UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                    FORM 10-Q

[x]    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
                              Exchange Act of 1934

                      For the quarter ended March 31, 1998
                                       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: 001-12403

                             SUSA Partnership, L.P.
             (Exact name of registrant as specified in its charter)

                                    Tennessee
                         (State or other jurisdiction of
                         incorporation or organization)

                                   62-1554135
                                  (IRS Employer
                             Identification Number)

                   165 Madison Avenue, Suite 1300, Memphis, TN
                    (Address of principal executive offices)

                                      38103
                                   (Zip Codes)

Registrant's telephone number, including area code: (901) 252-2000

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. (X) Yes ( ) NO



<PAGE>
<TABLE>

                                         PART 1 - FINANCIAL INFORMATION

Item 1.  Financial Statements
                                              SUSA Partnership, LP
                                      Consolidated Statements of Operations
                                                   (unaudited)
                                  (amounts in thousands, except per unit data)
<CAPTION>

                                                                     Three months ended        Three months ended
                                                                         March 31, 1998            March 31, 1997
                                                                ------------------------   -----------------------
<S> <C>

Property Revenues:
Rental income                                                                   $47,270                   $33,476
Other income                                                                      1,048                       441
                                                                ------------------------   -----------------------

Total property revenues                                                          48,318                    33,917
                                                                ------------------------   -----------------------

Property Expenses:
Cost of property operations & maintenance                                        12,128                     8,422
Taxes                                                                             3,943                     2,972
General & administrative                                                          1,876                     1,267
Depreciation & amortization                                                       6,568                     4,174
                                                                ------------------------   -----------------------

Total property expenses                                                          24,515                    16,835
                                                                ------------------------   -----------------------

Income from property operations                                                  23,803                    17,082

Other income (expense):
Interest expense                                                                 (9,265)                   (3,269)
Interest income                                                                   1,240                       237
                                                                ------------------------   -----------------------

Income before minority interest                                                  15,778                    14,050

Minority interest                                                                   146                       (37)
                                                                ------------------------   -----------------------

Net income                                                                      $15,924                   $14,013
                                                                ------------------------   -----------------------

Basic net income per unit                                                         $0.52                     $0.52
                                                                ------------------------   -----------------------

Diluted net income per unit                                                       $0.52                     $0.52
                                                                ------------------------   -----------------------

Basic weighted average units outstanding                                         30,530                    26,939
                                                                ------------------------   -----------------------

Diluted weighted average units outstanding                                       30,723                    27,170
                                                                ------------------------   -----------------------

                                 See Notes to Consolidated Financial Statements


                                       2
<PAGE>


                                           SUSA Partnership, LP
                                       Consolidated Balance Sheets
                                 (amounts in thousands, except unit data)
<CAPTION>

                                                                           as of                     as of
                                                                  March 31, 1998         December 31, 1997
                                                          -----------------------    ----------------------
                                                                     (unaudited)
Assets

Investments in storage facilities, at cost:
Land                                                                    $364,328                  $339,939
Buildings and equipment                                                  980,622                   902,925
                                                          -----------------------    ----------------------
                                                                       1,344,950                 1,242,864

Accumulated depreciation                                                 (51,355)                  (44,955)
                                                          -----------------------    ----------------------
                                                                       1,293,595                 1,197,909

Cash & cash equivalents                                                    2,072                       909
Other assets                                                              83,107                    60,864
                                                          -----------------------    ----------------------

     Total assets                                                     $1,378,774                $1,259,682
                                                          -----------------------    ----------------------

Liabilities & partners' capital

Notes payable                                                           $400,000                  $400,000
Line of credit borrowings                                                 91,429                    31,843
Mortgage notes payable                                                    50,758                    42,766
Accounts payable & accrued expenses                                       16,098                    10,785
Dividends payable                                                         17,733                         -
Rents received in advance                                                  8,822                     7,690
Minority interest                                                          2,139                     2,306
                                                          -----------------------    ----------------------

     Total liabilities                                                   586,979                   495,390
                                                          -----------------------    ----------------------

Commitments and contingencies

Partners' capital:
General partnership units
27,678,928 and 27,634,790 outstanding                                    683,996                   685,347
Limited partnership units
3,534,342 and 2,828,635 outstanding                                      120,107                    91,716
Notes receivable - employees                                             (12,308)                  (12,771)
                                                          -----------------------    ----------------------

     Total partners' capital                                             791,795                   764,292
                                                          -----------------------    ----------------------

     Total liabilities & partners capital                             $1,378,774                $1,259,682
                                                          -----------------------    ----------------------

                              See Notes to Consolidated Financial Statements

                                       3
<PAGE>
                                              SUSA Partnership, LP
                                     Consolidated Statements of Cash Flows
                                                  (unaudited)
                                             (amounts in thousands)
<CAPTION>

