TSKALTUBO SPA & WELLNESS RESORT DEVELOPMENTRESORT DEVELOPMENT

Georgian National Investment Agency 2013

INININVNV STNVESTNNGEOORGIANN

VESTORGIA

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GEORGIA IS EXPECTING SIGNIFICANT GROWTH TRAJECTORY IN TOURIST ARRIVALS

TOTAL INTERNATIONAL TOURIST ARRIVALS

Internati onal arrivals have seen ~40% year-on-year growth

Number of tourists visiti ng Georgia for health and medical care purposes

May 2011 - April 2012

Source: Georgian Nati onal Tourism Administrati on

Turkey

Azerbaijan

Armenia

Russia

Central and Eastern Europe

Other Europe

Other

1171

3771156

226 6111527

38,93238,932

STOURIST ARRIVALSOURIST ARRIVALS

SS0.6

1.0 1.1 1.3 1.52.0

2.8

4.4

5.5

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IN IN GEO

TSKALTUBO: THE CURRENT SETTINGTSKALTUBO: THE CURRENT SETTING

• City Located in West Georgia, Imereti region at the foot of the Caucasus Mountains.

• Located on key tourist route near Kutaisi (2nd largest city in Georgia) on route to key desti nati ons in Western Georgia.

• Widely popular desti nati on for health treatments from Soviet ti mes.

• Tskaltubo –famous brand in CIS countries

THE GLOBAL SECTORTHE GLOBAL SECTOR

• Signifi cant growth in health & wellness tourism worldwide over past several decades.

• Popularizati on of the wellness concept in the 1970-1990 in U.S. and Europe, now with growing popularity of the older “medical resort” concept.

OPPORTUNITY: THE “REINVENTION” OPPORTUNITY: THE “REINVENTION” OF TSKALTUBOOF TSKALTUBO

• Good opportunity to renovate Tskaltubo resort to achieve the right mix of the traditi onal balneotherapy resort styles with modern, spa resort concepts.

• Benefi t from growing internati onal, regional and local tourism in Georgia.

• Support and commitment to infrastructure development from Government of Georgia.

• Incenti ves may be applied on the basis of individual negoti ati ons

TSKALTUBO - OVERVIEW

VESTORGIA

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TSKALTUBO’S IDEAL LOCATION: COUNTRY MAP & TRAVEL INFRASTRUCTURE

LOCATION ON KEY TOURISTIC/BUSINESS ROUTE:LOCATION ON KEY TOURISTIC/BUSINESS ROUTE:

• Kutaisi – 7 km – 2nd largest city• Poti – 40 km – Biggest Port (FIZ) • Mesti a – 130 km –Mountain Resort• Batumi- 150 km- Resort and Entertainment Centre• Tbilisi – 220 km – Capital of Georgia• Close proximity to Nati onal Parks and historic sites

EASY & MODERN ACCESS:EASY & MODERN ACCESS:

• New Kutaisi Internati onal Airport• New Highway• Renovated City Infrastructure

Poti

Batumi

STA

STTAAAAAT

Kobuleti

SSTSSTTSSTTSKutaisisiiisi

Road NetworkRussiaRussia

TbilisiTbilisi

AzAzAzAzererererbbbababaijanAzzzzererererbbbbbbaijanArmeniaArmenia

BlackBlackSeaSea

SS30 km

100 km

230 km

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IN IN GEO

TSKALTUBO TODAY

• Subtropical climate and considered to be the unique spa resort in the region. Average annual temperature of +14.6C, with average low of +5.3C and average high of +25C.

• Vast reserve of thermal waters with unique therapeuti c qualiti es.

• Over 2000 hours of sunshine annually.

• More than 150 types of deciduous (leafy) and coniferous (evergreen) trees on the territory of this unique resort area.

