3 January 2007

Not for publication, release or distribution in whole or in part in

Australia, Canada, Japan or the United States

Babcock & Brown Public Partnerships Limited

(Incorporated in Guernsey with registered number 45241)

Portfolio Update

In accordance with Listing Rule 15.4.11(2), Babcock & Brown Public Partnerships Limited

(the 'Company') announces its 10 largest investments, including all holdings with a value greater than 5% of the Company’s total assets as at 31 December 2006.

Hereford & Worcester Magistrates Court

Strathclyde Police Training Centre

Tower Hamlets Schools

Northamptonshire Schools

Calderdale Schools

Norfolk Police HQ

Derbyshire Schools Phase 2

Reliance Rail

Bootle Government Offices

RiverCity Motorway

For further information, please contact:

Babcock & Brown                    Anthony Kennaway                +44 (0)20 7203 7300

Heritage International Fund       Laurence McNairn                  +44 (0)1481 716000

Managers Limited, Secretary