Realty Parking Properties II L.P.
                              Ketter ti Ubvestirs

                                      -1-
<PAGE>

                                         REALTY PARKING PROPERTIES II L.P.

                                                1997 ANNUAL REPORT

                                                  March 20, 1998

Dear Investor:


OPERATIONS

         In 1997,  the operating  results of Realty  Parking  Properties II L.P.
continued their positive trend. Parking lot rental income increased $125,045, or
5%, during 1997, as compared to 1996.  This increase is largely  attributable to
increased percentage rents earned at several properties.

         Percentage rents were earned at six of the Fund's eleven properties. In
1997, the Nashville,  Tulsa,  Atlanta, San Francisco,  Dallas-Metropolitan,  and
Phoenix  facilities  earned  a total  of  $642,941  in  percentage  rents.  This
represents a 57% increase over the percentage rents earned in 1996.

         Of  particular  importance  during  1997,  was the  sale of the  Fund's
Seattle facility. Net of sale expenses, including a termination and advisory fee
to Central Parking (the Fund's advisor),  the sale produced  approximately  $7.2
million for  distribution.  In accordance with the structure of the Fund, 99% of
this amount was distributed to Limited  Partners.  As a result of the sale, each
investor  received  $5.12 per $25  investment  unit.  Overall,  the Seattle sale
proved to be very  profitable,  earning a  substantial  return  over the  Fund's
acquisition costs of approximately $4.3 million.

         The Fund recently placed the Dallas  Metropolitan Garage under contract
to a real estate  investment firm which specializes in parking  facilities.  The
sale  should  occur  in May  1998,  however,  there  is no  assurance  that  the
prospective buyer will close pursuant to the contract of sale.


CASH DISTRIBUTION

         The  Fund  made a fourth  quarter  1997  distribution  of  $349,600  to
partners on February  13, 1998.  Each partner  received his or her share of this
distribution in the amount of $.2485 per unit.
This distribution represents a 5% annualized return.


                                      -2-

<PAGE>


OUTLOOK

         Management   remains   pleased  with  the   operations  of  the  Fund's
properties.  The  information  Management  gained  during  its site  visits  has
permitted  better  analysis of disposition  strategies.  While it was originally
anticipated  that the highest  returns would be obtained from property  sales to
buyers who desired sites for near-term  development  potential,  management  now
believes that certain  properties  could be sold at  substantial  gains based on
their parking economics. The potential sale of the Dallas-Metropolitan garage is
an excellent example.


SUMMARY

         Management  is  pleased  with  1997's  results  and  looks  forward  to
continued gains in 1998. The possible sale of the Dallas-Metropolitan garage and
increased  interest  in other  facilities  should lend to  continued  growth and
returns to the Fund's investors.


Very truly yours,


John M. Prugh, President
Realty Parking Company II, Inc.
General Partner

                                      -3-

<PAGE>


                        Realty Parking Properties II L.P.
                              Financial Statements


                                      -4-
<PAGE>
                                         INDEPENDENT AUDITORS' REPORT


The Partners
         Realty Parking Properties II L.P.:


We   have audited the accompanying  balance sheets of Realty Parking  Properties
     II L.P.  (the  "Fund") as of  December  31,  1997 and 1996 and the  related
     statements of operations,  partners' capital and cash flows for each of the
     years in the  three-year  period ended December 31, 1997.  These  financial
     statements  are  the   responsibility   of  the  Fund'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 Realty Parking Properties
     II L.P. as of December 31, 1997 and 1996, and the results of its operations
     and its cash  flows for each of the years in the  three-year  period  ended
     December  31,  1997  in  conformity  with  generally  accepted   accounting
     principles.



                                                      KPMG PEAT MARWICK LLP


Baltimore, Maryland
         January 23, 1998

                                      -5-

<PAGE>
              REALTY PARKING PROPERTIES II L.P.

