Responding to reports of delayed payments to the unit from developers, including the troubled Evergrande, Centaline Property said that its mainland China unit is due a sizable sum of unpaid commissions and that as a result, it is unable to pay staff their commissions.
The announcement by Centaline comes as the housing market crisis, increased default risk, and a deteriorating economy are pushing real estate developers and agents into commission arrears.
As property developers struggle with the debt crisis and cash shortage, Centaline Property firm (Shenzhen), the mainland division of the Hong Kong real estate firm, reported on Friday that it had not been able to recover all commission fees.
"The current amount of unpaid commissions from developers and agents is huge and Centaline Property is not in a position to advance them to its employees," the company said.
Although it did not specify how much was owing in fees, the Securities Times state news agency stated on August 21 that the amount was over 1 billion yuan ($137.19 million).
According to Centaline, the Shenzhen business has been paying fixed salary up until July. It also stated that all of its units are running regularly and that it will not leave the market in mainland China.
When money is recovered, Centaline said it will give the settlement of corresponding commissions with employees top priority. The company has established a team to manage past-due payments.
The team's leader, Liu Tianyang, previously admitted to the Securities Times that while some developers utilised houses to offset commissions, doing so frequently led to a loss of income for the Shenzhen property agency.
The payment of commissions owed to employees, he claimed, would make the company's already challenging situation worse.
(Source:www.reuters.com)
The announcement by Centaline comes as the housing market crisis, increased default risk, and a deteriorating economy are pushing real estate developers and agents into commission arrears.
As property developers struggle with the debt crisis and cash shortage, Centaline Property firm (Shenzhen), the mainland division of the Hong Kong real estate firm, reported on Friday that it had not been able to recover all commission fees.
"The current amount of unpaid commissions from developers and agents is huge and Centaline Property is not in a position to advance them to its employees," the company said.
Although it did not specify how much was owing in fees, the Securities Times state news agency stated on August 21 that the amount was over 1 billion yuan ($137.19 million).
According to Centaline, the Shenzhen business has been paying fixed salary up until July. It also stated that all of its units are running regularly and that it will not leave the market in mainland China.
When money is recovered, Centaline said it will give the settlement of corresponding commissions with employees top priority. The company has established a team to manage past-due payments.
The team's leader, Liu Tianyang, previously admitted to the Securities Times that while some developers utilised houses to offset commissions, doing so frequently led to a loss of income for the Shenzhen property agency.
The payment of commissions owed to employees, he claimed, would make the company's already challenging situation worse.
(Source:www.reuters.com)