TBILISI, March 11 – A new state audit has found that most municipal properties sold through electronic auction in Georgia drew just one bidder, spotlighting how local governments are privatizing public real estate.
The findings, reported by BPN, touch a sensitive subject in Georgia, where privatization of public assets has been a recurring feature of the post-Soviet era, including during the market-oriented reform drive of the 2000s.
According to the audit, municipalities disposed of 420 properties during the period reviewed. In 215 cases, they used a direct disposal method. Only 26 properties were sold through a public auction. Another 179 properties were sold through electronic auction, but in 133 of those cases only one person took part and won without competition.
The figures come from an audit of how municipalities managed and disposed of real estate in 2022, 2023 and the first six months of 2024, up to July 1, 2024. The review covered municipalities including Aspindza, Dedoplistskaro, Lagodekhi, Marneuli, Mtskheta, Sagarejo, Sighnaghi, Kvareli, Tsalka, Samtredia, Martvili, Chokhatauri and Tskaltubo.
The audit also said municipalities mostly sold or leased out property with no special conditions attached. It found that 83% of privatized properties and 93% of leased properties were disposed of without any conditions, meaning local governments received extra budget revenue but did not consider alternative terms that could have reflected the interests of residents.
Even where conditions were attached, enforcement was weak, according to the report. Auditors said that among properties disposed of with obligations, the period for fulfilling those obligations had expired in 24 cases, and in five of them the conditions had not been met. In another group of 37 properties disposed of with conditions before 2022, the conditions remained unfulfilled in six cases. The report says municipalities did not take proper action against entities that failed to meet those obligations.