                        Balance Sheets

<TABLE>
<CAPTION>
                                  December 31,
                                    1997 1996

Assets

<S>                                                           <C>                 <C>
  Investment in real estate (Note 3)                          $26,789,804         $31,457,822
  Cash and cash equivalents                                       887,200             694,405
  Other assets
    Accounts receivable                                           283,112             307,582
    Organization and start-up costs
          less accumulated amortization
          of $52,229 and $50,863, respectively (Note 2)               --                1,366
    Financing costs less accumulated
          amortization of $21,000 and $15,000, respectively         9,003              15,003
                                                                  292,115             323,951

                                                              $27,969,119         $32,476,178

Liabilities and Partners' Capital

    Accounts payable and accrued expenses                     $    24,932         $   123,891
    Due to affiliates (Note 6)                                     68,890             121,206
    Real estate taxes payable                                     283,112             304,754
    Note payable (Note 7)                                       3,061,000           3,061,000
                                                                3,437,934           3,610,851


  Partners' Capital (Note 9)
    General Partner                                               (64,122)            (20,782)
    Assignee and Limited Partnership
         Interests  -  $25 stated value per
         unit, 1,392,800 units outstanding                     24,595,207          28,886,009
    Subordinated Limited Partner                                      100                 100
                                                               24,531,185          28,865,327

                                                              $27,969,119         $32,476,178

</TABLE>



See accompanying notes to financial statements

                                      -6-

<PAGE>


           REALTY PARKING PROPERTIES II L.P.

               Statements of Operations
           For the years ended December 31,
<TABLE>
<CAPTION>
                                                           1997        1996        1995

Revenues
<S>                                                    <C>         <C>         <C>
  Parking lot rental (Note 5)                          $2,589,901  $2,464,856  $2,252,425
  Interest income                                          35,447      14,495      15,020
  Gain from sale of property, net (Note 4)              2,708,847        --          --
                                                        5,334,195   2,479,351   2,267,445

Expenses
   Administrative, including amounts to
        related party (Note 6)                             88,750      88,682      78,160
   Professional fees                                       27,125      32,480      46,640
   Management fees to related party (Note 6)              220,078     238,295     238,975
   Interest                                               279,635     284,366     271,305
   Depreciation of property                               172,748     171,248     153,980
   Amortization of organization and
       start-up costs and financing costs                   7,366      16,440      16,440
                                                          795,702     831,511     805,500

Net earnings                                           $4,538,493  $1,647,840  $1,461,945

Net earnings per unit of assignee and
        limited partnership interests-basic (Note 9)   $     3.23  $     1.17  $     1.04

</TABLE>

See accompanying notes to financial statements
                                      -7-
<PAGE>
REALTY PARKING PROPERTIES II L.P.

 Statements of Partners' Capital
For the years ended December 31,
<TABLE>
<CAPTION>
                                    Assignee
                                  and Limited   Subordinated
                                  Partnership     Limited      General
                                   Interests      Partner      Partner      Total


<S>                              <C>           <C>           <C>        <C>
Balance at December 31, 1994     $ 28,984,598  $        100  $ (19,784) $ 28,964,914

Net earnings                        1,447,326           --      14,619     1,461,945

Distributions to partners          (1,566,876)          --     (15,828)   (1,582,704)


Balance at December 31, 1995       28,865,048           100    (20,993)   28,844,155

Net earnings                        1,631,362           --      16,478     1,647,840

Distributions to partners          (1,610,401)          --     (16,267)   (1,626,668)


Balance at December 31, 1996       28,886,009           100    (20,782)   28,865,327

Net earnings                        4,493,108           --      45,385     4,538,493

Distributions to partners
    Operations                     (1,651,834)          --     (16,684)   (1,668,518)
    Sale proceeds, net             (7,132,076)          --     (72,041)   (7,204,117)


Balance at December 31, 1997     $ 24,595,207  $        100  $ (64,122) $ 24,531,185
</TABLE>


See accompanying notes to financial statements
                                      -8-
<PAGE>
REALTY PARKING PROPERTIES II L.P.

