INDEPENDENT AUDITORS' REPORT


To the Partners of
  Nooney Income Fund Ltd. II, L.P.:

We have audited the  accompanying  balance sheets of Nooney Income Fund Ltd. II,
L.P. (a limited  partnership)  as of December 31, 1996 and 1995, and the related
statements of operations,  partners' equity (deficit) and cash flows for each of
the three years in the period ended  December 31, 1996. Our audits also included
the  financial  statement  schedules  listed in the index at Item 14(a)2.  These
financial  statements  are  the  responsibility  of  the  Partnership's  general
partners.  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 the
Partnership's  general  partners,  as well as evaluating  the overall  financial
statement  presentation.  We believe that our audits provide a reasonable  basis
for our opinion.

In our  opinion,  such  financial  statements  present  fairly,  in all material
respects,  the  financial  position of Nooney  Income Fund,  Ltd. II, L.P. 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.  Also,  in our opinion,  such
financial  statement  schedules,  when  considered  in  relation  to  the  basic
financial  statements taken as a whole,  present fairly in all material respects
the information set forth therein.



DELOITTE & TOUCHE LLP



St. Louis, Missouri
February 14, 1997


                                      -22-
<PAGE>



    NOONEY INCOME FUND LTD. II, L.P.
    (A LIMITED PARTNERSHIP)

    BALANCE SHEETS
    DECEMBER 31, 1996 AND 1995
  --------------------------------------------------------------------------


    ASSETS                                          1996           1995

    CASH AND CASH EQUIVALENTS (Note 3)          $ 1,323,026    $ 1,092,159

    ACCOUNTS RECEIVABLE                             219,655        320,515

    INVESTMENT PROPERTY (Notes 1, 2 and 4):
      Land                                        2,618,857      2,618,857
      Buildings and improvements                 13,405,976     13,341,502
                                                -----------    -----------

                                                 16,024,833     15,960,359
      Less accumulated depreciation               3,710,204      3,225,159
                                                -----------    -----------

                                                 12,314,629     12,735,200
      Investment property held for sale
       (Notes 1 and 4)                            2,483,469      2,431,537
                                                -----------    -----------

           Total investment property             14,798,098     15,166,737

    DEFERRED EXPENSES - At amortized cost           132,327        224,155
                                                -----------    -----------

    TOTAL                                       $16,473,106    $16,803,566
                                                ===========    ===========


    LIABILITIES AND PARTNERS' EQUITY

    LIABILITIES:
      Accounts payable and accrued expenses     $   103,331    $   251,779
      Accrued real estate taxes                     582,482        606,111
      Refundable tenant deposits                    125,026        112,034
      Mortgage note payable (Note 4)              7,190,000      7,190,000
                                                -----------    -----------

        Total liabilities                         8,000,839      8,159,924

    PARTNERS' EQUITY                              8,472,267      8,643,642
                                                -----------    -----------

    TOTAL                                       $16,473,106    $16,803,566
                                                ===========    ===========


    See notes to financial statements.

                                      -23-
<PAGE>


    NOONEY INCOME FUND LTD. II, L.P.
    (A LIMITED PARTNERSHIP)

    STATEMENTS OF OPERATIONS
    YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
  --------------------------------------------------------------------------


                                           1996        1995        1994

    REVENUES:
      Rental and other income (Note 5)  $3,502,080  $1,754,750  $1,729,872
      Interest                               7,589      31,790      23,494
                                        ----------  ----------  ----------

          Total revenues                 3,509,669   1,786,540   1,753,366

    EXPENSES:
      Interest                             614,006       1,134       1,238
      Depreciation and amortization        652,940     450,319     459,247
      Real estate taxes                    754,649     366,762     331,245
      Property management fees -
       related party                       211,474     107,060     105,854
      Repairs and maintenance              306,146     123,167     118,850
      Other operating expenses
       (includes $40,000 in 1996 and
       $25,000 in 1995 and 1994 to
       related party)                      754,932     372,120     354,554
      Professional services                131,951     156,461     128,332
                                        ----------  ----------  ----------

          Total expenses                 3,426,098   1,577,023   1,499,320
                                        ----------  ----------  ----------

    NET INCOME                          $   83,571  $  209,517  $  254,046
                                        ==========  ==========  ==========