                                                                   Three months ended         Three months ended
                                                                       March 31, 1998             March 31, 1997
                                                              ------------------------   ------------------------

Operating activities:
Net income                                                                $    15,924                $    14,013

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

     Depreciation and amortization                                              6,568                      4,174
     Minority interest                                                           (146)                        37
     Changes in assets and liabilities:
          Other assets                                                         (4,322)                      (721)
          Other liabilities                                                     6,575                      1,449
                                                              ------------------------   ------------------------
Net  cash provided by operating activities                                     24,599                     18,952
                                                              ------------------------   ------------------------

Investing activities:
Acquisition and improvements of storage facilities                            (58,318)                   (37,275)
Proceeds from sale/exchange of storage facilities                                 151                          -
Development of storage facilities                                              (8,786)                    (4,041)
Mortgage lending                                                              (18,092)                         -
                                                              ------------------------   ------------------------
Net cash used in investing activities                                         (85,045)                   (41,316)
                                                              ------------------------   ------------------------

Financing activities:
Net borrowings (repayments) under line of credit                               59,586                    (52,730)
Mortgage principal payments/payoffs                                              (220)                    (8,312)
Mortgage principal borrowings                                                     145                        932
Cash dividends                                                                     18                          -
General partner contributions                                                   1,043                     90,584
Payments on notes receivable                                                    1,058                          -
Minority investor cash contribution                                                39                          -
Distribution to minority interests                                                (60)                       (15)
                                                              ------------------------   ------------------------
Net cash provided by financing activities                                      61,609                     30,459
                                                              ------------------------   ------------------------

Net increase (decrease) in cash and equivalents                                 1,163                      8,095
Cash and equivalents, beginning of period                                         909                      1,349
                                                              ------------------------   ------------------------
Cash and equivalents, end of period                                       $     2,072                $     9,444
                                                              ------------------------   ------------------------

Supplemental schedule of non-cash activities:
 Common stock issued in exchange for notes receivable
    and contributed to Partnership in exchange for
    Partnership Units                                                     $       595                $         -
 Mortgages assumed on storage facilities acquired                         $     8,067                $     1,835
 Storage facilities acquired in exchange for
  Partnership Units                                                       $    27,066                $         -
Common stock shares issued to Directors                                   $        20                $         -
 Partnership Units exchanged for shares of
   common stock                                                           $       161                $         -
                                                              ------------------------   ------------------------

                                 See Notes to Consolidated Financial Statements
</TABLE>

                                       4
<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 1998
              (amounts in thousands, except unit and per unit data)

1.       Unaudited Interim Financial Statements

         References to the Company and the Partnership refer to SUSA
         Partnership, L.P. References to the REIT refer to Storage USA, Inc.,
         general partner and holder of approximately 89% of the interest
         therein. Interim consolidated financial statements of the Company are
         prepared pursuant to the requirements for reporting on Form 10-Q.
         Accordingly, certain disclosures accompanying annual financial
         statements prepared in accordance with generally accepted accounting
         principles are omitted. In the opinion of management, all adjustments,
         consisting solely of normal recurring adjustments, necessary for the
         fair presentation of consolidated financial statements for the interim
         periods have been included. The current period's results of operations
         are not necessarily indicative of results that ultimately may be
         achieved for the year. The interim consolidated financial statements
         and notes thereto should be read in conjunction with the financial
         statements and notes thereto included in the Company's Form 10-K for
         the year ended December 31, 1997 as filed with the Securities and
         Exchange Commission.

 2.       Organization

         SUSA Partnership, L.P. (the "Company" and the "Partnership") was formed
         by Storage USA, Inc. (the "REIT"), to acquire, develop, construct,
         franchise and own and operate self-storage facilities throughout the
         United States. On March 23, 1994, the REIT completed an initial public
         offering (the "IPO") of 6,325,000 shares of common stock at $21.75 per
         share. The REIT is structured as an umbrella partnership real estate
         investment trust ("UPREIT") in which substantially all of the REIT's
         business is conducted through the Partnership. Under this structure,
         the Company is able to acquire self-storage facilities in exchange for
         units of limited partnership interest in the Partnership ("Units"),
         permitting the sellers to at least partially defer taxation of capital
         gains.
         
         At March 31, 1998 and 1997, respectively, the REIT had an approximately
         88.7% and 92.9% partnership interest in the Partnership.

         In 1996, the Company formed Storage USA Franchise Corp ("Franchise"), a
         Tennessee corporation. The Company owns 100% of the non-voting common
         stock of Franchise. The Company accounts for Franchise under the equity
         method and includes its 97.5% share of the profit or loss of Franchise
         in Other Income.