• Existi ng and operati ng set of sanatoriums and baths receiving visitors all year round

• 2008-2010 Tskaltubo was visited by 2 000 visitors a year, in 2011 increased to 7 000, in 2012 -15 000 and by 2020 it is expected 32 000 visitors(due to the improved infrastructure and higher demand for spa treatments).

Source: Georgian Nati onal Tourism Administrati on

VESTORGIA

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TSKALTUBO’S UNIQUE THERMAL & MINERAL WATERS

UNIQUE MINERAL MAKE UPUNIQUE MINERAL MAKE UP

• Tskaltubo’s water composition is very complex and rare, with no analogies in Asian or European countries.

• While salt and mineralization levels are low, the salts have extremely active Calcium and Magnesium contents.

• The chemical composition of Tskaltubo’s water does not include any strong toxic substances.

• The chemical composition of almost all of Tskaltubo’s waters is more or less identical. It does not change seasonally and it does not depend on the amount of sediment (rain, snow etc.).

IDEAL, CONSTANT TEMPERATURESIDEAL, CONSTANT TEMPERATURES

• The temperature of Tskaltubo’s water, which varies from 32 to 35 degrees Celsius, is almost equal to human body temperature. Thus, the water does not require additional warming or cooling.

• Temperatures are naturally constant, a result of bath locations directly at springs and from the constant flow of water, which is key to prevent loss of a range of components (minerals, gases, etc.) which would decrease effectiveness of medical treatments.

CURATIVE FACILITIES CURATIVE FACILITIES

• Best for treating patients suffering mostly from diseases of locomotor system and nervous, heart, hypertension and bronchial asthma.

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IN IN GEO

TSKALTUBO: CITY MAP & INFRASTRUCTURE

40 ha Landscape for Development

Lake “Tsivi”

Playground

9 baths

80 ha City Park in city center

Channel around the City Park

20 Sanatoriums (15 state, 5 private) situated in circle around City Park

VESTORGIA

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GOVERNMENT INVESTS IN TSKALTUBO

Second Regional Development Second Regional Development Project (Imereti ) Project (Imereti )

World Bank $30m & Government World Bank $30m & Government of Georgia $7.5m (2012-2016)of Georgia $7.5m (2012-2016)

Component 1.1 Urban Component 1.1 Urban regenarati on of Tskaltubo) regenarati on of Tskaltubo)

An integrated approach for urban An integrated approach for urban renewal of Tskaltubo City: renewal of Tskaltubo City: Rehabili-tati ng of municipal infrastructure, (water,sanitati on, street lighti ng and access roads) restorati on of public buildings, urban renewal of Tskaltubo central park.

The Project Development Objec-The Project Development Objec-ti ve ti ve is to improve infrastructure services and insti tuti onal capacity to support increased contributi on of tourism in the local economy of the Imereti Region.

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IN IN GEO

TSKALTUBO - CENTRAL PARK

CAFE-PEERCAFE-PEER DECORATIVE FOUNTAINSDECORATIVE FOUNTAINS

PERGOLAPERGOLA BICYCLE PARKINGBICYCLE PARKING

IN IN GEO

VESTORGIA

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TOURIST ATTRACTIONS NEAR TSKALTUBO

Government invests in Tourism Government invests in Tourism infrastructureinfrastructure

Second Regional Development Project (Imereti ) Second Regional Development Project (Imereti )

World Bank&Government of Georgia World Bank&Government of Georgia

Component 1.2.Tourism Circuits DevelopmentComponent 1.2.Tourism Circuits Development

An integrated approach to site upgrading and improved management of the six most att racti ve An integrated approach to site upgrading and improved management of the six most att racti ve cultural heritage sites in Imereti :cultural heritage sites in Imereti : including Gelati Monastery; Vani museum and surrounding archeological site; Ubisa Church; the Katskhi church; the Katskhi Column Monastery and the Motsameta Monastery;

Other tourist desti nati ons: Other tourist desti nati ons: Sataphlia strict nature reserve (known for it’s Dinosaurs traces); Ajameti Protected Area; Prometheus Cave (one of the richest cave in Europe); Borjomi-Kharagauli Nati onal Park.

