Georgia Sets $27.3 Million Total Cost for Tskaltubo Medea Sanatorium Sale

A buyer for the Medea sanatorium in Tskaltubo, Georgia, must commit a total of $27.3 million, combining a purchase price of $3.3 million with a mandated $24 million renovation budget. The Georgian government listed the property on October 20, and the online auction closes on November 15.

The Medea complex is the most prominent of ten Soviet-era sanatoriums currently up for sale. The renovation requirements specify the delivery of at least 120 guest rooms, conference halls, and restaurants over a five-year period. The other nine properties in the auction carry similar obligations, with initial bid prices ranging from $1 million to $3.5 million.

Tskaltubo was a major destination during the Soviet period, attracting visitors via direct trains from Moscow for its mildly radioactive mineral springs. The town's infrastructure has deteriorated since the 1990s, when the buildings also served as housing for people displaced by the conflicts in Abkhazia and South Ossetia.

Frederic Le Fichoux, a commercial real estate expert who contributed to a 2020 feasibility study for the town, noted that individual building restorations may not be enough to revive the destination. He stated that if one investor renovates a single property, the rest of the town remains in a state of ruin. Le Fichoux argues that public funding for infrastructure, such as roads, is necessary to support private reinvestment in the buildings.

The state has attempted to sell these properties before, but the process has faced setbacks. Seven sanatoriums were sold in previous auctions, yet three have returned to state ownership. Medea was taken back by the state 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 approach as all or nothing. He pointed out that Tskaltubo is exempt from casino permit fees that can reach $1.9 million annually in other parts of the country. He noted that therapeutic baths alone cannot support the volume of tourists the town could host.

Bidzina Ivanishvili, the founder of the ruling Georgian Dream party, had pledged to buy the spas in October 2019 and launch a full-scale rehabilitation. Prime Minister Irakli Kobakhidze said on October 20 that the plan was dropped due to the pandemic and de facto sanctions against Ivanishvili. Madonna Mushkudiani, a former resident who fled Abkhazia in 1992, said the buildings were a second home for displaced families, though she was relocated to an apartment in 2023.