Georgia Lists Tskaltubo Spas For Sale With Mandatory $24 Million Renovation

Tskaltubo’s ten state-owned sanatoriums are entering a new auction phase that demands far more from buyers than a simple purchase price. The Georgian government listed the properties on October 20, and the online bidding process is scheduled to end on November 15. The central conflict lies in the scale of the financial commitments attached to the assets. While the entry price for the most famous building, the Medea sanatorium, is set at the equivalent of $3.3 million, the buyer must also pledge $24 million for a five-year renovation.

The renovation mandate for Medea requires the creation of at least 120 guest rooms, along with conference halls and restaurants. The other nine sanatoriums in the auction carry similar conditions. Their starting prices range from $1 million to $3.5 million, but each comes with a requirement to invest substantially more in repairs and upgrades. The total investment required for the Medea project alone reaches $27.3 million.

Frederic Le Fichoux, a commercial real estate expert who contributed to a 2020 feasibility study for the town, warned that fixing single buildings may not solve the wider issue. He noted that the surrounding infrastructure remains neglected. Le Fichoux said, "If you are one investor and you buy, you renovate that property that you bought, you turn it around, but then the rest of the destination is still kept as a ruin." He argued that the town needs public funding for better roads and access to support private reinvestment.

The state has attempted to sell these assets before with mixed results. Seven sanatoriums changed hands in earlier auctions, but three have since reverted to state ownership. Medea was one of them, returned to the government in 2024 after its previous buyer failed to meet contractual obligations. David Sichinava, a Canada-based academic who grew up in Tskaltubo, described the redevelopment strategy as "all or nothing." He noted that the town is exempt from permit fees for casino operators, a benefit worth up to $1.9 million annually elsewhere in Georgia.

Sichinava said, "Balneology (the science of therapeutic use of baths) alone can't really support the kind of tourists that this town can host." The town gained national attention in October 2019 when Bidzina Ivanishvili, Georgia’s wealthiest man, promised to buy the spas and undertake a "full-scale rehabilitation." Prime Minister Irakli Kobakhidze stated on October 20 that the plan was dropped due to the pandemic and "de facto sanctions" against Ivanishvili.

Since the 1990s, the buildings have also served as temporary housing for people displaced by conflicts in Abkhazia and South Ossetia. Most residents have moved out, though Sichinava estimates 100 to 200 displaced people still live in the structures. Madonna Mushkudiani moved into one of the buildings after fleeing Abkhazia in 1992. She was relocated to an apartment in 2023 but still visits former neighbors. She told RFE/RL, "We miss every minute we spent there. It was our second home."