors,  LLC and
Everest/Madison  Investors,  LLC, as plaintiffs,  against  Philip B.  Grotewohl,
Grotewohl Management Services,  Inc., Kenneth M. Sanders,  Robert J. Dana, Borel
Associates,  and BWC  Incorporated,  as  defendants,  and the  Partnerships,  as
nominal  defendants.  The factual basis underlying the causes of action pertains
to the  receipt  by the  defendants  of  franchise  fees  and  reimbursement  of
expenses,  the  indications of interest made by the plaintiffs in purchasing the
properties of the nominal defendants,  and the alleged refusal of the defendants
to provide  information  required by the terms of the Partnership's  partnership
agreement and California law. The complaint requests the following relief: (i) a
declaration  that  the  action  is a  proper  derivative  action;  (ii) an order
requiring the defendants to discharge their fiduciary duties to the Partnerships
and to enjoin them from breaching their fiduciary duties;  (iii) disgorgement of
certain profits; (iv) appointment of a receiver; and (v) an award for damages in
an amount to be determined.  The defendants and nominal defendants have recently
been served and are formulating their response to the complaint.

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

     Inapplicable.
                                      -5-
<PAGE>




                                     PART II


Item 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
             STOCKHOLDER MATTERS

Market Information

     The Units are not freely  transferable  and no public  market for the Units
has developed or is expected to develop.

Holders

     As of December 1, 1997,  a total of 1,014  investors  ("Limited  Partners")
held Units in the Partnership.

Distributions

     Cash  distributions  are made on a quarterly  basis from Cash Available for
Distribution,  defined in the Partnership's Certificate and Agreement of Limited
Partnership  (the  "Partnership  Agreement")  as Cash Flow,  less  adequate cash
reserves for  obligations  of the  Partnership  for which there is no provision.
Cash Flow means cash funds provided from operations of the Partnership,  without
deduction  for  depreciation,  but after  deducting  cash  funds  used to pay or
provide for the payment of debt service,  capital  improvements and replacements
and the operating expenses of the Partnership's property.

     In addition,  the Partnership will promptly  distribute net proceeds of the
sale and  refinancing  of its motel  properties to the General  Partners and the
Limited Partners of the Partnership (the "Limited Partners"), to the extent such
proceeds are not reinvested in the acquisition of additional properties.

     The following  distributions  to the Limited  Partners were made during the
last two fiscal years:

                                         Total         Amount
                        Date         Distribution     Per Unit
                      --------       ------------     --------
                       8-15-96          $21,000         $3.00
                      11-15-96          $21,000         $3.00
                       2-15-97          $35,000         $5.00
                        3-3-97         $280,000        $40.00
                       5-15-97          $35,000         $5.00
                       8-15-97          $52,500         $7.50


Item 6.  SELECTED FINANCIAL DATA

     Following are selected  financial  data of the  Partnership  for the fiscal
years ended September 30, 1997, 1996, 1995, 1994 and 1993.



                                      -6-

<PAGE>


                             SUPER 8 MOTELS II, LTD.

Item 6. Selected Financial Data



                                      Years Ended September 30:
                     ----------------------------------------------------------
                         1997       1996        1995        1994        1993
                     ----------  ----------  ----------  ----------  ----------
Total Income         $1,032,367    $889,283    $850,781    $827,562    $846,804
Motel Room Income      $995,707    $856,246    $829,326    $808,505    $828,804
Net Income (Loss)      $213,399    $101,430     $31,089    $(31,564)   $(88,213)

Per Partnership Unit:
  Cash distributions     $60.50       $3.00        -           -           -
  Net income (loss)      $30.18      $14.35       $4.40      $(4.46)    $(12.48)

                                      Years Ended September 30:
                     ----------------------------------------------------------
                         1997       1996        1995        1994        1993
                     ----------  ----------  ----------  ----------  ----------

Total Assets         $1,067,776  $1,268,224  $1,172,917  $1,122,106  $1,158,408
Long-Term Debt             -           -           -           -           -






























                                      -7-

<PAGE>

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

Liquidity

     The Managing  General Partner  believes that the  Partnership's  liquidity,
defined as its  ability to  generate  sufficient  amounts of cash to satisfy its
cash needs, is adequate.  Current assets of $486,052 exceed current  liabilities
of $108,806 by $ 377,246 as of September  30, 1997 as compared with $546,237 for
the same date in the previous fiscal year.

     After the second  quarter of the fiscal year ended  September 30, 1992, the
Managing General Partner suspended the Limited Partners' quarterly distributions
to preserve  cash,  with the intention of resuming  distributions  to the extent
distributions  could be  sustained  by the cash flow from the Santa  Rosa  motel
operations.  In  August  1996,  the  Managing  General  Partner  authorized  the
resumption of distributions at a modest $3 per Unit per quarter. The most recent
distribution was $7.50 per Unit per quarter.

     The Managing  General Partner has a reserve target equal to 5% of "Adjusted
Capital  Contributions,"  or  $174,716  (5% of  $3,494,317).  "Adjusted  Capital
Contributions"  is computed as the original amount raised  ($7,000,000) less the
$259,154  returned  to the  Limited  Partners  in 1982  from the sale of  excess
Ontario land, and less the $3,246,529  returned to the Limited Partners from the
1990  Ontario  motel sale.  The $377,246  excess of current  assets over current
liabilities exceeds the reserve target. The Managing General Partner has decided
to maintain the higher operating  reserve pending  sustained  improvement in the
Santa Rosa lodging market.

     The  Partnership's  primary  source of liquidity is its gross revenues from
operations.  As noted below, the Partnership has a positive cash flow from motel
operations. In addition, the Partnership's equity in its Santa Rosa motel, which
is presently unencumbered, would provide a potential source of liquidity through
financing in the event the Partnership's  liquidity were impaired.  There can be
no assurance,  however, that the Partnership could borrow against such equity on
favorable terms should additional liquidity be required.


Capital Resources

     The Partnership  owns and operates one motel property,  a 100-room  lodging
facility located on leased land in Santa Rosa, California.

