Prime Property Group director Eyal Aharoni has admitted housing residential tenants in two empty Wellington office blocks.

One building was on 61 Molesworth St, which has now been demolished since it was seriously damaged in the November 14 earthquake.

A family of four, a bankrupt businessmen and a sickness beneficiary lived there.

The Ministry of Business Innovation and Employment (MBie) has just finished its investigation into the unlawful tenancies and is taking building owner, Prime Property Group, to the Tenancy Tribunal.

Advertisement

Meanwhile, an unknown number of tenants were last year found living in an earthquake-prone commercial building on Wakefield St, also owned by Prime Property Group.

Aharoni said he was just trying to house the homeless.

"Those are basically two buildings that we own which are completely empty and there are a lot of people out there who have nowhere to live and we are essentially trying to help people."

MBie compliance and investigations team manager Steve Watson said the investigation confirmed the first floor of the Molesworth St building had been rented out.

"The kitchen and cubicles were being used as bedrooms, the toilet was in a corridor through the fire exit, and the family was using a shower on the ground floor of the building."

Aharoni said the family found living conditions comfortable, but he had never seen them himself.

"The [family] actually found the place quite acceptable, comfortable and good so I don't think it's for MBie or anyone else to rule otherwise."

Aharoni said he would not discuss the details of the upcoming hearing because it was a matter before the court.

He said, however, the group would argue its case on the basis the law is ambiguous.

"We're not sure whether the activity was legal or illegal, it's actually not that clear."

Aharoni said a replacement would be built on the vacant site and the fate of a Jim Allen mural salvaged from demolition was unknown.

Wellington City Council has previously confirmed it was aware of residential tenancies at the Wakefield St building, the former home of the Greater Wellington Regional Council, which was vacated after the Seddon earthquakes.

Aharoni said no one was in the building at the time of the Kaikoura earthquake and the arrangement there was more transient than at Molesworth St.

"They were coming and going, there were a few people there but I can't tell you how many."

He said the people who stayed at Wakefield St paid about $100 rent a week.

Watson said MBie was not investigating the property.

"It's impossible to investigate without co-operation from tenants, and the file has been closed due to a lack of usable evidence."

Aharoni said he regretted allowing people to stay in the properties.

He said his actions were not an isolated case and many other empty office blocks in the city were rented out for residential use.

"The action against me possibly will make landlords think twice and possibly create a further squeeze in the residential market, making accommodation even harder to find, but that's for MBie to decide what they want to do."