Waikato Police are investigating an unexplained fire on Maori land in the Coromandel at the same place convicted murderer David Tamihere is banned from setting foot on.

Double-murderer David Tamihere has been barred from visiting the spot, known as Mataora Block, near Whiritoa, after the Department of Corrections feared he could move the body of Swedish tourist Heidi Paakkonen, whose remains have never been found.

In 2013, he successfully defended a charge of breaching parole conditions after he took part in a television interview where he was flown in a helicopter over the land.

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At the time, then Department of Corrections service manager Daniel Munro said Tamihere had initially wanted to go to family land at Mataora Bay between Whangamata and Waihi, but the department had concerns including "the risk of locating the body of the missing victim and moving it".

The fire happened about 11.45pm on February 25. Northern fire communications shift manager Jaron Phillips said the fire was at two units on the land, both of which were "well ablaze" when Waihi crews arrived. "They've been described as absolutely levelled."

The units were about 3 kilometres from Waihi Whangamata road, down a gravel road and surrounded by thick bush. Police initially labelled the fire as suspicious but Detective Senior Sergeant Mike Whitehead of the Waikato CIB said it was now being treated as unexplained.

"[Police are] still waiting for the Fire Investigator's report but there is no obvious cause," he said.

A source working on the investigation, who asked not to be named, said the units had been standing for about 25 years.

"They were built in probably 1990, I think '89 they went in."

David Tamihere was convicted in 1990 of the murders of the two Swedish backpackers - Heidi Paakkonen and her fiance Urban Hoglin in 1989. Tamihere's electronic bracelet was removed in 2011.

When asked if police had any reason to believe Paakkonen's body could be under the units, Whitehead replied "no comment".

Detective Mark Leatham of Thames CIB confirmed a preliminary investigation by fire investigators indicated the fire may be suspicious. He said police were working alongside the fire service to establish the cause of the blaze and who was responsible.

No one was injured in the blaze.

No one was living in the units at the time, said neighbour Lawrence O'Keeffe. There were two of three units on the site. One remains standing.

O'Keeffe, a retired farmer, lives less than 150 metres from the units. He was woken from his armchair on Wednesday by some young people who knocked on his door and told him there was a fire.

"They were camping in a bach down there in the clearing and they thought it was my place on fire, but when they came out they saw it was John Tamihere's place on fire."

Mataora Block is one of two confirmed applications for recognition agreements with the Crown, with the contact on the application listed as John Tamihere, the former MP and radio DJ and David Tamihere's brother.

When contacted, John Tamihere replied: "I will be making no comment".

O'Keeffe said he "didn't really know" the people who rapped on his door.

"They were staying with people in Waihi, that's what they said. But they wouldn't come and knock me up if they had started the fire, that's for sure."

He said no one was living in the units at the time.

Nearby resident Tom Jones said there was generally not a lot of activity around the place.

"It's quite a secluded bay . . . it's fairly quiet, I think there's only three or four people there permanently, if that."

O'Keeffe said he was aware of the history of the land and David Tamihere's case.

Paakkonen's body has never been found but the discovery of Hoglin's remains in Whangamata conflicted with testimony from an inmate who said David Tamihere spoke of cutting up the bodies and throwing them in the sea.

At the time of the murders, David Tamihere was living rough in the Coromandel, on the run after being convicted of sexually assaulting and threatening to kill a woman. He also had a prior conviction for the manslaughter of a young Auckland woman, Mary Barcham, whom he killed in 1972.

Leatham said police are appealing to anyone who may have knowledge on the incident.

Anyone with any information on the fire is asked to contact Detective Mark Leathem at the Thames Police Station.