"Australia has been extremely receptive to the Reckson story," said Scott Rechler, Reckson's chief executive officer during the firm's first-quarter results conference call. "Scale is critical in its success and the LPT's success is critical for Reckson's success. We'll be in better position to capture imbedded value."

No dollar amount has been determined, but Rechler said it could be "a few hundred million." Also, no properties have been identified as of yet. "We're trying to find the right mix of growth and stability." For previous coverage on Reckson's LPT, click here .

One of the reasons properties that could go toward the LPT have not been identified is because the firm has seen a slowdown in its acquisitions. "Increased valuations and hype have resulted in owners taking things to market," said Rechler. In some instances, the prices become "too rich and we pass." The firm does anticipate making $500 million worth of acquisitions and $300 million worth of sales. "The sales are trending ahead of acquisitions," said Rechler. During the past two quarters the firm has sold or contracted to sell more than $1 billion of properties or interest in properties.

Reckson reported diluted funds from operations of $47.6 million including a $3.6 million charge recognized in connection with the firm's long-term incentive compensation plan. When adjusted for this charge the company reported diluted FFO of $51.2 million. This compares to diluted FFO of $46.4 million for the first quarter of 2005. Reckson reported net income of $57.7 million including $43.6 million related to gains on sales of real estate and the charge for the compensation plan, as compared to $17.4 million for the first quarter of 2005. The REIT also gave earnings guidance for 2006 diluted FFO in the range of $2.36 to $2.40 per share and 2007 diluted FFO in the range of $2.60 to $2.80 per share.

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Reckson Sees Possible Growth in LPT

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