                         Statements of Cash Flows
                     For the years ended December 31,
<TABLE>
<CAPTION>
                                                                                1997          1996          1995

Cash flows from operating activities
<S>                                                                        <C>           <C>           <C>
          Net earnings                                                     $  4,538,493  $  1,647,840  $  1,461,945
          Adjustments to reconcile net earnings to net cash
                  provided by operating activities
                  Gain from sale of property                                 (2,708,847)          --            --
                  Depreciation  of property                                     172,748       171,248       153,980
                  Amortization of organization and start-up costs
                        and financing costs                                       7,366        16,440        16,440
                  Changes in assets and liabilities
                        (Increase) decrease in accounts receivable
                                and real estate taxes payable                     2,828         5,990        (8,906)
                        Increase (decrease) in accounts payable
                                and accrued expenses                            (98,959)       84,350        34,746
                        Increase (decrease) in amounts due to affiliates        (52,316)       40,579        10,855
Net cash provided by operating activities                                     1,861,313     1,966,447     1,669,060


Cash flows from investing activities -
         Sale of property, net                                                7,204,117           --            --
         Additions to investment in real estate                                     --       (129,304)     (412,974)
Net cash provided by (used in) investing activities                           7,204,117      (129,304)     (412,974)


Cash flows from financing activities
         Proceeds from note borrowing                                               --        116,000       445,000
         Distributions to partners                                           (8,872,635)   (1,626,668)   (1,582,704)
Net cash used in financing activities                                        (8,872,635)   (1,510,668)   (1,137,704)

Net increase in cash and cash equivalents                                       192,795       326,475       118,382
Cash and cash equivalents
         Beginning of year                                                      694,405       367,930       249,548

         End of year                                                       $    887,200  $    694,405  $    367,930
</TABLE>


See accompanying notes to financial statements

                                      -9-
<PAGE>

                                         REALTY PARKING PROPERTIES II L.P.
                                           Notes to Financial Statements

                                                 December 31, 1997

(1)    Organization

       Realty  Parking  Properties  II L.P.  (the "Fund") is a Delaware  limited
       partnership  formed on  December  26,  1990 to acquire  surface  lots and
       parking  garage  structures  to be held  for  appreciation  and  used for
       parking  operations to produce  current  income.  The general  partner is
       Realty Parking Company II, Inc. and the  subordinated  limited partner is
       Realty  Associates  Limited  Partnership,  an  affiliate  of the  general
       partner.

       The Fund has entered into parking consulting and advisory agreements with
       Central  Parking  System,  Inc.   ("Central")  and  Allright  Corporation
       ("Allright"),  respectively.  Central  purchased  42,104 assignee limited
       partnership  interests,  net of  selling  commissions,  representing  its
       maximum allowable purchase of $1,000,000.

       The Fund owns eleven properties in total, eight of which are wholly owned
       by the Fund.  The undivided  tenants-in-common  ownership of three of the
       properties is noted below.  The  properties are not subject to a mortgage
       or other  lien or  encumbrance  under  the  terms of the loan  agreement,
       however, the collateral security provision of the loan agreement provides
       for the  assignment  of the Fund's  rights as a lessor to its interest in
       the parking lot leases, contracts and income. As of December 31, 1997 the
       Fund owned the following properties:
<TABLE>
<CAPTION>

                                                         Approximate
         Location                                         Size (Sq. Ft.)                Type

<S>                                                           <C>
        Phoenix, Arizona                                      275,310                  surface lot
         San Diego, California                                  50,000                  surface lot
         San Diego, California (Union)                          35,000                  surface lot
         San Francisco, California                              12,720                  surface lot
         Denver, Colorado                                      106,250                  surface lot
         Atlanta, Georgia                                       78,582                  surface lot and garage
         Tulsa, Oklahoma                                        39,646                  surface lot
         Nashville, Tennessee                                   57,720                  surface lot and garage
         Dallas, Texas                                          45,714                  surface lot and garage
         Dallas, Texas (Metro)                                  19,450                  surface lot and garage
         San Antonio, Texas                                     43,341                  surface lot

</TABLE>

       The Fund owns an 80% undivided interest in the Denver,  Colorado property
       and a 60%  undivided  interest  in  the  Tulsa,  Oklahoma  property.  The
       remaining interests of these two properties are owned by Central.

       The Fund owns a two-thirds  undivided  interest in the  Atlanta,  Georgia
       property. The remaining interest of this property is owned by Allright.

