China Green Development Group announced a directive in late October 2026 to suspend all ongoing hotel construction projects that meet suspension criteria. The move follows the group reporting a net loss attributable to shareholders of 814 million yuan in autumn 2026, a significant drop from a 157 million yuan profit the previous year.
Suspended Hotel and Tourism Projects
The suspension impacts multiple hotel and cultural tourism developments, including the second phase of Xinjiang Huamei Resort, newly planned supporting facilities for Wen’an phase two, and long-term hotel cluster plans at Wenchang Shanhaitian. Additionally, construction projects in Kuqa, Turpan, Hami, Kashgar, and Kuitun remain suspended or uncertain.
Hotels in Xinjiang Huamei Resort phase one reported an average occupancy rate below 20% in the first quarter of 2026, underscoring profitability challenges.
Strategic Shift and Business Model Breakdown
Since Liu Yu’s departure at the end of 2024, China Green Development has pursued a strategic contraction, emphasizing strict investment control. The prior model relied on transferring profits from the group’s new energy sector to subsidize losses in cultural tourism and hotel investments. However, in the first half of 2026, the new energy gross profit margin plummeted from 56.82% to 39.3%, eroding financial support for the cultural tourism projects.
Asset Transfers and Hotel Sales
The Changbai Mountain hotel asset package was transferred
and removed from the balance sheet in 2026. The Hangzhou Green Development Center’s planned height was reduced from 299 meters to 190 meters in 2024, and its 99% equity was listed for transfer at a reserve price of 3.58 billion yuan in November 2025. Meanwhile, R&F auctioned the Hilton Doubletree Resort Chengmai R&F Mangrove Bay and Hyatt Regency Hainan Ocean Paradise Resort Lingshui at a total starting price of 873 million yuan with a 30% discount in October 2026 but failed to attract bidders. Shimao sold two Hong Kong hotels, Sheraton Hong Kong Tung Chung and Four Points by Sheraton
Hong Kong Tung Chung, for HK$2.7 billion in October 2026, down from the original asking price of no less than HK$6 billion in 2023.
Market Demand Changes and Industry Context
The group’s core urban hotels — JW Marriott Marquis Shanghai Luwan, The Shanghai EDITION, and Four Seasons Dalian — remain classified as high-quality assets with plans for optimization rather than suspension. China’s five-star hotel market shifted as corporate guests decreased from around 60% to less than 50%, replaced by leisure and high-net-worth individuals. The decline in stable long-term corporate contracts undermines hotel revenue predictability. The model of positioning hotels as real estate support or city landmarks
is increasingly unsustainable amid rising operational costs and diminished guest stability.
China Green Development management summarized the policy as “Suspend all projects that should be suspended,” signaling a strict suspension stance on ongoing hotel projects without clear return prospects, according to eu.36kr.com.
An unnamed industry insider noted, “For a 400-meter-high building, the electricity bill for lighting every night will not be discounted by 70% just because only 30% of the rooms are occupied.” Another insider characterized the suspended assets as “poor assets that perform poorly in all scenarios.”