     The  Partnership   currently  has  no  material   commitments  for  capital
expenditures.  Its motel property is in full operation,  and no further property
acquisitions or extraordinary  capital improvements are contemplated.  Except as
described  below, the Managing General Partner is aware of no material trends or
changes with respect to the mix or relative  cost of the  Partnership's  capital
resources.  Working  capital  is  expected  to be  generated  by  revenues  from
operations.

     During the fiscal year covered by this  report,  the  Partnership  expended
$61,087 on  renovations  and  replacements  ($43,159 of which was  capitalized).
Included in these  amounts was  $28,669 for guest room and  corridor  carpeting,
$8,024  for a  replacement  washing  machine,  $4,459 for six  replacement  room
air-conditioning units and $3,660 for furniture refurbishment.

                                      -8-
<PAGE>


     During  the  fiscal  year  ended   September  30,  1996,  the   Partnership
capitalized  $36,984 of the $57,971 spent on the  refurbishment of its motel and
furnishings.  Included in the  capitalized  items were $11,148 for a replacement
central office computer,  $8,149 for a replacement  washing machine,  $6,817 for
new  backflow  devices  required  by the  City of Santa  Rosa  under  the  EPA's
administration  of the Clean Water Act,  $6,088 for  replacement  room  carpets,
$2,577 for a  replacement  clothes dryer and $2,205 for  replacement  television
sets. The non-capitalized renovations of $20,988 included expenditures for lamps
and light fixtures, drapes,  air-conditioning units, mattresses, chairs, outside
building trim repairs and landscaping.

     The Managing  General Partner  anticipates  that  approximately 3% of gross
room revenues will be spent on replacement and renovation during the fiscal year
ending  September 30, 1998.  The Managing  General  Partner  intends that all of
these  expenditure  will be made from cash flow from operations or, if such cash
flow is insufficient, from the Partnership's cash reserves.

Results of Operations

Partnership's Combined Financial Results

     During the fiscal year  covered by this report as compared to the  previous
fiscal year, the  Partnership  achieved a $143,084 (or 16.1%)  increase in total
income.  This  increase was due  primarily to a $139,461 (or 16.3%)  increase in
guest room revenue. The increased room revenue is discussed under the Santa Rosa
Motel caption below.

     During the fiscal year ended September 30, 1996 as compared to the previous
fiscal  year,  the  Partnership  achieved a $38,502 (or 4.5%)  increase in total
income, due primarily to a $26,920 (or 3.2%) increase in guest room revenue. The
income increase is discussed under the Santa Rosa Motel caption below.

     During the fiscal year  covered by this report as compared to the  previous
fiscal year, the  Partnership  experienced a $31,115 (or 3.9%) increase in total
expenses.  This  increase  is related to  increased  property  occupancy  and is
discussed below in more detail.

     During the fiscal year ended September 30, 1996 as compared to the previous
fiscal year,  the  Partnership  achieved a $31,839 (or 3.9%)  reduction in total
expenses,  due primarily to the $25,548 (or 3.7%)  reduction in motel  operating
expenses. This decrease in motel operating expenses is discussed below.

Santa Rosa Motel

     The  following is a comparison  of operating  results of the  Partnership's
Santa Rosa motel for the twelve-month periods ended September 30, 1995, 1996 and
1997:
                                         Average        Average
                                        Occupancy        Room
             Twelve months ended:          Rate          Rate
             --------------------       ---------       -------          
             September 30, 1995           53.7%         $42.33
             September 30, 1996           52.6%         $44.49
             September 30, 1997           59.8%         $45.65

                                      -9-

<PAGE>
                              Total    Total Expenditures   Partnership
   Twelve months ended:     Revenues    and Debt Service    Cash Flow (1)
   --------------------    ----------  ------------------   ------------
   September 30, 1995        $850,781       $752,705           $98,076
   September 30, 1996        $889,283       $733,042          $156,241
   September 30, 1997      $1,032,367       $771,215          $261,152

     (1) While  Partnership  Cash Flow as it is used here is not an amount found
in the  financial  statements,  this amount is the best  indicator of the annual
change  in the  amount,  if  any,  available  for  distribution  to the  Limited
Partners.  This  calculation  is reconciled  to the financial  statements in the
following table.

     Reconciliation  of  Partnership  Cash Flow (included in the chart above) to
Net  Income  as  shown  on  the  Statements  of  Operations  (in  the  financial
statements) is as follows:
                                        1995         1996         1997
                                     --------      --------      --------
Partnership Cash Flow                 $98,076      $156,241      $261,152
Additions to Fixed Assets              28,974        36,964        43,159
Depreciation and Amortization         (97,047)      (91,815)      (90,581)
Other Items                             1,086            40          (331)
                                     --------      --------      --------
Net Income                            $31,089      $101,430      $213,399
                                     ========      ========      ========

     During the fiscal year  covered by this report as compared to the  previous
fiscal  year,  the  Partnership's  Santa Rosa motel  achieved an increase in its
guest room  revenue  through  increases  in both its  average  room rate and its
occupancy  rate.  The occupancy  rate  increased  from 52.6% during the previous
fiscal year to 59.8% for the fiscal  year  covered by this  report.  The average
room rate increased from $44.49 to $45.65.  These two increases  resulted in the
16% increase in guest room  revenue.  The Santa Rosa motel  achieved its largest
increased revenue from the leisure-market segment with the next largest increase
from the corporate segment.

     During the fiscal year ended September 30, 1996 as compared to the previous
fiscal  year,  the  Partnership's  Santa Rosa motel  achieved an increase in its
guest room  revenue  through an increase in its  average  daily room rate.  This
increase in revenue was  partially  offset by a decrease in overall room demand.
This result was  achieved  by selling  more rooms to the  higher-priced  leisure
market  segment  and  fewer  rooms  to  the  corporate,  government,  group  and
discount-market segments.

     During the fiscal year  covered by this report as compared to the  previous
fiscal year, the  Partnership's  Santa Rosa motel  experienced a $38,173 or 5.2%
increase in total  expenditures  which is due primarily to the 13.7% increase in
occupancy.  The increased expenditures included $14,411 in room attendent wages,
$6,973 in increased  franchise  royalties  and  advertising  costs and $7,250 in
appraisal costs.

