The government department negotiated the sale with another government department - the Ministry of Housing - who previously owned 37,730sq m of land on Pūriri Park Rd in Maunu.
The land is zoned residential but is adjacent to Whangārei District Council owned Pūriri Park, and has been used as a de facto park since the 1960s.
More than 300 mostly local residents packed into a public meeting last Saturday to discuss its future.
Save Pūriri Park steering committee spokesperson Trevor Reader said a question was asked at the meeting as to whether the residents could buy the land back from Housing New Zealand.
"Housing NZ indicated clearly they are in the process of acquiring the land not selling it."
Reader said as that was made quite clear to them, they would not be pursuing it any further.
When asked if $1.35 million was a good price for the land, Whangārei MP Dr Shane Reti said it was not for him to comment on the price.
However, he did say a member of the audience asked at the meeting "if for that same price would there be similar areas that might even be bigger and accommodate more houses?"
A Housing New Zealand spokesperson said it considered the purchase an excellent development opportunity.
"Having just acquired this piece of residential-zoned land for much-needed state housing in Whangārei we are also looking at other blocks of land elsewhere in the city that would fit neatly alongside."
There were 170 people on the housing register in Whangārei in the first quarter of this year.
"Both the Ministry of Education and Housing New Zealand got independent valuation advice about the land and that is how the price was settled."
It did not reveal what those valuations were.
The agency is now working on development plans for it's Maunu land and will "look forward to sharing these with the Whangārei community as soon as practicable".
