SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934 For the fiscal year ended December 31, 2005 or
                                  -----------------

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the transition period from                   to                  .
                               -----------------    -----------------

Commission File Number:     0-8667
                            ------

                         PUBLIC STORAGE PROPERTIES, LTD.
                         -------------------------------
             (Exact name of Registrant as specified in its charter)

             California                              95-3196921
----------------------------------------- --------------------------------------
   (State or other jurisdiction of                 (I.R.S. Employer
   incorporation or organization)              Identification Number)
701 Western Avenue, Glendale, California           91201-2349
----------------------------------------- --------------------------------------
(Address of principal executive offices)            (Zip Code)

Registrant's telephone number, including area code: (818) 244-8080.
                                                    ---------------

Securities registered pursuant to Section 12(b) of the Act:   NONE

Securities registered pursuant to Section 12(g) of the Act:

       Units of Limited Partnership Interest
       -------------------------------------
                 (Title of class)
       -------------------------------------

Indicate by check mark if the  registrant is a well-known  seasoned  issuer,  as
defined in Rule 405 of the Securities Act. Yes [X] No [ ]

Indicate  by  check  mark if the  registrant  is not  required  to file  reports
pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes [ ] No [X]

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.
                               Yes [X]               No  [   ]

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated  filer or a  non-accelerated  filer (as defined in Rule 12b-2 of the
Exchange Act). Large Accelerated Filer [ ] Accelerated Filer [ ] Non-accelerated
Filer [X]

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

The aggregate market value of the voting and non-voting common stock held by
non-affiliates of the Registrant as of June 30, 2005:

                                       1


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Limited Partner Units, $500.00 Par Value - $12,770,000 (computed on the basis of
$1,700 per unit which was the highest reported sale price prior to the quarter
ended June 30, 2005).

The number of units outstanding of the registrant's classes of common equity as
of March 30, 2006:

Units of Limited Partnership Interest, $500.00 Par Value - 20,000 units

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      NONE

                                       2


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                                     PART I

ITEM 1.  BUSINESS
         --------

Forward Looking Statements
--------------------------

        When  used  within  this  document,  the  words  "expects,"  "believes,"
"anticipates,"  "should,"  "estimates," and similar  expressions are intended to
identify "forward-looking statements" within the meaning of that term in Section
27A of the  Securities  Exchange Act of 1933, as amended,  and in Section 21E of
the Securities Exchange Act of 1934, as amended. Such forward-looking statements
involve known and unknown risks,  uncertainties,  and other  factors,  which may
cause the actual results and performance of Public Storage Properties, Ltd. (the
"Partnership") to be materially different from those expressed or implied in the
forward  looking  statements.  Such  factors  are  described  in Item 1A,  "Risk
Factors" and include changes in general  economic  conditions and in the markets
in which the  Partnership  operates and the impact of  competition  from new and
existing storage and commercial facilities and other storage alternatives, which
could impact rents and occupancy  levels at the  Partnership's  facilities;  the
impact of the regulatory environment as well as national,  state, and local laws
and regulations,  which could increase the Partnership's  expense and reduce the
Partnership's cash available for distribution;  and economic  uncertainty due to
the impact of war or terrorism  could  adversely  affect our business  plan.  We
disclaim  any  obligation  to publicly  release the results of any  revisions to
these   forward-looking   statements   reflecting  new   estimates,   events  or
circumstances after the date of this report.

General
-------

        The Partnership is a publicly held limited  partnership formed under the
California  Uniform  Limited  Partnership  Act in November 1976. The Partnership
raised  $10,000,000  in gross  proceeds  by  selling  20,000  units  of  limited
partnership  interest  ("Units") in an interstate  offering,  which commenced in
October 1977 and completed in January 1978. The Partnership was formed to engage
in the business of developing and operating self-storage facilities for personal
and business use.

        The  Partnership  has reported  annually to the  Securities and Exchange
Commission ("SEC") on form 10-K which includes financial statements certified by
independent public  accountants.  The Partnership has also reported quarterly to
the SEC on Form  10-Q and  includes  unaudited  financial  statements  with such
filings. The Partnership expects to continue such reporting. On an annual basis,
the Partnership mails the audited financial  statements and related footnotes to
all limited partners.

        The public may read and copy any materials this  Partnership  files with
the SEC at the SEC's Public Reference Room at 450 Fifth Street,  NW, Washington,
DC 20549.  The public  may obtain  information  on the  operation  of the Public
Reference Room by calling the SEC at  1-800-732-0330.  The partnership  does not
maintain a website.  However,  the SEC  maintains an Internet site that contains
reports,  proxy and  information  statements,  and other  information  regarding
issuers,  including the Partnership,  that file  electronically  with the SEC at
http://www.sec.gov.

        In 1995, there were a series of mergers among Public Storage Management,
Inc. (which was the  Partnership's  self-storage  facilities  operator),  Public
Storage,  Inc. (which was one of the  Partnership's  general partners) and their
affiliates (collectively,  "PSMI"),  culminating in the November 16, 1995 merger
(the  "PSMI  Merger")  of  PSMI  into  Storage  Equities,  Inc.,  a real  estate
investment  trust ("REIT")  organized as a California  corporation.  In the PSMI
Merger, Storage Equities,  Inc. was renamed Public Storage, Inc. ("PSI") and PSI
acquired  substantially  all of PSMI's United States real estate  operations and
became  a  co-general  partner  of  the  Partnership  and  the  operator  of the
Partnership's self-storage facilities.

        The  Partnership's   general  partners  are  PSI  and  B.  Wayne  Hughes
("Hughes") (collectively referred to as the "General Partners"). Hughes has been
a general partner of the Partnership since its inception.  Hughes is chairman of
the board of PSI, and was its chief executive  officer through November 7, 2002,
and  Hughes  and  members  of his family  (the  "Hughes  Family")  are the major
shareholders of PSI.

        The  Partnership is managed,  and its  investment  decisions are made by
Hughes and the executive  officers and directors of PSI. The limited partners of
the Partnership  have no right to participate in the operation or conduct of its
business and affairs.

                                       3

<PAGE>


        The term of the  Partnership is until all properties have been sold and,
in any event, not later than December 31, 2035.

Investment Objectives and Policies
----------------------------------

        The Partnership's  investment objectives are to (i) preserve and protect
invested  capital,  (ii) maximize the potential for appreciation in value of its
investments, and (iii) provide for cash distributions from operations.

        Following are the Partnership's  investment practices and policies.  The
partnership  does not anticipate  any new  investments,  other than  maintenance
capital  expenditures,  and  does not  anticipate  liquidating  the real  estate
investments  it now holds.  While a vote of the limited  partners  is  generally
required to change the Partnership's  investment policies,  the general partners
hold a majority of the limited  partnership  units, and as a result, the General
Partners could change these policies through their vote.

        o   Our investments  consist of nine self-storage  facilities located in
            the  United  States.  See  "Self-storage   Facilities"  and  Item  2
            "Properties"  for  further   information.   These  investments  were
            acquired both for income and capital gains.

        o   There is no limitation on the amount or percentage of assets,  which
            can be invested in any specific person.

        The Partnership does not anticipate  issuing senior  securities,  making
loans to other  persons,  investing in the  securities  of other issuers for the
purpose of exercising  control,  underwriting  the  securities of other issuers,
engaging  in the  purchase  and  sale of  investments,  offering  securities  in
exchange for property,  or repurchasing or otherwise reacquiring its outstanding
securities.  The  partnership  may consider  borrowing  money with the intent of
using the proceeds for distribution to partners.

Self-storage Facilities
-----------------------

        Self-storage  facilities are designed to offer accessible  storage space
for personal  and  business  use at a relatively  low cost. A user rents a fully
enclosed space, which is for the user's exclusive use and to which only the user
has access on an unrestricted basis during business hours.  On-site operation is
the responsibility of property managers who are supervised by district managers.
Some self-storage  facilities also include rentable  uncovered parking areas for
vehicle  storage.  Leases  for  self-storage  space  may  be on a  long-term  or
short-term  basis,  although  typically  spaces are  rented on a  month-to-month
basis.  Rental rates vary according to the location of the property and the size
of the storage space.

        Users of space in self-storage  facilities  include both individuals and
large and small  businesses.  Individuals  usually employ this space for storage
of, among other things,  furniture,  household appliances,  personal belongings,
motor  vehicles,   boats,  campers,   motorcycles  and  other  household  goods.
Businesses normally employ this space for storage of excess inventory,  business
records, seasonal goods, equipment and fixtures.

        Self-storage  facilities in which the Partnership has invested generally
consist  of  three  to  seven  buildings  containing  an  aggregate  of  between
approximately 250 to 1,100 storage spaces, most of which have between 25 and 400
square feet and an interior height of approximately 8 to 12 feet.

        The Partnership experiences minor seasonal fluctuations in the occupancy
levels of self-storage  facilities with occupancies  higher in the summer months
than in the winter  months.  The  Partnership  believes that these  fluctuations
result in part from increased moving activity during the summer.

        The Partnership's  self-storage facilities are all in California and are
generally  located in heavily  populated  areas and close to  concentrations  of
apartment  complexes,  single family  residences  and  commercial  developments.
However,  there may be  circumstances  in which it may be  appropriate  to own a
property  in a less  populated  area,  for  example,  in an area  that is highly
visible  from a major  thoroughfare  and  close to,  although  not in, a heavily
populated area. Moreover,  in certain population centers,  land costs and zoning
restrictions may create a demand for space in nearby less populated areas.

        As with most other types of real estate,  the conversion of self-storage
facilities  to  alternative  uses in connection  with a sale or otherwise  would
generally  require  substantial  investment.  However,  the Partnership does not
intend to convert its self-storage facilities to other uses.

                                       4


<PAGE>


Operating Strategies
--------------------

        The Partnership's  self-storage facilities are operated by PSI under the
"Public  Storage"  brand  name,  which  the  Partnership  believes  is the  most
recognized  name  in  the  self-storage  industry.  The  major  elements  of the
Partnership's operating strategies are as follows:

o    Capitalize on "Public  Storage's" name recognition.  PSI, together with its
     predecessor,  has  more  than  20  years  of  operating  experience  in the
     self-storage  business.  PSI has  informed the  Partnership  that it is the
     largest  self-storage  facility  operator in the United  States in terms of
     both number of facilities  and rentable space  operated.  PSI believes that
     its marketing and advertising  programs improve its competitive position in
     the  market.   PSI's  in-house   Yellow  Pages  staff  designs  and  places
     advertisements  in  directories  in  virtually  all  markets  in  which  it
     operates.  Customers  calling  either PSI's  toll-free  telephone  referral
     system,  (800) 44-STORE,  or a self-storage  facility are directed to PSI's
     reservation  system  where a  trained  representative  discusses  with  the
     customer  space  requirements,  price  and  location  preferences  and also
     informs the customer of other  products  and services  provided by PSI. The
     telephone  reservation  system  supports  rental  activity  at  all  of the
     Partnership's properties.

o    Maintain high occupancy levels and increase annual realized rents.  Subject
     to market conditions,  the Partnership generally seeks to maximize-revenues
     through  high  occupancy  levels  and  to  eliminate  promotions  prior  to
     increasing   rental  rates.   Average   occupancy  for  the   Partnership's
     self-storage  facilities  was 91% and 92% in 2005 and  2004,  respectively.
     Annual  realized  rents per occupied  square foot  increased from $13.86 in
     2004 to $14.69 in 2005.

o    Systems and controls.  PSI has an  organizational  structure and a property
     operation  system which links its corporate  office with each  self-storage
     facility.  This enables PSI to obtain daily  information from each facility
     and to achieve  efficiencies  in operations  and maintain  control over its
     space inventory,  rental rates,  promotional  discounts and  delinquencies.
     Expense  management is achieved  through  centralized  payroll and accounts
     payable systems and a comprehensive  property tax appeals  department,  and
     PSI has an  extensive  internal  audit  program  designed to ensure  proper
     handling of cash collections.

o    Professional property operation.  There are approximately 4,030 persons who
     render services for the Public Storage system,  primarily personnel engaged
     in  property  operations,  substantially  all of  whom  are  employed  by a
     clearing  company that provides  certain  administrative  and  cost-sharing
     services to PSI and other owners of properties operated by PSI.

Property Operator
-----------------

        The  Partnership's  self-storage  facilities  are  managed  by  PSI  (as
successor to PSMI) pursuant to a Management Agreement.

        Under the supervision of the Partnership,  PSI coordinates the operation
of the  facilities,  establishes  rental policies and rates,  directs  marketing
activity  and  directs the  purchase  of  equipment  and  supplies,  maintenance
activity  and  the  selection  and  engagement  of  all  vendors,  supplies  and
independent contractors.

        PSI  engages,  at the  expense  of the  Partnership,  employees  for the
operation  of  the  Partnership's   facilities,   including  property  managers,
assistant managers, relief managers, and billing and maintenance personnel. Some
or all of these  employees may be employed on a part-time  basis and may also be
employed by other persons, partnerships,  real estate investment trusts or other
entities owning facilities operated by PSI.

        In the purchasing of services such as advertising  (including  broadcast
media advertising) and insurance, PSI attempts to achieve economies by combining
the resources of the various facilities that it operates. Facilities operated by
PSI  have  historically  carried   comprehensive   insurance,   including  fire,
earthquake, liability and extended coverage.