    NET INCOME ALLOCATION:
      General partners                  $   12,729  $   13,989  $   20,380
      Limited partners                  $   70,842  $  195,528  $  233,666

    LIMITED PARTNERS' DATA (Note 2):
      Net income per unit               $     3.69  $    10.17  $    12.16
                                        ==========  ==========  ==========
      Cash distributions -
       Investment income per unit       $     3.69  $    10.17  $    12.16
                                        ==========  ==========  ==========
      Cash distributions -
       Return of capital per unit       $     8.81  $     2.33  $     6.59
                                        ==========  ==========  ==========

      Weighted average limited
       partnership units outstanding        19,221      19,221      19,221
                                        ==========  ==========  ==========


    See notes to financial statements.

                                      -24-
<PAGE>


  NOONEY INCOME FUND LTD. II, L.P.
  (A LIMITED PARTNERSHIP)

  STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
  YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
 ----------------------------------------------------------------------------


                                           Limited      General
                                           Partners     Partners     Total

  BALANCE (DEFICIT), JANUARY 1, 1994      $8,941,669  $ (124,207) $8,817,462

    Net income                               233,666      20,380     254,046

    Cash distributions                      (360,410)    (22,012)   (382,422)
                                          ----------  ----------  ----------

  BALANCE (DEFICIT), DECEMBER 31, 1994     8,814,925    (125,839)  8,689,086

    Net income                               195,528      13,989     209,517

    Cash distributions                      (240,268)    (14,693)   (254,961)
                                          ----------  ----------  ----------

  BALANCE (DEFICIT), DECEMBER 31, 1995     8,770,185    (126,543)  8,643,642

    Net income                                70,842      12,729      83,571

    Cash distributions                      (240,263)    (14,683)   (254,946)
                                          ----------  ----------  ----------

  BALANCE (DEFICIT), DECEMBER 31, 19964   $8,600,764  $ (128,497) $8,472,267
                                          ==========  ==========  ==========


  See notes to financial statements.

                                      -25-
<PAGE>


  NOONEY INCOME FUND LTD. II, L.P.
  (A LIMITED PARTNERSHIP)

  STATEMENTS OF CASH FLOWS
  YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
 ----------------------------------------------------------------------------


                                              1996        1995        1994

  CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income                            $   83,571  $  209,517  $  254,046
    Adjustments to reconcile net income
      to net cash provided by operating
      activities:
       Depreciation                          593,828     421,224     428,766
       Amortization of deferred expenses      59,112      29,095      30,481
       Net changes in accounts affecting
        operations:
          Accounts receivable                100,860    (211,683)     87,981
          Deferred expenses                   32,716     165,135     (54,627)
          Accounts payable and accrued
           expenses                         (148,448)    209,004      (8,332)
          Accrued real estate taxes          (23,629)    315,539     (35,006)
          Accrued sewer expenses                --       (32,400)      1,238
          Refundable tenant deposits          12,992      48,415       1,695
                                          ----------  ----------  ----------

            Net cash provided by
             operating activities            711,002     823,576     706,242
                                          ----------  ----------  ----------

  CASH FLOWS FROM INVESTING ACTIVITIES:
    Net additions to investment property    (225,189)   (154,049)   (251,995)
    Acquisition interests                       --    (7,630,440)       --
                                          ----------  ----------  ----------

            Net cash used in investing
             activities                     (225,189) (7,784,489)   (251,995)
                                          ----------  ----------  ----------

  CASH FLOWS FROM FINANCING ACTIVITIES-
    Cash distributions to partners          (254,946)   (254,961)   (382,422)
    Proceeds from mortgage note payable         --     7,190,000        --
                                          ----------  ----------  ----------

            Net cash provided by (used
             in) financing activities       (254,946)  6,935,039    (382,422)
                                          ----------  ----------  ----------

  NET INCREASE (DECREASE) IN CASH
    AND CASH EQUIVALENTS                     230,867     (25,874)     71,825

  CASH AND CASH EQUIVALENTS,
    BEGINNING OF YEAR                      1,092,159   1,118,033   1,046,208
                                          ----------  ----------  ----------

  CASH AND CASH EQUIVALENTS,
    END OF YEAR                           $1,323,026  $1,092,159  $1,118,033
                                          ==========  ==========  ==========

  SUPPLEMENTAL DISCLOSURE OF CASH FLOW
    INFORMATION - Cash paid during the
    year for interest                     $  599,823  $    1,134  $    1,238
                                          ==========  ==========  ==========



  See notes to financial statements.

