Guaranteed Yield in Batumi: What Does It Really Mean?

“8% guaranteed.” “10% for two years.” Sometimes 12%.

These numbers are common in Batumi aparthotel sales. The important question is not whether the guarantee is real. It is where the money comes from, who is promising it, and what you paid for it.

Written August 2026. The figures below are sourced and dated — check them against the year you are reading this.

A guaranteed yield is a payment schedule, not a return

A return is what an asset earns.

A guarantee is a promise by a company to pay a fixed amount regardless of what the asset earns.

Those are different things.

A Batumi apartment may genuinely generate enough rental income to support the advertised payment. Or the developer may be paying the buyer from another source. Or the buyer may have paid for the guarantee in the purchase price and is simply receiving part of that premium back over time.

None of those possibilities, by itself, makes the transaction fraudulent. But they produce very different investments.

A guarantee is therefore better understood as a credit question than a yield question. The relevant questions become: who pays, out of what money, for how long, and what happens if they stop?

Where can the money actually come from?

There are only three places.

1. The unit genuinely earns it

The apartment generates enough rental income to fund the payment.

This is the cleanest version. The underlying asset produces the return.

But the numbers still need to work after management, platform commissions, cleaning, utilities, furnishing and other operating costs.

2. The developer earns it elsewhere

The developer sells the apartment at a margin and uses part of that margin to make the promised payments over time.

Again, this is not automatically improper. But the payment is no longer evidence that the apartment itself produces that return.

3. The buyer paid for it at purchase

The guarantee may already be incorporated into the price. The buyer pays more for the guaranteed unit, then receives payments over the following years.

In that case, the apparent income can partly be the buyer’s own money coming back in instalments.

The second and third structures are common. Neither is necessarily fraud. Both change what the deal is worth.

The question that settles most of the argument

What does this exact unit cost without the guarantee?

This is the question to ask before discussing the percentage.

A developer running a straightforward programme should be able to show the price with the guarantee and the price without it. They are simply two versions of the same product.

If the identical unit costs materially less without the guarantee, the percentage needs to be viewed in that context.

Consider this exact example.

The guaranteed unit costs USD 60,000. An identical unit two floors down, without the guarantee, costs USD 50,000. The advertised guarantee is 10% for two years.

Ten per cent of USD 60,000 is USD 6,000 a year. Over two years, that is USD 12,000 in payments.

But the guaranteed buyer has already paid a USD 10,000 premium for the supposedly identical product.

So the buyer is not simply buying USD 12,000 of new income. They have paid USD 10,000 more and receive USD 12,000 back through the guarantee.

That is not buying income. It is financing it at your own expense and paying a small fee for the privilege.

The exact economics depend on the contract and what else differs between the two units. But the comparison is powerful because it strips the percentage out of the sales presentation.

What does a Batumi apartment actually earn?

The underlying market is seasonal. Very seasonal.

The available figures give a useful starting point.

Batumi market figure	Figure
Visitors to Adjara, 2024	~2.5 million
Active short-term rental listings in Batumi	~3,300–3,600
Summer occupancy	55–56%
Average daily rate	~USD 37
Typical gross income per apartment per year	~USD 7,000
Share of annual income earned in two months	Over 80%

The last figure is particularly important.

An apartment grossing USD 7,000 a year is not earning approximately USD 580 every month. It earns close to USD 2,800 in each of two months and very little across the other ten.

That is what seasonality looks like when translated into cash flow.

And USD 7,000 is gross.

From that amount come platform commissions, the management company’s share, cleaning between guests, utilities, replacement of furniture and equipment that a hundred strangers a year can use hard, plus the standing costs of months in which there is little or no income.

Now compare that with a 10% guarantee on a USD 60,000 purchase. That is USD 6,000 a year, paid monthly, including in winter.

The gap between the underlying gross income and the guaranteed payment is not small.

Someone funds it. The useful question is who.

Seasonality is what the guarantee hides

A guarantee solves a real problem. It turns highly seasonal rental income into a flat monthly payment.

That is useful for an investor who values predictable cash flow. There is no reason to pretend otherwise.

But it also removes the signal that would otherwise show you how the property performs.

During the guarantee period, a strong unit and a weak unit can pay exactly the same amount.

The building’s real rental performance becomes visible when the guarantee ends. That is precisely when the buyer can no longer use the guarantee to change the original purchase decision.

The underlying market also has a difficult off-season. In Q1 2024, the number of booked nights in Batumi fell 30% year on year.

Adjara’s tourism administration estimates that a 10% improvement in seasonality would add USD 50–60 million a year to the regional economy. That estimate is useful context. It also deserves context of its own: the figure comes from the administration whose role includes promoting the destination.

The point is not that Batumi has no winter demand. The point is that seasonality is economically significant enough that smoothing it with a guarantee has real value — and a real cost.

The winter statistic you may be shown

There is a genuine statistic that can make Batumi look much stronger in winter.

STR Global figures published by the Georgian National Tourism Administration for branded hotels in Q1 2025 show:

Location	Branded-hotel occupancy, Q1 2025
Batumi	59.9%
Tbilisi	39.5%
Rest of Georgia	35.3%

Batumi leads the country in this measure. The number is real.

But it answers a different question.

STR counts branded hotels that are open and reporting. Much of Batumi’s seasonal accommodation closes during winter. The branded hotels that remain open absorb the demand that remains and can therefore post a high occupancy figure.

That is a statistic about survivors.

Your apartment is not automatically part of that pool. It competes with approximately 3,500 short-term listings that remain online throughout the year, whether or not they receive bookings, as well as with the other units in its own building.