                                      -10-

<PAGE>


                                         REALTY PARKING PROPERTIES II L.P.
                                     Notes to Financial Statements (continued)


(2)    Summary of Significant Accounting Policies

       The accompanying  financial  statements have been prepared on the accrual
       basis of  accounting.  The Fund reports its operating  results for income
       tax purposes on the accrual basis.  No provision for income taxes is made
       because any liability for income taxes is that of the individual partners
       and not that of the Fund.

       The Fund has joint interest and control with other venturers in the three
       properties which are accounted for using the proportionate  share method.
       The financial  statements include the Fund's  proportionate  share of the
       properties' historical cost, revenues and expenses.

       Lease   revenues  are  recorded  as  earned  under  the  terms  of  lease
agreements.

       Costs  associated  with the  marketing  of assignee  limited  partnership
       interests  to the  public  were  offset  against  the  related  partners'
       capital.  Costs  associated  with  the  organization  of  the  Fund  were
       capitalized and amortized on a straight-line  basis over a period of five
       years.

       The Fund considers all highly liquid investments with original maturities
       of three months or less as cash  equivalents.  Cash and cash  equivalents
       consist  of a cash and a money  market  account  and are  stated at cost,
       which approximates market value at December 31, 1997 and 1996.

       Investment  in real  estate is stated at the lower of fair value or cost,
       net of  accumulated  depreciation,  and includes all related  acquisition
       costs of the properties.  Depreciation of the parking garage buildings is
       computed  using the  straight-line  method  over 31.5 years for  property
       placed in  service  prior to  January  1, 1994 and 39 years for  property
       placed  in  service  after  January  1,  1994.  Land   improvements   are
       depreciated using the straight-line method over 15 years.

       Management  of the Fund has made a number of  estimates  and  assumptions
       relating to the reporting of assets,  liabilities,  revenues and expenses
       to prepare  these  financial  statements  in  conformity  with  generally
       accepted  accounting  principles.  Actual results could differ from those
       estimates.

       The fair value of financial  instruments  is  determined  by reference to
       various market data and other valuation considerations. The fair value of
       financial instruments approximate their recorded values.

       In accordance with Statement of Financial  Accounting  Standards No. 121,
       "Accounting  for the  Impairment of Long-Lived  Assets and for Long-Lived
       Assets  to Be  Disposed  Of,"  the  Fund  records  impairment  losses  on
       long-lived  assets  used in  operations  when  events  and  circumstances
       indicate  that the  individual  assets might be  impaired,  based on fair
       value, and the undiscounted cash flows estimated to be generated by those
       assets are less than the carrying amounts of the assets.

                                      -11-

<PAGE>


                                         REALTY PARKING PROPERTIES II L.P.
                                     Notes to Financial Statements (continued)


(2)    Summary of Significant Accounting Policies (continued)

       During  1997 and  1996,  no events or  circumstances  indicated  that the
       assets of the Fund were impaired.

(3)    Investment in Real Estate

       Investment in real estate is summarized as follows at December 31:
<TABLE>
<CAPTION>

                                                                  1997                         1996

<S>                                                              <C>                         <C>
         Land                                                    $21,857,657                 $26,356,118
         Building                                                  5,583,532                   5,583,532

                                                                  27,441,189                  31,939,650
         Less: Accumulated depreciation                              651,385                     481,828

                                                                 $26,789,804                 $31,457,822
</TABLE>

(4)    Sale of Property

       On June 26, 1997,  the Fund sold its 66,179 square foot parcel of land in
       Seattle, Washington for $8,000,000. The Fund's investment in the property
       was $4,495,268,  net of accumulated  depreciation of $3,191.  The capital
       gain from the sale totaled $2,708,847, net of expenses of $795,885.

