Source: China Fund News
China Fund News Mo Fei
More than half a month ago, he was refuting the rumors that "lost rent and ran away". Now, he has to declare bankruptcy because he is unable to save himself.
html Late at night on August 7, Lejia Apartment announced that the company had stopped operating and closed all business. A large number of employees left their jobs, had no operating income, and was unable to repay the debts owed by customers.7 Since July, Lejia Apartment has been deeply involved in various storms such as "the bankruptcy runs away, the building is gone, and the capital chain is broken". For this reason, the company came out twice to refute the rumors, "The company is operating normally and there is no problem."
Just over ten days later, Lejia Apartment spontaneously closed down and spread its hands, admitting that it was "no money." In the announcement, the company also admitted that there are problems with the "high entry and low exit" business model.
Lejia Apartment went bankrupt, implicating a number of landlords and tenants to lose funds in vain. A tenant asked angrily, "I worked hard to save money and pay the rent for one year, but I'll be driven away after living there for two months. Is it for us to stay on the street?"
late-night announcement to close business and operate
more than city tenants may be affected by
thunder every late at night, and this time the explosion was still a long-term rental apartment.
In the above announcement, Lejia Company stated that it was unable to perform the contract due to poor management of the company. Although the company has made every effort to actively rescue itself through various channels, none of them have been effective. At present, the company has stopped operating and closed all businesses. A large number of employees have left their jobs, no operating income, and cannot repay the debts owed by customers.
Information provided by a netizen on the Weibo platform shows that the Nanjing headquarters of Lejia Apartment has been empty and confirmed that the company has stopped operating. "At present, the company only allows you to go to the registration point to register for mediation, but there is no solution."
It is reported that the operating entity of Lejia Apartment is Nanjing Lejia Commercial Management Co., Ltd. According to industrial and commercial data, Nanjing Lejia Commercial Management Co., Ltd. was established on May 30, 2016 and the company is headquartered in Nanjing City, Jiangsu Province. Nanjing Lejia Company is a private enterprise that manages value-added services and maintains housing rental, with a registered capital of 1 million yuan and the major shareholder and legal representative Jiang Qian holds 80% of the shares.
. According to public information, since its establishment, Lejia Apartment has been deployed in eight major cities across the country in less than three years, including Nanjing, Hangzhou, Suzhou, Chengdu, Chongqing, Hefei, Xi'an, Kunshan, etc. However, the official website currently shows that only Nanjing, Hangzhou and Suzhou have disclosed housing information.
According to the plan announced on the recruitment website, Lejia Apartment plans to open branches in Shenyang, Xuzhou, Xiamen, Foshan, Qingdao, Yantai, Wuhan, Guangzhou, Shenzhen, Beijing, Shanghai, Zhengzhou and other cities in 2019. More than 300 contracted centers have been built nationwide, with more than 1,000 employees and more than 100,000 properties. At present, the total value of the housing assets managed by Lejia has reached more than 100 billion yuan. The sudden closure of Lejia Apartment means that tens of thousands of tenants in the above seven cities will be affected.
has denied rumors twice and ran away rumored
Tenants and tenants collectively protect their rights
In fact, since July, the business difficulties of Lejia Apartment have been revealed.
Previously, many media outlets exposed the problem of the capital chain break in Lejia Apartment in Hefei, Hangzhou, Xi'an and other places, resulting in the news that "landlords cannot collect rent and thousands of tenants are facing being kicked out of the rental house."
It is reported that the operating model adopted by Lejia Apartment mainly uses the landlord to accept the property and then sign a long-term agreement with the tenant. The tenant often needs to pay up to half a year. But since July, many tenants have begun to complain online that they are facing eviction by their landlords and cannot contact Lejia staff.
For a moment, rumors of Lejia's apartment owing rent and running away were everywhere. On July 14, Lejia Apartment published a "rumor-refuting statement" on its official Weibo, saying that the company was in normal operation and that "Lejia Apartment ran away" was the news that some rumor-mongers used it to slander it when the company terminated a few contracts that did not meet the market demand.
On July 21, Lejia Apartment issued another announcement stating that "the company is operating normally. Some employees who have been liquidated deliberately released false information and caused a run for customers. The company has connected with investors and provided information to the public security organs to recover the company's funds occupied by the company's salesmen who have been liquidated."
According to Zhejiang Online News, on July 23, Lejia Apartment held a press conference. Lejia Apartment will never run away. The company's Hangzhou business will be divided and other companies will take over.
At the above press conference, the relevant person in charge of Lejia Apartment admitted, "We do not want to let any of the tenants or landlords suffer losses. We will actively deal with it, but it takes time to deal with it. I hope the landlord and tenants can give us some time, and we will give specific explanations and arrangements on the official platform of Lejia Apartment in the future."
Just as landlords and tenants in many cities were waiting for Lejia Apartment to introduce a better solution, they did not expect the bad news of the company's bankruptcy. After the announcement of Lejia Apartment on August 7, the rights protection groups of landlords and tenants of Lejia Apartment were in full swing.
The "high in and low out" model
Branch capital occupied severely
Regarding the business problems that arise in the company, Lejia Apartment stated in the above announcement that it did not deeply realize that the "high in and low out" business model has serious defects, and the internal management system trend of the value company, which caused the company's business to be shut down.
