Why does China Green Development Group apply the "all that should be suspended must be suspended" requirement to its ongoing hotel construction projects?
In the autumn of 2026, the semi-annual report released by China Green Development left the market in silence. The financial report shows that the group's net profit attributable to shareholders was -814 million yuan, compared with a profit of 157 million yuan in the same period of the previous year.
The superficial explanation for the losses lies in the "revenue growth without profit growth" of its new energy main business and the pressure of financial expenses. However, those who are familiar with the development track of this enterprise clearly know that what has dragged down its pace is never just the decline in gross profit margin of wind and solar power stations. Those heavy-asset hotels and cultural tourism projects that were once highly expected but have now become chronic problems in the financial statements are the core of this round of contraction.
Since Liu Yu stepped down at the end of 2024, in less than two years, the strategic adjustment of China Green Development has been almost resolute. Among the hotel and cultural tourism projects, the second phase of Xinjiang Huamei Resort has been suspended, all new supporting facilities for the second phase of Wen'an have been fully halted, the long-term hotel cluster planning for Wenchang Shanhaitian has been sealed, the Changbai Mountain hotel asset package has been delivered and removed from the balance sheet, and the Hangzhou Green Development Center has been listed for transfer.
The new management's wording is concise and stern: "Suspend all projects that should be suspended". It clearly intends to exchange time for space, and strictly control all new investments that are not supported by returns.
The weight of these four words declares not only tactical contraction, but also the end of an entire old development paradigm — the era of high-end hotels that once relied on real estate dividends and stood as landmarks on the city skyline is exiting the historical stage at a speed faster than everyone expected.
Green Development's "Suspend All That Should Be Suspended": An Era Hits the Pause Button
To understand why "Suspend All That Should Be Suspended" became the top instruction of Green Development in 2026, we need to go back to the world before this phrase was put forward.
The core asset formula left over from Liu Yu's tenure was summarized as "exchanging new energy for cultural tourism resources". At the negotiation table of large-scale wind and solar power bases, Green Development once used industrial investment as a bargaining chip to obtain land around top scenic spots granted by local governments.
This model operated smoothly in the upward cycle of the new energy industry. The profits from wind and solar projects were sufficient to cover the depreciation and losses of the cultural tourism sector, and the enterprise had resources in hand, a complete business story, and acceptable financial statements.
At the 2024 China International Import Expo, Green Development signed a cluster cooperation agreement with Marriott, InterContinental and Hilton for 17 hotels in the second phase of Xinjiang Huamei Resort in one go. Its strong momentum made it a sample of cultural tourism expansion.
At that time, no one expected that less than two years after the signing of this cooperation agreement, quite a number of the hotel names would appear on the list of "suspended investment".
Great changes have taken place from both sides simultaneously. On the new energy side, in the first half of 2026, the gross profit margin of Green Development's this sector plummeted from 56.82% to 39.3%, sliding from a "high-profit cash cow" to "break-even operation".
On the cultural tourism side, after the six hotels of the first phase of Xinjiang Huamei Resort opened in July 2025, the average occupancy rate in the first quarter of 2026 was less than 20%.
High housing prices in the summer vacation do exist, but during the long off-seasons in Nalati, Yining and Korla, the costs of depreciation, labor and maintenance remain unchanged. The cash flow from only a few peak months is far from enough to cover the rigid expenses of the whole 12 months of the year. Investors call this type of assets "seasonal assets with high uncertainty". In the words of insiders, they are simply "poor assets that perform poorly in all scenarios".
Therefore, when there is no hope for growth in the new energy sector and the cultural tourism resources obtained on the other side cannot generate profits on their own, the foundation of the entire exchange logic no longer exists.
What followed was an almost ruthless asset disposal.
Hotels such as JW Marriott Marquis Shanghai Luwan, The Shanghai EDITION and Four Seasons Dalian, which are located in the core areas of cities, have solid brand premiums and balanced passenger flow structures, are classified as "high-quality assets", with the task of optimizing operation and exploring revitalization paths such as REITs.
The six hotels of the first phase in Xinjiang are defined as "seasonal bottleneck assets", and the transformation strategy is to reduce low-margin group customers and control fixed costs in the off-season, which is the so-called "survive the first full year first".
The Hangzhou Green Development Center, the original landmark of Qianjiang New Town with a 299-meter main tower, had its planned height reduced to 190 meters in 2024. In November 2025, its 99% equity was listed for transfer at a reserve price of 3.58 billion yuan, with the consideration only 0.28% higher than its net assets, almost breaking even.
As for the projects under construction in Kuqa, Turpan, Hami, Kashgar, Kuitun and other places, they are still left there, waiting for an unclear future that may never come.
After a series of actions, an industry insider put forward a sincere analysis: The reason why "Suspend All That Should Be Suspended" became the top instruction of Green Development in 2026 is precisely because the new management finally admitted a fact that they were reluctant to face: those suspended projects should never have been launched in certain ways from the very beginning.