        PSI has systems for managing space inventories,  accounting and handling
delinquent  accounts,  including a  computerized  network  linking PSI  operated
facilities. Each project manager is furnished with detailed operating procedures
and typically  receives  facilities  management  training from PSI. Form letters
covering a variety of circumstances are also supplied to the project managers. A
record of actions  taken by the project  managers  when  delinquencies  occur is
maintained.


                                       5

<PAGE>


        The  Partnership's  facilities  are  typically  advertised  via signage,
yellow pages, flyers, broadcast media advertising (i.e. television and radio) in
geographic areas in which many of the Partnership's  facilities are located,  as
well as on the internet. Broadcast media and other advertising costs are charged
to the  Partnership's  facilities  located in geographic  areas  affected by the
advertising.  From  time to  time,  PSI  adopts  promotional  programs,  such as
temporary rent reductions, in selected areas or for individual facilities.

        For as long as the Management  Agreement between the Partnership and PSI
is in effect, PSI has granted the Partnership a non-exclusive license to use two
PSI service marks and related  designs  including  the "Public  Storage" name in
conjunction  with rental and  operation of  facilities  managed  pursuant to the
Management  Agreement.   Upon  termination  of  the  Management  Agreement,  the
Partnership  would no longer have the right to use the service marks and related
designs.  The  General  Partners  believe  that the loss of the right to use the
service marks and related  designs could have a material  adverse  effect on the
Partnership's business.

        The Management  Agreement  between the Partnership and PSI provides that
the  Management  Agreement may be terminated  without cause upon 60 days written
notice by the Partnership or six months notice by PSI.

Competition
-----------

        Local market  conditions play a significant role in how competition will
affect the  Partnership's  operations.  Competition from other  self-storage and
other storage alternatives in the market areas in which the Partnership operates
is  significant  and affects the  occupancy  levels,  rental rates and operating
expenses  of  certain  of  the   Partnership's   facilities.   Any  increase  in
availability of funds for investment in real estate may accelerate  competition.
Further development of self-storage  facilities may intensify  competition among
self-storage  facilities in the market areas in which the Partnership  operates.
In addition to competition from self-storage  facilities  operated by PSI, there
are other publicly traded REITs and numerous  regional and local operators.  The
Partnership believes that the significant  operating and financial experience of
PSI,  and  the  "Public  Storage"  brand  name  recognition  should  enable  the
Partnership to continue to compete effectively with other entities.

Other Business Activities
-------------------------

        A corporation that reinsures  policies against losses to goods stored by
tenants in PSI's  storage  facilities  was  purchased by PSI from Mr. Hughes and
members of his family (the "Hughes  Family") on December  31,  2001.  We believe
that the  availability of insurance  reduces our potential  liability to tenants
for losses to their goods from theft or destruction.  This corporation  receives
the premiums and bears the risks associated with the re-insurance.

        A  subsidiary  of PSI sells  locks  and  boxes  and rents  trucks to the
general  public and tenants to be used in securing their spaces and moving their
goods.  The  subsidiary  of PSI  receives the revenues and bears the cost of the
activities. We believe that the availability of locks and boxes for sale and the
rental of trucks promote the rental of spaces.

Federal Income Tax
------------------

        Public Storage Properties,  Ltd. is treated as a partnership for Federal
income tax  purposes  with the taxable  income of the entity  allocated  to each
partner in accordance with the partnership agreement.

Employees
---------

        There are  approximately 15 persons who render services on behalf of the
Partnership. These persons include resident managers, assistant managers, relief
managers,  area managers,  and  administrative and maintenance  personnel.  Some
employees  may be  employed  on a  part-time  basis and may be employed by other
persons,  partnerships,  REITs or other entities owning  facilities  operated by
PSI.

                                       6


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ITEM 1A. RISK FACTORS
         ------------

        In  addition  to the other  information  in our Form  10-K,  you  should
consider the following factors in evaluating the Partnership:

         THE GENERAL PARTNERS CONTROL THE PARTNERSHIP AS A GROUP.

        Public  Storage,  Inc.  is  a  general  partner  and  beneficially  owns
approximately  31.4% of our outstanding  limited partnership units. In addition,
B. Wayne Hughes,  General  Partner of the  Partnership,  and Chairman of PSI and
members of his family  beneficially own 31.5% of the limited  partnership units.
As a result,  the General Partners,  as a group,  control matters submitted to a
vote  of our  unitholders,  including  amending  our  organizational  documents,
dissolving the Partnership and approving other such transactions.

        PUBLIC  STORAGE'S  PROPOSED  ACQUISITION  OF  SHURGARD  MAY  SUBJECT THE
PARTNERSHIP TO ADDITIONAL RISKS.

        Public Storage announced  recently that it had entered into an agreement
to acquire  Shurgard Storage Centers,  Inc.  ("Shurgard"),  a publicly held REIT
that has interests in approximately 646 self-storage  facilities  located in the
United States and Europe.

        There would be no change in the financial  interests of the  Partnership
if this acquisition of Shurgard is completed.  However, because the self-storage
facilities of the  Partnership and Public Storage are managed by Public Storage,
and the  self-storage  facilities  owned by  Shurgard  would  also be managed by
Public  Storage,  the  merger  could  have  potential  negative  impacts  on the
Partnership, as follows:

        o   Difficulties  in the  integration of operations,  technologies,  and
            personnel of Shurgard could negatively  impact the operations of the
            facilities managed by Public Storage, including the Partnership's.

        o   Public  Storage's   management  attention  to  the  integration  and
            acquisition  of  Shurgard  could  divert  attention  away  from  the
            operations of the existing  self-storage  portfolio that it manages,
            including the Partnership's properties.

        o   Individual  Partnership  properties  could  experience a decrease in
            move-ins,  reductions  to rental  rates,  increases  to  promotional
            discounts, or other negative impacts to revenues in the short and/or
            long term due to the competitive impact of Public Storage commencing
            management  of the former  Shurgard  facilities,  particularly  with
            respect  to those  facilities  that are  close to the  Partnership's
            facilities.

        SINCE OUR BUSINESS  CONSISTS  PRIMARILY OF OPERATING REAL ESTATE, WE ARE
SUBJECT TO REAL ESTATE OPERATING RISKS.

        The value of our  investments  may be reduced  by general  risks of real
estate  ownership.  Since we derive  substantially  all of our income  from real
estate  operations,  we  are  subject  to  the  general  risks  of  owning  real
estate-related assets, including:

        o   lack of demand for rental spaces or units in a locale;

        o   changes in general economic or local conditions;

        o   natural disasters, such as earthquakes;

        o   potential terrorist attacks;

        o   changes in supply of or demand for similar or  competing  facilities
            in an area;

        o   the impact of environmental protection laws;

        o   changes in interest  rates and  availability  of permanent  mortgage
            funds which may render the sale or financing of a property difficult
            or unattractive; and

        o   changes in tax, real estate and zoning laws.

        There is significant  competition among self-storage facilities and from
other storage alternatives.  All of our properties are self-storage  facilities,
which generated substantially all of our revenue for the year ended December 31,
2005.  Local market  conditions will play a significant  part in how competition


                                       7


<PAGE>


will affect us.  Competition in the market areas in which many of our properties
are located from other self-storage facilities and other storage alternatives is
significant  and has affected the occupancy  levels,  rental rates and operating
expenses of our properties. Any increase in availability of funds for investment
in real estate may accelerate  competition.  Further development of self-storage
facilities may intensify competition among operators of self-storage  facilities
in the market areas in which we operate.

        We may incur  significant  environmental  costs and  liabilities.  As an
owner and operator of real properties,  under various  federal,  state and local
environmental  laws,  we are  required  to clean up spills or other  releases of
hazardous or toxic substances on or from our properties.  Certain  environmental
laws impose liability  whether or not the owner knew of, or was responsible for,
the presence of the hazardous or toxic substances.  In some cases, liability may
not be limited to the value of the property.  The presence of these  substances,
or the failure to properly remediate any resulting  contamination,  whether from
environmental  or microbial  issues,  also may  adversely  affect the owner's or
operator's ability to sell, lease or operate its property or to borrow using its
property as collateral.

        We  have  conducted   preliminary   environmental   assessments  on  the
Partnership's  properties  to  evaluate  the  environmental  condition  of,  and
potential  environmental  liabilities  associated  with, our  properties.  These
assessments generally consist of an investigation of environmental conditions at
the property (not including soil or groundwater  sampling or analysis),  as well
as a review of available  information  regarding the site and publicly available
data  regarding  conditions at other sites in the vicinity.  In connection  with
these  property  assessments,  we have  become  aware that prior  operations  or
activities at some facilities or from nearby locations have or may have resulted
in contamination to the soil or groundwater at these facilities. In this regard,
some of our facilities are or may be the subject of federal or state environment
investigations  or remedial  actions.  Although we cannot provide any assurance,
based on the  preliminary  environmental  assessments,  we believe we have funds
available to cover any liability from  environmental  contamination or potential
contamination  and we are not aware of any  environmental  contamination  of our
facilities  material to our overall business,  financial condition or results of
operation.

        There has been an  increasing  number of claims and  litigation  against
owners and  managers of rental  properties  relating  to moisture  infiltration,
which can result in mold or other property  damage.  When we receive a complaint
concerning  moisture  infiltration,  condensation or mold problems and/or become
aware that an air quality concern exists,  we implement  corrective  measures in
accordance  with  guidelines and protocols we have developed with the assistance
of outside  experts.  We seek to work  proactively  with our  tenants to resolve
moisture  infiltration  and  mold-related  issues,  subject  to our  contractual
limitations on liability for such claims.  However,  we can provide no assurance
that material legal claims  relating to moisture  infiltration  and the presence
of, or exposure to, mold will not arise in the future.

        Property   taxes  can   increase  and  cause  a  decline  in  yields  on
investments.  Each of our  properties is subject to real property  taxes.  These
real property  taxes may increase in the future as property tax rates change and
as our properties are assessed or reassessed by tax authorities.  Such increases
could adversely impact our profitability.

        We must comply with the  Americans  with  Disabilities  Act and fire and
safety  regulations,   which  can  require  significant  expenditures.  All  our
properties must comply with the Americans with Disabilities Act and with related
regulations  (the  "ADA").  The ADA has  separate  compliance  requirements  for
"public accommodations" and "commercial facilities," but generally requires that
buildings be made  accessible to persons with  disabilities.  Various state laws
impose similar  requirements.  A failure to comply with the ADA or similar state
laws could result in government  imposed fines on us and the award of damages to
individuals affected by the failure. In addition, we must operate our properties
in compliance with numerous local fire and safety  regulations,  building codes,
and other land use regulations.  Compliance with these  requirements can require
us to spend  substantial  amounts of money,  which would  reduce cash  otherwise
available  for  distribution  to  shareholders.  Failure  to comply  with  these
requirements could also affect the marketability of our real estate facilities.

        TERRORIST  ATTACKS AND THE  POSSIBILITY OF WIDER ARMED CONFLICT MAY HAVE
AN ADVERSE  IMPACT ON OUR BUSINESS AND OPERATING  RESULTS AND COULD DECREASE THE
VALUE OF OUR ASSETS.

         Terrorist attacks and other acts of violence or war, such as those that
took place on September 11, 2001, could have a material adverse impact on our
business and operating results. There can be no assurance that there will not be
further terrorist attacks against the United States or its businesses or
interests. Attacks or armed conflicts that directly impact one or more of our
properties could significantly affect our ability to operate those properties
and thereby impair our operating results. Further, we may not have insurance
coverage for losses caused by a terrorist attack. Such insurance may not be

                                       8


<PAGE>


available, or if it is available and we decide to obtain such terrorist
coverage, the cost for the insurance may be significant in relationship to the
risk overall. In addition, the adverse effects that such violent acts and
threats of future attacks could have on the U.S. economy could similarly have a
material adverse effect on our business and results of operations. Finally,
further terrorist acts could cause the United States to enter into a wider armed
conflict, which could further impact our business and operating results.

        DEVELOPMENTS  IN CALIFORNIA  MAY HAVE AN ADVERSE  IMPACT ON OUR BUSINESS
AND OPERATING RESULTS AND COULD DECREASE THE VALUE OF OUR ASSETS.

        All  of  the   Partnership's   properties  are  located  in  California.
California is facing budgetary problems. Action that may be taken in response to
these problems,  such as an increase in property taxes on commercial properties,
could adversely impact our business and results of operations.  In addition, the
Partnership  could be  adversely  impacted  by efforts  to  reenact  legislation
mandating medical  insurance for employees of California  businesses and members
of their families.

        INCREASES  IN  INTEREST  RATES  MAY  ADVERSELY  AFFECT  THE PRICE OF OUR
PARTNERSHIP UNITS.

        One of the factors that  influences the market price of our  partnership
units is the annual  rate of  distributions  that we pay on the  securities,  as
compared with interest  rates. An increase in interest rates may lead purchasers
of partnership  units to demand higher annual  distribution  rates,  which could
adversely affect the market price of our partnership units.

        OUR OWNERSHIP INTEREST IN STOR-RE MAY LOSE VALUE OR BECOME A LIABILITY.

