From the end of 2020 to the beginning of 2021, the mainland has exposed news of large-scale layoffs and intensive departures of senior executives in more than a dozen real estate companies.
From late 2020 to early 2021, more than a dozen real estate companies on the mainland have been exposed to massive layoffs and intensive executive departures. Nearly 500 mainland real estate companies went bankrupt last year, while the property market is under pressure from declining consumer purchasing power and rising mortgage pressure.
The most recently exposed layoffs were at Field Real Estate Group, where news broke on Feb. 20 that 13 senior executives resigned en masse around the New Year, involving finance, investment, marketing and other areas, including Vice Chairman and President Liu Senfeng, Executive President and CFO Li Bin, and Vice Chairman and Co-President Luo Jianwei.
In its response on the 21st, Field Group did not deny that the above executives left the company, but said that these employees left last year, not after the Chinese New Year, and said that most of them were persuaded to leave by the company and two were resigned.
The 21st Century Business Herald on the mainland quoted informed sources as saying that most of these executives were discouraged from leaving because their performance did not meet the standards. At the same Time, such large-scale personnel changes have also raised concerns about the company’s situation.
According to incomplete statistics from mainland media, more than 10 real estate companies in the mainland are rumored to have made larger-scale layoffs between the end of 2020 and the beginning of 2021; 29 senior executives of real estate companies left in the first 22 days before the start of 2021, mostly core personnel in the positions of president and director, including the top 10 real estate companies and small and medium-sized real estate companies.
According to the report, most of these real estate companies responded to the news of layoffs with words such as “staff call” and “optimization”, which is considered to be because the word “layoff” is too sensitive.
For example, Time China and Xiangsheng Holdings were exposed to the news of layoffs on Jan. 28. For example, Time China laid off 20% to 30% of its workforce without warning, but in fact more departments were laid off at a rate of 30%; Xiangsheng Holdings issued a 30% layoff target, which was divided equally among all departments, equivalent to laying off more than 1,000 employees.
Time China said in its response that it was “digital transformation”; Xiangsheng Holdings said it was “regional reorganization and structural upgrade”; another real estate company, Lanshi Real Estate, which was exposed to layoffs on Feb. 2, responded that it was “a voluntary move by employees to seek development. Another real estate company, Lanshi Real Estate, which was exposed to layoffs on February 2, responded that it was “a voluntary move by employees to seek development.
According to a Communist Party court announcement alone, 470 mainland real estate companies are expected to go bankrupt by 2020. However, according to industry insiders, many real estate companies are already in bankruptcy, but have not filed for bankruptcy due to the cumbersome and lengthy filing procedures.
In addition, the mainland public’s purchasing power has plummeted amid the extended Epidemic and city closures. Official figures from the Communist Party of China say that domestic consumption on the mainland will shrink by 3.9% in 2020.
A recent posting on the Internet about “free housing in Yanjiao, Hebei Province” has sparked much debate. The owner of the house is under a lot of pressure to repay the loan to the person who took it in. The mainland media quoted a Yanjiao real estate agent as saying that it is not uncommon for people to be unable to repay their loans.