3.       Investment in Storage Facilities

         The following table summarizes the activity in storage facilities
         during the period:

           Cost:
                 Balance on January 1, 1998              $    1,242,864
                 Property acquisitions                           89,242
                 Development                                      8,786
                 Sale of land                                      (151)
                 Improvements and other                           4,209
                                                         ===============
                 Balance on March  31, 1998              $    1,344,950
                                                         ===============

           Accumulated depreciation:
                 Balance on January 1, 1998              $       44,955
                 Additions during the period                      6,400
                                                         ===============
                 Balance on March 31, 1998               $       51,355
                                                         ===============

                                      5
<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)
                                 March 31, 1998
              (amounts in thousands, except unit and per unit data)

3.       Investment in Storage Facilities, continued

         The following pro forma combined results of operations of the Company
         for the three months ended March 31, 1998 has been prepared assuming
         that the acquisition of the 21 properties acquired during the same
         three month period had been completed as of January 1, 1998.

                                                    Pro forma for the
                                                   three months ended
                                                       March 31, 1998
                                              ------------------------

              Revenues                                        $50,980
              Net income                                      $16,838
              Basic net income per unit                         $0.54
              Diluted net income per unit                       $0.54



         The unaudited pro forma information is not necessarily indicative of
         what actual results of operations of the Company would have been
         assuming such transactions had been completed as of January 1, 1998,
         nor does it purport to represent the results of operations for future
         periods.


4.       Lines of Credit and Mortgages Payable

         The Company can borrow under a $150,000 line of credit with a group of
         commercial banks and under a $40,000 line of credit with a commercial
         bank. These lines of credit bear interest at various spreads over
         LIBOR. During the quarter ended March 31, 1998, the weighted average
         borrowings were $61,344, and the weighted average interest rate was
         6.8%. At March 31, 1998, approximately $91,429 was outstanding on the
         lines of credit. At March 31, 1998, there were $40,364 of fixed rate
         mortgage notes payable and $10,394 of variable rate mortgage notes
         payable. As of March 31, 1998, the fixed rate mortgage notes carried
         rates of interest ranging from 6.5% to 11.5% with a weighted average
         rate of 10.1%. The variable rate mortgage notes carried rates of
         interest ranging from 7.9% to 9.0% with a weighted average rate of
         8.3%. During the three months ended March 31, 1998, total interest paid
         was $2,221 and total interest capitalized for construction costs was
         $638.


5.       Other Income

         Other income for the three months ended March 31, 1998 and 1997
         consisted primarily of revenue from the sale of locks and packaging
         supplies, truck rentals, ground rents for billboards and cellular
         towers and the proportionate share of earnings of Franchise. Fees
         earned for the management of facilities owned by third parties are
         included in the earnings of Franchise.



                                       6

<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)
                                 March 31, 1998
              (amounts in thousands, except unit and per unit data)

6.       Income per Unit

         Basic and diluted income per unit is calculated by dividing net income
         by the appropriate weighted average units as presented in the following
         table:

          For the period ended March 31,             1998               1997
          -------------------------------------------------------------------
          Basic weighted average
            common units outstanding               30,530             26,939
          Dilutive effect of stock options            193                231
          -------------------------------------------------------------------
          Diluted weighted average
            common units outstanding               30,723             27,170


7.       Recent Accounting Developments

         On February 27, 1998, the AICPA Accounting Standards Executive
         Committee (AcSEC) issued Statement of Position 98-1 (SOP 98-1),
         "Accounting for the Costs of Computer Software Developed or Obtained
         for Internal Use", which is effective for fiscal years beginning after
         December 15, 1998. SOP 98-1 sets forth guidelines for the
         capitalization of costs relating to internal-use software. The Company
         will adopt SOP 98-1 on April 1, 1998. The adoption of SOP 98-1 is not
         expected to have a material impact on the financial statements of the
         Company.

         In March 1998, EITF 97-11, "Accounting for Internal Costs Related to
         Real Estate Property Acquisitions", was adopted. This standard,
         effective April 1, 1998, requires that the Company expense all costs of
         its internal acquisitions department. Had the company adopted this
         policy on January 1, 1997, basic net income per unit for 1997 and the
         first quarter of 1998 would have been $2.31 and $0.52, respectively.
         This is a $0.02 reduction in 1997 reported basic net income per unit of
         $2.33 and no change in the first quarter 1998 reported basic net income
         per unit of $0.52.

         On April 3, 1998, the AICPA Accounting Standards Executive Committee
         (AcSEC) issued Statement of Position 98-5 (SOP 98-5), "Accounting for
         the Costs of Start-Up Activities", which is effective for fiscal years
         beginning after December 31, 1998. SOP 98-5 requires all costs of
         start-up activities to be expensed as incurred. The adoption of SOP
         98-5 is not expected to have a material impact on the financial
         statements of the Company.

