Beijing-based rental expert Danke Apartment is struggling to get its house in order, becoming the latest entrant to the COVID hit list. The pandemic-induced cash crunch has left its clients - property owners and tenants - jostling each other.
The online platform, owned by New York-listed Phoenix Tree Holdings Ltd., claims to offer "affordable" homes to young people in metropolises through co-living spaces. Danke sources flats from property owners then rents the renovated and furnished units for tenants, similar to WeWork's WeLive service.
Nevertheless, the firm running short on liquidity has been defaulting on rents since September in major cities, including Beijing, Shanghai and Hangzhou. Clearly, this has enraged landlords and spelled serious troubles for tenants who are made to pay months of rent in advance.
But as tenants are loath to leave, some homeowners are resorting to intimidating tactics like cutting off water and power supplies or changing the locks, leading to greater conflicts.
A property owner in Tianjin, surnamed Wang told CGTN that he had not received monthly rental payments from Danke for the last two months.
"Danke's staff told me to contact the company for solutions," he said, adding, "The staff said the company has delayed payment of their salaries as well."
The crisis has perched the lessees on the horns of a dilemma. "I have moved out as the property owner required, although I've paid a whole year rent with a consumer loan," Beijing-based tenant surnamed Zhang told CGTN.
"Danke refunded one month rent deposit via my Danke app account after I ceased the lease contract, but the deposit could not be withdrawn in cash from the app," she added.