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Prime Property Group's director has admitted housing residential tenants in two empty Wellington office blocks.

One of them was a building on 61 Molesworth Street, which has now been demolished since it sustained serious damage in the November 14 earthquake.

A family of four, a bankrupt businessmen and a sickness beneficiary lived there on a permanent basis.

The Ministry of Business Innovation and Employment (MBIE) has just finished its investigation of the unlawful tenancies and is taking Prime Property Group to the Tenancy Tribunal.

Meanwhile, an unknown number of residential tenants were last year found to be living in an earthquake prone commercial building on Wakefield Street.

It is also owned by Prime Property Group.

The company’s director Eyal Aharoni said he was just trying to house the homeless.

“Those are basically two buildings that we own which are completely empty and there are a lot of people out there that have nowhere to live and we are essentially trying to help people.”

MBIE compliance and investigations team manager Steve Watson said the investigation confirmed the first floor of the Molesworth Street building had been rented out.

“The kitchen and cubicles were being used as bedrooms, the toilet was in a corridor through the fire exit, and the family was using a shower on the ground floor of the building.”

They were facilities used by the Mape family. 

Aharoni said they found living conditions there comfortable despite never seeing them for himself.

“The Mape family actually found the place quite acceptable, comfortable and good so I don’t think it’s for MBIE or anyone else to rule otherwise.”

Aharoni said he would not discuss the details of the upcoming hearing because it was a matter before the court.

He said, however, the group would argue its case on the basis the law is ambiguous.

“We’re not sure whether the activity was legal or illegal, it’s actually not that clear.”

Aharoni said a replacement building would be built on the vacant site and the fate of a Jim Allen mural salvaged from demolition was unknown.

Wellington City Council has previously confirmed it was aware of residential tenancies at another commercial office block that Prime Property Group owned in Wakefield Street.

It was the former Greater Wellington Regional Council building, which was vacated after the Seddon earthquakes.

Aharoni said there was no one in the building at the time of the Kaikoura earthquake and the arrangement there was more transient than at Molesworth Street.

“With sort of younger people and they were coming and going, there were a few people there but I can’t tell you how many.”

He said the people who stayed at that property were paying about $100 a week in rent. 

Watson said MBIE was not currently investigating the operation at Wakefield Street. 

“It’s impossible to investigate without cooperation from tenants, and the file has been closed due to a lack of useable evidence."

Aharoni said he regretted allowing people to stay in both properties.

He said his actions were not an isolated case and many other empty office blocks in the city were being rented out for residential use.

“The action against me possibly will make landlords think twice and possibly create a further squeeze in the residential market, making accommodation even harder to find, but that’s for MBIE to decide what they want to do.”