     During the fiscal year ended September 30, 1996 as compared to the previous
fiscal year,  the  Partnership's  Santa Rosa motel  achieved a 2.6% reduction in
total  expenditures and debt service while the average occupancy  declined 2.0%.
The  Partnership's   Santa  Rosa  motel  achieved  a  reduction  of  $20,880  in
expenditures  for  renovations and additions to fixed assets and $5,241 in front
desk wages and salaries,  which were  partially  offset by a $7,264  increase in
utility costs.
                                      -10-
<PAGE>

Future Trends

     The Managing  General Partner  believes that the adverse  conditions in the
Santa  Rosa  lodging  market  somewhat  eased in the last  year,  although  such
conditions  may  continue  to  have  a  negative  impact  on  the  Partnership's
profitability  in the near  term.  Although  there can be no  assurance  in this
regard,  analysis  of  economic  growth  trends  and  planned  hotel  and  motel
construction  leads the Managing  General Partner to believe that the Santa Rosa
economy will eventually absorb the existing supply of motel rooms.

     The  Managing   General   Partner  expects  the   Partnership's   occupancy
percentages  (and thus  revenues and  profitability)  to benefit from  continued
economic  growth in the local and  California  economies.  The Managing  General
Partner  anticipates  lower  occupancy rates and perhaps lower room rates in the
event of an economic  downturn.  The  Managing  General  Partner  believes  that
competitive  conditions  in the Santa Rosa  market are such as to  restrict  the
Partnership's  ability,  in the  short  run,  to  increase  its  room  rates  to
compensate for inflation.


Item 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES
                ABOUT MARKET RISK

     Inapplicable
































                                      -11-

<PAGE>


Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     See Financial  Statements and Notes to Financial Statements attached hereto
at pages F-1 through F-13.



















































                                      -12-

<PAGE>










                           ANNUAL REPORT ON FORM 10-K

                                     ITEM 8

                              FINANCIAL STATEMENTS

                             SUPER 8 MOTELS II, LTD.

                             SACRAMENTO, CALIFORNIA

                               SEPTEMBER 30, 1997




































                                      F-1

<PAGE>

Item 8: Financial Statements



                             SUPER 8 MOTELS II, LTD.

                          INDEX OF FINANCIAL STATEMENTS


                                                                     Pages
                                                                     -----

Financial Statements:
    Report of Certified Public Accountants                            F-3

    Balance Sheets, September 30, 1997 and 1996                       F-4

    Statements of Operations for the years ended                      F-5
      September 30, 1997, 1996 and 1995

    Statements of Partners' Equity for the years ended                F-6
      September 30, 1997, 1996 and 1995

    Statements of Cash Flows for the years ended                      F-7 to
      September 30, 1997, 1996 and 1995                               F-8

    Notes to Financial Statements                                     F-9 to
                                                                      F-12



Note:  All  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  financial
statements or notes thereto.






















                                      F-2
<PAGE>

            REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS




To the Partners
Super 8 Motels II, Ltd.

We have audited the  accompanying  balance  sheets of Super 8 Motels II, Ltd., a
California  limited  partnership,  as of  September  30,  1997  and 1996 and the
related  statements of operations,  partners'  equity and cash flows for each of
the  three  years in the  period  ended  September  30,  1997.  These  financial
statements  are  the  responsibility  of  the  Partnership'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 Super 8 Motels II, Ltd. as of
September 30, 1997 and 1996 and the results of its operations and its cash flows
for  each of the  three  years  in the  period  ended  September  30,  1997,  in
conformity with generally accepted accounting principles.


VOCKER KRISTOFFERSON AND CO.



San Mateo, California




















                                      F-3
<PAGE>

                             SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                                 BALANCE SHEETS
                           September 30, 1997 and 1996


                                     ASSETS

                                                          1997          1996
                                                       ----------    ----------
Current Assets:
 Cash and temporary investments (Notes 1 and 3)          $459,098      $614,405
 Accounts receivable                                       17,937         9,323
 Prepaid expenses                                           9,017        21,662
                                                       ----------    ----------
  Total Current Assets                                    486,052       645,390
                                                       ----------    ----------
Property and Equipment (Notes 2 and 7):
 Capital improvements                                      34,947        34,947
 Building                                               1,845,878     1,845,878
 Furniture and equipment                                  524,159       497,661
                                                       ----------    ----------
                                                        2,404,984     2,378,486
 Accumulated depreciation and amortization             (1,834,078)   (1,759,327)
                                                       ----------    ----------
  Property and Equipment, Net                             570,906       619,159
                                                       ----------    ----------
Other Assets (Note 2):
 Deposit of federal income tax                             10,818         3,675
                                                       ----------    ----------
    Total Assets                                       $1,067,776    $1,268,224
                                                       ==========    ==========

                        LIABILITIES AND PARTNERS' EQUITY

Current Liabilities:
 Accounts payable and accrued liabilities              $  105,071    $   97,413
 Due to related parties (Note 4)                            3,735         1,740
                                                       ----------    ----------
    Total Liabilities                                     108,806        99,153
                                                       ----------    ----------

Contingent Liabilities and Lease Commitment  
 (Notes 4 and 5)                                             -             -

Partners' Equity:
 General Partners                                          49,493        47,359
 Limited Partners                                         909,477     1,121,712
                                                       ----------    ----------
  Total Partners' Equity                                  958,970     1,169,071
                                                       ----------    ----------
    Total Liabilities and Partners' Equity             $1,067,776    $1,268,224
                                                       ==========    ==========


   The accompanying notes are an integral part of these financial statements

                                      F-4
<PAGE>

                            SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                            STATEMENTS OF OPERATIONS



