The former Dunedin prison may have more heritage value than initially thought, after the Historic Places Trust found the courtyard style of the building was a rarity in New Zealand.
The building was decommissioned in August 2007, after operating as a prison for about 111 years. At the time of its closure, it accommodated about 59 medium-security prisoners and 40 remand prisoners.
It has a category 1 historic rating and is worth about $1.8 million, according to Dunedin City Council rating information.
The crown disposal process began last year. Ngai Tahu has the first right of refusal, but has not yet been offered the building.
The Historic Places Trust was requested to provide a heritage and architectural assessment report on the building, which it did, together with a draft covenant agreement, at the end of January.
Trust Otago-Southland area manager Owen Graham said the report of a consultant who visited the building late last year to assess its historic value and further researched the building, found the prison was one of few older penal buildings left that were built with a rehabilitative focus, not just a punitive purpose.
These sorts of prisons, known as "courtyard prisons" were rare and so more historically valuable.
Assistant general manager of finance systems and infrastructure at Corrections, Derek Lyons, said the department was reviewing the reports before entering into negotiations with the trust on the conditions to be included in the covenant agreement.
The sale process would begin once the covenant agreement was finalised.
The department expected the covenant conditions would not preclude using the building for other financially viable purposes, Mr Lyons said.