For the same quarter, average occupancy across Airbnb listings in Georgia was 40.9%. That is a country-wide average, carried by cities with year-round demand.

So the 59.9% figure is not wrong. It is simply not a measurement of the apartment you are being offered.

Who is actually guaranteeing the payment?

Read the contract for the name of the party that owes you the money.

Then ask a basic question: is it the developer, or a separate management company?

Very often, the obligation sits with a service company established for the building. That company may have limited assets. A promise from an entity that owns nothing is worth what that entity owns.

Ask what happens if the company is wound up in year two. Does the obligation pass to another entity? Usually not.

Ask whether the payment is secured against anything:

• escrow;
• retained funds;
• the developer’s other assets;
• another form of security.

Almost never. Ask anyway. The reaction can tell you something.

And what happens if the company simply stops paying? You may have a legal claim. But a court claim against a company with no assets has limited practical value.

This is not a reason to walk away from every guaranteed-yield programme. It is a reason to price the promise for what it is: unsecured credit from a company you have not credit-checked.

The day the guarantee ends

Year three arrives.

Imagine a building with, say, 300 near-identical units. Many of them come off their guarantees at approximately the same time. Many owners list them on the same platforms. They compete in a city with approximately 3,500 competing short-term listings.

And the strongest rental season lasts two months.

That is the asset that was actually bought. The guarantee did not remove that market. It simply delayed the buyer’s introduction to it.

So the better question at the beginning is not “What is the guaranteed yield?” It is: “What will this unit earn in year four?”

Everything before that is, in part, a financing arrangement.

“10%” of what, exactly?

A percentage sounds precise. It is not precise until the base and the conditions are clear.

There are five places where the number can hide.

1. What is the base?

Is the 10% calculated on the purchase price? Or on a price that includes the furniture package? Does it include VAT?

A percentage applied to a larger base produces a larger payment.

2. Gross or net?

Is the payment net of management fees? What about utilities? What about tax?

“10% guaranteed” does not tell you whether 10% is what reaches your account.

3. When is it paid?

Monthly? Or as a lump sum at the end of the year, after the developer has had your money for twelve months?

The timing has economic value.

4. For how long, and from when?

Does the guarantee start when you sign? When you pay in full? When the building opens?

A guarantee that begins only after completion is worth less if completion is delayed for a year.

5. What happens before opening?

An off-plan apartment may be sold with a guarantee that begins later than the buyer’s payment schedule. You can therefore be paying for the property long before the guarantee starts.

Get all five points in writing. A developer that answers them clearly and quickly is usually the one worth continuing to examine.

One tax point to check early

Georgia taxes an individual’s residential rental income at 5%. Capital gains on the sale of residential property are exempt if the property has been owned for more than two years.

That exemption does not apply to property used to generate business income.

An apartment let to tenants is straightforwardly residential. A unit placed into a hotel-style managed pool is a different situation. Whether it retains the same treatment on exit is a question to resolve with a tax adviser before signing, not in the year you sell.

The distinction can affect the tax treatment of the eventual exit.

These are general rules, not tax advice. The treatment of a particular property and ownership structure should be checked with a qualified tax adviser.

What we check before letting a client sign

A guaranteed-yield offer should be reduced to documents and numbers. Our checklist is straightforward:

• The price list, with and without the guarantee, in writing.
• The legal entity that owes the payment, and what it owns.
• The developer’s completed buildings — not planned buildings, completed ones.
• Actual revenue from comparable units already operating in the city.
• The management contract and what it says about the years after the guarantee.
• The exit: how many units are in the building, how many have been resold, and at what prices.

The purpose is not to prove that the guarantee is good or bad. It is to find out what you are actually buying.

Some guaranteed-yield deals are good. The good ones survive these questions. That is exactly why the questions are worth asking.

A short note on Tbilisi

Everything above is deliberately about Batumi.

The guaranteed-yield product is overwhelmingly coastal, and it exists in large part because coastal rental income is seasonal enough to need smoothing.

Tbilisi has a different demand pattern, including business travel, relocation, medical travel, transit and students.

The Batumi arithmetic does not transfer to Tbilisi. Nor does Tbilisi’s arithmetic automatically transfer back to Batumi. Each market needs to be judged on its own numbers.

A separate comparison of Batumi and Tbilisi investment economics can be provided if that is the question you are trying to answer.

The question to ask before you sign

A guaranteed yield can be useful. It can make cash flow easier to plan. It can reduce the immediate effect of Batumi’s seasonality. And some programmes genuinely deliver what they promise.

But a guarantee is not the same thing as the asset producing the advertised return.

The percentage tells you what someone promises to pay. It does not tell you:

• what the apartment actually earns;
• what you paid for the promise;
• who owes you the money;
• what assets stand behind that obligation;
• what happens when the guarantee ends.

That is why the most useful question is not “Is 10% good?” It is: “What does this exact unit cost without the guarantee, and what will it earn in year four?”

Once those two numbers are known, the sales percentage becomes much less interesting.

Send us the offer — the price list, the guarantee terms and the building — and we will give you the arithmetic and the name of the party that owes you the money. No meeting required.

Sources

• Adjara Tourism Administration — visitor volumes and seasonality, 2024
• Airbnb market data for Batumi — active listings, occupancy, average daily rate, income concentration, and the Q1 2024 year-on-year change in booked nights, as compiled in btuai.ge
• Georgian National Tourism Administration, Statistical Overview of Georgian Tourism, Q1 2025 — branded-hotel occupancy by city (source: STR Global) and Airbnb occupancy and unit counts (source: AirDNA): gnta.ge
• Tax treatment of rental income and capital gains — PwC Georgia tax summaries