In answer to questions from Hawke's Bay Today, a ministry spokesperson confirmed HUD acquired the site in July, and, as was intended at that time, plans to on-sell to a CHP.
It had expected a CHP would be contracted to operate the site as soon as it became available, but the spokesperson said: "Finding one prepared to purchase has taken longer than expected.
"Given the intention to contract a CHP to operate the site as social housing, it would not be appropriate to have interim tenanting arrangements with Kāinga Ora," they said.
"We are in discussions with community housing providers, but no formal agreement has been reached. None of the units have been tenanted yet."
The contract with the developer ended at the time of handover and the company is unable to comment.
Government Napier MP Katie Nimon didn't have the details and said she was unable to comment, other than saying: "I look forward to those units becoming homes and a community for people that need it."
Labour housing spokesman Kieran McAnulty, whose Wairarapa electorate includes Central Hawke's Bay, described the delays as "madness".
"We are hearing stories like this all over the place," he said, adding it was "unacceptable" that such accommodation should go unused in an area of such extensive homelessness as Hawke's Bay.
He said the current Government had stopped 3500 new builds planned by housing agency Kāinga Ora under the previous Labour Government and was selling off prime sites, at a time when "those on the front line" say homelessness is "the worst it's ever been".
The consequences of that homelessness include worst-case scenarios of ill-health and imprisonment, at huge cost to the country, he said.
"It doesn't make sense."
Napier Mayor Richard McGrath said: "This is a central government-led project, and decisions about tenancy and provider arrangements sit with the Crown.
"Napier needs more quality housing options, and Council supports all efforts by government, iwi and community providers to deliver homes for our people," he said.
Long-time housing campaigner Maxine Boag, who recently completed 18 years as a city councillor, said:
"Someone needs to pull their finger out. The need is there, so it's very sad that there are 30 new apartments vacant when there are so many on the waiting list and struggling to find accommodation."