SYDNEY—Morgan Stanley Real Estate Investing has agreed to sell a nine-property portfolio of Australian office properties to Chinese sovereign wealth fund CIC International. Published reports value the acquisition of Morgan Stanley's Investa Property Group real estate at A$2.45 billion, or US$1.79 billion.

The deal for 126 Phillip St. in Sydney and other office towers reportedly is the largest direct real estate transaction in Australian history. It marks the debut in that country for CIC, which outbid more than 20 competitors, including DEXUS Property Group and its partner, the Abu Dhabi Investment Authority, according to the Australian Financial Review.

Investa Property's office holdings, which Investa Office will continue to manage, are just one aspect of an Australian real estate group that Morgan Stanley put up for sale this past February. Still up for grabs is the broader Investa platform, valued at about A$9 billion, or about US$6.6 billion. It includes a management portfolio of several office properties not covered by the sale to CIC, as well as a development arm.