                                      -26-
<PAGE>


NOONEY INCOME FUND LTD. II, L.P.
(A LIMITED PARTNERSHIP)

NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1995
--------------------------------------------------------------------------------


1.    BUSINESS

      Nooney  Income  Fund  Ltd.  II,  L.P.  (the  "Partnership")  is a  limited
      partnership  organized under the laws of the State of Missouri on February
      13, 1985 for the purpose of investing in income-producing real properties,
      such  as  shopping  centers,   office  buildings,   warehouses  and  other
      commercial properties.

      Prior to December 29, 1995, the Partnership owned three properties jointly
      with Nooney Income Fund Ltd.  III,  L.P. (NIF III).  NIF III was unable to
      service  its  debt,  and  its  percentage  interests  in the  jointly-held
      properties were transferred to a subsidiary of the mortgage lender in lieu
      of  foreclosure.  On December  29, 1995,  the  Partnership  purchased  the
      partial  interests of  Countryside  Executive  Center (50%),  Wards Corner
      Business  Center  A & B  (55%)  and  NorthCreek  Office  Park  (55%)  (the
      Acquisition  Interests)  from the subsidiary of the mortgage  lender.  The
      purchase  price was  $7,190,000  which was 100%  financed by the  mortgage
      lender.  The  Partnership  received  authority to complete the transaction
      through  solicitation  of the  limited  partners,  with a majority  of the
      limited  partnership  units  positively  consenting  to  the  transaction.
      Effective  January 1, 1996, the property known as Wards Corner was renamed
      Northeast Commerce Center.

      The Partnership's  undivided interest in its properties prior to and after
      the acquisition is as follows:

                                                       Prior to         After
                                                     Acquisition    Acquisition

      Leawood Fountain Plaza                              24 %           24 %
      Countryside Executive Center                        50 %          100 %
      Northeast Commerce Center                           45 %          100 %
      NorthCreek Office Park                              45 %          100 %
      Tower Industrial Building                          100 %          100 %


      The  transaction was accounted for under the purchase  method;  therefore,
      the  balance  sheets  as  of  December  31,  1996  and  1995  include  the
      Partnership's interests in its properties after the acquisition.

      The Partnership's portfolio is comprised of a 24% undivided interest in an
      office  complex in Leawood,  Kansas;  an office  warehouse  in  Mundelein,
      Illinois;  a single  story  office  building  in  Palatine,  Illinois;  an
      office/warehouse/showroom  facility  in  Loveland,  Ohio;  and  an  office
      complex in Cincinnati,  Ohio. The proportionate  share of these properties
      owned by the Partnership  generated 8.2%, 5.6%, 30.3%,  16.5% and 39.4% of
      rental and other  income,  respectively,  for the year ended  December 31,
      1996.

      It  is  management's   intent  to  sell   Countryside   Executive   Center
      (Countryside) as soon as practicable  because of local market  conditions,
      tax burdens and other factors related specifically to this property.

                                      -27-
<PAGE>

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      The  financial  statements  include  only those  assets,  liabilities  and
      results of  operations  of the  partners  which  relate to the business of
      Nooney Income Fund Ltd. II, L.P. The statements do not include any assets,
      liabilities, revenues or expenses attributable to the partners' individual
      activities.  No provision has been made for federal and state income taxes
      since these taxes are the personal responsibility of the partners.

      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.

      The corporate  general partner is a  partially-owned  subsidiary of Nooney
      Company.  One of the individual  general partners is an officer,  director
      and shareholder of Nooney Company.  Another  individual  general partner's
      spouse is a  shareholder  of Nooney  Company.  Nooney  Company  is also an
      economic  assignee  of two  former  individual  general  partners.  Nooney
      Krombach Company, a wholly-owned subsidiary of Nooney Company, manages the
      Partnership's  real estate for a management fee. Property  management fees
      paid to Nooney  Krombach  Company were  $211,454 and $107,060 and $105,854
      for the years ended  December 31, 1996,  1995 and 1994,  respectively.  In
      1995, the Partnership paid an acquisition/financing fee to Nooney Krombach
      Company of $75,000 relating to the purchase of the Acquisition  Interests,
      which  was  capitalized  into  the  purchase  price.   Additionally,   the
      Partnership  paid Nooney  Krombach  Company $40,000 in 1996 and $25,000 in
      1995 and  1994 as  reimbursement  for  administrative  services  including
      accounting,  issuing  and  transferring  of  units,  data  processing  and
      investor communications.

