The modest two-storey property of 126 sq m has a 100sq m footprint and carries a capital value of $740,000.
Dean Collins, of Colliers International, said the property, opposite the Meridian mall, was on the market for four weeks before the auction.
Opening the auction at $650,000, about 70 bids were made by about six people, before it sold for $1.13 million.
Despite requiring an estimated $100,000 on earthquake-proofing, and lacking a sitting tenant, the building's central location in the ''tightly-held Golden block'' of central Dunedin property had attracted a lot of interest, Mr Collins said.
''In the end, there was a bidding war between two buyers.''
The late-1800s single-title freehold property has 4.3m of George St frontage and is zoned Commercial: Retail (non residential), and the land is valued at $590,000.
The unidentified Otago buyer intended to possibly lease it out as is, Mr Collins said, and in the medium term might earthquake-proof the building or redevelop the site entirely. There was strong demand for prime retail space, but a shortage of quality premises, meaning central rentals had ''increased modestly'', he said.
Rental of second-tier properties had eased, with landlords offering incentives to attract tenants, he said.