        The  Partnership  has  a  0.9%  ownership  interest  in  STOR-Re  Mutual
Insurance  Corporation  ("STOR-Re"),  which was formed in 1994 as an association
captive  insurance  company,  and is controlled by PSI. STOR-Re provided limited
property  and  liability  insurance  coverage  to  the  Partnership,   PSI,  and
affiliates of PSI for losses  occurring prior to April 1, 2004.  Liabilities for
losses  and loss  adjustment  expenses  include an amount  determined  from loss
reports and individual  cases and an amount,  based on  recommendations  from an
outside actuary that is a member of the American  Academy of Actuaries,  using a
frequency and severity method, for losses incurred but not reported. Determining
the  liability  for  unpaid  losses  and loss  adjustment  expense is based upon
estimates  and while we believe that the amount is adequate,  the ultimate  loss
may be in excess of or less than the  amounts  provided,  which may  result in a
reduction in the value of the Partnership's investment or could result in future
payments to STOR-Re if its reserves were determined to be inadequate.  Financial
data with respect to STOR-Re is included in Note 5 to the Partnership's December
31, 2005 financial statements.

ITEM 1B. UNRESOLVED STAFF COMMENTS
         -------------------------

      Not applicable.

ITEM 2.  PROPERTIES
         ----------

        The following table sets forth information as of December 31, 2005 about
properties owned by the Partnership:

<TABLE>
<CAPTION>
                                              Net            Number            Date             Completion
      Location          Size of Parcel   Rentable Area      of Spaces       of Purchase             Date
----------------------  ---------------- ---------------- -------------- -------------------- ------------------
CALIFORNIA
----------
<S>                       <C>             <C>                   <C>        <C>                   <C>
Corona                    2.82 acres      52,000 sq. ft.        467        June 29, 1978         Dec. 1978
Fremont                   3.00 acres      53,000 sq. ft.        464        Mar. 21, 1978         Nov. 1978
Milpitas                  3.40 acres      40,000 sq. ft         419        May 8, 1978           Nov. 1978
Norco                     1.66 acres      29,000 sq. ft         257        July 19, 1978         Dec. 1978
North Hollywood           2.06 acres      38,000 sq. ft.        343        Mar. 17, 1978         Dec. 1979
Pasadena                  1.84 acres      37,000 sq. ft.        385        Feb. 24, 1978         Aug. 1978
Sun Valley                2.72 acres      53,000 sq. ft.        477        May 30, 1978          Oct. 1978
Wilmington                6.32 acres     133,000 sq. ft.      1,089        Apr. 18, 1978         Aug. 1978
Whittier - El Monte       3.28 acres      58,000 sq. ft.        532        Nov. 29, 1977         July 1978
</TABLE>

         The weighted average occupancy level for the self-storage facilities
was 92% during 2004 and 91% during 2005.

                                       9


<PAGE>


        The  Partnership  does not have any  agreements  to buy or sell any real
estate.  The  partnership  does not anticipate any new  investments,  other than
maintenance capital expenditures,  and does not anticipate  liquidating the real
estate investments it now holds.

        As of December 31, 2005, the properties were not encumbered.

ITEM 3.        LEGAL PROCEEDINGS
               -----------------

        Serrao v. Public  Storage,  Inc.  (filed April 2003)  (Superior  Court -
        ------------------------------------------------------------------------
        Orange County)
        ------------------------------------------------------------------------

        The  plaintiff  in this  case  filed a suit  against  PSI on behalf of a
putative  class of renters  who rented  self-storage  units from PSI.  Plaintiff
alleges  that PSI  misrepresented  the size of its  storage  units,  has brought
claims  under   California   statutory  and  common  law  relating  to  consumer
protection,  fraud, unfair competition, and negligent misrepresentation,  and is
seeking monetary damages, restitution, and declaratory and injunctive relief.

        The claim in this case is substantially similar to those in Henriquez v.
Public Storage, Inc., which was disclosed in prior reports. In January 2003, the
plaintiff caused the Henriquez action to be dismissed.

        Based upon the  uncertainty  inherent in any putative class action,  PSI
cannot  presently  determine  the  potential  damages,  if any, or the  ultimate
outcome of this litigation.  On November 3, 2003, the court granted PSI's motion
to strike the plaintiff's nationwide class allegations and to limit any putative
class to California residents only. In August 2005, PSI filed a motion to remove
the case to federal court, but the case has been remanded to the Superior Court.
PSI is  vigorously  contesting  the claims  upon  which  this  lawsuit is based,
including class certification efforts.

        Brinkley et al v. Public  Storage,  Inc.  (filed April,  2005) (Superior
        ------------------------------------------------------------------------
        court of California - Los Angeles County)
        ------------------------------------------------------------------------

        The Brinkley  plaintiffs are suing PSI on behalf of a purported class of
California  property  managers who claim that they were not  compensated for all
the hours they worked.  The Brinkley suit is based upon California wage and hour
laws.  The  maximum  potential  liability  cannot  be  estimated,  but  would be
increased if a class or classes are  certified or, if claims are permitted to be
brought on behalf of others under the California Unfair Business  Practices Act.
PSI is  vigorously  contesting  the claims  and  intend to resist any  expansion
beyond the named plaintiffs on the grounds of lack of commonality of claims. PSI
does not believe that this matter will have any material  adverse  effect on the
results of operations of the Partnership.

     Other Items
     -----------

         PSI and the Partnership are a party to various claims, complaints, and
other legal actions that have arisen in the normal course of business from time
to time, that are not described above. We believe that it is unlikely that the
outcome of these other pending legal proceedings including employment and tenant
claims, in the aggregate, will have a material adverse effect upon the
operations or financial position of the Partnership.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
         ---------------------------------------------------

         No matters were submitted to a vote of security holders during the
fourth quarter of the fiscal year ended December 31, 2005.

                                       10


<PAGE>


                                     PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S  COMMON EQUITY,  RELATED STOCKHOLDER
         ----------------------------------------------------------------
         MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
         -------------------------------------------------

        The Partnership has no common stock.

        The Units are not listed on any national  securities  exchange or quoted
on the NASDAQ System and there is no  established  public trading market for the
Units. Secondary sales activity for the Units has been limited and sporadic. The
General Partners monitor transfers of the Units (a) because the admission of the
transferee as a substitute  limited partner  requires the consent of the General
Partners under the Partnership's  Amended and Restated Certificate and Agreement
of  Limited  Partnership,  (b) in order to ensure  compliance  with safe  harbor
provisions  to  avoid  treatment  as a  "publicly  traded  partnership"  for tax
purposes,  and (c) because  the General  Partners  (and their  affiliates)  have
purchased Units. However, the General Partners do not have information regarding
the  prices at which all  secondary  sale  transactions  in the Units  have been
effectuated.   Various   organizations   offer  to  purchase  and  sell  limited
partnership  interests  (including  securities of the type such as the Units) in
secondary sales  transactions.  Various  publications such as The Stanger Report
summarize  and report  information  (on a monthly,  bimonthly  or less  frequent
basis) regarding secondary sales transactions in limited  partnership  interests
(including  the  Units),  including  the  prices at which such  secondary  sales
transactions are effectuated.

        Exclusive of the General  Partners'  interest in the Partnership,  as of
December 31, 2005, there were approximately 599 unitholders of record.

        Distributions  to the general and limited partners of all cash available
for   distribution   (as  defined)  are  made  quarterly.   Cash  available  for
distribution  is generally  funds from  operations of the  Partnership,  without
deduction  for  depreciation,  but  after  deducting  funds to pay or  establish
reserves  for all other  expenses  (other than  incentive  distributions  to the
general  partner) and capital  improvements,  plus net proceeds from any sale or
financing of the Partnership's properties.

        Reference is made to Item 6 and 7 hereof for  information  on the amount
of such distributions.

ITEM 6.  SELECTED FINANCIAL DATA
         -----------------------
<TABLE>
<CAPTION>

   For the Year Ended
     December 31,                  2005               2004               2003               2002               2001
---------------------------- ------------------ ----------------- ------------------- ----------------- ------------------
<S>                           <C>                <C>               <C>                 <C>                <C>
Revenues                      $    7,002,000     $    6,593,000    $    6,246,000      $   5,938,000      $    6,006,000

Depreciation and
  amortization                       181,000            217,000           454,000            516,000             533,000


Interest expense                           -                  -                 -             14,000             221,000

Net income                         4,888,000          4,475,000         3,977,000          3,729,000           3,643,000

Limited partners' share            3,619,000          3,397,000         3,004,000          3,242,000           3,607,000

General partners' share            1,269,000          1,078,000           973,000            487,000              36,000

Limited partners'
  per unit data (1):
  Net income                         $180.95            $169.85           $150.20            $162.10             $180.35
  Cash Distributions                 $183.00            $155.00           $140.00             $67.50                 -

As of December 31,
---------------------------

Cash and cash equivalents     $    1,448,000    $     1,407,000    $    1,070,000    $       538,000      $      175,000

Total assets                  $    4,639,000    $     4,697,000    $    4,422,000    $     4,178,000      $    4,242,000

Notes payable                 $            -    $             -    $            -    $             -      $    2,000,000
</TABLE>

 (1) Per unit  data is based  on the  weighted  average  number  of the  limited
partnership     units     (20,000)     outstanding     during    each    period.

                                       11


<PAGE>


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

     The  following   discussion   should  be  read  in  conjunction   with  the
Partnership's financial statements and notes thereto.

Forward Looking Statements
--------------------------

     When  used  within  this  document,   the  words   "expects,"   "believes,"
"anticipates,"  "should,"  "estimates," and similar  expressions are intended to
identify "forward-looking statements" within the meaning of that term in Section
27A of the  Securities  Exchange Act of 1933, as amended,  and in Section 21E of
the Securities Exchange Act of 1934, as amended. Such forward-looking statements
involve known and unknown risks,  uncertainties,  and other  factors,  which may
cause the actual  results and  performance  of the  Partnership to be materially
different  from those  expressed or implied in the forward  looking  statements.
Such factors are  described in Item 1A,  "Risk  Factors" and include  changes in
general economic conditions and in the markets in which the Partnership operates
and the impact of  competition  from new and  existing  storage  and  commercial
facilities  and  other  storage  alternatives,  which  could  impact  rents  and
occupancy levels at the Partnership's  facilities;  the impact of the regulatory
environment as well as national,  state, and local laws and  regulations,  which
could  increase  the  Partnership's  expense and reduce the  Partnership's  cash
available for distribution; and economic uncertainty due to the impact of war or
terrorism could  adversely  affect our business plan. We disclaim any obligation
to  publicly  release  the  results of any  revisions  to these  forward-looking
statements  reflecting new estimates,  events or circumstances after the date of
this report.

Overview
--------

     The   self-storage   industry   is  highly   fragmented   and  is  composed
predominantly  of numerous  local and  regional  operators.  Competition  in the
markets in which we  operate  is  significant  and has  increased  over the past
several years due to  additional  development  of  self-storage  facilities.  We
believe  that the  increase  in  competition  has had a  negative  impact to the
Partnership's  occupancy  levels and rental rates in many markets.  However,  we
believe  that  the   Partnership's   affiliation   with  PSI  provides   several
distinguishing   characteristics   that  enable  the   Partnership   to  compete
effectively with other owners and operators.

     PSI is the largest  owner and operator of  self-storage  facilities  in the
United States.  All of PSI's  facilities are operated under the "Public Storage"
brand name,  which we believe is the most recognized and established name in the
self-storage  industry.  Market  concentration  establishes  PSI  as  one of the
dominant  providers of self-storage  space in most markets in which PSI operates
and enables PSI to use a variety of promotional  activities,  such as television
advertising as well as targeted  discounting and referrals,  which are generally
not economically viable to most of PSI's competitors.

     We will continue to focus our growth  strategies on improving the operating
performance of our existing self-storage  properties primarily through increases
in revenues  achieved  through the telephone  reservation  center and associated
marketing efforts. We expect potential future increases in rental income to come
primarily from increases in realized rent, although there can be no assurance.

CRITICAL ACCOUNTING POLICIES
----------------------------

      IMPAIRMENT OF REAL ESTATE

     Substantially  all of our assets  consist of real  estate.  On a  quarterly
basis, we evaluate our real estate for impairment. The evaluation of real estate
for impairment  requires  determining  whether  indicators of impairment  exist,
which is a subjective process.  When any indicators of impairment are found, the
evaluation then entails  projections of future operating cash flows,  which also
involves significant judgment. We identified no such impairments at December 31,
2005.  However,  future events, or facts and circumstances  that currently exist
that we have not yet  identified,  could cause us to conclude in the future that
our real estate is impaired. Any resulting impairment loss could have a material
adverse impact on our financial condition and results of operations.

      ESTIMATED USEFUL LIVES OF LONG-LIVED ASSETS

     Substantially all of our assets consist of depreciable,  long-lived assets.
We record  depreciation  expense  with  respect to these assets based upon their
estimated  useful  lives.  Any  change in the  estimated  useful  lives of those
assets,  caused by functional or economic  obsolescence or other factors,  could
have a  material  adverse  impact  on our  financial  condition  or  results  of
operations.