      Investment  property is recorded at the  lower-of-cost  or net  realizable
      value.  Impairment is  determined  if the sum of the expected  future cash
      flows  (undiscounted  and  without  interest  charges)  is less  than  the
      carrying  amount of the  property.  Investment  property that is currently
      held  for sale is  recorded  at the  lower  of its net  book  value or net
      realizable value.

      Buildings and  improvements  are depreciated  over their estimated  useful
      lives using the straight-line method.

      Lease  agreements  are accounted for as operating  leases and rentals from
      such leases are reported as revenues ratably over the terms of the leases.
      Certain lease  agreements  provide for rent  concessions.  At December 31,
      1996, accounts receivable include  approximately $59,000 ($59,000 in 1995)
      of  accrued  rent  concessions  which is not yet due  under  the  terms of
      various lease agreements.

      Included in rental and other  income are  amounts  received  from  tenants
      under  provisions  of lease  agreements  which  require the tenants to pay
      additional  rent equal to specified  portions of certain  expenses such as
      real estate taxes, insurance,  utilities and common area maintenance.  The
      income  is  recorded  in the same  period  that  the  related  expense  is
      incurred.

      Net Operating Cash Income,  as defined in the  Partnership  Agreement,  is
      distributed  quarterly  as  follows:  (1)  90%  pro  rata  to the  limited
      partners;  (2) 9% to the  individual  general  partners  as  their  annual
      Partnership Management Fee; and (3) 1% to the individual general partners.

                                      -28-
<PAGE>

      In the event it is  determined  after the close of a fiscal  year that the
      limited partners have not received their 7-1/2% non-cumulative  preference
      as defined  in the  Partnership  Agreement,  then the  individual  general
      partners  return  to the  partnership  a  portion  of their  distributions
      received as their 9% annual  Partnership  Management Fee until the limited
      partners  have  received  their  7-1/2%  non-cumulative   preference.  The
      individual  general  partners  are not  required  to return  any amount in
      excess of one-half of the 9% Partnership  Management Fee received.  If Net
      Operating  Cash  Income for any fiscal year is not  sufficient  to pay the
      limited  partners any portion of their 7-1/2%  non-cumulative  preference,
      the unpaid  amount  does not  accrue to future  fiscal  years.  The annual
      Partnership  Management Fee is a cumulative  preference.  The preferential
      return can be distributed  only through cash  distributed as a result of a
      Major Capital Event (as defined) or cash  distributed  upon dissolution of
      the  partnership.  Such preferred  distribution  is only allowed after the
      general and  limited  partners  receive  amounts  equal to their  adjusted
      capital  accounts  and the  limited  partners  receive  an 11%  cumulative
      return.  Through December 31, 1996,  Partnership  Management Fees totaling
      $249,441 have not been paid under the limitations stated above. Based upon
      the  priorities of cash to be  distributed,  management  believes that the
      likelihood  of payment of the  $249,441  is remote and  therefore  was not
      accrued on the balance sheet.

      For  financial  statement  and  income  tax  reporting,  the  income  from
      operations is allocated as follows:  first, a special  allocation of gross
      income to the  individual  general  partners  in the  amount  equal to the
      annual  partnership  management fee distributed to the individual  general
      partners  during the period;  then,  the  remainder is allocated 1% to the
      individual general partners and 99% pro rata to the limited partners based
      upon the  relationship of original  capital  contributions  of the limited
      partners.

      Limited  partnership  per unit  computations  are  based  on the  weighted
      average number of limited partnership units outstanding during the period.

      The  Partnership  considers  all highly  liquid  debt  instruments  with a
      maturity  of  three  months  or  less  at  date  of  purchase  to be  cash
      equivalents.