What these four words have suspended is not just several construction sites and several cooperation agreements, but an old era that regards hotels as supporting facilities for real estate, resources as profit guarantees, and scale as a safety cushion...
The Dusk of Landmark Hotels Was Destined From the Moment the Real Estate Dividend Faded
The reason why Green Development's this round of contraction is of exemplary significance is that it used to be a development model of real estate-backed high-end hotels in China. What is happening to Green Development today is also taking place at the same time at R&F, Shimao, and every other player that once regarded hotels as supporting facilities for real estate.
Over the past two decades, high-end hotels have played an almost tacit role in the golden era of China's real estate industry — developers acquire land in core locations, plan a super high-rise building or a complex, and introduce internationally renowned high-end hotel brands such as Marriott, InterContinental, Hilton or The Ritz-Carlton, but the profitability of the hotel itself is not highly expected.
The value of such hotels is often reflected in three aspects: increasing the selling price and rent of residential and office properties, serving as "supporting sincerity" in negotiations with local governments, and being precipitated on the financial statements in the form of construction in progress or investment real estate to endorse the scale of assets.
In this model, the hotel is a supporting facility, and its operational attribute as a business is relatively weakened. At that time, the height of landmark hotels, the reputation of brands, and the luxury of lobbies all served the real profit center of real estate sales. It seemed that as long as other supporting properties could be sold, hotel losses could be absorbed, and as long as the valuation was rising, depreciation and interest would not be problems.
However, the drawbacks of this model have also become fully exposed in the process of development. When residential sales stagnate, asset valuations are revised downward, and financing channels narrow, hotels seem to suddenly change from "supporting facilities" to "burdens" overnight.
R&F's trajectory is quite straightforward. Once upon a time, R&F, which owned more than 90 luxury hotels, was the largest luxury hotel owner in China. In October 2026, Hilton Doubletree Resort Chengmai R&F Mangrove Bay and Hyatt Regency Hainan Ocean Paradise Resort Lingshui were put on the judicial auction platform on the same day, with a total starting price of 873 million yuan, 30% off the original value, and zero bidders.
This is not an isolated case. In the past three years, R&F's hotel assets have repeatedly gone through the cycle of being listed, viewed, unsold, price cut, and relisted on the judicial auction platform. R&F, which once took over the hotel asset package in 2017, is now clearing its hotel territory at a rate of one to two hotels per month.
Shimao's hotel assets have similar stories. The Sheraton Hong Kong Tung Chung and Four Points by Sheraton Hong Kong Tung Chung hotel cluster, with more than 1,200 rooms, was once the flagship asset of Shimao's hotel business in Hong Kong.
When it was first put up for sale in 2023, Shimao's asking price was no less than HK$6 billion. In October 2026, the final transaction price of the two hotels was only HK$2.7 billion, shrinking by more than half. More importantly, this transaction was not initiated by Shimao voluntarily, but the result of the receiver appointed by the creditor exercising the right of sale. The proceeds are directly used to repay the syndicated loan, and Shimao itself cannot get a penny.
The transfer of pricing power from developers to creditors itself reveals some signals: when hotels are no longer assets but collateral for liabilities, their valuation logic is no longer determined by brand, location or vision, but only by the order of repayment.
The deeper change lies in the demand structure. In 2025, China's five-star hotel market indeed showed a moderate recovery trend, and the RevPAR of hotels with a room price above 1,000 yuan increased by about 5% year-on-year.
But the driving force for maintaining growth has changed. The occupancy rate that used to be supported by corporate contracted guests and government-enterprise conferences is now being replaced by leisure vacation, weekend short trips and high-net-worth individual guests.
The proportion of corporate guests has dropped from 60% to less than 50%, which means that hotels can no longer rely on long-term and stable B-end contracts as a base, and every room sold needs to compete for attention with countless competitors in the open market.
For this reason, the "landmark" attribute that groups with real estate as their main business, such as Green Development, once took pride in, has become a burden in this new context. The maintenance cost of super high-rise buildings, the energy consumption of large public areas, and the inefficient restaurants and banquet halls configured to maintain a grand appearance, all turn into rigid losses when the occupancy rate is insufficient.
"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". This statement from an industry insider is a lament for the end of the super dividend era, and also a brilliant summary of the current situation of real estate-backed hotels.
In the "To Be Observed" List Lies the Final Test for the Stock Operation of Real Estate-Backed Hotels
When we go back to Green Development's disposal list, we will find some details worth thinking about.
The hotel cluster of The Ritz-Carlton, Westin and Aloft in Urumqi is still under construction. The official website of CITIC Design confirmed in July 2026 that the core tube of the T1 tower of this project has been capped, the main structure construction has been fully completed, and the Aloft Hotel in the T2 tower has entered the decoration stage.