                                       12


<PAGE>


     ACCRUALS FOR CONTINGENCIES

     We are exposed to business and legal liability risks with respect to events
that  have  occurred,  but in  accordance  with  generally  accepted  accounting
principles  in the U.S.,  we have not  accrued  for such  potential  liabilities
because the loss is either not  probable or not  estimable or because we are not
aware of the event.  Future  events and the result of pending  litigation  could
result in such potential  losses  becoming  probable and estimable,  which could
have a  material,  adverse  impact on our  financial  condition  or  results  of
operations. Some of these potential losses, which we are aware of, are described
in Notes 5 and 8 to the Partnership's financial statements.

     ACCRUALS FOR OPERATING EXPENSES

     We accrue for property tax expense and other operating  expenses based upon
estimates  and  historical  trends and current and  anticipated  local and state
government  rules  and  regulations.  If these  estimates  and  assumptions  are
incorrect,  the timing of the recognition our expenses could be incorrect.  Cost
of operations,  interest expense, general and administrative expense, as well as
television,  yellow page,  and other  advertising  expenditures  are expensed as
incurred.

RESULTS OF OPERATIONS
---------------------

     YEAR ENDED DECEMBER 31, 2005 COMPARED TO YEAR ENDED DECEMBER 31, 2004:

     The Partnership's net income in 2005 was $4,888,000  compared to $4,475,000
in 2004,  representing  an increase of $413,000 or 9%. The increase is primarily
attributable to improved property  operations at the Partnership's  self-storage
facilities.

     During 2005,  property net  operating  income  (rental  income less cost of
operations,  management  fees paid to an  affiliate  and  depreciation  expense)
increased $356,000 or 8% from $4,506,000 in 2004 to $4,862,000 in 2005.

     Rental  income was  $6,879,000  in 2005  compared  to  $6,537,000  in 2004,
representing an increase of $342,000,  or 5%. The increase is attributable to an
increase  in  realized  rent  per  occupied  square  foot  at the  Partnership's
self-storage facilities.  Weighted average occupancy levels were 91% during 2005
compared to 92% during 2004.  The average  annual  realized rent per square foot
was $14.69 during 2005 compared to $13.86 during 2004.

     Cost of operations  (including  management  fees paid to an affiliate)  was
$1,836,000  and  $1,814,000  in 2005 and  2004,  respectively,  representing  an
increase of $22,000, or 1%. This increase is primarily attributable to increases
in  management  fees (as a result of higher  revenues) and property and casualty
insurance expense, partially offset by a decrease in repairs and maintenance and
advertising expenses.

     Depreciation  expense was  $181,000  for the year ended  December  31, 2005
compared to $217,000 for the same period in 2004.  The decrease in  depreciation
expense is primarily  related to the Partnership's  buildings,  which were fully
depreciated  in 2004,  as such,  depreciation  expense for 2005 is entirely  for
capital  improvements,   which  generally  are  depreciated  over  an  estimated
five-year  average  useful  life.  The level of  depreciation  expense in future
periods will depend upon the timing and amount of new capital  expenditures  and
the extent to which past capital expenditures become fully depreciated.

     YEAR ENDED DECEMBER 31, 2004 COMPARED TO YEAR ENDED DECEMBER 31, 2003:

     The Partnership's net income in 2004 was $4,475,000  compared to $3,977,000
in 2003,  representing an increase of $498,000 or 13%. The increase is primarily
attributable to improved property  operations at the Partnership's  self-storage
facilities.

     During 2004,  property net  operating  income  (rental  income less cost of
operations,  management  fees paid to an  affiliate  and  depreciation  expense)
increased $491,000 or 12% from $4,015,000 in 2003 to $4,506,000 in 2004.

     Rental  income was  $6,537,000  in 2004  compared  to  $6,201,000  in 2003,
representing an increase of $336,000,  or 5%. The increase is attributable to an
increase in average  occupancy  at the  Partnership's  self-storage  facilities.
Weighted  average  occupancy  levels were 92% during 2004 compared to 90% during
2003.  The average  annual  realized rent per square foot was $13.86 during 2004
compared to $13.43 during 2003.

                                       13

<PAGE>


     Cost of operations  (including  management  fees paid to an affiliate)  was
$1,814,000  and  $1,732,000  in 2004 and  2003,  respectively,  representing  an
increase of $82,000, or 5%. This increase is primarily attributable to increases
in repair and maintenance  expense,  payroll and management fees (as a result of
higher  revenues),  partially  offset  by  a  decrease  in  office  expense  and
advertising expenses.

     Depreciation  expense was  $217,000  for the year ended  December  31, 2004
compared to $454,000 for the same period in 2003.  The decrease in  depreciation
expense is primarily related to the Partnership's buildings which were placed in
service in 1978 and 1979 becoming fully depreciated.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

     Cash  flow from  operating  activities  of  $5,018,000  for the year  ended
December 31, 2005 have been  sufficient to meet all current  obligations  of the
Partnership.  Capital  improvements  totaled $48,000 for the year ended December
31, 2005 compared to $152,000 in 2004 and $205,000 in 2003.

     The Partnership does not anticipate issuing senior securities, making loans
to other  persons,  investing in the securities of other issuers for the purpose
of exercising control, underwriting the securities of other issuers, engaging in
the  purchase  and sale of  investments,  offering  securities  in exchange  for
property, or repurchasing or otherwise  reacquiring its outstanding  securities.
The  partnership  may  consider  borrowing  money  with the  intent of using the
proceeds for distribution to partners.

     DISTRIBUTIONS

     Distributions  to the limited and general  partners for the years 1978-1990
aggregated $37,832,000 including $20,202,000 distributed to the partners in 1987
in connection  with the financing of the properties.  The Partnership  Agreement
requires that cash available for  distribution  (cash flow from all sources less
cash  necessary  for  any  obligations  or  capital  improvement)  needs  to  be
distributed at least quarterly.

     Cash  distributions  were  suspended  during the fourth quarter of 1990 for
debt service  payments.  Because all debt service was repaid as of September 30,
2002, the Partnership  resumed  quarterly  distributions  beginning in the third
quarter of 2002.

     We  paid  distributions  to  the  limited  and  general  partners  totaling
$3,660,000 ($183.00 per unit) and $1,269,000,  respectively,  for the year ended
December 31, 2005.  We paid  distributions  to the limited and general  partners
totaling  $3,100,000  ($155.00 per unit) and $1,075,000,  respectively,  for the
year ended  December  31,  2004.  Future  distribution  rates may be adjusted to
levels which are supported by operating cash flow after capital improvements and
any other necessary obligations.

ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
            ----------------------------------------------------------

      As of December 31, 2005, the Partnership had no outstanding debt.

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
            -------------------------------------------

     The  Partnership's  financial  statements  are included  elsewhere  herein.
Reference is made to the Index to Financial  Statements and Financial  Statement
Schedules in Item 15(a).

ITEM 9.     CHANGES IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON ACCOUNTING AND
            -------------------------------------------------------------------
            FINANCIAL DISCLOSURE
            --------------------

         Not applicable.

ITEM 9A.    CONTROLS AND PROCEDURES
            -----------------------

     Public Storage,  Inc. maintains disclosure controls and procedures that are
designed to ensure that  information  required  to be  disclosed  in reports the
Partnership  files and submits under the Exchange  Act, is recorded,  processed,
summarized and reported within the time periods specified in accordance with SEC
guidelines  and that  such  information  is  communicated  to the  Partnership's
management,  including its Chief Executive Officer and Chief Financial  Officer,

                                       14

<PAGE>


to allow timely decisions  regarding required disclosure based on the definition
of "disclosure  controls and  procedures" in Rule 13a-15(e) of the Exchange Act.
In designing and evaluating the disclosure  controls and procedures,  management
recognized  that any controls and  procedures,  no matter how well  designed and
operated, can provide only reasonable assurance of achieving the desired control
objectives.

     At the end of the  period  covered by this  report,  Public  Storage,  Inc.
carried out an evaluation,  under the supervision and with the  participation of
the Partnership's  management,  including Public Storage, Inc.'s Chief Executive
Officer and Chief  Financial  Officer,  of the  effectiveness  of the design and
operation of the Partnership's  disclosure  controls and procedures.  Based upon
that  evaluation,  the  Chief  Executive  Officer  and Chief  Financial  Officer
concluded  that  the  Partnership's  disclosure  controls  and  procedures  were
effective.  During the fourth quarter of 2005, there were no significant changes
in the  Partnership's  internal  controls  over  financial  reporting  that have
materially  affected,  or  are  reasonably  likely  to  materially  affect,  the
Partnership's internal control over financial reporting.

ITEM 9B. OTHER INFORMATION
         -----------------

         Not applicable.

                                       15


<PAGE>


                                    PART III

ITEM 10.    DIRECTORS AND EXECUTIVE OFFICERS OF THE PARTNERSHIP
            ---------------------------------------------------

     The Partnership has no directors or executive officers.

     The Partnership's General Partners are PSI and B. Wayne Hughes. PSI, acting
through its  directors and  executive  officers,  and Mr. Hughes manage and make
investment  decisions  for the  Partnership.  The  self-storage  facilities  are
managed by PSI pursuant to a Management Agreement.

     Pursuant to the Partnership's  Amended Certificate and Agreement of Limited
Partnership (the  "Partnership  Agreement"),  a copy of which is included in the
Partnership's  prospectus included in the Partnership's  Registration Statement,
each of the  General  Partners  continues  to serve  until (i) death,  insanity,
insolvency,  bankruptcy or dissolution,  (ii) withdrawal with the consent of the
other  general  partner and a majority  vote of the limited  partners,  or (iii)
removal by a majority vote of the limited partners.

     The names of all directors and executive  officers of PSI, the offices held
by each of them with PSI, and their ages and business experience during the past
five years are as follows:
<TABLE>
<CAPTION>


        Name                                    Positions with PSI
------------------------     ---------------------------------------------------
<S>                          <C>
B. Wayne Hughes              Chairman of the Board
                             Chief Executive Officer, Vice Chairman of the Board
Ronald L. Havner, Jr.          and President
John Reyes                   Senior Vice President and Chief Financial Officer
John S. Baumann              Senior Vice President and Chief Legal Officer
John G. Graul                Senior Vice President and President, Self-storage Operations
David F. Doll                Senior Vice President and President, Real Estate Group
Harvey Lenkin                Director
B. Wayne Hughes, Jr.         Director
Robert J. Abernethy          Director
Dann V. Angeloff             Director
William C. Baker             Director
John T. Evans                Director
Uri P. Harkham               Director
Daniel C. Staton             Director
</TABLE>

     B.  Wayne  Hughes,  age 72, has been a director  of the  Company  since its
organization in 1980 and was President and Co-Chief  Executive Officer from 1980
until  November  1991  when he  became  Chairman  of the  Board  and sole  Chief
Executive  Officer.  Mr. Hughes retired as Chief  Executive  Officer in November
2002 and remains Chairman of the Board.  Mr. Hughes is currently  engaged in the
acquisition  and  operation of commercial  properties  in California  and in the
acquisition and operation of self-storage  facilities in Canada.  Mr. Hughes has
been active in the real  estate  investment  field for over 30 years.  He is the
father of B. Wayne Hughes, Jr., a member of the Company's Board.

     Ronald L. Havner, Jr., age 48, has been the Vice-Chairman,  Chief Executive
Officer and a director of the Company since  November  2002 and President  since
July 1, 2005.  Mr.  Havner  joined the Company in 1986 and has held a variety of
positions,  including  Chairman of the Company's  affiliate,  PS Business Parks,
Inc. (PSB),  since March 1998 and was Chief Executive  Officer of PSB from March
1998 until  August  2003.  He is also a member of the Board of  Governors of the
National  Association  of Real Estate  Investment  Trusts,  Inc.  (NAREIT) and a
director of Business Machine Security,  Inc., The Mobile Storage Group and Union
BanCal Corporation.

     Harvey Lenkin,  age 69, retired as President and Chief Operating Officer of
the  Company on June 30,  2005.  Mr.  Lenkin was  employed by the Company or its
predecessor  for 27 years and has been a member of the Board of Directors  since
1991.  He has been a director of the  Company's  affiliate,  PS Business  Parks,
Inc.,  since March 1998 and was  President of PSB from 1990 until March 1998. He
is also a director of Paladin Realty Income Properties I, Inc. and a director of
Huntington  Memorial Hospital,  Pasadena,  California and a former member of the
Executive Committee of the Board of Governors of NAREIT.

                                       16


<PAGE>


     Robert J.  Abernethy,  age 66, Chairman of the Audit Committee and a member
of  the  Compensation  Committee,   has  been  President  of  American  Standard
Development Company and of Self-Storage  Management  Company,  which develop and
operate  self-storage  facilities,  since  1976  and  1977,  respectively.   Mr.
Abernethy was controller of a division of Hughes  Aircraft from 1972 to 1974. He
has been a director of the Company since its organization. He is a member of the
board of trustees  of Johns  Hopkins  University,  a director of the Los Angeles
Music  Center,   a  member  of  the  Board  of  Overseers  of  the  Los  Angeles
Philharmonic,  a trustee  of Loyola  Marymount  University,  a  director  of the
Pacific Council on International  Policy, a director of the Atlantic Council,  a
member  of  the   Council  on  Foreign   Relations   and  a  former   California
Transportation  Commissioner.  Mr.  Abernethy is a former member of the board of
directors of the Los Angeles County Metropolitan Transportation Authority and of
the Metropolitan Water District of Southern  California,  a former member of the
California  State Board of Education,  a former member of the  California  State
Arts  Council,  a former  Planning  Commissioner,  a  former  Telecommunications
Commissioner and the former Vice-Chairman of the Economic Development Commission
of the City of Los Angeles.  He received an M.B.A.  from the Harvard  University
Graduate School of Business.

