The Age- Saturday, 15 December, 2007.

APT fills investor stockings
Capital Gain

Executives at Australian Public Trustees will be on every agent's Christmas card list this year.

The Melbourne listed fund manager is believed to be formalising a $230 million purchase of a least three east coast office buildings.

Sources say APT's Government Property Fund will pay more that $70 million for the former Customs House office building at 414 La Trobe Street in the CBD, about $120 million for Brisbane's State Law Building at 50 Ann Street, and about $40 million for a seven-level office building at 62 Northbourne Avenue in Canberra.

The buildings are being sold by Investa Property Group, which delisted in September after it was bought by Morgan Stanley.

The sale prices reflect average passing yields of between 6% and 7%. All properties are leased to government departments of agencies.

The properties are expected to more than double the value of the Government Property Fund, which targets government properties as well as health, transport and education assets.

Government agencies typically absorb building maintenance costs and outgoings - normally paid for by landllords - making them attractive tenants for conservative property investors focused on rental returns.

APT chief executive and director Darren Olney-Fraser declined to comment on the rumours. But industry sources said buying the securely leased buildings would fit APT's stategy. They expect a formal announcement next week.

Government Property Fund also owns the Australian Taxation Office in Geelong, VicRoads in Sunshine and a Department of Human Services building in Bendigo, as well as assets in South Australia, Western Australia and the Northern Territory.

Investa Property Group, is also selling 469 La Trobe, 420 St Kilda Road and 441 St Kilda Road. It is selling hlef-share interests in 209 Kings Way in South Melbourne and 320 Pitt Street in Sydney's CBD.

CBRE and Colliers International are marketing the estimated $1.3 billion portfolio sale.