The ferry company sold part of the island, including part of the area now called The Terrace, to developer Walter Castaing, who created waterfront sections.
Mr Dwen said that several years after the subdivision was completed, Mr Castaing found that part of his purchase included a large seabed site, much of it below the high-water mark.
The site was again sold on to Mr Castaing's son Graeme, who set up West Harbour Marinas with Mark Dwen's parents - Ronald and Louise Dwen - in 1976.
The intention was to develop the site into a marina complex, said Mark Dwen.
"Plans were drawn up and we commissioned the University of Auckland to undertake significant research into things like tidal flows, and siltation," he said.
Herald Island residents objected to the original development, as did The Ministry of Defence, due to the potential impact on flying at the nearby air force base at Whenuapai.
However, lack of funds and the death of Ronald Dwen 17 years ago ultimately led to any development plans being dropped.
Mark Dwen said the site still had the potential to be developed into a marina or could be reclaimed for housing.
"As a marina you could not get a better site. It is one of the most sheltered sites in the Waitemata, has very easy access and is in a very picturesque setting," he said.
As the site was privately owned, he did not believe there were any restriction on how it could be developed.
"We are very conscious of the views of Herald Island residents but the reality is that even though it is seabed, it is privately owned land and can be developed."
The land has been listed with Harcourts Hobsonville Realty and Mr Dwen said the price was open to negotiation.
Annie Siddall of Harcourts Hobsonville Realty said the property was almost impossible to value because it was unique.
According a 2003 report commissioned for the Land Information Ministry, there was only 32 private titles that were purely seabed.
