Summary of Key Points
Due to a decline in its core real estate business and overwhelming debt, Jianye Real Estate had no choice but to sell two of its most significant cultural and tourism projects—Only Henan·Drama Fantasy City and Jianye Film Town—for 3 billion yuan to Xincheng Capital, a subsidiary of CITIC Capital. This move was necessary to raise funds and survive in the tough real estate market. It represents not only the failure of the heavy asset model of cultural and tourism projects for real estate companies during this downturn but also a reluctant compromise between passion and commercial reality.
Why Sell?
The root of Jianye's difficulties lies in its main real estate business:
- Unsustainable debt: By the end of 2025, the total debt amounted to 103.4 billion yuan, while total assets were only 94.9 billion yuan (resulting in insolvency). With only 420 million yuan in cash on hand, the company had to repay 22.4 billion yuan in debts within a year, and an additional 500 million dollars in foreign debt was about to mature.
- Declining profitability of the main business: Sales in the first half of 2026 were 3.755 billion yuan, a 15.5% decrease from the same period last year. Over 90% of Jianye's revenue comes from real estate, and it is no longer profitable.
- Cultural and tourism projects becoming a burden: Only Henan·Drama Fantasy City and Jianye Film Town have been losing money annually (62.82 million yuan in 2024 and 55.29 million yuan in 2025). These projects, once funded by real estate sales profits, have now become a drain on cash flow.
What Was Sold?
These two projects are more than just ordinary cultural and tourism attractions; they represent something deeply personal to Hu Baosen:
- Jianye Film Town: Opened in 2019 with an investment of 4.5 billion yuan, the town replicates the Dehua Street from the Republic of China era in Zhengzhou. It became popular for its live performances and immersive experiences, representing Jianye's attempt at a "real estate + culture and tourism + hospitality" model.
- Only Henan·Drama Fantasy City: Launched in 2021 with an investment of 6 billion yuan, covering 622 acres and featuring 21 theaters, it is the largest drama-themed complex in China. Hu Baosen once said, "This isn't for us; it's for Henan." In its four years of operation, it has welcomed 58 million visitors, with over 80% coming from outside the province, making it a cultural ambassador for Henan.
To Whom Was It Sold?
The buyer is Xincheng Capital, a subsidiary of CITIC Capital. Why them?
- Real estate companies struggle with cultural and tourism projects: These projects require long-term operation and meticulous management, which real estate companies, accustomed to quick turnover (acquiring land and selling properties for quick profits), cannot afford.
- Professional capital is more suitable: Xincheng Capital is an industrial investment firm skilled in long-term operations and content development. They can gradually unlock the cultural and commercial value of these projects rather than focusing on immediate profit.
Industry Insights: The Future of Real Estate Companies' Cultural and Tourism Initiatives
Jianye is not an isolated case. Other companies like Sunac, Wanda, and R&F have also invested heavily in cultural and tourism projects but are now cutting back on non-core businesses:
- The old approach no longer works: Real estate companies used to acquire land at low prices and use sales profits to cover losses from these projects. Now that housing sales are declining, this model is unsustainable.
- The future of culture and tourism: lighter rather than heavier assets: Real estate companies are not well-suited for managing heavy cultural and tourism assets (which require significant investment and slow returns). In the future, these tasks will be entrusted to professional organizations that can provide brand management and other services without substantial capital investment.
Hu Baosen's Resignation
Hu Baosen, known for his deep connection to Henan, aimed to transform Jianye from a real estate company into a "service provider for Henan's lifestyle." He invested in hotels, culture and tourism, football, and agriculture. However, in the business world, passion alone cannot generate cash flow:
- He once said, "Surviving is more important than anything else," reflecting his understanding that, no matter how much he valued these projects, the company's survival was paramount.
- Selling the cultural and tourism projects does not mean he has given up on his passions; it means finding new ways to preserve their value. As long as the projects continue to operate, they will remain a symbol of Henan's culture.
In summary, this analysis explains the circumstances behind Jianye's decision to sell its cultural and tourism assets in plain language, covering the debt crisis, the compromise between passion and reality, and industry trends. It helps ordinary people understand the challenges faced by real estate companies and the changes in the cultural and tourism sector.