By GE Zhenwei
The stream of catastrophes and near catastrophes afflicting Chinese real-estate developers has begun to infect real-estate agents.
Centaline Group is unable to pay staff due to developers withholding commissions. Commissions are a crucial part of a real estate agent's income. Developers build, and agents sell. The commission is basically all there is.
Financial assistance, difficult circumstances
Due to the financial strain and even collapse of several real estate developers, cases of delayed commission payments are becoming common.
A widely circulated video captured the scene where an employee begged for his salary in the office of ZHENG Shulun, GM of Centaline. Others highlighted that this situation has persisted for the past five to six years.
Major developers owe Centaline Group over one billion yuan. The company has filed lawsuits for 535 million yuan. The court has enforced more than 400 million yuan of that, but given the developers have more important things to do with what little cash they have.
COO LIU Tianyang is leading the effort to recover these commissions which will be disbursed as soon as they are received. Centaline will offer "financial assistance" to employees in especially difficult circumstances.
Established in 1978 in Hong Kong, Centaline Group is primarily a brokerage and agency for both new and second-hand properties, with around 60 percent of the revenue generated from new properties and the remainder from second-hand properties.
Gloomy outlook at the top
CEO, SHI Junrong, holds a pessimistic view of China's real estate market in the coming years. Operations have been badly affected by the downturn in the real estate market over the past two years. In 2022, Centaline closed 300 branches.
Given the unfavorable economic outlook, a swift rebound in the housing market appears unlikely. As real-estate companies struggle, salaries are going unpaid across the board, with construction firms, agents and other stakeholders affected.
