When the restoration is complete, the council will sell the building back to the developer, KNC Construction Ltd.
Mr Brown said it was an excellent outcome for the first use of the fund.
He said it was saving a piece of Auckland history as part of a project that would inject investment, retail and residential use into an area that needed revitalisation.
The Wong Doo building got its name when Thomas Wong Doo moved in in 1942 and ran a business selling textiles, silks, embroideries and fireworks for the next 20 years.
It last housed the Canvas City Company.
The Airedale cottages are thought to have been constructed by stonemason Thomas Rusden who bought the site in 1856.
The two cottages, rare examples of colonial era workers' housing in the central city, were owned by the Pezaro family between 1931 and 1966.
The family ran a cigar factory from an adjoining property in Wakefield St.
The cottages will be restored and sold.