      Deferred expenses consist primarily of lease fees which are amortized over
      the terms of their respective leases.

3.    CASH EQUIVALENTS

      Cash  equivalents  consist  of bank  repurchase  agreements  of $50,000 at
      December 31, 1996 ($370,000 at December 31, 1995).

4.    MORTGAGE NOTE PAYABLE

      Mortgage  note payable as of December  31, 1996 and 1995,  consists of the
      following:

                                                        1996           1995

       Note payable to bank, interest only
        due monthly at bank's prime rate (8.25%
        at December 31, 1996) plus .75% to
        December 1996 when monthly principal
        payments commence                            $7,190,000    $7,190,000
                                                     ==========    ==========


      The mortgage note is  collateralized  by deeds of trust and  assignment of
      rents on investment property  (Countryside,  Northeast Commerce Center and
      NorthCreek  Office Park) with a net book value of  $13,100,000 at December
      31, 1996.

                                      -29-
<PAGE>

      Principal payments required during the next five years are as follows:

        1997                                                          $   93,468
        1998                                                             100,656
        1999                                                             115,044
        2000                                                             115,044
        2001                                                             132,000
        2002                                                           6,633,788


      In accordance  with Statement of Financial  Accounting  Standards No. 107,
      Disclosures  About Fair Value of Instruments,  the estimated fair value of
      mortgage notes payable with maturities greater than one year is determined
      based on rates  currently  available to the Partnership for mortgage notes
      with similar  terms and  remaining  maturities.  The  carrying  amount and
      estimated fair market value of the Partnership's debt at December 31, 1996
      and 1995 are equal due to the adjustable rate feature of the note.

5.    RENTAL REVENUES UNDER OPERATING LEASES

      Minimum future rental  revenues under  noncancelable  operating  leases in
      effect as of December 31, 1996 are as follows:

        1997                                                          $2,473,000
        1998                                                           1,849,000
        1999                                                             929,000
        2000                                                             500,000
        2001                                                             362,000
        Remainder                                                        617,000
                                                                      ----------

            Total                                                     $6,730,000
                                                                      ==========


6.    FEDERAL INCOME TAX STATUS

      The general  partners  believe,  based on opinion of legal  counsel,  that
      Nooney Income Fund Ltd. II, L.P. is  considered a  partnership  for income
      tax purposes.

      Selling  commissions and offering expenses incurred in connection with the
      sale of  limited  partnership  units are not  deductible  for  income  tax
      purposes and therefore increase the partners' bases. Investment properties
      are  depreciated  for income tax  purposes  using rates which  differ from
      rates used for computing  depreciation for financial statement  reporting.
      Rents  received in advance are  includable  in taxable  income in the year
      received.  Rent  concessions,  recognized  ratably  over  lease  terms for
      financial statement purposes, are includable in taxable income in the year
      rents are received. Losses in connection with the write-down of investment
      property  are not  recognized  for tax  purposes  until  the  property  is
      disposed.

                                      -30-
<PAGE>

      The  comparison  of  financial  statement  and income tax  reporting is as
      follows:

                                                   Financial         Income
                                                   Statement          Tax

        1996:
         Net income (loss)                       $    83,571     $(8,446,752)
         Partners' equity                          8,472,267       5,794,556

        1995:
         Net income                              $   209,517     $    53,069
         Partners' equity                          8,643,642      14,496,254

        1994:
         Net income                              $   254,046     $   114,775
         Partners' equity                          8,689,086      14,698,146


7.    MAJOR TENANT

      A substantial amount of the Partnership's revenue in 1996 was derived from
      two major  tenants whose rentals  amounted to  approximately  $469,000 and
      $374,000  or  13.3%  and  10.6%,   respectively,   of  total  revenues.  A
      substantial  amount of the Partnership's  revenue in 1995 was derived from
      two major  tenants whose rentals  amounted to  approximately  $201,000 and
      $191,000 or 11.3% and 10.7%, respectively, of total revenues.

