Craggy Range Vineyards has bought 2.5ha of land and associated development rights adjoining its Waimarama Rd winery in Havelock North.
The winery plans to extend its vineyard, build four to six boutique cottages and extend its winemaking facilities to the south of the existing winery.
The Overseas Investment Office has granted permission for the purchase. Its decision summary said the price of the "sensitive land" was $1.89 million.
The summary said the proposed development satisfied criteria of the Overseas Investment Act, which required "substantial and identifiable benefit to New Zealand".
The winery is majority-owned by the Australian-based Peabody family, through overseas-registered companies.
Craggy Range chairman and owner Terry Peabody said the winery planned to progressively extend its Waimarama Rd estate from next year.
"This is a further endorsement of our family's long-term commitment to the Hawke's Bay region and the wine industry," he said.
The adjoining land had resource consents for the winery's intended activities.
"As we continue to expand our global markets, the Waimarama Rd estate and its associated visitor and hospitality programmes remains a key part in delivering the Craggy Range experience."
Hawke's Bay Winegrowers Association chairman Nicholas Buck said the purchase was good news and proof the industry had turned a corner.
"This is another sign that the more successful players in the industry are continuing to expand," he said.
Vendors Denis Thorner and Pamela Brockie have moved to another Havelock North address. Mr Thorner is managing director of Thorners, an Upper Hutt-based insurance and finance company.