                                                  Years Ended September 30:
                                              ---------------------------------
                                                 1997        1996        1995
                                              ---------   ---------   ---------
Income:
 Motel room                                    $995,707    $856,246    $829,326
 Telephone and vending                           14,913      14,721      10,260
 Interest                                        16,818      17,236      10,068
 Other                                            4,929       1,080       1,127
                                              ---------   ---------   ---------
  Total Income                                1,032,367     889,283     850,781
                                              ---------   ---------   ---------
Expenses:
 Motel operations (exclusive of depreciation
  shown separately below) (Notes 4 and 6)       684,677     662,519     688,067
 General and administrative (exclusive of
  depreciation shown separately below) (Note 4)  43,710      33,519      34,578
 Depreciation and amortization (Note 2)          90,581      91,815      97,047
                                              ---------   ---------   ---------
  Total Expenses                                818,968     787,853     819,692
                                              ---------   ---------   ---------

  Net Income                                   $213,399    $101,430     $31,089
                                              =========   =========   =========

Net Income Allocable to General Partners         $2,134      $1,014        $311
                                                =======     =======     =======

Net Income Allocable to Limited Partners       $211,265    $100,416     $30,778
                                               ========    ========     ======= 

Net Income Per Partnership Unit (Note 1)         $30.18      $14.35       $4.40
                                                =======     =======     ======= 

Distributions to Limited Partners
 Per Partnership Unit (Note 1)                   $60.50       $3.00       $ -
                                                =======     =======     =======












   The accompanying notes are an integral part of these financial statements

                                      F-5
<PAGE>

                             SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                         STATEMENTS OF PARTNERS' EQUITY

                                                   Years Ended September 30:
                                              ---------------------------------
                                                 1997        1996        1995
                                              ---------   ---------   ---------
General Partners:
 Balance, beginning of year                   $  47,359   $  46,345   $  46,034
  Net income                                      2,134       1,014         311
                                              ---------   ---------   ---------
   Balance, End of Year                          49,493      47,359      46,345
                                              ---------   ---------   ---------
Limited Partners:
 Balance, beginning of year                   1,121,712   1,042,296   1,011,518
  Net income                                    211,265     100,416      30,778
  Distributions to limited partners            (423,500)    (21,000)       -
                                              ---------   ---------   ---------
   Balance, End of Year                         909,477   1,121,712   1,042,296
                                              ---------   ---------   ---------

   Total Partners' Equity                      $958,970  $1,169,071  $1,088,641
                                              =========   =========   =========































   The accompanying notes are an integral part of these financial statements

                                      F-6
<PAGE>
                            SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                            STATEMENTS OF CASH FLOWS

                                                   Years Ended September 30:
                                              ---------------------------------
                                                 1997        1996        1995
                                              ---------   ---------   ---------
Cash Flows From Operating Activities:
 Received from motel operations              $1,007,202    $880,407    $840,465
 Expended for motel operations and
  general and administrative expenses          (712,901)   (679,215)   (704,198)
 Interest received                               16,551      17,338       8,172
                                              ---------   ---------   ---------
   Net Cash Provided by
     Operating Activities                       310,852     218,530     144,439
                                              ---------   ---------   ---------

Cash Flows From Investing Activities:
 Purchases of property and equipment            (43,159)    (36,984)    (28,974)
 Proceeds from sale of equipment                    500          20        -
                                              ---------   ---------   ---------
   Net Cash Used by
     Investing Activities                       (42,659)    (36,964)    (28,974)
                                              ---------   ---------   ---------

Cash Flows From Financing Activities:
 Distributions paid to limited partners        (423,500)    (21,000)       -
                                              ---------   ---------   ---------
   Net Cash Used by Financing Activities       (423,500)    (21,000)       -
                                              ---------   ---------   ---------

   Net Increase (Decrease) in Cash and
     Temporary Investments                     (155,307)    160,566     115,465

Cash and Temporary Investments:
 Beginning of year                              614,405     453,839     338,374
                                              ---------   ---------   ---------

   End of Year                                 $459,098    $614,405    $453,839
                                              =========   =========   =========















   The accompanying notes are an integral part of these financial statements

                                      F-7
<PAGE>

                             SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                      STATEMENTS OF CASH FLOWS (Continued)


                                                  Years Ended September 30:
                                              ---------------------------------
                                                 1997        1996        1995
                                              ---------   ---------   ---------
Reconciliation of Net Income (Loss) to Net Cash
  Provided by Operating Activities:
  Net income (loss)                            $213,399    $101,430   $  31,089
                                              ---------   ---------   ---------
 Adjustments to reconcile net income (loss) to
  net cash provided (used) by operating activities:
   Depreciation and amortization                 90,581      91,815      97,047
   Loss (gain) on sale of property                  331         (20)       -
   (Increase) decrease in accounts receivable    (8,614)      8,462      (2,144)
   (Increase) decrease in prepaid expenses       12,645       5,641      (1,276)
   Increase in other assets                      (7,143)     (3,675)       -
   Increase in accounts payable and accrued
     liabilities                                  7,658      14,936      19,599
   Increase (decrease) in due to
    related parties                               1,995         (59)        124
                                              ---------   ---------   ---------

   Total Adjustments                             97,453     117,100     113,350
                                              ---------   ---------   ---------
   Net Cash Provided by
    Operating Activities:                      $310,852    $218,530    $144,439
                                              =========   =========   =========
























   The accompanying notes are an integral part of these financial statements

                                      F-8
<PAGE>
                            SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1 - THE PARTNERSHIP

Super 8 Motels II, Ltd., is a limited partnership organized under California law
on May 7, 1979,  to  acquire  and  operate  motel  properties  in Santa Rosa and
Ontario,  California.  The Santa Rosa Motel was opened in November,  1980, and
the Ontario Motel was opened in May,  1981.  The Ontario Motel property was sold
in February, 1990. The Partnership grants credit to customers, substantially all
of which are local businesses in Santa Rosa.

The  Managing  General  Partner  of  the  Partnership  is  Grotewohl  Management
Services,  Inc.,  the  sole  shareholder  and  officer  of which  is  Philip  B.
Grotewohl. The Associate General Partner of the Partnership is Robert J. Dana.

The net income or net loss of the  Partnership  is  allocated  1% to the General
Partners  and 99% to the  Limited  Partners.  Net income and  distributions  per
partnership unit are based upon 7,000 units  outstanding.  All partnership units
are owned by the Limited Partners.