                                   * * * * * *

                                      -31-

<PAGE>

<TABLE>
NOONEY INCOME FUND LTD. II, L.P.
(A LIMITED PARTNERSHIP)

SCHEDULE - RECONCILIATION OF PARTNERS' EQUITY (DEFICIT)
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
------------------------------------------------------------------------------------------------------------------------------------

The reconciliation of partners' equity (deficit) between financial statement and income tax reporting is as follows:
<CAPTION>
                                                                 December 31, 1996                      December 31, 1995
                                                        -----------------------------------    ------------------------------------
                                                          Limited     General                    Limited     General
                                                          Partners    Partners      Total        Partners    Partners      Total

<S>                                                     <C>          <C>        <C>            <C>          <C>         <C>
Balance (deficit) per statement of partners' equity     $ 8,600,764  $(128,497) $ 8,472,267    $ 8,770,185  $(126,543)  $ 8,643,642

Add:
  Selling commissions and other offering costs not
    deductible for income tax purposes                    2,411,625       --      2,411,625      2,411,625       --       2,411,625
  Prepaid rents included in income for income
    tax purposes                                             23,551        238       23,789         (1,411)       (14)       (1,425)
  Master lease income included in income for
    income tax purposes                                     118,404      1,196      119,600        118,404      1,196       119,600
  Writedown of investment property not recognized
    for income tax purposes                               5,202,450     52,550    5,255,000      5,202,450     52,550     5,255,000
                                                        -----------  ---------  -----------    -----------  ---------   -----------
          Total                                          16,356,794    (74,513)  16,282,281     16,501,253    (72,811)   16,428,442

Less:
  Excess depreciation and amortization deducted
    for income tax purposes                              10,303,392    122,070   10,425,462      1,836,918     36,549     1,873,467
  Rent concessions not recognized for income
    tax purposes                                             58,833        594       59,427         58,134        587        58,721
  Insurance premiums deducted for tax purposes                2,808         28        2,836           --         --            --
                                                        -----------  ---------  -----------    -----------  ---------   -----------
Balance (deficit) per tax return                        $ 5,991,761  $(197,205) $ 5,794,556    $14,606,201  $(109,947)  $14,496,254
                                                        ===========  =========  ===========    ===========  =========   ===========


                                                                 December 31, 1994
                                                        -----------------------------------
                                                          Limited     General
                                                          Partners    Partners      Total

Balance (deficit) per statement of partners' equity     $ 8,814,925  $(125,839) $ 8,689,086

Add:
  Selling commissions and other offering costs not
    deductible for income tax purposes                    2,411,625       --      2,411,625
  Prepaid rents included in income for income
    tax purposes                                             10,620        107       10,727
  Master lease income included in income for
    income tax purposes                                     118,404      1,196      119,600
  Writedown of investment property not recognized
    for income tax purposes                               5,202,450     52,550    5,255,000
                                                        -----------  ---------  -----------
          Total                                          16,558,024    (71,986)  16,486,038

Less:
  Excess depreciation and amortization deducted
    for income tax purposes                               1,662,220     34,784    1,697,004
  Rent concessions not recognized for income
    tax purposes                                             89,979        909       90,888
  Insurance premiums deducted for tax purposes                 --         --           --
                                                        -----------  ---------  -----------
Balance (deficit) per tax return                        $14,805,825  $(107,679) $14,698,146
                                                        ===========  =========  ===========

                                                                -32-
</TABLE>

<PAGE>

<TABLE>
NOONEY INCOME FUND LTD. II, L.P.
(A LIMITED PARTNERSHIP)

SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1996
------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
                Column A               Column B              Column C               Column D                Column E
                --------               --------              --------               --------                --------
                                                                                     Costs           Gross Amount at Which
                                                   Initial Cost to Partnership    Capitalized      Carried at Close of Period
                                                  ------------------------------  Subsequent to  -------------------------------
                                                          Buildings and           Acquisition(1)         Buildings and
              Description            Encumbrances  Land   Improvements    Total                   Land   Improvements     Total

