Georgia is once again offering ten former sanatoriums in the spa town of Tskaltubo for auction. As RFE/RL reports, the current auction round opened on October 20, 2026, and is scheduled to end on November 15. By purchasing the properties, investors take on binding obligations to develop the buildings for new tourism uses within five years.
The state is thus linking privatization to a specific development mandate. The complexes, some of which have fallen into disrepair, are to become hotels, healthcare facilities and other tourism amenities once again.
Purchase price and investment obligations go together
The well-known Medea sanatorium, with its striking colonnades, illustrates the scale of the financial commitment. According to the Georgian business portal BM.ge, the starting price is around GEL 8,500,000. In addition, the buyer must invest at least GEL 61,935,000 excluding VAT within five years.
The plans call for a hotel with at least 120 rooms, conference halls and restaurants, operating under the name of an international hotel operator or brand. The obligation therefore extends all the way to opening a fully operational hotel.
For all ten properties combined, the business publication Commersant puts the minimum investment at GEL 314,013,000 excluding VAT. Depending on the complex, the plans envisage hotels, apartments or diagnostic and rehabilitation facilities. The requirements therefore vary according to the building and its intended use.
Why the sanatoriums are being offered again
The new round builds on the “New Life for Tskaltubo” program launched in 2022. According to Commersant, seven sanatoriums have been sold under the program so far, three of which subsequently returned to state ownership.
Medea is among those properties. RFE/RL reports that the state took it back in 2024 because the buyer at the time had failed to meet contractual obligations. The example illustrates how central the agreed development is to this form of privatization.
The National Agency of State Property describes the broader program as a combination of modern spa tourism, medical services and the renewal of the town center and public spaces. The hotels are therefore part of a larger undertaking for the entire spa town.
A spa town also needs vibrant surroundings
Tskaltubo's warm mineral springs and historic spa architecture give it a distinctive tourism profile. Real estate expert Frederic Le Fichoux, interviewed by RFE/RL, sees commercial potential and emphasizes that individual renovations only deliver their full impact when the areas around the buildings develop as well.
Renewal also involves the complexes' social history. Some buildings still house internally displaced people who found shelter there after the conflicts in Abkhazia and South Ossetia, as RFE/RL reports. Their housing situation is therefore also part of the town's development.
What does this mean for buyers and investors?
For project investors, the focus is on the total commitment: acquisition, mandatory investment and subsequent operation must work together. There are also property-specific considerations. Commersant mentions heritage protection for certain buildings, existing uses and easements affecting parts of the plots, among other factors.
For property buyers in the surrounding area, the main point of interest is how the individual projects will come together to form a functioning spa town. In our view, operating hotels, healthcare facilities and well-maintained public spaces can make the town a more appealing place to spend time and attract additional economic activity. This also improves the environment for long-term property investment.
Our conclusion
The renewed auction gives Tskaltubo's regeneration another concrete starting point. The combination of historic buildings, thermal springs and binding development mandates offers an exciting foundation for the spa town's future.
We see this as an opportunity for Georgia's regional development: if building restoration and public infrastructure move forward together, Tskaltubo can give its distinctive character a new lease of life. A vibrant spa town with quality amenities also supports the long-term appeal and value growth of real estate.