     Dann V. Angeloff, age 70, Chairman of the  Nominating/Corporate  Governance
Committee and a member of the Compensation Committee,  has been President of the
Angeloff Company, a corporate  financial advisory firm, since 1976. Mr. Angeloff
is currently the general partner of a limited partnership that in 1974 purchased
a  self-storage  facility  operated  by the  Company.  Mr.  Angeloff  has been a
director of the  Company  since its  organization.  He is a director of Bjurman,
Barry Fund, Inc.,  Nicholas/Applegate  Fund, ReadyPac Foods,  Retirement Capital
Group and SoftBrands, Inc.

     William  C.  Baker,  age 72, a member  of  Nominating/Corporate  Governance
Committee,  became a director  of the Company in November  1991.  Mr.  Baker was
Chairman and Chief  Executive  Officer of Callaway Golf Company from August 2004
until August 2005.  From August 1998 through  April 2000,  he was  President and
Treasurer of Meditrust  Operating  Company, a real estate investment trust. From
April 1996 to December  1998,  Mr.  Baker was Chief  Executive  Officer of Santa
Anita Companies,  which then operated the Santa Anita Racetrack. From April 1993
through May 1995, he was President of Red Robin International, Inc., an operator
and  franchisor  of casual dining  restaurants  in the United States and Canada.
From  January  1992  through  December  1995,  Mr.  Baker was Chairman and Chief
Executive Officer of Carolina Restaurant Enterprises,  Inc., a franchisee of Red
Robin  International,  Inc.  From 1991 to 1999,  he was Chairman of the Board of
Coast Newport  Properties,  a real estate brokerage company.  From 1976 to 1988,
Mr. Baker was a principal  shareholder and Chairman and Chief Executive  Officer
of Del Taco,  Inc.,  an operator  and  franchisor  of fast food  restaurants  in
California.  He is a director of La Quinta, Inc., California Pizza Kitchen, Javo
Beverage Company and Callaway Golf Company.

     John  T.  Evans,  age  67,  a  member  of the  Audit  Committee  and of the
Nominating/Corporate  Governance Committee,  became a director of the Company in
August  2003.  Mr.  Evans has been a partner in the law firm of Osler,  Hoskin &
Harcourt LLP, Toronto, Canada from April 1993 to the present and in the law firm
of Blake, Cassels & Graydon LLP, Toronto,  Canada from April 1966 to April 1993.
Mr.  Evans  specializes  in business law  matters,  securities,  restructurings,
mergers and  acquisitions and advising on corporate  governance.  Mr. Evans is a
director of Cara Operations  Inc.,  Kubota Metal  Corporation,  and Toronto East
General  Hospital.  Until  August  2003,  Mr.  Evans was a director  of Canadian
Mini-Warehouse  Properties Ltd., a Canadian corporation owned by B. Wayne Hughes
and members of his family.

     Uri P. Harkham,  age 57, a member of the Compensation  Committee,  became a
director of the Company in March 1993.  Mr.  Harkham has been the  President and
Chief Executive Officer of the Jonathan Martin Fashion Group,  which specializes
in  designing,   manufacturing  and  marketing   women's  clothing,   since  its
organization in 1976. Since 1978, Mr. Harkham has been the Chairman of the Board
of Harkham  Properties,  a real estate firm  specializing in buying and managing
warehouses and retail and mixed-use real estate in California.

     B. Wayne  Hughes,  Jr., age 46, became a director of the Company in January
1998.  He was  employed  by the  Company  from  1989 to  2002,  serving  as Vice
President - Acquisitions  of the Company from 1992 to 2002.  Mr. Hughes,  Jr. is
currently Vice President of American Commercial Equities, LLC, a company engaged
in the acquisition and operation of commercial properties in California and is a
director  of  Canadian  Mini-Ware  Properties  Ltd.,  a company  engaged  in the
acquisition,  development and operation of self-storage facilities in Canada. He
is the son of B. Wayne Hughes.

     Daniel C. Staton,  age 53,  Chairman of the  Compensation  Committee  and a
member of the Audit Committee, became a director of the Company in March 1999 in
connection  with the merger of Storage  Trust Realty,  a real estate  investment
trust,  with the  Company.  Mr.  Staton was Chairman of the Board of Trustees of
Storage  Trust  Realty  from  February  1998  until  March 1999 and a Trustee of
Storage  Trust Realty from  November  1994 until March 1999.  He is President of
Walnut  Capital  Partners,  an investment  and venture  capital  company and the
Co-Chief  Executive Officer of PMGI (formerly Media General,  Inc.), a print and
electronic  media  company.  Mr.  Staton  was the Chief  Operating  Officer  and
Executive Vice President of Duke Realty Investments,  Inc. from 1993 to 1997 and

                                       17


<PAGE>


a director of Duke Realty  Investments,  Inc. from 1993 until August 1999.  From
1981  to  1993,  Mr.  Staton  was a  principal  owner  of Duke  Associates,  the
predecessor of Duke Realty Investments, Inc. Prior to joining Duke Associates in
1981, he was a partner and general  manager of his own moving  company,  Gateway
Van & Storage, Inc. in St. Louis, Missouri. From 1986 to 1988, Mr. Staton served
as president of the Greater  Cincinnati  Chapter of the National  Association of
Industrial and Office Parks.

     Each  director of PSI serves  until he resigns or is removed from office by
PSI, and may resign or be removed from office at any time with or without cause.
Each  officer  of PSI  serves  until he  resigns  or is  removed by the board of
directors  of PSI.  Any such officer may resign or be removed from office at any
time with or without cause.

     There  have  been  no  events  under  any   bankruptcy   act,  no  criminal
proceedings,  and no judgments or injunctions  material to the evaluation of the
ability of any director or executive officer of PSI during the past five years.

     The  members  of the PSI  Audit  Committee  of the  Board  are:  Robert  J.
Abernethy  (Chairman),  John T. Evans,  and Daniel Staton.  The Board of PSI has
determined  that the Chairman of the Audit  Committee,  Robert J.  Abernethy and
Audit  Committee  member  Daniel C. Staton,  each qualify as an audit  committee
financial  expert within the meaning of the rules of the Securities and Exchange
Commission.  The Board has further determined that Messrs.  Abernethy and Staton
are each  independent  within the meaning of Item  7(d)(3)(iv)  of Schedule  14A
under the Exchange Act.

     The financial  records of the  Partnership  are  maintained and prepared by
employees of PSI. The Board of Directors of PSI has adopted a code of ethics for
its senior  financial  officers.  The Code of Ethics  applies  to those  persons
serving as PSI's principal  executive officer,  principal  financial officer and
principal  accounting  officer.  A copy of the Code of  Ethics is  available  by
written  request from the  Secretary of PSI at 701 Western  Ave.,  Glendale,  CA
91201-2349.

ITEM 11. EXECUTIVE COMPENSATION
         ----------------------

     The Partnership has no subsidiaries, directors or officers. See Item 13 for
a description of certain  transactions  between the  Partnership and its General
Partners and their affiliates.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         ------------------------------------------------------------------
         RELATED STOCKHOLDER MATTERS
         ---------------------------

    (a)  At March 30, 2006, the following beneficially owned more than 5% of the
         Units:
<TABLE>
<CAPTION>


          Title                           Name and Address                        Beneficial               Percent
        of Class                         of Beneficial Owner                      Ownership                of Class
---------------------------- ---------------------------------------------- -------------------------- ---------------
<S>                           <S>                                                <C>                          <C>
Units of Limited              Public Storage, Inc.                               6,274 Units (1)              31.4%
Partnership Interest          701 Western Ave.
                              Glendale, California 91201

Units of Limited              H-G Family Corporation, Tamara Hughes              6,301 Units (2)              31.5%
Partnership Interest          Gustavson, PS Orangeco Partnerships, Inc.
                              701 Western Ave.
                              Glendale, California 91201

</TABLE>

(1)      Includes  (i) 6,169  Units owned by PSI as to which PSI has sole voting
         and dispositive power, (ii) 25 Units which PSI has an option to acquire
         from a corporation of which Hughes' children are shareholders and (iii)
         80  Units  which  PSI has an  option  to  acquire  from  Tamara  Hughes
         Gustavson, an adult daughter of Hughes.

(2)      Includes (i) 6,025 Units owned by H-G Family Corporation, a corporation
         o9f  which  Hughes'  children  are  shareholders;  PSI has an option to
         acquire  25 of these  Units,  (ii) 80  Units  owned  by  Tamara  Hughes
         Gustavson  as to which  Tamara  Hughes  Gustavson  has sole  voting and
         dispositive  power;  PSI has an option to acquire  these 80 Units,  and
         (iii) 196 Units owned by PS Orangeco Partnerships,  Inc., a corporation
         in which Hughes and members of his family own  approximately 48% of the
         voting stock,  PSI owns 46% and members of PSI's management and related
         individuals own approximately 6%.

                                       18


<PAGE>


     (b) The Partnership has no officers and directors.

     The General  Partners (or their  predecessor-in-interest)  have contributed
$101,010 to the capital of the  Partnership  and as a result  participate in the
distributions  to the  limited  partners  and in the  Partnership's  profits and
losses in the same proportion that the General  Partners'  capital  contribution
bears to the total capital contribution  (approximately  $80,808 was contributed
by PSI  and  $20,202  was  contributed  by Mr.  Hughes).  In  1995,  Mr.  Hughes
contributed  his ownership and rights to  distributions  from the Partnership to
BWH Marina  Corporation II, a corporation  wholly-owned by Mr. Hughes.  In 2002,
BWH Marina Corporation II sold its interest to H-G Family Corporation.  As such,
Mr.  Hughes  continues  to act as a  general  partner  but  receives  no  direct
compensation or other consideration from the Partnership.  Information regarding
ownership of Units by PSI and Hughes,  the General Partners,  is set forth under
section (a) above.  The  directors  and  executive  officers  of PSI  (including
Hughes), as a group (17 persons),  beneficially own an aggregate of 6,239 Units,
representing  31.2% of the Units  (including the 6,025 Units owned by H-G Family
Corporation and the 196 Units owned by PS Orangeco Partnerships, Inc.).

     (c) The Partnership knows of no contractual arrangements,  the operation of
     the terms of which may at a  subsequent  date result in a change in control
     of  the   Partnership,   except  for  articles  16,  17  and  21.1  of  the
     Partnership's Amended Certificate and Agreement of Limited Partnership (the
     "Partnership Agreement"),  a copy of which is included in the Partnership's
     prospectus  included in the Partnership's  Registration  Statement File No.
     2-57750.  Those articles provide,  in substance,  that the limited partners
     shall have the right,  by majority  vote,  to remove a general  partner and
     that a general  partner may  designate a successor  with the consent of the
     other general partner and a majority of the limited partners.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
         ----------------------------------------------

     The  Partnership  Agreement  provides  that the  General  Partners  will be
entitled  to  cash  incentive  distributions  in an  amount  equal  to (i) 8% of
distributions  of cash  flow from  operations  until  the  distributions  to all
partners from all sources equal their capital contributions;  thereafter, 25% of
distributions of cash flow from operations,  and (ii) 25% of distributions  from
net proceeds from sale and financing of the Partnership's  properties  remaining
after  distribution  to all  partners of any portion  thereof  required to cause
distributions to partners from all sources to equal their capital contributions.
During  1985,  the partners  received  cumulative  distributions  equal to their
capital  contributions.  Mr. Hughes has assigned his ownership and  distribution
rights in the Partnership to BWH Marina Corporation II ("BWH Marinas"),  and BWH
Marinas sold its  interests to H-G Family  Corporation  in 2002.  In addition to
their distribution rights with respect to their general partner's interests, PSI
and  H-G  Family   Corporation  own  6,169  and  6,025  Limited  Partner  Units,
respectively.  During 2005, PSI and H-G Family Corporation  received  $1,015,000
and $254,000,  respectively, in distributions related to their general partner's
ownership interests.

     The    Partnership    has   a   Management    Agreement    with   PSI   (as
successor-in-interest  to PSMI). Under the Management Agreement, the Partnership
pays PSI a fee of 6% of the  gross  revenues  of the  mini-warehouse  properties
operated  for the  Partnership.  For as long as the  Management  Agreement is in
effect,  PSI has granted the Partnership a non-exclusive  license to use two PSI
service  marks and related  designs,  including  the "Public  Storage"  name, in
conjunction  with rental and  operation of  facilities  managed  pursuant to the
Management  Agreement.   Upon  termination  of  the  Management  Agreement,  the
Partnership  would no longer have the right to use the service marks and related
designs.  The  General  Partners  believe  that the loss of the right to use the
service marks and related  designs could have a material  adverse  effect on the
Partnership's  business.  The  Management  Agreement  with PSI provides that the
Management Agreement may be terminated without cause upon 60 days written notice
by the  Partnership or 6 months notice by PSI.  During 2005,  2004 and 2003, the
Partnership paid fees of $413,000, $392,000 and $374,000,  respectively,  to PSI
pursuant to the Management Agreement.

