Crown property disposal process

Find out about the process Crown agencies must follow for disposing of their property.

When a Crown agency wants to dispose of property that it owns, it must follow processes set out in legislation and government policy documents. The specific requirements the agency must meet depend on the legislation under which the land is held, but most Crown agencies must follow the process set out in the Public Works Act (1981). 

Not all properties for disposal will go through all the steps listed below. Properties may be disposed of at any stage of the process.

Most of these steps are outsourced to Crown property accredited suppliers, employed by the disposing agency. But all reports and sale agreements must be submitted to LINZ for approval and sign-off.

Stage 1: Property no longer required by the Crown

The agency must:

  1. Decide it no longer requires the property for its operations;
  2. Obtain ministerial consent to dispose of the property, if necessary;
  3. Obtain a title for the property, if the property is not already held in a title or is being subdivided from a larger area. A subdivision consent under the Resource Management Act 1991 may be required;
  4. Advise iwi through a preliminary notice, if required by a particular Treaty settlement
  5. Consider whether any values on the property should be protected before disposal
  6. Advise the following agencies:
    • Department of Conservation to identify any marginal strips or conservation values on the property
    • Heritage New Zealand to identify any heritage values on the property
    • Housing New Zealand Corporation to decide whether the property can be used for housing
    • Ministry of Business, Innovation and Employment (where the property is in the Auckland urban area) to decide whether the property can be used for housing.

At this stage, other Crown agencies such as government departments or local authorities may request the property. If agreed to by LINZ, these transfers are made under the Public Works Act.

Stage 2: Offerback and gifted lands

The Crown must offer to sell the property back to the person from whom it was originally acquired, or to their successor, unless an exemption applies. This offer is usually based on the property’s current market value.

If land was gifted to the Crown for a particular purpose, it may be offered back to the donor at no cost under the government’s Gifted Lands policies.

Stage 3: Treaty settlements

The agency must either:

  1. Offer the property for sale to an iwi under a Right of First Refusal provision in its Treaty settlement, unless an exception applies, or;
  2. Apply the Māori Protection Mechanism (protects Māori interest in Crown owned land which has been identified for disposal) and Sites of Significance processes, if the property is in an area where a Treaty settlement has not been reached. These processes allow the Office of Treaty Settlements to purchase the property for a future settlement, or for Te Puni Kōkiri to protect any significant sites on the property.

Stage 4: Open market sale

If the property is not disposed of at any of the earlier stages, the agency can put the property on the market for sale by public tender, auction or listing with a licensed real estate agent.

Last Updated: 26 February 2016