<S>                                  <C>        <C>        <C>         <C>         <C>         <C>        <C>         <C>
Leawood Fountain Plaza Office
  Complex 24% undivided interest),
  Leawood, Kansas                    $     --   $  318,962 $ 1,991,417 $ 2,310,379 $ (665,376) $  318,962 $ 1,326,041 $ 1,645,003
Tower Industrial Building,
 Mundelein, Illinois                       --      193,744   1,042,076   1,235,820      2,841     193,744   1,044,917   1,238,661
NorthCreek Office Park,
 Cincinnati, Ohio                          --      338,850   4,639,617   4,978,467  3,624,231   1,370,100   7,232,598   8,602,698
Northeast Commerce Center,
 Cincinnati, Ohio                          --      199,361   2,784,317   2,983,678  1,554,793     736,051   3,802,420   4,538,471
Countryside Executive Center,
 NorthCreek Office Park and Wards
 Center Business Center A & B         7,190,000       --          --          --         --          --          --          --
                                     ---------- ---------- ----------- ----------- ----------  ---------- ----------- -----------
                                           --    1,050,917  10,457,427  11,508,344  4,516,489   2,618,857  13,405,976  16,024,833
Countryside Executive Center,
 Palatine, Illinois                        --      623,919   4,302,911   4,926,830 (1,381,931)  1,356,419   2,188,480   3,544,899(2)
                                     ---------- ---------- ----------- ----------- ----------  ---------- ----------- -----------
          Total                      $7,190,000 $1,674,836 $14,760,338 $16,435,174 $3,134,558  $3,975,276 $15,594,456 $19,569,732
                                     ========== ========== =========== =========== ==========  ========== =========== ===========
</TABLE>

<TABLE>
<CAPTION>
                                                    Column F            Column G           Column H               Column I
                                                  ------------        ------------         --------        ---------------------
                                                                                                                 Life on
                                                                                                            Which Depreciation
                                                  Accumulated           Date of              Date            In Latest Income
                                                  Depreciation        Construction         Acquired        Statement is Computed

<S>                                                <C>                  <C>                <C>                    <C>
Leawood Fountain Plaza Office
 Complex (24% undivided interest),
 Leawood, Kansas                                   $  787,406           1982-1983           2/20/85               30 years
Tower Industrial Building,
 Mundelein, Illinois                                  377,253              1974             3/20/86               30 years
NorthCreek Office Park,
 Cincinnati, Ohio                                   1,662,474           1984-1986          12/29/86               30 years
Northeast Commerce Center,
 Cincinnati, Ohio                                     883,071              1985            12/29/86               30 years
                                                   ----------
                                                    3,710,204
Countryside Executive Center,
 Palatine, Illinois                                 1,061,430              1975            12/16/86               30 years
                                                   ----------
          Total                                    $4,771,634 (2)
                                                   ==========

(1) Amounts shown are net of assets written-off and the following  writedowns to reflect appraised values:

       Leawood Fountain Plaza Office Complex          754,000
       NorthCreek Office Park                       2,852,836
       Northeast Commerce Center                    2,520,518
       Countryside Executive Center                 7,475,910

(2)  Amount is shown net in the financial statements $(2,483,469).

                                                                                                                       (Continued)

                                                               -33-
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<PAGE>

<TABLE>
NOONEY INCOME FUND LTD. II, L.P.
(A LIMITED PARTNERSHIP)

SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
------------------------------------------------------------------------------------------------------------------------------------

<CAPTION>
                                                                        1996               1995              1994

<S>                                                                 <C>               <C>               <C>
(A) Reconciliation of amounts in Column E:

    Balance at beginning of period                                  $ 19,442,902      $ 11,935,190      $ 11,709,165

    Add:
      Cost of improvements                                               225,189           154,049           251,995
      Acquisition of undivided interests                                    --           7,630,440              --

    Less - cost of disposals                                             (98,359)         (276,777)          (25,970)
                                                                    ------------      ------------      -------------
    Balance at end of period                                        $ 19,569,732      $ 19,442,902      $ 11,935,190
                                                                    ============      ============      ============

    Reconciliation of amounts in Column F:

(B) Balance at beginning period                                     $  4,276,165      $  4,131,718      $  3,728,922

    Add -  Provision during period                                       593,828           421,224           428,766

    Less -  Depreciation on disposals                                    (98,359)         (276,777)          (25,970)
                                                                    ------------      ------------      ------------
    Balance at end of period                                        $  4,771,634      $  4,276,165      $  4,131,718
                                                                    ============      ============      ============
(C) The aggregate cost of real estate owned for
    federal income tax purposes                                     $ 33,173,530      $ 24,697,902      $ 17,190,190
                                                                    ============      ============      ============

                                                                                                         (Concluded)
                                                                -34-
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