The Xiamen The Ritz-Carlton Hotel also has substantial progress. The public notice from Xiamen Housing and Urban-Rural Development Bureau on September 28, 2026 shows that the fire protection design review of the three sections of the fine decoration project of this project has been completed, with the result of "qualified".
The JW Marriott, Le Méridien and Moxy cluster in Sayram Lake is in a more ambiguous state. Public information shows that in February 2026, Yuanda Aluminum Industry won the bid for the curtain wall project of this project, and the information from the State-owned Assets Supervision and Administration Commission of the State Council in March 2025 also included this project in the centralized start-up list of the second phase of Xinjiang.
However, the winning of the curtain wall bid and the start-up record do not mean continuous construction. A more accurate statement may be that the project still has activity traces at the level of engineering procurement, but public information is not sufficient to give a definite judgment on whether it has entered substantial continued construction. Indeed, some projects are classified as "to be observed" rather than included in the "full suspension" list.
Some people may ask, what is the measurement standard for observation?
Judging from the hotel group and brand level to which the project belongs, it is most likely not the brand level; judging from the project location, it is even less about the city level. Therefore, the ultimate answer to this question seems to fall on the key point of "whether the cash flow can break even within a specific cycle".
Specifically, the Urumqi project is tied to the supporting facilities for the Central Asia Summit, while Sayram Lake and Xiamen have relatively balanced passenger flow structure and expectations. In other words, even for "to be observed" projects, what is being observed is whether the operation model can be established, not whether the landmark effect can be realized.
When the door of incremental expansion is closed, Green Development's "to be observed" points to a more fundamental shift — stock operation has become an inevitable way out.
The core competence of stock operation is completely different from that of the incremental development era. If the development era competes for the vision of land acquisition, financing cost and construction speed, then the operation era competes for revenue management per available room, granular cost control, diversification of passenger flow structure and anti-cyclical capability.
The reason why The Shanghai EDITION and JW Marriott Marquis Shanghai Luwan are defined as high-quality assets is not because they are "high-end", but because they are located in the core areas of cities with the most abundant passenger flow and most diverse demands, the brand premium can be converted into real RevPAR, and there is the possibility of asset exit through tools such as REITs.
The reason why the six hotels in the first phase of Xinjiang are still hanging on the lifeline of "survive the off-season first" is that their annual operation model has not yet been verified.
This shift raises a sharp question for the whole industry. The entire set of hotel development logic cultivated over the past two decades — from the pursuit of "landmark" in the design stage, to the priority of image over cost in the construction stage, and then to "waiting for appreciation" after opening — almost all needs to be rewritten under the current framework of stock operation.
Since then, the hotel is no longer a business card, but a machine that needs to operate every day and generate cash every day.
The official announcement of the exit of Liu Yu, former chairman of Green Development, did not directly deny its cultural tourism layout, but the market's interpretation has never been limited to the official wording. From the market's perspective, the contraction track of Huamei Resort itself constitutes a more straightforward conclusion than the audit report: the expansion model that relies on resource exchange, heavy asset accumulation and policy support has been falsified in the face of real passenger flow data and cash flow.
The cost of falsification is undoubtedly expensive. In the 13.29 billion yuan asset package in Shanghai, Pujiang Garden has been sold out and the funds have been recovered, but Xinzi Garden is still a silent construction site full of weeds more than three years after land acquisition.
The cost of developed products in inventory is as high as 21 billion yuan, and the accumulated inventory impairment provision has exceeded 6 billion yuan. Who will ultimately bear these figures is an unavoidable problem within this central enterprise.
Green Development's answer is clear: suspend all new investments that do not generate returns, classify the precipitated assets, sell those that can be sold, revitalize those that can be revitalized, and adopt the strategy of "exchanging time for space" for the remaining assets.
This path is not glorious, but it means admitting mistakes, accepting scale contraction, and returning from the narrative of "cultural tourism central enterprise" to the duty of "asset manager".
As for the ongoing projects in Urumqi, Sayram Lake and Xiamen, they may become the touchstone to test the new logic.
If the full-year operation model can be run through by its own operation without the support of residential sales proceeds and new energy profit subsidies, Green Development will truly complete the transformation from a developer to an operator. If it cannot be done, the "Suspend All That Should Be Suspended" list will probably continue to grow longer...
For more players still in the market, Green Development's story raises far more questions than it gives answers. When hotels no longer serve land appreciation, no longer serve corporate image, and no longer serve anything outside the hotel itself, what else can they rely on to survive?
R&F's judicial auction page is still waiting for bidders, Shimao's syndicated loan is still waiting for repayment, and those buildings that once stood up in the name of landmarks are looking for new owners at prices that may not even satisfy the creditors. Everyone or institution holding high-end hotel assets has reached the time when this question must be answered.