     In addition,  the Partnership  combines its insurance purchasing power with
PSI through  captive  insurance  entities  controlled  by PSI (see Note 5 to the
Partnership's  financial  statements).  These captive  entities  provide limited
property and liability insurance to the Partnership at commercially  competitive
rates. The Partnership and PSI also utilize  unaffiliated  insurance carriers to
provide  property and  liability  insurance  in excess of the captive  entities'
limitations.  Premiums paid to the captive entities for the years ended December
31, 2005, 2004 and 2003 were $46,000, $79,000 and $52,000, respectively.

                                       19


<PAGE>


ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
         --------------------------------------

         Fees billed to the  Partnership by Ernst & Young LLP for 2004 and 2005,
         as are follows:

         Audit  Fees:  Audit  fees  billed  (or  expected  to be  billed) to the
         Partnership  by Ernst & Young  LLP for the  audit of the  Partnership's
         annual  financial  statements  and reviews of the  quarterly  financial
         statements included in the Partnership's quarterly reports on Form 10-Q
         totaled $8,000 for 2004 and $11,000 for 2005.

         Tax Fees: Tax fees billed (or expected to be billed) to the Partnership
         by Ernst & Young  LLP for tax  services  (primarily  federal  and state
         income tax preparation) totaled $8,000 for 2004 and $10,000 for 2005.

         Audit-Related  Fees and Other Fees:  During 2004 and 2005 Ernst & Young
         LLP did not bill the  Partnership  for  audit-related  services  or any
         other services, except audit services and tax services denoted above.

         The Audit Committee of PSI pre-approves all services performed by Ernst
         & Young LLP,  including  those listed  above.  At this time,  the Audit
         Committee  has not  delegated  pre-approval  authority to any member or
         members of the Audit Committee.

                                       20


<PAGE>


                                     PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
         ------------------------------------------

(a)   List of documents filed as part of this Report.

      1. Financial Statements. See Index to Financial Statements and
         Financial Statement Schedule.

      2. Financial Statement Schedules. See Index to Financial Statements and
         Financial Statement Schedule.

      3. Exhibits: See Exhibit Index contained below.

(b)   Exhibits: See Exhibit Index contained below.

(c)   Not applicable.

                                       21


<PAGE>


                         PUBLIC STORAGE PROPERTIES, LTD.

                                  EXHIBIT INDEX

                           (Items 15(a)(3) and 15(b))


3.1       Amended Certificate and Agreement of Limited  Partnership.  Previously
          filed with the Securities and Exchange  Commission as Exhibit A to the
          Partnership's   Prospectus  included  in  Registration  Statement  No.
          2-57750 and incorporated herein by reference.

10.1      Second Amended and Restated  Management  Agreement  dated November 16,
          1995 between the Partnership and Public Storage, Inc. Previously filed
          with the  Securities  and  Exchange  Commission  as an  exhibit to the
          Partnership's  Annual Report on Form 10-K for the year ended  December
          31, 1996 and incorporated herein by reference.

10.2      Loan  documents  dated  January 27, 1998 between the  Partnership  and
          Public Storage, Inc. Previously filed with the Securities and Exchange
          Commission  as an exhibit to the  Partnership's  Annual Report on Form
          10-K for the year ended December 31, 1997 and  incorporated  herein by
          reference.

10.3      Credit  Agreement  dated  October  23,  1998  between  Public  Storage
          Properties,  Ltd.  and First  Union  Bank.  Previously  filed with the
          Securities and Exchange  Commission as an exhibit to the Partnership's
          Quarterly Report on Form 10-Q for the quarter ended September 30, 1998
          and incorporated herein by reference.

14        Code of Ethics for Senior Financial  Officers of Public Storage,  Inc.
          Filed with the  Partnership's  Annual Report on Form 10-K for the year
          ended December 31, 2003 and incorporated herein by reference.

31.1      Certification  pursuant  to Section 302 of the  Sarbanes-Oxley  Act of
          2002 signed and dated by Ronald L. Havner, Jr. Filed herewith.

31.2      Certification  pursuant  to Section 302 of the  Sarbanes-Oxley  Act of
          2002 signed and dated by John Reyes. Filed herewith.

32        Certification  pursuant  to Section 906 of the  Sarbanes-Oxley  Act of
          2002. Furnished herewith.

                                       22


<PAGE>


                                   SIGNATURES

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

                                 PUBLIC STORAGE PROPERTIES, LTD.
                                 a California Limited Partnership
Dated:  March 31, 2006      By:  Public Storage, Inc., General Partner

                            By:  /s/ Ronald L. Havner, Jr.
                                  ----------------------------------------------
                                 Ronald L. Havner, Jr., Vice Chairman of
                                 the Board, Chief Executive Officer and
                                 President of Public Storage, Inc.,
                                 Corporate General Partner

                            By:  /s/ B. Wayne Hughes
                                 -----------------------------------------------
                                 B. Wayne Hughes,General Partner and Chairman of
                                 the Board of ublic Storage Inc.

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Partnership in the capacities and on the dates indicated.

                                       23


<PAGE>

<TABLE>
<CAPTION>

        Signature                                                 Capacity                                             Date
----------------------------------------------     ---------------------------------------------------------   ------------------

<S>                                                    <C>                                                        <C>
                                                       Vice Chairman of the Board, Chief Executive
                                                       Officer and President of Public Storage, Inc.,
/s/ Ronald L. Havner Jr.                               Corporate General Partner                                  March 31, 2006
---------------------------------------
Ronald L. Havner, Jr.

                                                       General Partner and Chairman of the Board of
/s/ B. Wayne Hughes                                    Public Storage, Inc.                                       March 31, 2006
---------------------------------------
B. Wayne Hughes

                                                       Senior Vice President and Chief Financial Officer
                                                       of Public Storage, Inc. (principal financial
/s/ John Reyes                                         officer and principal accounting officer)                  March 31, 2006
---------------------------------------
John Reyes

/s/ Harvey Lenkin                                      Director of Public Storage, Inc.                           March 31, 2006
---------------------------------------
Harvey Lenkin

/s/ B. Wayne Hughes, Jr.                               Director of Public Storage, Inc.                           March 31, 2006
---------------------------------------
B. Wayne Hughes, Jr.

/s/ Robert J. Abernethy                                Director of Public Storage, Inc.                           March 31, 2006
---------------------------------------
Robert J. Abernethy

/s/ Dann V. Angeloff                                   Director of Public Storage, Inc.                           March 31, 2006
---------------------------------------
Dann V. Angeloff

/s/ William Baker                                      Director of Public Storage, Inc.                           March 31, 2006
---------------------------------------
William C. Baker

/s/ John T. Evans                                      Director of Public Storage, Inc.                           March 31, 2006
---------------------------------------
John T. Evans

/s/ Uri P. Harkham                                     Director of Public Storage, Inc.                           March 31, 2006
---------------------------------------
Uri P. Harkham

/s/ Daniel C. Staton                                   Director of Public Storage, Inc.                           March 31, 2006
---------------------------------------
Daniel C. Staton

</TABLE>

                                       24


<PAGE>


                         PUBLIC STORAGE PROPERTIES, LTD.
                          INDEX TO FINANCIAL STATEMENTS
                                       AND
                          FINANCIAL STATEMENT SCHEDULE
                                  (Item 15 (a))

                                                                            Page
                                                                      References
                                                                      ----------

Report of Independent Registered Public Accounting Firm                      F-1
Financial Statements and Schedule:

Balance Sheets as of December 31, 2005 and 2004                              F-2

For the years ended December 31, 2005, 2004 and 2003:

     Statements of Income                                                    F-3

     Statements of Partners' Equity                                          F-4

     Statements of Cash Flows                                                F-5

Notes to Financial Statements                                         F-6 - F-11


Schedule:

     III - Real Estate and Accumulated Depreciation                  F-12 - F-13

         All other schedules have been omitted since the required information is
not present or not present in amounts sufficient to require submission of the
schedule, or because the information required is included in the financial
statements or the notes thereto.

                                       25


<PAGE>


             Report of Independent Registered Public Accounting Firm




The Partners
Public Storage Properties, Ltd.


We have audited the  accompanying  balance sheets of Public Storage  Properties,
Ltd.  (the  "Partnership")  as of December  31,  2005 and 2004,  and the related
statements  of  income,  partners'  equity  and cash flows for each of the three
years in the period  ended  December  31,  2005.  Our audits also  included  the
schedule  listed in the index at item  15(a).  These  financial  statements  and
schedule  are  the   responsibility   of  the  Partnership's   management.   Our
responsibility  is to  express  an opinion  on these  financial  statements  and
schedule based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  We were not engaged to perform an
audit of the Partnership's internal control over financial reporting.  Our audit
included  consideration of internal control over financial  reporting as a basis
for designing audit  procedures that are appropriate in the  circumstances,  but
not for the  purpose  of  expressing  an  opinion  on the  effectiveness  of the
Partnership's internal control over financial reporting.  Accordingly we express
no such opinion.  An audit also includes  examining,  on a test basis,  evidence
supporting the amounts and  disclosures in the financial  statements,  assessing
the accounting principles used and significant estimates made by management, and
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 Public Storage Properties, Ltd.
at December 31, 2005 and 2004,  and the results of its  operations  and its cash
flows for each of the three years in the period  ended  December  31,  2005,  in
conformity with U.S.  generally  accepted  accounting  principles.  Also, in our
opinion,  the related financial statement schedule,  when considered in relation
to the  basic  financial  statements  taken as a whole,  presents  fairly in all
material respects the information set forth therein.





                                                               ERNST & YOUNG LLP





March 27, 2006
Los Angeles, California

                                      F-1


<PAGE>


                         PUBLIC STORAGE PROPERTIES, LTD.
                                 BALANCE SHEETS
                           December 31, 2005 and 2004

<TABLE>
<CAPTION>

                                                                                 2005                   2004
                                                                          ----------------------  ---------------------

                                ASSETS
                                ------

<S>                                                                         <C>                    <C>
Cash and cash equivalents                                                   $     1,448,000        $     1,407,000
Rent and other receivables                                                           69,000                 35,000

Real estate facilities, at cost:
     Building, land improvements and equipment                                    9,622,000              9,574,000
     Land                                                                         2,476,000              2,476,000
                                                                          ----------------------  ---------------------
                                                                                 12,098,000             12,050,000


     Less accumulated depreciation                                               (9,004,000)            (8,823,000)
                                                                          ----------------------  ---------------------
                                                                                  3,094,000              3,227,000

Other assets                                                                         71,000                 68,000
                                                                          ----------------------  ---------------------

Total assets                                                                $     4,682,000        $     4,737,000
                                                                          ======================  =====================



                   LIABILITIES AND PARTNERS' EQUITY
                   --------------------------------

Accounts payable                                                            $        88,000        $        82,000
Deferred revenue                                                                    163,000                183,000

Commitments and contingencies (Note 8)                                                    -                      -

Partners' equity
    Limited partners' equity, $500 per unit, 20,000 units
       authorized, issued and outstanding                                         3,290,000              3,321,000
      General partners' equity                                                    1,141,000              1,151,000
                                                                          ----------------------------  ---------------

    Total partners' equity                                                        4,431,000              4,472,000
                                                                          ----------------------  ---------------------

Total liabilities and partners' equity                                      $     4,682,000        $     4,737,000
                                                                          ======================  =====================

                             See accompaning notes.
                                      F-2


<PAGE>
</TABLE>


                         PUBLIC STORAGE PROPERTIES, LTD.
                              STATEMENTS OF INCOME
              For the years ended December 31, 2005, 2004 and 2003

<TABLE>
<CAPTION>

                                                                 2005                   2004                   2003
                                                      ---------------------- ----------------------- -------------------------
REVENUES:
<S>                                                    <C>                   <C>                        <C>
Rental income                                          $       6,879,000      $       6,537,000         $    6,201,000
Other income                                                     123,000                 56,000                 45,000
                                                      ---------------------- ----------------------- -------------------------

                                                               7,002,000              6,593,000              6,246,000
                                                      ---------------------- ----------------------- -------------------------

COSTS AND EXPENSES:

Cost of operations                                             1,423,000              1,422,000              1,358,000
Management fees paid to affiliate                                413,000                392,000                374,000
Depreciation                                                     181,000                217,000                454,000
Administrative                                                    97,000                 87,000                 83,000
                                                      ---------------------- ----------------------- -------------------------

                                                               2,114,000              2,118,000              2,269,000
                                                      ---------------------- ----------------------- -------------------------

NET INCOME                                             $       4,888,000      $       4,475,000         $    3,977,000
                                                      ====================== ======================= =========================

Limited partners' share of net income ($180.95 per
   unit in 2005, $169.85 per unit in 2004 and
   $150.20 per unit in 2003)                           $       3,619,000      $       3,397,000         $    3,004,000

General partners' share of net income                          1,269,000              1,078,000                973,000
                                                      ---------------------- ----------------------- -------------------------

                                                       $       4,888,000      $       4,475,000         $    3,977,000
                                                      ====================== ======================= =========================

</TABLE>
                            See accompanying notes.
                                      F-3


<PAGE>


                         PUBLIC STORAGE PROPERTIES, LTD.
                         STATEMENTS OF PARTNERS' EQUITY
              For the years ended December 31, 2005, 2004 and 2003