(5)    Leases

       The Fund leased six properties to Central and five properties to Allright
       for periods of 10 years (expiring between August 2002 and July 2004) with
       options to extend  these leases for two  additional  terms of five years.
       Under the terms of the typical lease  agreement the lessees are obligated
       to pay the Fund the greater of the  minimum  rent plus  reimbursement  of
       real  estate  taxes or 65% of the  gross  parking  revenues  ("percentage
       rent").  Percentage  rents  earned  during  1997,  1996 and 1995  totaled
       $642,958,  $409,065  and  $300,823,   respectively.   The  typical  lease
       agreement calls for minimum rents of 6.0% of certain acquisition costs in
       the first year, 6.5% in the second year and 7.0% thereafter.  Parking lot
       rents of $1,946,943,  $2,055,791  and $1,951,602 in 1997,  1996 and 1995,
       respectively,  represented minimum rents due in accordance with the lease
       agreements in effect during each period. Additionally, under the terms of
       the leases,  the parking lot operator is  responsible  for all  operating
       costs,  including  ad valorem  real  estate  taxes and general and garage
       liability insurance  coverage.  Each lease is cancelable by the Fund upon
       the sale of the property and the payment to the lessee of a  "termination
       fee". The termination fee generally equals 15% of the amount,  if any, by
       which

                                      -12-

<PAGE>


                                         REALTY PARKING PROPERTIES II L.P.
                                     Notes to Financial Statements (continued)


(5)    Leases (continued)

       a property's  sales proceeds exceed the original  acquisition cost of the
       property plus a 12% compounded annual return on the original  acquisition
       cost minus all rents received by the Fund from the property.  Some of the
       leases may differ from the terms  outlined  above in order to accommodate
       specific circumstances of an acquired property.

       The minimum rents to be received under the terms of the operating  leases
       in effect at December 31, 1997 are summarized as follows:

         1998                                                  $   1,829,793
         1999                                                      1,835,863
         2000                                                      1,844,361
         2001                                                      1,850,431
         2002                                                      1,763,585
         Subsequent to 2002                                        1,986,252

         Total                                                  $ 11,110,285

(6)    Related Party Transactions

       The general  partner  earned an  asset-based  management fee of $220,078,
       $238,295 and $238,975 in 1997, 1996 and 1995, respectively,  for advising
       the Fund and managing its investments.  This fee is equal to 0.75% of the
       Fund's capital contributions invested in properties or updated appraisals
       for certain of the Fund's  properties  and 0.5% of capital  contributions
       temporarily  held awaiting  investment in properties.  Additionally,  the
       general  partner is  reimbursed  for certain costs  incurred  relating to
       administrative services of the Fund totaling $95,695, $74,556 and $80,555
       in 1997, 1996 and 1995, respectively.

       In 1997 the Fund  paid  Central  a  termination  fee of  $283,949  and an
       advisory  fee of $120,000  in  connection  with the sale of the  Seattle,
       Washington property.

       Under the terms of the lease  agreements,  real estate  taxes paid by the
       Fund will be  reimbursed  by Central or Allright and are not reflected on
       the statements of operations. The Fund has recorded $283,112 and $304,754
       of real estate taxes in both of accounts receivable and real estate taxes
       payable at December 31, 1997 and 1996, respectively.

(7)    Note Payable

       On July 18,  1994 the Fund  closed  on its $5.6  million  line of  credit
       agreement  with a  bank.  Borrowings  under  the  credit  agreement  bear
       interest on the  outstanding  principal  amount at the bank's  prime rate
       plus 1% per annum.  Effective July 18, 1997, the line of credit agreement
       was amended to a maximum $3.5  million  capacity,  the  interest  rate on
       outstanding  borrowings  was  reduced to the  bank's  prime rate (8.5% at
       December 31,  1997) and the  commitment  was  extended for an  additional
       three years,  until July 18, 2000. The principal  balance at December 31,
       1997 and 1996 was $3,061,000.  The collateral  security  provision of the
       loan  agreement  provides for the  assignment  of the Fund's  rights as a
       lessor to its interest in the parking lot

                                      -13-

<PAGE>


                                         REALTY PARKING PROPERTIES II L.P.
                                     Notes to Financial Statements (continued)


(7)    Note Payable (continued)

       leases,  contracts and income. Interest paid on the outstanding principal
       balance  totaled  $279,635,  $284,366 and $271,305 during the years ended
       December 31, 1997, 1996 and 1995, respectively.

(8)    Earnings for Federal Income Tax Purposes

       There was no  difference  between the Fund's net  earnings for income tax
       purposes and the net earnings for financial reporting purposes.

