Māori landowners of Tai Tokerau's Matauri-X Incorporation are hoping to save their whenua at Matauri Bay by selling off a subdivision.
They will be losing 50 hectares to save the other 300-plus hectares, which was all put up as security for a doomed business venture 14 years ago.
The Incorporation, under former chief executive Hemi Rua Rapata, borrowed to buy a water bottling company which turned out to be worthless.
The initial loan of about $3 million then spiralled upwards.
The Maori Land Court investigated and appointed an administrator and approved a scheme to refinance and pay off the debt by subdividing and selling off 80 sections.
But the global financial crisis intervened and only eight sections ever sold.
Receivers PricewaterhouseCoopers (PwC) have now found a buyer for the entire subdivision and agreed to write off the rest of the debt, much of it penalty interest.
The Incorporation's business advisor, Pat Durham, said it was the best possible outcome for the 400 Matauri-X shareholders whose ancestral land had been under a debt cloud for more than a decade.
But a lawyer specialising in Māori land and business affairs, Chapman Tripp's Nick Wells, said the loss of any Māori land in this day and age was heartbreaking and avoidable.
He said the Māori Land Court had recently approved agreements in which trustees leased their land long-term to a subsidiary, which borrowed against the lease.
"The lease, let's say it's for 30 years, is quite a valuable asset, because you've got the rights to land for 30 years embedded in the lease, so it is valuable," he said.
"If everything goes bad, yes - I suppose the lease of the land is lost for 30 years, but after that time the ability to use it returns to the trust."