Qatar has agreed to buy part of a London residential development through the investment agency that acquired the Chelsea Barracks from Britain's defence ministry this year, a spokesman for the agency said on Sunday.

State-owned Qatar Diar agreed to buy three buildings of the Grosvenor Waterside development in Chelsea. When they are completed in 2012, the buildings will have 335 apartments, the spokesman said, confirming a statement carried by local media.

The statement did not say how much Diar agreed to pay London developer St. James Group Ltd for the properties.

'This project...will complement our purchase of Chelsea Barracks,' Diar chief executive Nasser al-Ansari was quoted as saying in the statement.

Diar bought the Chelsea Barracks in London from Britain's Ministry of Defence in April. London's Financial Times reported it paid around 600 million pounds ($1.22 billion).

Diar's owner, the Qatar Investment Authority, has offered to buy British supermarket chain J Sainsbury Plc for 10.6 billion pounds.

The authority, a sovereign wealth fund worth an estimated $50 billion, is diversifying away from the weakening US dollar which Qatar's customers pay for its oil and gas exports.

The authority has cut its dollar holdings assets by more than half to 40 percent in the past two years, Qatar's prime minister said last week. - Reuters