8.       Subsequent Events

         From March 31, 1998 to May 14, 1998, the Company completed the
         acquisition of three self-storage facilities for approximately $8,174.
         These acquisitions were financed through operating cash flows and
         borrowings under the available lines of credit. The Company has also
         entered into various property acquisition contracts with an aggregate
         cost of approximately $48,321. These acquisitions are subject to
         customary conditions to closing, including satisfactory due diligence,
         and most of the acquisitions should close during the second quarter.
         Should these contracts be terminated, the costs incurred by the Company
         would not be material.


                                       7

<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)
                                 March 31, 1998
              (amounts in thousands, except unit and per unit data)

9.       Legal Proceedings

         The Company is the subject of a purported national class action filed
         on September 25, 1997, in the Superior Court of the District of
         Columbia, Nelda Perkins v. Storage USA, Inc., Civil Action No.
         97-CA97426, seeking recovery of certain late fees paid by Company
         tenants since September 1993, treble damages, unspecified punitive
         damages and an injunction against further assessment of similar fees.
         The Company believes it has defenses to the claims and intends to
         defend the suit vigorously. While the ultimate resolution of this case
         cannot be currently determined, management believes that the aggregate
         liability or loss, if any, resulting from this claim will not have a
         material adverse effect on its financial position. However, if during
         any period the potential contingency should become probable, the
         results of operations in that period could be materially affected.


                                       8
<PAGE>



ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS

This Form 10-Q may include forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These statements are identified by phrases such as the
Company "expects" or "anticipates" and words of similar effect. Actual results
may differ materially from those projected. Among the factors that could cause
such a difference are: changes in the economic conditions in the markets in
which the Company operates; certain of the Company's competitors with
substantially greater financial resources than the Company reducing the number
of suitable acquisition opportunities offered to the Company and increasing the
price necessary to consummate the acquisition of particular facilities;
increased development of new facilities and competition in the Company's markets
resulting in oversupply thereby lowering rental and occupancy rates; the
availability of sufficient capital to finance the Company's business plan on
terms satisfactory to the Company; increased costs related to compliance with
laws, including environmental laws; general business and economic conditions;
and other risk factors described in the Company's reports filed from time to
time with the Securities and Exchange Commission. The Company cautions readers
not to place undue reliance on any such forward-looking statements, which
statements are pursuant to the Private Securities Litigation Reform Act of 1995
and, as such, speak only of the date made.

The following discussion and analysis of the consolidated financial condition
and results of operations of the Company should be read in conjunction with the
Consolidated Financial Statements and Notes thereto. References to the Company
and the Partnership refer to SUSA Partnership, L.P. References to the REIT refer
to Storage USA, Inc., general partner and holder of approximately 89% of the
interest therein.

Due to the substantial number of facilities acquired from March 31, 1997 to
March 31, 1998, management believes that it is meaningful and relevant in
understanding the present and ongoing operations of the Company to compare
certain information using occupancy and per square foot information.

The following are definitions of terms used throughout this discussion in
analyzing the Company's business. Physical Occupancy is defined as the total net
rentable square feet rented as of the date computed divided by the total net
rentable square feet available. Gross Potential Income is defined as the sum of
all units available to rent at a facility multiplied by the market rental rate
applicable to those units as of the date computed. Expected Income is defined as
the sum of the monthly rent being charged for the rented units at a facility as
of the date computed. Economic Occupancy is defined as the Expected Income
divided by the Gross Potential Income. Rent Per Square Foot is defined as the
annualized result of dividing Gross Potential Income on the date computed by
total net rentable square feet available. Direct Property Operating Costs is
defined as the costs incurred in the operation of a facility, such as utilities,
real estate taxes, and on-site personnel. Indirect Property Operating Costs is
defined as costs incurred in the management of all facilities, such as
accounting personnel and management level operations personnel. Net Operating
Income ("NOI") is defined as total property revenues less Direct Property
Operating Costs.



                                       9

<PAGE>

Results of Operations- Quarter Ended March 31, 1998 Compared to Quarter Ended
March 31, 1997.

