Libya looks for City berth

The Libyan Investment Authority, which manages the country's $65 billion (£39.7 billion) oil wealth, wants to open its first branch in London as business links between the two countries grow.

The news came as the political fallout after the release of the Lockebrie bomber escalated today.

Abdelbaset al-Megrahi who is terminally ill with prostate cancer was sent home to Tripoli last week. On his return he was given a hero's welcome in spite of requests to the contrary from Scotland.

Sovereign wealth fund, Tripoli-based Libyan Investment Authority, bought Portman House on Oxford Street for £155 million in July and an office at 14 Cornhill opposite the Bank of England for £120 million in December.

It is now on the look out for more investments as it prepares to pour millions of pounds into the London property market.

"They are looking for more properties in London, mainly in commercial real estate, as they are not affected by the credit crunch," said Jeremy Grey, a managing director at James Andrew, the property consultants which advised LIA over the Oxford Street purchase. "They buy when prices are low and they don't sell. They are long-term investors."

LIA officials are now looking for an office in London, most likely in Mayfair, St James's or Kensington.