Shelbourne Properties II, Inc. Announces Entering Into of a Liquidating Trust Effective on or About April 16, 2004

Shelbourne Properties II, Inc. Announces Entering Into of a Liquidating Trust
Effective on or About April 16, 2004 


BOSTON, March 18  /PRNewswire-FirstCall/ -- Shelbourne Properties II, Inc. (the
"Company")  today announced that, in accordance with the Plan of Liquidation
previously approved by the Company's stockholders, the Company intends to enter
into a liquidating trust agreement (the "Trust Agreement") on or about April 16,
2004, for the purpose of winding up the Company's affairs and liquidating its
assets.  It is currently anticipated that, on or about April 16, 2004, the
Company will transfer its then remaining assets to the Trustee (as defined
below) of the Shelbourne II Liquidating Trust (the "Liquidating Trust").  The
Liquidating Trustwill also assume the Company's then remaining liabilities.
April 15, 2004 (the "Record Date") will be the last day of trading of the
Company's common stock on the American Stock Exchange, and the Company's stock
transfer books will be closed as of the close of business on such date.  The
transfer of assets by the Company, and the assumption of liabilities by the
Liquidating Trust, will not cover the Company's interest in a group of
properties net leased to an affiliate of Accor S.A. since the Companyhas no
economic interest in these properties.

Under the terms of the proposed Trust Agreement, on April 16, 2004, each
stockholder of the Company on the Record Date (each, a "beneficiary")
automatically will become the holder of one unit of beneficialinterest ("Unit")
in the Liquidating Trust for each share of the Company's common stock then held
of record by such stockholder. As provided in the Company's Plan of Liquidation,
the holder of Class B Units in the Company's Operating Partnership is entitled
to receive 15% of all distributions made by the Company and the Liquidating
Trust after such time as aggregate distributions by the Company and the
Liquidating Trust from and after August 19, 2002 exceed a specified per share
amount.  After givingeffect to dividends paid since August 19, 2002, the
remaining unpaid per share amount as of March 15, 2004 was $3.21.  After the
specified per share amount has been received by beneficiaries, the holder of
Class B Units will receive 15% of all subsequent distributions by the
Liquidating Trust.

After April 16, 2004, all outstanding shares of the Company's common stock will
be deemed cancelled, and the rights of beneficiaries in their Units will not be
represented by any form of certificate or other instrument. Stockholders of the
Company on the Record Date will not be required to take any action to receive
their Units. The Trustee will maintain a record of the name and address of each
beneficiary and such beneficiary's aggregate Units in the Liquidating Trust.
Subject to certain exceptions related to transfer by will, intestate succession
or operation of law, the Units will not be transferable, nor will a beneficiary
have authority or power to sell or in any other manner dispose of any Units.

Itis currently contemplated that the initial trustee (the "Trustee") of the
Liquidating Trust will be Arthur N. Queler.  Successor trustees may be appointed
to administer the Liquidating Trust in accordance with the terms of the
Liquidating Trust Agreement. It is expected that from time to time the
Liquidating Trust will make distributions of its assets to beneficiaries, but
only to the extent that such assets will not be needed to provide for the
liabilities (including contingent liabilities) assumed by the Liquidating Trust.
No assurances can be given as to the amount or timing of any distributions by
the Liquidating Trust.

For federal income tax purposes, on April 16, 2004, each stockholder of the
Company on the Record Date will be deemed to havereceived a pro rata share of
the assets of the Company to be transferred to the Liquidating Trust, subject to
such stockholder's pro rata share of the liabilities of the Company assumed by
the Liquidating Trust.  Accordingly, on April 16, 2004 each stockholder will
recognize gain or loss in an amount equal to the difference between (x) the fair
market value of such stockholder's pro rata share of the assets of the Company
that are transferred to the Liquidating Trust, subject to such stockholder's pro
rata share of the liabilities of the Company that are assumed by the Liquidating
Trust, and (y) such stockholder's adjusted tax basis in the shares of the
Company's common stock held by such stockholder on the Record Date.

The Liquidating Trust is intended to qualify as a "liquidating trust" for
federal income tax purposes. As such, the Liquidating Trust will be a complete
pass-through entity for federal income tax purposes and, accordingly, will not
itself be subject to federal income tax.  Instead, each beneficiary will take
into account in computing its taxable income, its pro rata share of each item of
income, gain, loss and deduction of the Liquidating Trust, regardless of the
amount or timing of distributions made by the Liquidating Trust to
beneficiaries.  Distributions, if any, by the Liquidating Trust to beneficiaries
generally will not be taxable to such beneficiaries.  The Trustee will furnish
to beneficiaries of the Liquidating Trust a statement of their pro rata share of
the assetstransferred by the Company to the Liquidating Trust, less their pro
rata share of the Company's liabilities assumed by the Liquidating Trust. On a
yearly basis, the Trustee also will furnish to beneficiaries a statement of
their pro rata share of the items of income, gain, loss, deduction and credit
(if any) of the Liquidating Trust to be included on their tax returns.

Stockholders of the Company are urged to consult with their tax advisers as to
the tax consequences to them of the establishment andoperation of, and
distributions, if any, by, the Liquidating Trust.

This press release contains forward-looking statements that predict or indicate
future events that do not relate to historical matters.  There are a number of
important factors that could cause actual events to differ materially from those
indicated by such forward-looking statements.  These factors include, but are
not limited to, the following:  the Liquidating Trust may be unable to
consummate sale transactions with respect to some of its assets or such sales
may be materially delayed; and the Liquidating Trust may not be able to complete
the liquidation in a timely manner or realize proceeds from the sales of assets
in amounts that will enable it to provide liquidating distributions to
beneficiaries.

You should also read the risk factors that are discussed on periodic reports
filed with the Securities and Exchange Commission, including the risk factors
that are contained in our Form 10-K for the year ended December 31, 2002, and,
when available, our Form 10-K for the year ended December 31, 2003. You should
be aware that the risk factors contained in that Form 10-K may not be
exhaustive.  Therefore, we recommend that you read the information in that Form
10-K together with other reports and documents that we file with the SEC from
time to time, including our Forms 10-Q and 8-K, which may supplement, modify,
supersede or update those risk factors.

The Company assumes no obligation to update the forward-looking statements
included in this press release.  However, if the board of directors of the
Company should determine to extend the Record Date beyond April 15, 2004, the
Company will issue a press release announcing such date.  Further questions with
respect to the foregoing may be addressed to Carolyn Tiffany at [phone].


DATASOURCE: Shelbourne Properties II, Inc.



CONTACT:  Carolyn Tiffany, Chief Operating Officer of Shelbourne

Properties II, Inc., [phone]

Copyright