The Partnership  agreement  requires that the Partnership  maintain reserves for
normal repairs, replacements,  working capital and contingencies in an amount of
at least 5% of adjusted capital contributions  ($174,716 at September 30, 1997).
As of September 30, 1997,  the  Partnership  had a combined  balance in cash and
temporary investments of $459,098.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Items of Partnership  income are passed  through to the individual  partners for
income tax purposes, along with any income tax credits. Therefore, no federal or
California  income  taxes are provided for in the  financial  statements  of the
Partnership. Since the Partnership has a fiscal year-end other than the majority
of the partners,  the Partnership is required  annually to make a payment to the
Internal Revenue Service based on the prior year's income.

Property and equipment are recorded at cost. Depreciation and amortization are
computed using the following estimated useful lives and methods:

          Description              Methods            Useful Lives
  -----------------------  ----------------------     ------------ 
  Capital improvements     200% declining balance      7-20 years
                            and straight-line

  Buildings                150% declining balance     10-25 years
                            and straight-line

  Furniture and equipment  200% declining balance       5-7 years
                            and straight-line

Costs incurred in connection with maintenance and repair are charged to expense.
Major renewals and betterments  that  materially  prolong the life of assets are
capitalized.

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect certain  reported amounts and  disclosures.  Accordingly,  actual results
could differ from those estimates.
                                      F-9
<PAGE>

                             SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                    NOTES TO FINANCIAL STATEMENTS (Continued)

NOTE 3 - CASH AND TEMPORARY INVESTMENTS

Cash and temporary  investments as of September 30, 1997 and 1996 consist of the
following:
                                                    1997         1996        
                                                  --------     --------
  Cash in bank, non-interest bearing              $ 22,173     $ 35,070
  Money market accounts                            336,925      479,335
  Certificates of deposit                          100,000      100,000
                                                  --------     --------
     Total Cash and Temporary Investments         $459,098     $614,405
                                                  ========     ========

Temporary investments are recorded at cost, which approximates market value. The
Partnership  considers  temporary  investments  with original  maturities of six
months or less to be cash  equivalents  for  purposes of the  statement  of cash
flows.

NOTE 4 - RELATED PARTY TRANSACTIONS

Franchise Fees
Super 8 Motels,  Inc.,  now a wholly-owned  subsidiary of Hospitality  Franchise
Systems,  Inc., is franchisor of all Super 8 Motels. The Partnership pays to the
franchisor  monthly fees equal to 4% of the gross room revenues of the motel and
contributes an additional 1% of its gross room revenues to an  advertising  fund
administered by the franchisor.  In return the franchisor  provides the right to
use the name "Super 8," a national institutional advertising program, an advance
room reservation system, and inspection services.  These costs ($49,785 in 1997,
$42,812 in 1996 and $41,466 in 1995) are included in motel operations expense in
the accompanying  statements of operations.  The Partnership  operates its motel
property  as a  franchisee  of Super 8  Motels,  Inc.  through  a  sub-franchise
agreement with Brown & Grotewohl,  a California  general  partnership,  of which
Grotewohl  Management  Services,  Inc.,  (see Note 1) is a 50% owner.  Under the
sub-franchise  agreement,  Brown & Grotewohl  earned 40% of the above  franchise
fees,  which  amounted to $19,914,  $17,125 and $16,587 in 1997,  1996 and 1995,
respectively.

Property Management Fees
The General  Partners or their  affiliates  handle the  management  of the motel
property  of the  Partnership.  The  fee for  this  service  is 5% of the  gross
revenues from Partnership  operations,  as defined in the Partnership agreement,
not including income from the sale,  exchange or refinancing of such properties.
This fee is  payable  only out of the cash  available  for  distribution  of the
Partnership,  defined as the total cash  receipts  from  Partnership  operations
during a given  period of time less cash used during the same period to pay debt
service, capital improvements and replacements, operating expenses and reserves.
It is subordinated to prior receipt by the Limited  Partners of a cumulative 10%
per annum pre-tax return on their adjusted capital  contributions  for each year
of the Partnership's  existence.  At September 30, 1997 the Limited Partners had
not received the 10% cumulative return,  and as no property  management fees are
payable,  they are not  reflected  in  these  financial  statements.  Management
believes it is not likely that these fees will become payable in the future.

                                      F-10
<PAGE>
                             SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                    NOTES TO FINANCIAL STATEMENTS (Continued)

NOTE 4 - RELATED PARTY TRANSACTIONS (Continued)

Subordinated  Partnership  Management Fees During the Partnership's  operational
stage, the General Partners are to receive 9% of cash available for distribution
for  Partnership  management  services,  along  with  an  additional  1% of cash
available  for  distribution  on  account  of their  interest  in the income and
losses,  subordinated,  however,  to  receipt  by  the  Limited  Partners  of  a
cumulative 10% per annum pre-tax return on their adjusted capital  contributions
and to payment of the  property  management  fees  referred to above.  Since the
Limited  Partners had not received  the 10%  cumulative  return and the property
management fees had not been paid, no partnership  management fees are presently
payable  and  therefore  are  not  reflected  in  these  financial   statements.
Management  expects these fees will never be paid. This fee is payable only from
cash funds provided from operations of the Partnership, and may not be paid from
the proceeds of sale or refinancing.

Subordinated Incentive Distributions
Under the terms of the  Partnership  agreement,  the net proceeds of the sale of
any of the Partnership's motel properties and of any financing or refinancing of
any of the Partnership's motel properties,  to the extent that such proceeds are
not to be reinvested in the acquisition of additional properties, shall promptly
be distributed to the General Partners and Limited  Partners.  Until the Limited
Partners  have  received  distributions  from all sources equal to their capital
contributions  plus a cumulative  10% per annum pre-tax return on their adjusted
capital contributions,  all of such proceeds shall be distributed to the Limited
Partners. Thereafter, 15% of the remainder of such proceeds shall be distributed
to the General Partners as cash incentive distributions and the balance shall be
distributed to the Limited Partners.

