(Yicai) Oct. 17 -- Leading Chinese property developer China Jinmao Holdings Group has put its five-star hotel in popular Chinese tourist destination Sanya up for sale for no less than CNY1.85 billion (USD254 million).

Jinmao's board of directors has approved the listing of its subsidiary Jinmao Sanya, the operator of the Hilton Sanya Resort and Spa, on the Beijing Equity Exchange, the Hong Kong-based parent company announced on Oct. 15. The sale includes creditor's rights worth about CNY58.5 million (USD8 million).

This is an appropriate time to sell the nearly 20-year-old hotel at a reasonable price to generate cash flow and improve its financial situation, Jinmao noted, adding that it will use the proceeds for future investments and to supplement working capital.

Opened in 2006, the Hilton Sanya Resort and Spa has 492 rooms and is the sole asset of Jinmao Sanya.

Jinmao is not the only property developer opting to sell hotel assets to improve its finances. In fact, Country Garden Holdings, Shui On Land, Financial Street Holdings Group, Macrolink Culturaltainment Development, Overseas Chinese Town, China Vanke, and other builders have listed their hotel assets for transfer since the beginning of last year.

"Over the past couple of years, high-end hotels have generally underperformed, and their owners, including real estate developers, have been under cash flow pressure," Wei Changren, founder of tourism-centered news outlet Jinglve, told Yicai. "Owners likely aim to optimize their investment portfolios by selling these assets."

Even though China's tourism industry is recovering, the hotel market faces hurdles due to oversupply, particularly luxury hotels with higher operating costs. For example, US hotel chain Marriott reported a 4.2 percent decrease in revenue per available room in the Chinese market in the second quarter of the year from a year earlier.

Editors: Tang Shihua, Futura Costaglione