"There are parts of the portfolio that we have acquired with the express intention of selling down over the next 12 months," the statement explains. General manager for the joint venture, Neil Tobin, says it had A$5 billion ($3.8 billion) in assets with a further A$800 million ($6.11 billion) in assets under management. "We are in a position to deliver strong growth in earnings from the joint venture next year with 2007 being the first full year of investment. The portfolio is diversified across six sectors, 80% of which are European assets and the remainder in the US."

GPT also confirms it has placed plans to create a A$1.8-billion ($1.4-billion) hotel fund with Babcock & Brown "on the back-burner" but might consider it at a later date. GPT has a market value of A$9.2 billion ($7 billion) and is Australia's third-largest property trust. The company has reported a 19.5% increase in half-year operating income to A$275.1 million ($210 million). A company statement adds that its strong first-half profit was due to growth from the group's core portfolio, a larger portfolio in the Babcock & Brown joint venture and a saving in fees previously paid to former manager Lend Lease.

Yesterday, Macquarie Office Trust announced its intention to sell some of its mature assets and reinvest the receipts in Europe and Asia.