A Chinese investor has snapped up a blue-chip 7-Eleven store prior to auction in Ultimo for $5.05 million, highlighting the fierce competition for income-producing assets, situated in prime locations.

David Hickey, Tom Tuxworth and Nick Tuxworth of Savills Metropolitan and Regional Sales negotiated the deal $600,000 above the reserve for 869 George Street at a yield of 3.47 percent.

“We generated more than 270 enquires within the first ten days of the campaign, demonstrating a wave of national and international capital looking to secure retail properties leased to quality tenants, such as 7-Eleven,” Mr Hickey said.

The freehold retail asset has a five-year lease in place to convenience store 7-Eleven, with two additional five-year options to renew.

This is the first time that 869 George Street has been sold in half a century and Mr Hickey said these generational-style assets rarely come to market and buyers will continue compete because these opportunities are so scarce.

“The buyer was attracted to the high-quality asset and location, being in one of the best-performing and most tightly held retail spots in the country,” he said.

Mr Hickey continued to say despite recent negative press regarding the perceived “market slowdown” there is flight for quality assets when buyers are looking to invest.

“The metrics achieved in this transaction are now an area benchmark and demonstrate that if properties are well-positioned for price maximisation then they will continue to trade stronger than ever,” he said.