Lend Lease Group, Australia's biggest property developer, plans to create a fund that will invest in property developments in China's biggest cities within the next three years as it reduces its exposure to Europe and the Middle East.

The Sydney-based company, which has had a construction business in China for the past 20 years, is seeking to develop retail properties with a mix of its own and other groups' capital, Chief Executive Officer Steve McCann said. It has identified 12 cities for possible developments, he said.

"We've been talking to a number of potential partners for some time now," McCann said. "The medium-term ambition will be to launch a fund in China using offshore capital and invest alongside our investors in some development projects."

Lend Lease on Thursday reported profit rose to A$501.4 million ($517.6 million) in the year ended June 30, driven by increases in income from its Asian development and investment management businesses, and its Australian construction and infrastructure divisions.

China Daily-Agencies