Mirvac Group, which snapped 18 months of losses in its first half, is in talks to buy Westpac Office Trust as Australian property funds target rivals in an economy that dodged the global recession.

Westpac Office shares surged the most since October 2008, valuing the company at A$392m, after the company said it has granted Sydney-based Mirvac exclusivity to conduct due diligence for a limited time. Mirvac, which said it will raise A$500m in a share sale, was halted from trade.