The Christchurch City Council has agreed to terminate its agreement with bankrupt property developer Dave Henderson.
In 2008, the council bought five central city properties off Mr Henderson for $17 million.
The deal was controversial at the time, with business leaders raising questions about the price paid and the decision to give Mr Henderson the first option to buy the properties back.
On Thursday, the council unanimously agreed to terminate that agreement.
A report to the council says Mr Henderson was declared bankrupt at the end of last year and it was the appropriate decision.
The council says there is much interest in the site in Sydenham, an area which suffered extensive earthquake damage.