A luxury hotel that lost millions of yuan to a swindling manager has become China's first five-star hotel to lose its star status after a re-evaluation by China's tourism authority.

    The Shenzhen Grand View Hotel, in south China's Guangdong Province, has admitted that its facilities and services failed to meet five-star standards, but vowed to try to win back its five stars.

    The China National Tourism Administration (CNTA) has begun re-evaluating the star ratings of Chinese hotels, which used to enjoy permanent star status.

    The CNTA initiated re-evaluations of star hotels last year, and hundreds of hotels, with four-star status or below, were blacklisted. It said the re-evaluations of star hotels would be conducted every five years.

    The Shenzhen Grand View, founded in 1999, was the first five-star hotel to lose its status in a re-evaluation.

    "Our hotel failed the re-evaluation on account of substandard facilities," general manager Deng Jingchen told Xinhua.

    Deng explained the hotel was unable to refurbish because its previous general manager ran away with tens of millions of yuan in funds last year, seriously affecting the hotel's operations.

    He said the 221-room hotel was still open for business, and was making improvements to meet standards.

    "We will apply for the five-star status next year if we can make it," Deng said.

    A statement posted on the website of the CNTA said the hotel's establishments, facilities and services failed to meet five-star standards.

    A CNTA official said the administration planned to hold a press conference to give further details, when asked to comment on the statement.

    "The CNTA's move could help consolidate standards in the hotel sector, and the canceling of permanent star status will prompt hotels to make more efforts to build their reputations," said a staff member of the China Hotel Management Association, surnamed Zhang.

    Guangdong Province has the largest number of five-star hotels among all provincial areas, at more than 50, according to the local tourism administration.