The following table reflects the profit and loss statement for the quarters
ended March 31, 1998 and March 31, 1997 based on a percentage of total revenues
and is used in the discussion that follows:

For the quarter ended March 31,                        1998               1997
-------------------------------------------------------------------------------
REVENUES
Rental income                                          95.4%             98.0%
Other income                                            2.1%              1.3%
Interest income                                         2.5%              0.7%
-------------------------------------------------------------------------------
Total income                                          100.0%            100.0%

EXPENSES
Property operations                                    24.5%             24.7%
Taxes                                                   8.0%              8.7%
General and administrative                              3.8%              3.7%
-------------------------------------------------------------------------------
Earnings before depreciation and interest (EBITDA)     63.7%             62.9%


In the first quarter of 1998, the Company reported growth in revenue, NOI and
net income, respectively, of $14.4 million, $9.7 million and $1.5 million over
the same quarter of 1997. Since March 31, 1997, the Company has acquired 129
facilities. These acquired facilities added 7.8 million square feet, an increase
of 31.3%, bringing the total square feet of the 383 facilities owned by the
Company at March 31, 1998 to 25.0 million. For the first quarter of 1998, the
216 same store facilities owned during the entire first quarter of 1997 provided
64% of the Company's rental income. These same store facilities' rental income
grew 5.2% over first quarter 1997 results. The majority of this growth was
provided by an approximate 6.1% rate increase, which was offset by discounts and
the timing of rate increases. At March 31, 1998, the physical occupancy and rent
per square foot of the 216 same-store facilities was 85.9% and $10.46,
respectively, while the figures as of March 31, 1997, were 85.5% and $9.86,
respectively. The Company's portfolio of facilities as a whole had an average
physical occupancy at March 31, 1998 of 83.6% with an average rent per square
foot of $9.91.

Other income increased $607 thousand in the first quarter of 1998 over the same
period in 1997. The increase is primarily due to earnings in the equity
investment in Storage USA Franchise Corp. ("Franchise"), of which the Company
owns a 97.5% economic interest. Earnings from franchising activities increased
$327 thousand and earnings from management fees and the sales of lock and
packaging products increased $107 thousand. Franchise activities had just begun
to realize income in the first quarter of 1997. At March 31, 1998 there were 16
franchisees open and operating and approximately 50 in various stages of
development. The remainder of the increase in other income was primarily from
fees earned on loans made to Franchisees of Franchise ("Franchisees") by third
parties that are guaranteed by the Company and rental income on cellular tower
and billboard leases.

Cost of property operations and maintenance was $12.1 million for the quarter
ended March 31, 1998, representing a $3.7 million increase over the first
quarter of 1997. As a percentage of revenues, cost of property operations and
maintenance decreased from 24.7% for the quarter ended March 31, 1997 to 24.5%
for the quarter ended March 31, 1998. The decline as a percentage of revenues is
a result of revenue growth outpacing expense growth and explained by additional
revenue sources including interest earned on loans to Franchisees and earnings
from Franchise. Same-store revenues increased 5.2% while same store expenses
only increased 4.9%.

Tax expense increased from $3.0 million or 8.7% of revenues for the quarter
ended March 31, 1997, to $3.9 million or 8.0% of revenue for the quarter ended
March 31, 1998. The decrease as a percentage of revenues, is attributable to
refunds that were received in the first quarter of 1998, the exchange of several
properties in high tax areas and revenue growth outpacing tax expense growth.



                                       10
<PAGE>

General and administrative expense ("G&A") increased from $1.3 million or 3.7%
of revenues for the quarter ended March 31, 1997, to $1.9 million or 3.8% of
revenue for the quarter ended March 31, 1998. The growth in G&A reflects the
Company's expansion of its administration, development and acquisition,
management information systems and human resource departments in connection with
its ongoing growth strategy.

Depreciation expense increased to $6.6 million for the quarter ended March 31,
1998 from $4.2 million for the comparable period in 1997, reflecting the
increase in the number of facilities owned. The Company has acquired or placed
in service approximately $298 million in depreciable assets since April 1, 1997.

Interest expense for the quarter ended March 31, 1998, was $9.3 million as
compared to $3.3 million for the comparable period in 1997. The increase is due
to the issuance of $100 million in notes payable at 8.2% in June 1997, $100
million in notes payable at 7.0% in December 1997 and $100 million in notes
payable at 7.5% in December 1997. The remaining interest expense represents
weighted average borrowings of $61.3 million under the Company's lines of credit
at a weighted average interest rate of 6.8% and $45.1 million in weighted
average mortgages payable at a weighted average interest rate of 9.7%. In the
first quarter of 1997, the Company's outstanding indebtedness consisted of $100
million of notes bearing interest at 7.125%, weighted average borrowings under
the Company's lines of credit of $57.9 million at a weighted average interest
rate of 6.96%, and weighted average mortgage notes of $42.3 million at a
weighted average interest rate of 9.9%.

