If you’re considering buying or selling a company share apartment in New Zealand, it’s important to understand this unique form of property ownership. Unlike standard freehold or unit title ownership, a company share apartment involves purchasing shares in a company that owns the land and building, rather than holding the title to the apartment itself. In return, shareholders receive an occupation licence or lease that gives them the right to live in a specific unit.

This form of ownership was more prevalent before the Unit Titles Act 1972, but many company share apartments remain in existence today—particularly in older apartment blocks across cities like Wellington.

🏢 How Company Share Apartments Work

In a company share arrangement, the company owns the property, and shareholders (apartment owners) have a right to occupy a designated unit. The company’s board of directors, elected by shareholders, manages the property and makes decisions about maintenance, governance, and policy. These are typically guided by the company constitution and any shareholders’ agreements in place.

📄 Understanding Occupation Licences

An occupation licence or lease gives a shareholder the legal right to occupy a unit. While these can be registered on the land title—providing added protection—not all companies register them. A registered licence can offer greater appeal to buyers and enhanced security for lenders, as it allows a mortgage to be secured against the registered interest rather than just the company shares.

💡 What to Consider When Buying or Selling

If you’re planning to purchase or sell a company share apartment, consider the following:

• Review the constitution and occupation licence for any restrictions (e.g., subletting, pets).
• Ensure the company directors approve the new buyer—this is often required and may include an interview.
• Include a finance condition in the Sale and Purchase Agreement to allow withdrawal if bank financing isn’t secured.
• Be aware that many banks are hesitant to lend for company share apartments, especially where no registered occupation licence exists.
• KiwiSaver withdrawals for a first home purchase may not be approved—check with your provider first.
• Expect ongoing costs similar to body corporate fees, including insurance, maintenance, and rates.
• The company is responsible for building insurance, so it’s vital to ensure coverage is adequate.
• There is no legislative disclosure regime under the Unit Titles Act for these types of properties—so due diligence is essential.

🛡️ Get Legal Advice Before You Commit

Because of the complex legal structure surrounding company share apartments, it’s highly recommended to seek professional legal advice. At Core Legal, serving clients across Masterton and Wellington, we offer fixed-fee consultations to help you navigate the legal requirements, review documentation, and protect your investment.

📞 Contact our experienced property law team today to schedule a consultation and make an informed decision about your company share apartment transaction.