Administrative  Expenses Shared by the Partnership and its Affiliates  There are
certain administrative expenses allocated between the Partnership and affiliated
Super 8 partnerships.  These expenses,  which are allocated based on usage,  are
telephone,   data   processing,   rent  of  the   administrative   office,   and
administrative   salaries.   The   administrative   expenses  allocated  to  the
Partnership were approximately  $112,000 in 1997,  $113,000 in 1996 and $110,000
in  1995  and  are  included  in  motel  operations  expenses  and  general  and
administrative expenses in the accompanying  statements of operations.  Included
in  administrative  salaries are allocated amounts paid to two employees who are
related to Philip B.  Grotewohl,  the sole  shareholder of Grotewohl  Management
Services, Inc., a General Partner of the Partnership.


NOTE 5 - LEASE COMMITMENT

The Partnership  has a long-term  operating  lease  commitment on  approximately
three acres of land in Santa Rosa, California, the site of the Santa Rosa motel.
The term of the lease runs through August 31, 2015, with an option to extend the
lease for three consecutive periods of five years each. The base monthly rent is
subject to adjustment at three year intervals to reflect changes in the Consumer
Price Index.  The  Partnership  will pay all  property  taxes,  assessments  and
utilities.  Rent expenses for the fiscal years ending  September 30, 1997,  1996
and 1995 were $102,033, $101,354 and $101,679, respectively.

                                      F-11
<PAGE>
                             SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                    NOTES TO FINANCIAL STATEMENTS (Continued)

NOTE 5 - LEASE COMMITMENT (Continued)

The future lease  commitment  at September 30, 1997,  using the minimum  monthly
amounts, is as follows:

                  Years Ending
                  September 30:                 Amount
                  -------------               ----------
                      1998                      $100,778
                      1999                       100,778
                      2000                       100,778
                      2001                       100,778
                      2002                       100,778
                   2003-2007                     503,888
                   2008-2012                     503,888
                   2013-2015                     293,935
                                              ----------
                   Total                      $1,805,601
                                              ==========

NOTE 6 - MOTEL OPERATING EXPENSES

The following table summarizes the major components of motel operating  expenses
for the years ended September 30, 1997, 1996 and 1995.

                                               1997      1996      1995
                                             --------  --------  --------
  Salaries and related costs                 $211,215  $189,103  $191,794
  Rent                                         94,025    93,395    94,016
  Franchise and advertising fees               49,785    42,812    41,466
  Utilities                                    71,893    74,632    73,824
  Allocated costs, mainly indirect salaries    90,713    92,355    89,327
  Repairs and minor renovations                17,928    20,987    33,863
  Other operating expenses                    149,118   149,235   163,777
                                             --------  --------  --------

  Total Motel Operating Expenses             $684,677  $662,519  $688,067
                                             ========  ========  ========

NOTE 7 - PROPERTY AND EQUIPMENT

The following is a summary of the accumulated  depreciation  and amortization of
property and equipment:

                                                        1997         1996       
                                                     ----------   ----------
  Capital improvements                               $   34,947   $   34,075

  Building                                            1,353,486    1,292,582
  Furniture and equipment                               445,645      432,670
                                                     ----------   ----------
Accumulated depreciation and amortization            $1,834,078   $1,759,327
                                                     ==========   ==========

                                      F-12
<PAGE>

                             SUPER 8 MOTELS II, LTD.
                       (A California Limited Partnership)
                    NOTES TO FINANCIAL STATEMENTS (Continued)


NOTE 8 - CONCENTRATION OF CREDIT RISK

The Partnership  maintains its cash accounts in six commercial  banks located in
California.  Accounts  at  each  bank  are  guaranteed  by the  Federal  Deposit
Insurance  Corporation  (FDIC) up to $100,000  per bank.  A summary of the total
insured and uninsured  cash balances (not reduced by  outstanding  checks) as of
September 30, 1997 follows:

  Total cash in all California banks     $469,982
  Portion insured by FDIC                (329,181)
                                         --------
    Uninsured cash balances              $140,801
                                         ========

NOTE 9 - SUBSEQUENT EVENTS

On October 27, 1997 a complaint was filed in the United States District Court by
Grotewohl  Management  Services,  Inc.  (a general  partner of the  Partnership)
naming as defendants  Everest/Madison Investors, LLC, Everest Lodging Investors,
LLC, Everest  Properties II, LLC, Everest  Properties,  Inc., W. Robert Kohorst,
David I. Lesser, The Blackacre Capital Group, L.P., Blackacre Capital Management
Corp.,  Jeffrey  B.  Citron,  Ronald J.  Kravit,  and  Stephen B.  Enquist.  The
complaint  pertains to tender  offers  directed by certain of the  defendants to
limited  partners of the  Partnerships,  and to  indications of interest made by
certain of the  defendants in purchasing  the property of the  Partnership.  The
complaint alleges that the defendant violated certain provisions of the Security
and Exchange Act of 1934 and seeks injunctive and declaritive relief.

On October 28, 1997 a complaint was filed in the Superior  Court of the State of
California,   Sacramento   County  by  Everest   Lodging   Investors,   LLC  and
Everest/Madison  Investors,  LLC as  plaintiffs  against  Philip  B.  Grotewohl,
Grotewohl Management Services,  Inc., Kenneth M. Sanders,  Robert J. Dana, Borel
Associates, and BWC Incorporated, as defendants, and the Partnership, along with
four  other  partnerships  of which have  common  general  partners,  as nominal
defendants. The complaint pertains to the receipt by the defendants of franchise
fees and  reimbursement  of expenses,  the  indications  of interest made by the
plaintiffs in purchasing the  properties  of the nominal  defendants,  and the
alleged refusal of the defendants to provide  information  required by the terms
of the  Partnership's  partnership  agreement and California  law. The complaint
requests the follow relief: a declaration that the action is a proper derivative
action; an order requiring the defendants to discharge their fiduciary duties to
the  Partnerships  and to enjoin them from  breaching  their  fiduciary  duties;
return of certain profits;  appointment of a receiver;  and an award for damages
in an amount to be  determined.  The  defendants  and  nominal  defendants  have
recently been served and are formulating their response to the complaint.







