Tskaltubo Spa Bidders Face $27.3 Million Cost

The government of Georgia has opened an online auction for ten dilapidated sanatoriums in the resort town of Tskaltubo. The listing went live on October 20, and bids are due by November 15. For potential buyers, the entry price is just the first of several financial hurdles. The state seeks the equivalent of $3.3 million for the most famous property, the Medea sanatorium. However, the winning bidder must also commit $24 million toward a five-year renovation plan. That total investment would need to deliver at least 120 guest rooms, conference halls, and restaurants.

The other nine properties in the auction carry similar conditions. Initial prices range from $1 million to $3.5 million, with buyers required to pledge substantial additional funds for repairs. These buildings served as popular destinations during the Soviet era, attracting tourists from Moscow who came to bathe in warm, mildly radioactive mineral water. The Medea sanatorium is particularly recognizable, with its neoclassical arches frequently appearing in Western media coverage.

Frederic Le Fichoux, a commercial real estate expert who contributed to a 2020 feasibility study for the town, warned that restoring individual buildings might not fix the wider infrastructure. He noted that visitors may stay away if the surrounding area remains neglected. "If you are one investor and you buy, you renovate that property that you bought, you turn it around," Le Fichoux said, "but then the rest of the destination is still kept as a ruin." He argued that public funds are needed for roads and access to make private reinvestment viable.

This is not the first time the state has tried to sell these assets. Seven sanatoriums were sold in previous auctions, but three have returned to government ownership. Medea itself was taken back in 2024 after its previous buyer failed to meet specific contractual obligations. The history of the town includes a high-profile pledge in October 2019, when Bidzina Ivanishvili, Georgia’s wealthiest man, promised to buy the properties. He called their condition depressing and pledged full-scale rehabilitation, but the plan never materialized. Prime Minister Irakli Kobakhidze attributed the delay to the pandemic and sanctions against Ivanishvili.

David Sichinava, a Canada-based academic who grew up in Tskaltubo, described the redevelopment strategy as an all-or-nothing approach. He noted that the town is exempt from permit fees for casino operators, a benefit that can reach $1.9 million a year elsewhere in the country. Sichinava believes therapeutic baths alone cannot support the volume of tourists the town could host. "Balneology (the science of therapeutic use of baths) alone can't really support the kind of tourists that this town can host," he said.

Since the 1990s, the sanatoriums have also housed people displaced by conflicts in Abkhazia and South Ossetia. Most residents have moved out, but Sichinava estimates that 100 to 200 displaced people still live in the buildings. Madonna Mushkudiani moved into one of the properties after fleeing Abkhazia in 1992. She was relocated to an apartment in 2023 but still visits former neighbors. "We miss every minute we spent there. It was our second home," she said.