RGIA

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ONGOING REHABILITATION OF TSKALTUBO RESORT BY THE PRIVATE SECTOR

• 5 sanatoriums-private property • One operati ng hotel – Tskaltubo Spa Resort

REHABILITATION OF BALNEOLOGICAL BATHSREHABILITATION OF BALNEOLOGICAL BATHS

Number of baths: 9Bath #6 - restored/working conditi onBath #1 and Bath #3- normal conditi onBath#7 and Bath #8 – bad conditi onBath#2,#4,#5,#9 – needs reconstructi on

IN

VESTORGIA

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INVESTMENT OPPORTUNITIES-RENOVATION AND REDEVELOPMENTOF EXISTING SANATORIUMS INTO LUXURY SPA RESORTS

VESSTIA RG

SANATORIUM “GELATI”

Address: 6, Baratashvili Str., 6, Baratashvili Str.,State ownership: 100% 100%Land Area: 20 000 sq.m 20 000 sq.m Total Building Area: 6965 sq.m 6965 sq.m

SANATORIUM “TBILISI”

Address: 2, Baratashvili Str 2, Baratashvili StrState ownership: 100 % 100 % Land Area: 25 000 sq. m 25 000 sq. m Total Building Area: 8 250 sq.m8 250 sq.m

SANATORIUM “MEGOBROBA”

Address: 45, Rustaveli Str, 45, Rustaveli Str, State ownership: 100% 100% Land Area: 11 HA 11 HATotal Building Area: 54818 sq.m 54818 sq.m

SANATORIUM “RKINIGZELI”

Address: 51, Rustaveli Str 51, Rustaveli StrState ownership: 100% 100% Land Area: 33 000 sq. m 33 000 sq. m Total Building Area: 8 724 sq.m 8 724 sq.m

SANATORIUM “IMERETI”

Address: 4, Sulkhan Saba Str, 4, Sulkhan Saba Str,State ownership: 100% 100%Land Area: 35 000 sq. m 35 000 sq. m Total Building Area: 2 200 sq.m 2 200 sq.m

SANATORIUM “IVERIA”

Address: 2, 26 May Str 2, 26 May StrState ownership: 100% 100% Land Area: 20 956 sq. m 20 956 sq. m Total Building Area: 14 405sq. m 14 405sq. m

SANATORIUM “METALURGI”

Address: 7, Baratashvili Str, 7, Baratashvili Str, State ownership: 99,65% 99,65% Land Area: 50 000 sq. m Total 50 000 sq. m Total Total Building Area: 10 200 sq.m10 200 sq.m

SANATORIUM “SAVANE”

Address: 19, Rustaveli Str19, Rustaveli StrState ownership: 100 % 100 % Land Area: 15 000 sq. m 15 000 sq. m Total Building Area: 3150 sq.m 3150 sq.m

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IN IN GEO

TSKALTUBO DEVELOPMENT CONCEPT

TSKALTUBO RESORT AREA STRUCTURE OUTLOOKTSKALTUBO RESORT AREA STRUCTURE OUTLOOK

Desti nati on Spas

Hotel & Resort Spas

Day Spas

Related Industries in

the City

Off erings:Off erings:Treatment of diseases with mineral waters through baths, massage and relaxati on.

Diff erent type of clinics Medical treatmentsFitness ,therapiesBeauty treatment

Hotels,Restaurants, Shops, Tour Operators, Public Transport, Sports, Golf, Raft ing, Riding, Events.

INVESTAIN GEORGIA

GEORGIAN NATIONALGEORGIAN NATIONALINVESTMENT AGENCYINVESTMENT AGENCY

www.investingeorgia.orgwww.investingeorgia.org

E-mail: enquiry@investi ngeorgia.orgPortf olio Manager: Nino Tsetskhladze

E-mail: ninot@investi ngeorgia.org