                                      F-13
<PAGE>
Item 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
             ACCOUNTING AND FINANCIAL DISCLOSURE

     Inapplicable.

                                    PART III

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The  original  general  partners of the  Partnership  were Dennis A. Brown,
Philip B.  Grotewohl and Robert J. Dana.  Upon Mr. Brown's death on February 25,
1988,  Mr.  Grotewohl and Mr. Dana elected to continue the  Partnership.  During
March 1988, Mr.  Grotewohl  appointed  Grotewohl  Management  Services,  Inc., a
California corporation 50% of which is owned by Mr. Grotewohl,  his successor as
Managing General Partner of the Partnership.  Mr. Dana continues to be a General
Partner of the Partnership.

     The Managing  General  Partner was  organized in 1981 to serve as a general
partner of limited  partnerships  to be formed for the purpose of  investing  in
Super 8 Motels.

     Mr.  Grotewohl,  age 79,  was an  attorney-at-law  and was  engaged  in the
private practice of law in San Mateo County, California,  between 1967 and 1978.
Since 1978,  Mr.  Grotewohl's  principal  occupation  has been as a promoter and
general partner of Super 8 Motel limited partnerships.

     Mr.  Dana,  age 69,  was a  registered  representative  of  Brown,  Brosche
Securities,  Inc.  between  1982 and 1988.  Between 1976 and 1982 he served as a
registered  representative of several stock and investment brokers. Mr. Dana has
also served as marketing  consultant for various real estate limited partnership
and other direct participation investment programs.

     See Item 3, "Legal Proceedings."

Item 11. EXECUTIVE COMPENSATION

     The following  discussion contains certain information  regarding aggregate
direct or indirect  compensation paid by the Partnership  during the fiscal year
ended  September  30, 1997 or payable to the General  Partners and the Estate of
Dennis A Brown as a group.  Although Mr. Brown ceased to be a general partner of
the  Partnership  upon his  death,  his estate  shares in  certain  compensation
otherwise payable to the General Partners and their affiliates.

Property Management Fees

     The Manager is managing and will manage the Partnership's motel pursuant to
an  agreement  between the  Partnership  and Super 8 Management  Corporation,  a
corporation  which was  wholly-owned by Dennis A. Brown and Philip B. Grotewohl.
In March  1988 the  management  contract  between  the  Partnership  and Super 8
Management  Corporation  was  assigned  to the  Manager,  which is a  California
general  partnership  between  the  Estate of  Dennis A Brown  and the  Managing
General  Partner.  The fee for this service is 5% of the gross proceeds from the
operations of the motel.  This fee is payable only out of the  operational  cash
flow of the Partnership, and is subordinated to the prior receipt by the Limited
Partners  of a  cumulative  10% per  annum  return  on  their  Adjusted  Capital
Contributions.  This  compensation  is in  addition  to the  cost of  goods  and
services acquired for the Partnership from independent contractors.

                                      -13-
<PAGE>

     As a result of the sale of the Ontario motel in February  1990, the General
Partners  waived their claim to accrued  management  fees as the receipt thereof
became extremely remote. No property management fees have been accrued since the
Ontario motel sale due to the  unlikelihood  that they would ever be paid to the
General  Partners.   Before  the  General  Partners  can  receive  any  property
management fees, the Limited Partners must receive preferential distributions of
$3,317,783 to meet the subordination  requirement  calculated  through September
30,1997, plus $349,432 per each year thereafter.

Franchise Fees and Advertising Fees

     Super  8  Motels,  Inc.  is the  franchisor  of all  Super  8  Motels.  The
Partnership  operates its motel as a franchisee of Super 8 Motels, Inc., through
sub-franchises  obtained  from  Super 8  Management  Corporation.  The  original
sub-franchise  agreement  between  Super 8 Motels,  Inc.  and Super 8 Management
Corporation  was transferred to the Manager in March 1988. The  Partnership,  as
franchisee,  pays to the  franchisor  monthly  franchise fees equal to 4% of its
gross  room  revenue  and  contributes  1%  of  its  gross  room  revenue  to an
advertising  fund  administered  by  the  franchisor  to  finance  institutional
advertising. The Manager is entitled to one-half of the franchise fees.

     The total of franchise  fees accrued during the fiscal year covered by this
report was $39,828 (of which $19,914  accrued to the Manager).  All of the above
sums have been paid.

General Partners' Interest in Cash Available for Distribution

     At  quarterly  intervals,  the  total  amount  of  the  Partnership's  Cash
Available  for  Distribution  is  determined  at the  discretion of the Managing
General  Partner.  (See  Item 5  above.)  Distributions  therefrom  are  made as
follows:  (1) 90% of such distributions is paid to the Limited Partners;  (2) 9%
thereof is paid to the General Partners as Partnership  management fees; and (3)
1% thereof is paid to the General  Partners in accordance with their interest in
the income and losses of the Partnership.

     Notwithstanding the foregoing, however, distributions of Cash Available for
Distribution to the General Partners are deferred and paid only after payment to
the Limited  Partners of  distributions of Cash Available for Distribution in an
amount  equal  to  10%  per  annum   cumulative   on  their   Adjusted   Capital
Contributions.  During the fiscal year covered by this  report,  no amounts were
deferred for the General  Partners' share of distributions of Cash Available for
Distribution.  A total of $719,202 has been deferred since  commencement  of the
Partnership.  As discussed in the section captioned  "Property  Management Fees"
above,  the  payment of these  fees is  unlikely  due to the large  preferential
distribution unpaid to the Limited Partners.











                                      -14-
 
<PAGE>

General  Partners'  Interest  in Net  Proceeds  of Sales and  Financing  of 
Partnership Properties

    Net  proceeds of the sale of the  Partnership's  motel  property and of any
financing  or  refinancing  thereof (to the extent that the proceeds of any such
financing  or  refinancing  are  not  to be  reinvested  in the  acquisition  of
additional properties) will be promptly distributed.  Such distributions will be
paid as follows: (1) until the Limited Partners have received distributions from
all  sources  equal to 100% of their  capital  contributions  plus 10% per annum
cumulative on their Adjusted Capital Contributions, all of such proceeds will be
distributed to the Limited Partners; (2) thereafter,  15% of the balance of such
proceeds  will  be  distributed  to  the  General  Partners  as  cash  incentive
distributions  and the remaining 85% thereof will be  distributed to the Limited
Partners.  No distributions  have been paid to or accrued for the benefit of the
General Partners.