Interest income was $1.2 million for the quarter ended March 31, 1998 as
compared to $237 thousand for the quarter ended March 31, 1997. Interest income
represents loans to franchisees, earnings on overnight deposits and amounts
outstanding under the 1995 Employee Stock Purchase and Loan Plan. The increase
in interest income was primarily attributable to interest earned on $43.7
million of loans made to Franchisees from September 1, 1997 to March 31, 1998.
The Company has committed to lend an additional $65.9 million to Franchisees and
anticipates committing to additional loans in 1998.



Liquidity and Capital Resources

Cash provided from operating activities grew to $25.2 million for the three
months ended March 31, 1998 from the $19.1 million that was provided for the
three months ended March 31, 1997. This increase was primarily a result of the
significant expansion of the Company's portfolio. In the twelve months since
April 1, 1997 the Company has acquired 129 facilities, placed in service seven
development facilities and expanded eight facilities.

Cash used in investing activities of $85.0 million in the first quarter of 1998
and $41.3 million in the first quarter of 1997 was primarily invested in the
acquisition of self-storage facilities. 21 and 11 facilities containing 1.3
million and 654 thousand square feet, respectively were acquired in the first
quarter of 1998 and 1997, respectively. In addition to acquisitions, $8.8
million and $4.0 million was invested in the first quarter of 1998 and 1997,
respectively, for development properties. The Company placed in service two
development properties and one expansion property in the first quarter of 1998
and no development and one expansion property in 1997. There were 19 development
properties and 25 expansions in process with $34.6 million invested at March 31,
1998. The total development budget on these properties is $99.9 million. The
Company also made loans to Franchisees during the first quarter of 1998 in the
amount of $18.1 million. The Company has committed to lend an additional $65.9
million to Franchisees and anticipates committing to additional loans in 1998.
The Company is the guarantor on loans totaling $16.9 million that were lent to
Franchisees by third party lenders, and has committed to guarantee additional
loans totaling $5.6 million.



                                       11
<PAGE>

The Company initially funds its capital requirements primarily through its lines
of credit and refinances these with long-term capital in the form of equity and
debt securities. The lines bear interest at various spreads over LIBOR. The
total credit available under the lines of credit is $190 million. Amounts
outstanding under the lines of credit bore interest at a weighted average rate
of 6.8% during the first quarter of 1998. The Company had net borrowings of
$59.6 million in the first quarter of 1998 and net repayments of $52.7 million
in the first quarter of 1997.

The Company has issued $400 million of senior unsecured notes (the "Notes"). The
combined Notes have a weighted average interest rate of 7.46% and were issued at
a price to yield a weighted average of 7.70%. The terms of the notes are
staggered between seven and thirty years, maturing between 2003 and 2027.

The Company assumed $8.1 million of mortgages on facilities acquired during the
first quarter of 1998 and $1.8 million in the first quarter of 1997. During the
first quarter of 1997, $8.2 million of mortgage notes were paid off, and no
mortgage notes were paid off during the first quarter of 1998. At March 31,
1998, the Company had $40.4 million of fixed rate mortgage notes with a weighted
average interest rate of 10.1% and $10.4 million of variable rate mortgage notes
with a weighted average interest rate of 8.3%. These mortgage notes mature at
various dates through 2021.

At March 31, 1998, the Company had 31.2 million Units outstanding. On March 12,
1998, the Company declared a regular quarterly distribution of $0.64 per Unit.
The distribution was payable on April 13, 1998 to unitholders of record on March
27, 1998. Total distributions to unitholders equaled approximately $19.5
million.

During the first quarter of 1998, the Company issued 706 thousand Units valued
at $27.1 million. These Units were issued in exchange for self-storage
facilities or entities owning self-storage facilities. No Units were issued in
the first quarter of 1997. At March 31, 1998, the Company had 3.5 million Units
outstanding. 82 thousand of which are redeemable for an amount equal to their
fair market value ($3.1 million, based upon a price per Unit of $38.375 at March
31, 1998) payable by the Company either in cash or (at the Company's option,
based upon a determination by the REIT's Board of Directors that the Company's
anticipated cash requirements and anticipated cash flow make a lump sum payment
imprudent) by a promissory note payable in quarterly installments over two years
accruing interest at the prime rate. At March 31, 1998, 1.8 million Units held
by other Limited Partners were redeemable, at the option of such Limited
Partners, having passed the first anniversary of their issuance, for amounts
equal to the then fair market value of their Units ($69.7 million, based upon a
price per Unit of $38.375 at March 31, 1998) payable by the Company in cash or,
at the option of the Company, in shares of the REIT's Common Stock at the
initial exchange ratio of one share for each Unit. It is anticipated that a
source of funds for any such cash redemption will be retained cash flow or
proceeds from the future sale of securities of the Company or other Company
indebtedness. The Company has agreed to register under the Securities Act of
1933 any shares of the REIT's Common Stock issued upon redemption of Units.