<TABLE>
<CAPTION>



                                                                                                 Total Partners'
                                                   Limited Partners       General Partners              Equity
                                                ----------------------  --------------------- ----------------------

<S>                                                      <C>                   <C>                  <C>
Balance at December 31, 2002                            2,944,000            1,022,000            3,966,000

Net income                                              3,004,000              973,000            3,977,000

Distributions paid to partners                         (2,800,000)            (971,000)          (3,771,000)

Equity transfer                                           (51,000)              51,000                    -
                        `                       ---------------------  --------------------- ----------------------

Balance at December 31, 2003                            3,097,000            1,075,000            4,172,000

Net income                                              3,397,000            1,078,000            4,475,000

Distributions paid to partners                         (3,100,000)          (1,075,000)          (4,175,000)

Equity transfer                                           (73,000)              73,000                    -
                                                ----------------------  --------------------- ----------------------

Balance at December 31, 2004                            3,321,000            1,151,000            4,472,000

Net income                                              3,619,000            1,269,000            4,888,000

Distributions paid to partners                         (3,660,000)          (1,269,000)          (4,929,000)

Equity transfer                                            10,000              (10,000)                   -
                                                ----------------------  --------------------- ----------------------

Balance at December 31, 2005                       $    3,290,000        $   1,141,000        $   4,431,000
                                                ====================================================================
</TABLE>

                            See accompanying notes.
                                      F-4


<PAGE>


                         PUBLIC STORAGE PROPERTIES, LTD.
                            STATEMENTS OF CASH FLOWS
                 For the years ended December 31, 2005, 2004 and 2003

<TABLE>
<CAPTION>

                                                                           2005              2004              2003
                                                                   -----------------  ----------------- ------------------
Cash flows from operating activities:
   <S>                                                              <C>               <C>                    <C>
   Net income                                                       $    4,888,000    $    4,475,000    $    3,977,000

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

       Depreciation                                                        181,000           217,000           454,000
       (Increase) decrease in rent and other receivables                   (34,000)           12,000             2,000
       (Increase) decrease in other assets                                  (3,000)          (19,000)           23,000
        Increase (decrease) increase in accounts payable                     6,000           (28,000)           36,000
       (Decrease) increase in deferred revenue                             (20,000)            7,000            16,000
                                                                   -----------------  ----------------- ------------------

       Total adjustments                                                   130,000           189,000           531,000
                                                                   -----------------  ----------------- ------------------

       Net cash provided by operating activities                         5,018,000         4,664,000         4,508,000
                                                                   -----------------  ----------------- ------------------

Cash flows from investing activities:

   Additions to real estate facilities                                     (48,000)         (152,000)         (205,000)
                                                                   -----------------  ----------------- ------------------

       Net cash used in investing activities                               (48,000)         (152,000)         (205,000)
                                                                   -----------------  ----------------- ------------------

Cash flows from financing activities:

  Distributions paid to partners                                        (4,929,000)       (4,175,000)       (3,771,000)
                                                                   -----------------  ----------------- ------------------

       Net cash used in financing activities                            (4,929,000)       (4,175,000)       (3,771,000)
                                                                   -----------------  ----------------- ------------------

Net increase in cash and cash equivalents                                   41,000           337,000           532,000

Cash and cash equivalents at the beginning of the year                   1,407,000         1,070,000           538,000
                                                                   -----------------  ----------------- ------------------

Cash and cash equivalents at the end of the year                    $    1,448,000    $    1,407,000    $    1,070,000
                                                                   ================= ================== ==================

</TABLE>
                            See accompanying notes.
                                      F-5


<PAGE>


                         PUBLIC STORAGE PROPERTIES, LTD.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 2005



1.       DESCRIPTION OF PARTNERSHIP

                  Public  Storage  Properties,  Ltd.  (the  "Partnership")  is a
        publicly held limited  partnership  formed under the California  Uniform
        Limited  Partnership  Act  in  November  1976.  The  Partnership  raised
        $10,000,000  in gross  proceeds  by  selling  20,000  units  of  limited
        partnership  interest  ("Units")  in  an  interstate   offering,   which
        commenced in October 1977 and  completed  in January  1978.  The general
        partners in the  Partnership  are Public  Storage,  Inc.  ("PSI") and B.
        Wayne Hughes ("Hughes").

                  The  Partnership  was  formed  to engage  in the  business  of
        developing  and  operating  self-storage  facilities  for  personal  and
        business use. The Partnership owns nine self-storage  facilities located
        in California.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PARTNERSHIP MATTERS

         Use of Estimates:
         -----------------

                  The preparation of the financial statements in conformity with
        U.S. generally accepted  accounting  principles  requires  management to
        make estimates and assumptions  that affect the amounts  reported in the
        financial statements and accompanying notes. Actual results could differ
        from those estimates.

         Revenue and Expense Recognition:
         --------------------------------

                  Rental  income,   which  is  generally   earned   pursuant  to
        month-to-month  leases  for  storage  space,  is  recognized  as earned.
        Promotional  discounts  are  recognized  as a reduction to rental income
        over the promotional  period,  which is generally during the first month
        of occupancy.  Late charges and  administrative  fees are  recognized as
        income when collected. Interest income is recognized as earned.

                  We accrue for property tax expense  based upon  estimates  and
        historical  trends.  If these  estimates  are  incorrect,  the timing of
        expense recognition could be affected.

                  Cost of operations,  general and  administrative  expense,  as
        well as television,  yellow page, and other advertising expenditures are
        expensed as incurred.  Television,  yellow page,  and other  advertising
        expenditures totaled $222,000, $226,000 and $233,000 for the years ended
        December 31, 2005, 2004 and 2003, respectively.

         Allocation of Net Income:
         -------------------------

                  The general  partners' share of net income consists of amounts
        attributable  to  their  1%  capital   contribution  and  an  additional
        percentage  of cash  flow (as  defined)  which  relates  to the  general
        partners'  share of cash  distributions  as set forth in the Partnership
        Agreement (Note 4). All remaining net income is allocated to the limited
        partners.

                  Per unit data is based on the weighted  average  number of the
        limited partnership units (20,000) outstanding during the period.

         Cash and Cash Equivalents:
         --------------------------

                  For financial  statement purposes,  the Partnership  considers
        all highly liquid  financial  instruments  such as  short-term  treasury
        securities or investment  grade  short-term  commercial paper to be cash
        equivalents.

                                      F-6


<PAGE>

                        PUBLIC STORAGE PROPERTIES, LTD.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 2005


         Real Estate Facilities and Evaluation of Asset Impairment:
         ----------------------------------------------------------

                  Real estate  facilities are recorded at cost. Costs associated
        with  the  development,  construction,  renovation  and  improvement  of
        properties are  capitalized.  Interest,  property taxes, and other costs
        associated with the development  incurred during the construction period
        are  capitalized  as  building  cost.   Expenditures   for  repairs  and
        maintenance are charged to expense as incurred. Depreciation is computed
        using the  straight-line  method over the estimated  useful lives of the
        buildings and improvements,  which are generally between 5 and 25 years.
        At December 31,  2005,  all of the real estate  facilities  have been in
        service longer than 25 years,  and accordingly the original  development
        cost of such buildings are fully depreciated at December 31, 2005.

                  We  evaluate  our real  estate for  impairment  on a quarterly
        basis.  We first evaluate these assets for indicators of impairment such
        as a) a  significant  decrease in the market price of real estate,  b) a
        significant  adverse change in the extent or manner in which real estate
        is being used or in its physical  condition,  c) a  significant  adverse
        change in legal  factors or the  business  climate that could affect the
        value of the real estate,  d) an accumulation of costs  significantly in
        excess of the amount  originally  projected  for the  acquisition  of or
        construction  of the real estate,  or e) a  current-period  operating or
        cash flow loss  combined with a history of operating or cash flow losses
        or  a  projection  or  forecast  that  demonstrates   continuing  losses
        associated with the use of the real estate.  When any such indicators of
        impairment  are noted,  we compare the carrying value of the real estate
        to the future estimated undiscounted cash flows attributable to the real
        estate.  If the  real  estate's  recoverable  amount  is less  than  the
        carrying value of the asset, then an impairment charge is booked for the
        excess  of  carrying  value  over  the real  estate's  fair  value.  Our
        evaluations have identified no such impairments at December 31, 2005.

                  Any real estate  facility,  which we expect to sell or dispose
        of prior to its previously  estimated useful life is stated at the lower
        of its  estimated  net  realizable  value,  less  cost to  sell,  or its
        carrying value.

         Deferred revenue:
         -----------------

                  Deferred  revenue  totaling  $163,000 and $183,000 for each of
        the years ended  December 31, 2005 and 2004,  respectively,  consists of
        prepaid rents, which are recognized when earned.

         Environmental Cost:
         -------------------

                  The   Partnership's   policy   is  to   accrue   environmental
        assessments  and/or  remediation  costs  when it is  probable  that such
        efforts  will  be  required  and the  related  costs  can be  reasonably
        estimated.  Although there can be no assurance,  we are not aware of any
        environmental   contamination   at  any  of   our   facilities,   which,
        individually  or in the  aggregate,  would be  material  to our  overall
        business, financial condition or results of operations.

         Income Taxes:
         -------------

                  Public  Storage  Properties,  Ltd. is treated as a partnership
        for Federal  income tax purposes  with the taxable  income of the entity
        allocated to each partner in accordance with the partnership  agreement.
        Accordingly   no  Federal   income  tax   expense  is  recorded  by  the
        Partnership.

         Recent Accounting Pronouncements and Guidance:
         ----------------------------------------------

                  As of March 30,  2006,  there  have been no recent  accounting
        pronouncements and guidance, which were not effective for implementation
        prior to  December  31,  2005,  that would have a material  impact  upon
        reporting the operations or financial position of the Partnership.

                                       F7


<PAGE>


                        PUBLIC STORAGE PROPERTIES, LTD.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 2005


         Segment Reporting:
         ------------------

                  The  Partnership  only has one  reportable  segment as defined
        within Statement of Financial Accounting Standards No. 131.

3.       CASH DISTRIBUTIONS
         ------------------

                  The  Partnership  Agreement  requires that cash  available for
        distribution  (cash flow from all sources  less cash  necessary  for any
        obligations  or capital  improvements)  needs to be distributed at least
        quarterly. During 2004, we paid distributions to the limited and general
        partners  totaling   $3,100,000   ($155.00  per  unit)  and  $1,075,000,
        respectively.  During  2005,  we paid  distributions  to the limited and
        general partners totaling  $3,660,000 ($183.00 per unit) and $1,269,000,
        respectively.  Future distribution rates may be adjusted to levels which
        are supported by operating cash flow after capital  improvements and any
        other obligations.

4.       PARTNERS' EQUITY
         ----------------

                  PSI and Hughes are  general  partners of the  Partnership.  In
        1995, Hughes  contributed his ownership and rights to distributions from
        the Partnership to BWH Marina Corporation II, a corporation wholly-owned
        by Hughes. In 2002, BWH Marina  Corporation II sold its interests to H-G
        Family  Corporation.  As such, Mr. Hughes  continues to act as a general
        partner but receives no direct  compensation or other consideration from
        the Partnership.

                  The general partners have a 1% interest in the Partnership. In
        addition, the general partners have an 8% interest in cash distributions
        attributable to operations  (exclusive of distributions  attributable to
        sale and financing  proceeds until the limited  partners  recover all of
        their initial investment).  Thereafter,  the general partners have a 25%
        interest  in  all  cash  distributions  (including  sale  and  financing
        proceeds).  In 1985, the limited partners recovered all of their initial
        investment.  All  subsequent  cash  distributions  are being made 25.75%
        (including  the 1% interest)  to the general  partners and 74.25% to the
        limited partners. Transfers of equity are made periodically to reconcile
        the  partners'  equity  accounts to the  provisions  of the  Partnership
        Agreement.  These  transfers have no effect on the results of operations
        or distributions to partners.

5.       RELATED PARTY TRANSACTIONS
         --------------------------

         Management Agreement and Shared Expenses with PSI:
         --------------------------------------------------

                  The Partnership  has a Management  Agreement with PSI pursuant
        to which PSI operates the self-storage  facilities for a fee equal to 6%
        of the facilities' gross revenue (as defined).  For 2005, 2004 and 2003,
        the Partnership paid PSI $413,000, $392,000 and $374,000,  respectively,
        under this management agreement.

                  The  Management  Agreement  between  the  Partnership  and PSI
        provides that the Management  Agreement may be terminated  without cause
        upon 60 days written  notice by the  Partnership or six months notice by
        PSI.

                  The Partnership's  facilities,  along with facilities owned by
        PSI and its affiliates, are managed and marketed jointly by PSI in order
        to  take  advantage  of  scale  and  other  efficiencies.  As a  result,
        significant  components of cost of  operations,  such as payroll  costs,
        advertising and promotion,  data  processing and insurance  expenses are
        shared and allocated among the properties using  methodologies  meant to
        fairly allocate such costs based upon the related activities.  The total
        of such  expenses,  substantially  all of which are  included in Cost of
        Operations,  amounted to  $703,000,  $704,000 and $702,000 for the years
        ended December 31, 2005, 2004, and 2003, respectively.

         Ownership Interest by the General Partners
         ------------------------------------------

                  PSI owns 6,169  Limited  Partnership  Units  ("Units"),  as to
        which PSI has sole voting and dispositive power.

