Land at 11 Mission St has been transferred into the ownership of a Māori trust.
The settlement happened on June 18, the former owner of the land Tauranga City Council confirmed.
An agreement has been signed that will see the land leased back to The Elms Foundation - stewards of The Elms heritage site next door to the land - at a peppercorn rent of $1 a year.
Early this morning, members of the Ōtamataha Trust and the Elms Foundation attended a blessing at the site.
The official transfer and blessing concluded a nearly two-year controversial decision-making process.
The council bought the 1400sq m section in 2006 to secure it for the expansion of The Elms.
In 2018 the council proposed to give the section to the Ōtamataha Trust, which represents the property interests of Ngāti Tapu and Ngai Tamarawaho.
Critics cried that the council bought the land for the Elms and it should be given to the foundation directly. Supporters of the proposal said the council never made a formal promise to the Elms and the land should be returned to tangata whenua.
The previous council, under mayor Greg Brownless, voted to give the land to the trust, then revoked the decision in favour of a joint ownership or leasing arrangement between the trust and foundation.
In December, the newly-elected council, under mayor Tenby Powell, overturned that decision and voted to give the section to the Ōtamataha Trust, subject to the lease for The Elms.