On January 21, 1998, the REIT and the Partnership filed a joint shelf
registration statement with the Securities and Exchange Commission relating to
$900 million of securities, including up to $500 million of common stock,
preferred stock, depositary shares and warrants of the REIT and up to $400
million of unsecured, non-convertible senior debt securities of the Partnership.
An additional $50 million of unsecured, non-convertible senior debt securities
and $150 million of equity securities are issuable under the REIT's existing
shelf registration statement providing the REIT and the Partnership access to a
total of $1.1 billion of new securities available under the shelf registration
statement.

For the remainder of 1998 the Company anticipates issuing some combination of
unsecured notes payable, common stock in the REIT or preferred stock in the REIT
depending on prevailing market conditions. The proceeds from any debt or equity
offering would be used to repay borrowings under the Company's lines of credit
and for general purposes. As a general matter, the Company anticipates utilizing
its lines of credit as an interim source of funds to acquire and develop
self-storage facilities and repaying the credit lines with longer-term debt or
equity when management determines that market conditions are favorable. The
Company believes that the combination of debt or equity issuances pursuant to
the shelf registration statements, in addition to borrowings under its credit
facilities and issuances of Units, as described above, will provide the Company
with necessary liquidity and capital resources to meet the requirements of its
operating strategies over the next twelve months.



                                       12
<PAGE>

From March 31, 1998 to May 14, 1998, the Company completed the acquisition of
three self-storage facilities for approximately $8.2 million. These acquisitions
were financed through operating cash flows and borrowings under the available
lines of credit. The Company has also entered into various agreements to acquire
properties with an aggregate cost of approximately $48.3 million. These
acquisitions are subject to customary conditions to closing, including
satisfactory due diligence, and should close during the fourth quarter. Should
these contracts be terminated, the costs incurred by the Company would not be
material.

The Company has capitalized approximately $582 thousand for regularly scheduled
maintenance and repairs during the three months ended March 31, 1998 and $1.4
million to conform facilities acquired to Company standards. For the year, the
Company expects to incur approximately $3.4 million for scheduled maintenance
and repairs and approximately $5.7 million to conform facilities acquired during
1996, 1995 and 1994 to Company standards.


Funds From Operations ("FFO")

The Company believes that FFO should be considered in conjunction with its net
income and cash flows to facilitate a clear understanding of its results of
operations. FFO is defined as net income, computed in accordance with GAAP,
excluding gains (losses) from debt restructuring and sales of property, plus
depreciation and amortization, and after adjustments for unconsolidated
partnerships and joint ventures. FFO should not be considered an alternative to
net income as a measure of the Company's performance or to cash flows as a
measure of liquidity.

Effective January 1, 1996, the National Association of Real Estate Investment
Trusts amended its definition of FFO. Because other companies may interpret the
definition differently, FFO for the Company may not be comparable to similarly
titled measures of operating performance disclosed by other companies.

The following table illustrates the components of the Company's FFO for the
three months ended March 31, 1998 and March 31, 1997.

                                  Storage USA, Inc.
                            FFO Under Revised Computation
                         Fo the Quarter Ended March 31, 1998
                      (in thousands except for per share data)

Three months ended March 31,                      1998                 1997
----------------------------------------------------------------------------

Net Income                                   $  15,924            $  14,013

Depreciation of revenue producing assets         6,240                3,957
----------------------------------------------------------------------------

Consolidated FFO                             $  22,164            $  17,970



The REIT, in order to qualify as a REIT, is required to distribute a substantial
portion of its net income as dividends to its shareholders. While the Company's
goal is to generate and retain sufficient cash flow to meet its operating,
capital, and debt service needs, the REIT's dividend requirements may require
the Company to utilize its bank lines of credit to finance property acquisitions
and development and major capital improvements. For the year ended December 31,
1997, distributions were approximately 83.0% of the REIT's FFO.



                                       13
<PAGE>

Inflation

The Company does not believe that inflation had or will have a direct effect on
its operations. Substantially all of the leases at the facilities allow for
monthly rental increases that provide the Company with the opportunity to
achieve increases in rental income as each lease matures.

Seasonality

The Company's revenues typically have been higher in the third and fourth
quarters primarily because the Company increases its rental rates on most of its
storage units at the beginning of May, and to a lesser extent because
self-storage facilities tend to experience greater occupancy during the late
spring and early fall months due to the greater incidence of residential moves
during those periods. The Company believes that its tenant mix, rental
structure, and expense structure provide adequate protection against undue
fluctuations in cash flows and net revenues during off-peak seasons. Thus, the
Company does not expect seasonality to materially affect distributions to
shareholders.