                                      F-8


<PAGE>

                        PUBLIC STORAGE PROPERTIES, LTD.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 2005



                  Hughes and members of his family  (the  "Hughes  Family")  own
        6,105 Units. Hughes owns 6,025 Units, as to which Hughes has sole voting
        and  dispositive  power,  through a wholly-owned  corporation and Tamara
        Hughes Gustavson, an adult daughter of Hughes, owns 80 Units as to which
        Tamara Hughes  Gustavson has sole voting and dispositive  power. PSI has
        an option to  acquire  25 of the Units  held by Hughes  and the 80 Units
        held by Tamara Hughes Gustavson.

                  In  addition,  there  are  196  Units  owned  by  PS  Orangeco
        Partnerships,   Inc.,  a   corporation   in  which  Hughes  Family  owns
        approximately 48% of the voting stock, PSI owns 46% and members of PSI's
        management and related individuals own approximately 6%.

         Captive Insurance Activities with PSI
         -------------------------------------

                  The  Partnership  has a 0.9%  ownership  interest  in  STOR-Re
        Mutual Insurance Corporation ("STOR-Re"), which was formed in 1994 as an
        association  captive  insurance  company,  and is controlled by PSI. The
        Partnership accounts for its investment in STOR-Re, which is included in
        other  assets,  on the cost method,  and has  received no  distributions
        during the three years ended December 31, 2005.

                  STOR-Re  provides  limited  property and  liability  insurance
        coverage to the  Partnership,  PSI, and affiliates for losses  occurring
        before  April 1,  2004.  STOR-Re  was  succeeded  with  respect to these
        activities for losses  occurring  after March 31, 2004 by a wholly owned
        subsidiary of PSI (collectively, this entity and STOR-Re are referred to
        as the "Captive  Entities").  Liabilities for losses and loss adjustment
        expenses  include an amount  determined from loss reports and individual
        cases and an amount,  based on  recommendations  from an outside actuary
        that is a member of the American Academy of Actuaries, using a frequency
        and severity method,  for losses incurred but not reported.  Determining
        the  liability for unpaid  losses and loss  adjustment  expense is based
        upon  estimates  and while we believe that the amount is  adequate,  the
        ultimate loss may be in excess of or less than the amounts provided. The
        methods for making such  estimates  and for  establishing  the resulting
        liability are continually reviewed.

                  The following table sets forth certain condensed  consolidated
        financial information with respect to STOR-Re (representing 100% of this
        entity's operations and not the Partnership's pro-rata share):

<TABLE>
<CAPTION>


                                                                           2005                2004
                                                                   ------------------- -------------------
                                                                             (Amount in thousands)
           <S>                                                      <C>                  <C>
           For the year ended December 31,
           -------------------------------
           Premiums earned (a).............................         $            -       $    3,994
           Net investment income...........................                  663                677
           Loss and loss adjustment expense................                  900             (2,948)
           Other expenses..................................                 (349)              (200)
                                                                   ------------------- -------------------
              Net income...................................         $      1,214         $    1,523
                                                                   =======================================

           At December 31,
           ---------------
           Total assets (primarily cash and other                   $     26,876         $   31,326
             investments).................................
           Liabilities for losses and loss adjustment                     13,784             20,227
             expenses.....................................
           Other liabilities...............................                  208                  -
           Member's surplus................................               12,884             11,099
</TABLE>

                  (a)  Effective  April  1,  2004,   STOR-Re  ceased   providing
        insurance for losses  occurring  after April 1, 2004,  and was succeeded
        with respect to these activities by PSIC-H, a wholly owned subsidiary of
        PSI.  Accordingly,  premiums  and  associated  loss  expense  for losses
        occurring  after  March  31,  2004  are  not  included  in  this  table.


                  Premiums  paid to the  Captive  Entities  for the years  ended
        December  31,  2005,  2004 and 2003 were  $46,000,  $79,000 and $52,000,
        respectively.

                                      F-9


<PAGE>


                        PUBLIC STORAGE PROPERTIES, LTD.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 2005

         Other Activities with PSI
         -------------------------

                  A corporation that reinsures  policies against losses to goods
        stored by tenants in PSI's storage  facilities was purchased by PSI from
        Mr.  Hughes and members of his family (the "Hughes  Family") on December
        31,  2001.  This  corporation  receives the premiums and bears the risks
        associated with the re-insurance. The Partnership receives an access fee
        from this corporation in return for providing tenant listings.  This fee
        is based on number of spaces the  Partnership  has to rent.  Included in
        other income on our income statement for these fees are $58,000, $35,000
        and  $35,000  for the years  ended  December  31,  2005,  2004 and 2003,
        respectively.

                  A subsidiary  of PSI sells locks and boxes and rents trucks to
        the general  public and tenants to be used in securing  their spaces and
        moving  their  goods.  The  subsidiary  of PSI receives the revenues and
        bears the cost of the activities.

6.       TAXES BASED ON INCOME

                  Taxes based on income are the responsibility of the individual
         partners and, accordingly, the Partnership's financial statements do
         not reflect a provision for such taxes.

                  Unaudited  taxable net income was  $4,874,000,  $4,505,000 and
        $4,081,000  for the  years  ended  December  31,  2005,  2004 and  2003,
        respectively.  The difference  between taxable net income and net income
        is primarily related to depreciation  expense resulting from differences
        in depreciation and capitalization methodologies.

7.       SUPPLEMENTARY QUARTERLY FINANCIAL DATA (UNAUDITED)

<TABLE>
<CAPTION>

                                                                        Three Months Ended
                                        --------------------------------------------------------------------------------
                                         March 31, 2005      June 30, 2005     September 30, 2005     December 31, 2005
                                        ----------------- ------------------- ---------------------- -------------------
<S>                                      <C>                 <C>                 <C>                    <C>
Rental Income                            $    1,681,000      $    1,710,000      $     1,749,000        $     1,739,000
Cost of Operations (including
 management fees and depreciation)       $      501,000      $      498,000      $       497,000        $       521,000
Net Income                               $    1,172,000      $    1,205,000      $     1,255,000        $     1,256,000
Net Income Per Limited Partner Unit      $        44.70      $        45.30      $         47.75        $         43.20
Distributions                            $    1,077,000      $    1,159,000      $     1,158,000        $     1,535,000


                                                                      Three Months Ended
                                        --------------------------------------------------------------------------------
                                         March 31, 2004      June 30, 2004     September 30, 2004     December 31, 2004
                                        ----------------- ------------------- --------------------- --------------------
Rental Income                            $    1,572,000      $    1,601,000      $     1,666,000        $     1,698,000
Cost of Operations (including
 management fees and depreciation)       $      520,000      $      523,000      $       496,000        $       492,000
Net Income                               $    1,039,000      $    1,063,000      $     1,166,000        $     1,207,000
Net Income Per Limited Partner Unit      $        39.75      $        39.30      $         44.40        $         46.40
Distributions                            $      943,000      $    1,077,000      $     1,078,000        $     1,077,000

</TABLE>

8.       COMMITMENTS AND CONTINGENCIES

        Serrao v. Public  Storage,  Inc.  (filed April 2003)  (Superior  Court -
        ------------------------------------------------------------------------
        Orange County)
        ------------------------------------------------------------------------

                  The  plaintiff in this case filed a suit against PSI on behalf
          of a putative class of renters who rented self-storage units from PSI.
          Plaintiff  alleges  that PSI  misrepresented  the size of its  storage
          units,  has brought claims under  California  statutory and common law
          relating  to  consumer  protection,  fraud,  unfair  competition,  and

                                      F-10


<PAGE>


                        PUBLIC STORAGE PROPERTIES, LTD.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 2005


          negligent   misrepresentation,   and  is  seeking  monetary   damages,
          restitution, and declaratory and injunctive relief.

                  The claim in this case is  substantially  similar  to those in
          Henriquez  v.  Public  Storage,  Inc.,  which was  disclosed  in prior
          reports. In January 2003, the plaintiff caused the Henriquez action to
          be dismissed.

                  Based upon the  uncertainty  inherent  in any  putative  class
          action, PSI cannot presently  determine the potential damages, if any,
          or the ultimate outcome of this  litigation.  On November 3, 2003, the
          court granted PSI's motion to strike the plaintiff's  nationwide class
          allegations  and to limit any putative  class to California  residents
          only. In August 2005, PSI filed a motion to remove the case to federal
          court,  but the case has been remanded to the Superior  Court.  PSI is
          vigorously  contesting  the claims  upon which this  lawsuit is based,
          including class certification efforts.

          Brinkley et al v. Public  Storage,  Inc.  (filed April,  2005)
          --------------------------------------------------------------
          (Superior court of California - Los Angeles County)
          ---------------------------------------------------

                  The Brinkley plaintiffs are suing PSI on behalf of a purported
          class of  California  property  managers  who claim that they were not
          compensated for all the hours they worked.  The Brinkley suit is based
          upon  California wage and hour laws. The maximum  potential  liability
          cannot be estimated,  but would be increased if a class or classes are
          certified  or, if claims  are  permitted  to be  brought  on behalf of
          others under the  California  Unfair  Business  Practices  Act. PSI is
          vigorously  contesting  the claims and intend to resist any  expansion
          beyond the named  plaintiffs on the grounds of lack of  commonality of
          claims.  PSI does not believe  that this matter will have any material
          adverse effect on the results of operations of the Partnership.

         Other Items
         -----------

                  PSI  and  the  Partnership  are a  party  to  various  claims,
          complaints,  and other  legal  actions  that have arisen in the normal
          course of business from time to time, that are not described above. We
          believe  that it is unlikely  that the outcome of these other  pending
          legal  proceedings  including  employment  and tenant  claims,  in the
          aggregate,  will have a material adverse effect upon the operations or
          financial position of the Partnership.

                                      F-11


<PAGE>


                         Public Storage Properties, Ltd.
             Schedule III - Real Estate and Accumulated Depreciation
                      For the year ended December 31, 2005

<TABLE>
<CAPTION>



                                     Initial Cost
                              -------------------------------

                                               Building,    Costs Subsequent to
                                              Land Imp &        construction
        Description               Land         Equipment       (Improvements)
---------------------------   -------------  -------------  --------------------
<S>                              <C>             <C>               <C>
Pasadena                         $327,000        $515,000          $297,000
Whittier - El Monte               166,000         763,000           380,000
Fremont                           112,000         741,000           376,000
Milpitas                          198,000         649,000           279,000
Wilmington                        815,000       1,336,000           681,000
Sun Valley                        329,000         611,000           335,000
Corona                            155,000         757,000           348,000
Norco                              95,000         456,000           198,000
North Hollywood                   314,000         553,000           312,000
                               --------------  -------------  --------------------

                               $2,511,000      $6,381,000        $3,206,000
                               ============== ============== =====================
</TABLE>

<TABLE>
<CAPTION>


                                             Gross Carrying Amount
                                              at December 31, 2005
                                    --------------------------------------------

                                                  Building,
                                                  Land Imp &                       Accumulated         Date
        Description                 Land          Equipment            Total       Depreciation     Completed
---------------------------   ----------------- -----------------  -------------  ---------------  -----------
<S>                                 <C>              <C>             <C>              <C>             <C>
Pasadena                            $327,000         $812,000        $1,139,000       $769,000        08/78
Whittier - El Monte                  134,000        1,175,000         1,309,000      1,115,000        07/78
Fremont                              112,000        1,117,000         1,229,000      1,090,000        11/78
Milpitas                             195,000          931,000         1,126,000        829,000        11/78
Wilmington                           815,000        2,017,000         2,832,000      1,912,000        08/78
Sun Valley                           329,000          946,000         1,275,000        914,000        10/78
Corona                               155,000        1,105,000         1,260,000      1,009,000        12/78
Norco                                 95,000          654,000           749,000        586,000        12/78
North Hollywood                      314,000          865,000         1,179,000        780,000        12/79
                                ---------------- -----------------  -------------  ---------------  -----------

                                  $2,476,000       $9,622,000       $12,098,000     $9,004,000
                               ================= ================= =============== ===============
</TABLE>

                                      F-12


<PAGE>


                         Public Storage Properties, Ltd.
             Schedule III - Real Estate and Accumulated Depreciation
                                   (continued)


         Reconciliation of Real Estate Cost and Accumulated Depreciation

<TABLE>
<CAPTION>

                                 COST RECONCILIATION

                                                           2005               2004
                                                     ----------------  -----------------
<S>                                                   <C>              <C>
Balance at the beginning of the period                $  12,050,000    $  11,898,000

Additions during the period: Improvements                    48,000          152,000
                                                     ----------------  -----------------

Balance at the close of the period                    $  12,098,000    $  12,050,000


                       ACCUMULATED DEPRECIATION RECONCILIATION

                                                           2005             2004
                                                     ----------------  -----------------

Balance at the beginning of the period                $   8,823,000    $   8,606,000

Additions during the period: Depreciation                   181,000          217,000
                                                     ----------------  -----------------

Balance at the close of the period                    $   9,004,000    $   8,823,000
                                                     ===================================
</TABLE>

(a)  The aggregate depreciable cost prior to depreciation of real estate
     (excluding land) for Federal income tax purposes is $9,291,000 (unaudited

                                      F-13