The purchase will add to the country's largest state-owned fund's current assets in property, which stand at 3.9 per cent of its portfolio. Other properties include Adulbrahim Place, Bangkok City Tower, and Summer Set Lake Point.

"So far, the return from property investment by the GPF has generated around 7-8 per cent. According to a study, during the economic slowdown, the income from rental fees of property assets still remains regular," Visit Tantisunthorn, secretary-general of the GPF, said yesterday.

He said the fund had purchased both the land and buildings of Diethelm Towers, office buildings comprising the 18-floor Tower A and the 16-floor Tower B, with an occupancy rate of around 95 per cent.

The 7.5-rai plot, with a total rental area of 30,000 square metres, cost the GPF Bt2.998 billion.

Visit said the buildings were in a prime location at the centre of the capital's business district and have a high occupancy rate. There are several large-sized tenants with long-term rental contracts. This will help reduce investment risk and is likely to generate a satisfactory return, he added.

Visit said investment in property assets would provide a good return in the long term as an alternative investment amid the volatile interest-rate environment.

At the end of March, the GPF's assets were recorded at Bt294.84 billion, of which Bt283.66 billion is its investment portfolio. At the end of the first quarter, the GPF had 1.16 million members.

As of the end of last year, the GPF had allocated its assets in Thai fixed income (68 per cent), Thai equity (14 per cent), global fixed income (8 per cent), alternative investment (6 per cent), property (3 per cent), and global equity (1 per cent).

The state-owned fund generated a net rate of return to its members of 11.84 per cent in 2003, 2.02 per cent in 2004, and 6.83 per cent last year.