Recent Accounting Developments

On February 27, 1998, the AICPA Accounting Standards Executive Committee (AcSEC)
issued Statement of Position 98-1 (SOP 98-1), "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use", which is effective
for fiscal years beginning after December 15, 1998. SOP 98-1 sets forth
guidelines for the capitalization of costs relating to internal-use software.
The Company will adopt SOP 98-1 on April 1, 1998. The adoption of SOP 98-1 is
not expected to have a material impact on the financial statements of the
Company.

In March, 1998, EITF 97-11, "Accounting for Internal Costs Related to Real
Estate Property Acquisitions", was adopted. This standard, effective April 1,
1998, requires that the company expense all costs of its internal acquisitions
department. Had the company adopted this policy on January 1, 1997, basic net
income per unit for 1997 and the first quarter of 1998 would have been $2.31 and
$0.52, respectively. This is a $0.02 reduction in 1997 reported basic net income
per unit of $2.33 and no change in the first quarter 1998 reported basic net
income per unit of $0.52.

On April 3, 1998, the AICPA Accounting Standards Executive Committee (AcSEC)
issued Statement of Position 98-5 (SOP 98-5), "Accounting for the Costs of
Start-Up Activities", which is effective for fiscal years beginning after
December 31, 1998. SOP 98-5 requires all costs of start-up activities to be
expensed as incurred. The adoption of SOP 98-5 is not expected to have a
material impact on the financial statements of the Company.

Legal Proceedings

The Company is the subject of a purported national class action filed on
September 25, 1997, in the Superior Court of the District of Columbia, Nelda
Perkins v. Storage USA, Inc., Civil Action No. 97-CA97426, seeking recovery of
certain late fees paid by Company tenants since September 1993, treble damages,
unspecified punitive damages and an injunction against further assessment of
similar fees. The Company believes it has defenses to the claims and intends to
defend the suit vigorously. While the ultimate resolution of this case cannot be
currently determined, management believes that the aggregate liability or loss,
if any, resulting from this claim will not have a material adverse effect on its
financial position. However, if during any period the potential contingency
should become probable, the results of operations in that period could be
materially affected.




                                       14
<PAGE>


       ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         Not Applicable




                                       15
<PAGE>

                           Part II- OTHER INFORMATION

Item 1. Legal Proceedings

         Information regarding legal proceedings is incorporated herein by
reference to Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations.

Item 2. Changes in Securities
         During the three months ended March 31, 1998, the Company has issued
units of limited partnership interest in exchange for interest in self-storage
facilities. The date, amount and value of the issuances are summarized in the
following table:

       Date of            Units         Approximate
      Issuance            Issued           Value
--------------------------------------------------------
March 11, 1998                36,013    $     1,408,000
March 31, 1998               669,693    $    25,658,000
                      ----------------------------------
Total                        705,706    $    27,066,000



The Units were issued in private placements exempt from registration pursuant to
Section 4(2) of the Securities Act of 1933 to various owners of self-storage
facilities. Beginning one year after their issuance, each Unit is redeemable for
cash equal to the market value of one share of Common Stock at the time of
redemption or, at the Company's option, one share of Common Stock.

Item 3. Defaults Upon Senior Securities

         None

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

         None

Item 6.  Exhibits and Reports on Form 8-K.

         a.       Exhibit 27 - Financial Data Schedule

         b.        Reports on Form 8-K

                  On January 20, 1998, the Company filed an amended Current
                  Report on Form 8-K/A, which amended the Company's Form 8-K/A
                  filed November 25, 1997, which was an amendment to the
                  Company's Current Report on Form 8-K filed November 21, 1997.
                  The 8-K/A filed on January 20, 1998 included audited financial
                  statements for properties originally reported under Form 8-K
                  and reported the acquisition of four additional self-storage
                  facilities.

                  On January 26, 1998, the Company filed a Current Report on
                  Form 8-K reporting the acquisition of six self-storage
                  facilities, which was amended by Form 8-K/A filed February 17,
                  1998 to add financial statements regarding the six
                  acquisitions.

                  On March 6, 1998, the Company filed a Current Report on Form
                  8-K reporting the acquisition of five self-storage facilities,
                  which was amended by Form 8-K/A filed on March 27, 1998 to
                  include the acquisition of two additional self-storage
                  facilities, the signing of agreements to acquire five
                  self-storage facilities and to include financial statements
                  for the 12 facilities.




                                       16
<PAGE>

                                   SIGNATURES


         Pursuant to the requirements 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.


                         Dated:    May 15, 1998

                                   SUSA PARTNERSHIP, L.P.
                                   By STORAGE USA, Inc.,
                                   General Partner


                         By:       /s/ Dennis A. Reeve
                                   -------------------------------
                                   Dennis A. Reeve
                                   Chief Financial Officer
                                   (Principal Financial and Accounting Officer)