Scentre Group has sold its Sydney CBD office towers for $1.5 billion

Scentre Group has sold its Sydney CBD office towers to US private equity firm Blackstone for $1.52 billion.

It is planning to use part of the proceeds to fund an $800 million share buyback to boost investor returns.

They will grant Blackstone a 299-year leasehold interest for the office towers above the Westfield shopping centre in Market Street and Castlereagh Street, however they will retain ownership of Westfield Sydney and Sydney Tower.

Scentre shares lifted 2.56 per cent to a more than two-month high of $4.01 following the statement to the ASX concerning the matter.

Group chief executive Peter Allen said the $1.52 billion transaction price represented almost $800 million in additional value on investment and an unlevered internal rate of return of over 16 per cent per annum.

"Our development of the Sydney Office Towers in 2011 and ongoing investment until now has created significant value for securityholders," Mr Allen said.

In total Scentre now holds $2.1 billion in capital following the sale of 50 per cent of its stake in Westfield Burwood for $575 million in May.

Mr Allen said the company would initially use the new funds to repay debt before commencing an $800 million share buyback in August.