Key Points:

A piece of prime real estate near one of New Zealand's top tourist attractions is in foreign ownership with the Overseas Investment Office giving the green light for the $6.187 million deal to go ahead.

American businessman Gerhard Andlinger has bought the 53.845 hectares near Cathedral Cove at Hahei.

He has agreed to extend the Cathedral Cove walkway through Department of Conservation (DoC) land to Driftwood Cove.

Overseas Investment Office manager Annelies McClure said Mr Andlinger had agreed to pay DoC $225,000 towards the cost of constructing approximately 0.7 kilometres of walkway.

She said the walkway would include a wooden staircase down to Driftwood Cove and Mr Andlinger would pay survey and any other costs associated with the structure.

"If the total construction cost of the walkway and staircase is less than $225,000, Mr Andlinger has agreed that DoC can use the remainder for vegetation management in the Driftwood Cove area," she said.

In addition, Mr Andlinger would pay DoC $25,000 towards the cost of removing wilding pines from the northern boundary of the land and from the adjacent reserve administered by DoC.

The office's decision sheet said Mr Andlinger would use the property for "residential purposes".

According to Mr Andlinger's website, he rose from modest beginnings in Austria to become a respected businessman and generous philanthropist.

Mr Andlinger has given money to Princeton University, cancer research, and the American Austrian Foundation. He also serves as Chairman of The Salzburg Festival Society, the site said.

Campaign Against Foreign Control of Aotearoa spokesman Murray Horton said the sale was just one more piece of iconic coastal land in foreign ownership.

"Once land is alienated from New Zealand ownership, it is usually passed from one foreign owner to another and it's gone," Mr Horton said.

He said large areas of land being sold, including the high country station bought by Canadian country singer Shania Twain, was driving up prices and making it harder for young New Zealand farmers.

Mr Horton was also critical of the Overseas Investment Office's record on granting applications.

"They go through that like a dose of the old proverbial. Essentially it's a rubber stamp," Mr Horton said.

According to an estimate by his organisation, seven per cent of New Zealand's commercially productive land is in foreign ownership.

Past president of Forest and Bird and current member of the national executive Gerry McSweeney said the land coming into new ownership could provide more protection.

He said the vegetation plan could protect the land, which may not have otherwise been safe-guarded against development.

"We have to see as much coastal land protected as possible," Dr McSweeney said.

But Green Party co-leader Russell Norman said if the idea was to protect the bush and improve public access than legislation or laws should be passed on those specific issues.

"If we have to do that by the roundabout route of selling off all our coastal land, well that's silly," Dr Norman said.

He said the walkway extension and "vegetation plan" was good but not enough.

Dr Norman said the Green Party position was that it was fine for foreigners to come here and buy land but they should live here for more than six months of the year.