But to look deeper, Lejia Apartment's failure may still stem from a high-leverage capital game.
According to real estate personnel, the so-called "high in and low out" model is to rent a house from the landlord and then rent it to tenants at a low price, so as to seize market share through advanced subsidies. In order to charge tenants for rent for half a year or even one year, long-term rental apartments generally raise funds to tenants through similar "rent loan" models. At the same time, rent payments for rent are calculated quarterly. In this way, the accumulated funds can be invested in other directions for expansion or business development.
In fact, long-term rental apartments, a classic short-term loan funding game, is to use the leverage to leverage to enable long-term rental apartment operators to achieve the goal of rapid expansion, and this is also an important driving force for Lejia Apartment to achieve the layout of eight major cities in less than three years. But obviously, such financial leverage requires the operators behind it to have strong financial strength, while Lejia Apartment has just brought this leveraged expansion into an out-of-control collapse, and eventually the company fell to the ground and went bankrupt.
In addition to the shortcomings in business model, there are also serious problems in the internal governance of Lejia Apartment.
According to the statement previously released by Lejia Apartment, in March 2019, employees suspected of embezzling the company's funds in Hefei Branch, the main operating company of Lejia Apartment, and this phenomenon was "repeatedly banned". In order to curb the deterioration of funds at that time, Lejia Company took measures to strategically stop the expansion of Hefei market and cleared out some illegal employees and abnormal houses.
After the company officially confirmed that it would stop operating, Lejia Apartment is actually still facing the issue of how to resolve contract disputes over the rights and interests of existing landlords and tenants. It is reported that in order to resolve the dispute over the lease contract , under the premise that Lejia Apartment lacks funds, the Housing and Urban-Rural Development Bureau of Nanjing has begun to provide part of the solutions for Lejia Apartment:
1. The relevant district governments of Nanjing City organized judicial offices, people's mediation committees, law firms and other third-party institutions in accordance with the principle of convenient customers and local mediation, and set up mediation service points in their jurisdiction to provide dispute mediation and legal consultation services for Lejia Company customers in Nanjing.
2. Nanjing Housing Rental Industry Association recommends five housing rental companies including Nanjing I Love My Home Rental Replacement Co., Ltd., Nanjing Ziru Housing Rental Co., Ltd., Nanjing Yincheng Qianwanjian Apartment Management Co., Ltd., Nanjing Qingke Apartment Management Co., Ltd., and Nanjing Housing Real Estate Guarantee Co., Ltd., and other housing rental companies participated in the mediation service point work, and provided intermediary agency to Lejia Company customers on the basis of consensus and other high-quality and high-priced services such as intermediary agency and promoting the re-establishment of house rental relationships.
Although Lejia Apartment announced the closure of the above announcement, the company shall bear the losses caused by the landlord and shall not affect the tenants. He sincerely requests the landlord not to take excessive measures to evict the tenants.
But in fact, judging from the solution issued by the announcement, although Lejia Apartment agreed to terminate the lease contract agreement between the landlord and tenant, there is no next solution to the loss of funds caused by the termination of the contract.
"Long-term rental apartment liquidation will be more powerful than P2P"
It is worth noting that the liquidation incident of Lejia Apartment is not an isolated case.
Since the beginning of this year, many long-term rental apartment brands have reported news that capital chains have been broken, landlord rent cannot be paid, and operation platforms have run away. In July alone, four long-term rental apartment operators were suspected of running away and operating difficulties, and one company has "exploded its position" almost every week.
As early as last year, the real estate circle had already questioned the radical expansion model of long-term rental apartments with "high entry and low exit". I Love My Home Research Institute Dean Hu Jinghui once publicly stated that long-term rental apartment operators such as Ziroom and Eggshell compete for housing at prices 20%-40% higher than the market price is seriously contrary to market laws.
"Operations that violate market laws will inevitably be punished by the market." Hu Jinghui even asserted that long-term rental apartment liquidation must be more severe than P2P burst.
For operating entities, the layout threshold for long-term rental apartments is low, but the profit is actually not high. According to CRIC monitoring data, the rental return rate of apartments in 20 key cities in China is only 1%-3%. Nowadays, long-term rental apartments have entered a new round of reshuffle, and companies that blindly expand for market share may find it difficult to survive.
htmlOn July 29, the Institute of Finance and Economics Strategy of the Chinese Academy of Social Sciences released the "Monthly Analysis Report on the Development of China's Housing Market (July 2019)", which believes that under the condition that the rental rate is lower than expected, long-term rental apartment operators with relatively aggressive business methods will face greater operating pressure, and some long-term rental apartment enterprises are likely to "explode".In the industry's view, the incident of Lejia Apartment is of warning to the industry. Zhao Qingxiang, Secretary-General of the Beijing Real Estate Agency Association, pointed out that in the Lejia incident, relevant departments are actively putting out fires, and the legacy of "explosion" in the aftermath is very important. But more importantly, how to prevent problems from happening and prevent similar problems from happening repeatedly by building a long-term mechanism.
Zhao Qingxiang believes that to issue housing rental regulations as soon as possible, the leasing industry must establish an entry threshold through legislation; in addition, the association can take the lead in exploring the establishment of a risk reserve system, and leasing companies pay risk reserves according to their scale. On the one hand, this can hedge the risks brought by poor management, and on the other hand, it can also control the expansion speed of the company.
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