Medea Bidder Faces $24 Million Buildout Bill

Georgia has listed ten Soviet-era sanatoriums in the spa town of Tskaltubo for auction, with strict renovation requirements attached to every sale.

The government published the listings on October 20, and online bidding ends November 15. The Medea sanatorium, known for its neoclassical arches, carries an asking price of $3.3 million. Its buyer must also commit $24 million toward a five-year renovation that must deliver at least 120 guest rooms, conference halls, and restaurants. The other nine properties are priced between $1 million and $3.5 million and carry similar investment pledges.

Frederic Le Fichoux, a commercial real estate expert who worked on a 2020 feasibility study for Tskaltubo, said the terms reflect a structural problem with restoring individual buildings. "If you are one investor and you buy, you renovate that property that you bought, you turn it around," he said, "but then the rest of the destination is still kept as a ruin." Le Fichoux said the town needs public investment in roads and other access alongside private capital for the buildings.

The state has attempted sales before. Seven sanatoriums were sold in earlier auctions, and three returned to state ownership afterward, including Medea, which reverted in 2024 after its buyer missed contractual obligations. In October 2019, Bidzina Ivanishvili, founder of the ruling Georgian Dream party, promised to buy the properties and called their condition "depressing." Prime Minister Irakli Kobakhidze said on October 20 that the plan was dropped due to the pandemic and what he called "de facto sanctions" against Ivanishvili.

Since the 1990s, the buildings have sheltered people displaced by conflicts in Abkhazia and South Ossetia. David Sichinava, an academic who grew up among the sanatoriums, estimates 100 to 200 displaced residents remain in the structures. Tskaltubo is exempt from the casino permit fees that can reach $1.9 million a year elsewhere in Georgia, a rule Sichinava has mixed feelings about. "Balneology (the science of therapeutic use of baths) alone can't really support the kind of tourists that this town can host," he said. Madonna Mushkudiani moved into one sanatorium after fleeing Abkhazia in 1992 and was relocated to an apartment in 2023. "We miss every minute we spent there. It was our second home," she said.