Allocation of Compensation

     Compensation to the General  Partners and their  affiliates is allocated as
follows:

     (1)  Mr.  Dana  receives   annual   amounts  from  the  General   Partners'
compensation from the Partnership so that his cumulative additional compensation
from  year to year is  equal  to the  greater  of 25% of the  General  Partners'
cumulative  share of Cash  Available for  Distribution  and sale or  refinancing
proceeds  or 25% of the  cumulative  property  management  fees  received by the
General Partners  (reduced by all  Partnership-related  business expenses of the
General Partners).

     (2) All  compensation to the General Partners which is not allocated to Mr.
Dana is divided equally between Mr. Grotewohl and the Estate of Dennis A. Brown.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Security Ownership of Certain Beneficial Owners

  TITLE                                     AMOUNT AND NATURE OF
   OF                                          OF BENEFICIAL        PERCENT
  CLASS    NAME  OF BENEFICIAL OWNER             OWNERSHIP          OF CLASS
   -----    ------------------------------   --------------------    --------
  Units    Everest Lodging Investor, LLC         261 Units           3.73%
  Units    Everest Madison Investors, LLC        343 Units           4.97%
                                                 ---------
                             TOTAL               604 Units           8.63%
                                                 =========

     No person is known by the  Partnership to be the  beneficial  owner of more
than 5% of the Units.

Security Ownership of Management

     The General Partners do not beneficially own any Units.




                                      -15-

<PAGE>

Changes in Control

     With the consent of all other General Partners and Limited Partners holding
more than 50% of the Units,  a General  Partner may  designate  a  successor  or
additional general partner, in each case with such participation in such General
Partner's  interest as such General Partner and successor or additional  general
partner may agree upon,  provided that the interests of the Limited Partners are
not affected thereby.

     A General  Partner may withdraw  from the  Partnership  at any time upon 60
days'  prior  written  notice to the  Limited  Partners  and any  other  General
Partners, or may transfer his interest to an entity controlled by him; provided,
however,  that in either such event,  if it is determined  that the  Partnership
business  is to be  continued  rather than  dissolved  and  liquidated  upon the
happening  thereof,  the  withdrawal  or transfer  will be effective  only after
receipt by the  Partnership  of an  opinion  of counsel to the effect  that such
withdrawal  or transfer  will not cause the  Partnership  to be classified as an
association  taxable as a corporation  rather than as a partnership  for federal
income tax purposes.

     The  Limited  Partners  shall  take  no  part  in  the  management  of  the
Partnership's business; however, a majority in interest of the Limited Partners,
without the concurrence of the General  Partners,  shall have the right to amend
the Partnership Agreement, dissolve the Partnership, remove a General Partner or
any successor  general partner,  elect a new general partner or general partners
upon the removal,  retirement,  death,  insanity,  insolvency or bankruptcy of a
General  Partner,  and approve or disapprove  the sale,  exchange or pledge in a
single transaction of all or substantially all of the properties acquired by the
Partnership.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Administrative Expenses Shared by the Partnership and its Affiliates

     There are certain administrative expenses allocated between the Partnership
and affiliated Super 8 partnerships.  These expenses,  which are allocated based
on usage, are telephone,  data processing,  rent of  administrative  offices and
administrative   salaries.   The   administrative   expenses  allocated  to  the
Partnership were approximately  $112,000 in fiscal year ended September 30, 1997
and are included in general and administrative expenses and motel and restaurant
operations  expenses  in the  Partnership's  financial  statements.  Included in
administrative  salaries are  allocated  amounts paid to two  employees  who are
related  to  Philip B  Grotewohl,  a 50%  shareholder  of the  Managing  General
Partner.












                                      -16-

<PAGE>


                                     PART IV

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

     (a)  Documents filed as part of this report

   1. Financial Statements Included in Part II of this Report
         Report of Independent Certified Public Accountants
          Balance Sheets, September 30, 1997 and 1996
          Statements  of  Operations  for the Years Ended  September  30,
          1997,  1996 and 1995  Statements  of  Partners'  Equity for the
          Years Ended  September  30, 1997,  1996 and 1995  Statements of
          Cash Flows for the Years Ended  September  30,  1997,  1996 and
          1995 Notes to Financial Statements

   2.  Financial Statement Schedules Included in Part IV of the Report
         None

   3. Exhibits
         3. and 4.  The Partnership Agreement is incorporated herein 
         as an exhibit from the annual report on Form 10-K for the
         fiscal year ended September 30, 1984 (File No. 0-9218).

         10.1 Ground lease  pertaining to the  Partnership's  Santa Rosa,
         California  property  filed as Exhibit 10.1 to the annual report
         on Form 10-K for the fiscal year ended  September 30, 1982 (File
         No. 0-9218) is hereby incorporated herein as an exhibit.

   (b)   Reports on Form 8-K

     A current report on form 8-K dated November 13, 1997 was filed reporting an
"Other Event" under Item 5. No financial statements were included therein.






















                                      -17-

<PAGE>



                                   SIGNATURES

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

(Registrant)      SUPER 8 MOTELS II, LTD.

By (Signature and Title)                      /s/  Philip B. Grotewohl
                                              ------------------------
                                              Philip B. Grotewohl,
                                              Chairman of Grotewohl Management
                                              Services, Inc.,
                                              Managing General Partner

Date  December 22, 1997



     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
registrant and in the capacities and on the dates indicated.

By (Signature and Title)                      /s/  Philip B. Grotewohl
                                              ------------------------
                                              Philip B. Grotewohl,
                                              Chief executive officer,
                                              chief financial officer,
                                              chief accounting officer and sole
                                              director of Grotewohl Management
                                              Services, Inc., Managing General
                                              Partner

Date December 22, 1997




















                                      -18-

<PAGE>

<PAGE>