(9)    Partners' Capital

       The  Partnership  Agreement  provides,  among other  provisions,  for the
following:

       (a) The Fund will  consist  of the  general  partner,  the  assignee  and
           limited partners and the subordinated limited partner.

       (b) Distributions   to  the  Partners   relating  to  operations  of  the
           properties  will  be  based  on net  cash  flow,  as  defined  in the
           Partnership Agreement. Assignee and limited partners will receive 99%
           of net  cash  flow and the  general  partner  will  receive  1%.  Net
           earnings per unit of assignee and limited partnership  interests,  as
           disclosed on the  statements of  operations  is based upon  1,392,800
           Units.

       (c)  Net  proceeds  of  sale  or  financing  of the  properties  will  be
distributed as follows:

           -    99% to the assignee  and limited  partners and 1% to the general
                partner until each  investor has recovered his original  capital
                contribution  in full and received a  cumulative,  noncompounded
                annual  return of 12% of his  adjusted  capital  balance  to the
                extent  that  such  return  has not  been  provided  from  prior
                distributions of net cash flow.

           -    Any  remainder  will  be  distributed  90% to the  assignee  and
                limited  partners,  1% to  the  general  partner  and  9% to the
                subordinated limited partner.

       (d) Assignee  limited  partners  may elect to become  substitute  limited
           partners, as defined in the Partnership  Agreement.  Assignee limited
           partners who elect to become substitute limited partners will receive
           one  limited   partnership   interest  for  each   assignee   limited
           partnership interest they convert and will not be able to re-exchange
           their limited partnership  interests for assignee limited partnership
           interests.

       (e)  Restrictions  exist  regarding  transferability  or  disposition  of
partnership interests.


                                      -14-

<PAGE>


                                         REALTY PARKING PROPERTIES II L.P.
                                     Notes to Financial Statements (continued)

(10)   Distributions to Investors

       Distributions  of cash  flow to  investors  during  1997,  1996  and 1995
       totaled $1,668,518, $1,626,668 and $1,582,704, respectively, of which 99%
       was allocated to assignee and limited partners.  These distributions were
       derived from net cash provided by operating activities.

       Distribution of sale proceeds to investors during 1997 totaled $7,204,117
       of which 99% was allocated to assignee and limited  partners.  Holders of
       Units received a cash distribution of $5.12 per Unit.

(11)   Subsequent Events

       On February 13, 1998, the Fund made a cash distribution totaling $349,600
       of which  99% was  allocated  to  assignee  and  limited  partners.  This
       distribution  was derived  from funds  provided by  operating  activities
       during 1997. Holders of Units received a cash distribution of $0.2485 per
       Unit.

       In January 1998 the Fund entered into an agreement for the sale of one of
       its  properties.  Nonrefundable  earnest  money of $250,000 was deposited
       into an escrow account. The sale should occur in May 1998, however, there
       is no assurance  that the  prospective  buyer will close  pursuant to the
       contract of sale.

                                      -15-

<PAGE>






Directors and Executive Officers


Realty Parking Company II, Inc.
General Partner

         John M. Prugh
         President and Director

         Peter E. Bancroft
         Vice President and Director

         Terry F. Hall
         Vice President and Secretary

         Timothy M. Gisriel
         Treasurer

                                                  Form 10-K
A copy of the Fund's Annual Report on Form 10-K for the year ended  December 31,
1997 as filed with the  Securities  and  Exchange  Commission  is  available  to
partners without charge on request by
writing to:

         Investor Relations
         Realty Parking Properties II L.P.
         225 East Redwood Street
         Baltimore, Maryland 21202


                                                   Auditors

         KPMG Peat Marwick LLP
         111 South Calvert Street
         Baltimore, Maryland 21202


                                                Legal Counsel

         Piper & Marbury
         1100 Charles Center South
         36 South Charles Street
         Baltimore, Maryland 21201




                                             Further Information

Please  submit  changes  in  name,   address,   investment   representative  and
distribution  instructions  to  Investor  Relations  at the above  address.  For
further information or questions  regarding your investment,  please call Denise
Shaduk, Investment Coordinator at (410) 727-4083.

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