Sir Peter Jackson's World War One exhibition will close in four months' time after Massey University and the government failed to reach an agreement on extending the lease on the popular attraction.

Photo: RNZ / Alexander Robertson

Discussions between the two sides have been going on for years, but one last push to break the deadlock did not succeed.

Massey University and the Ministry for Culture and Heritage could not come to an agreement over extending the lease, which finishes at the end of the year.

Massey's Vice Chancellor Professor Jan Thomas said while it's delighted to have hosted the exhibition over the last four years, it needed the space back.

"We need to have an iconic building that increases both our floor space and also our presence within the Wellington city.

"We need the public space, such as the Great Hall, and as we grow our Wellington campus we're seeing more and more demand from staff and students for contemporary learning and teaching and research spaces," she said.

Massey explored the option of selling the building to the Ministry, which fell through.

Professor Thomas said it also proposed extend the lease for at least ten years and lift the rent, to pay for another building and replace the lost space.

The Ministry for Culture and Heritage chief executive Paul James said it preferred a shorter lease, and Massey's proposal proved prohibitive.

Photo: AFP

"But it was really about using an income stream from that to enable that to unpick quite an extensive property redevelopment.

"The sums of money, as I said there was nothing concrete, put in front of us but our quick estimate was that it was tens and tens of millions of dollars," he said.

Nevertheless, Mr James said the exhibition had been a success, with 400,000 people passing through since it opened in April 2015.

He said preparations are now underway to dismantle it, and restoring the building to its original state - the so-called make good provisions.

Last year, RNZ revealed those costs had spiralled from $2.5 million to almost $9m.

Mr James said current forecasts put the cost at somewhere between $6.5m and $12.5m, for which the ministry has set aside $8.5m for the task.

For those wanting to visit the exhibition, they have until December before it closes.