The tourism development unit under the debt-stricken China Evergrande Group was ordered to remove its mega resort project in Danzhou, South China’s Hainan Province, according to an administrative penalty notice issued by local authorities citing the company’s unlawful means of obtaining the project certificate.
According to the notice, which has been circulating online since the weekend, the project – covering 434,941.46 square meters or 39 buildings of the Ocean Flower Island, an artificial archipelago in Danzhou, the world’s largest of its kind – was ordered to be demolished within 10 days.
Evergrande issued a filing to the Hong Kong Stock Exchange on Monday saying that its shares will be temporarily suspended from trading. All subordinate businesses related to the company will also temporarily halt trading on the market.
The project of Ocean Flower Island has received a total investment of 160 billion yuan ($25.18 billion), including 28 major business hubs including an international conference and exhibition center, museum complex, fairy tale world, water park and international shopping plaza.
The mega project is one of several real estate developments in Hainan that have been subject to a “double suspension” – of both construction and sales.
In April 2019, Hainan Province investigated and addressed violations of laws and regulations relating to Ocean Flower Island, with an administrative fine of approximately 215 million yuan imposed.
Evergrande. Photo: CFP
