Vanke Invests 3 Billion Yuan in Real Estate Agent Lianjia
(Beijing) — Leading real estate developer China Vanke Co. Ltd. is investing 3 billion yuan ($436 million) in Lianjia, a source familiar with the situation told Caixin ahead of a potential initial public offering (IPO) for one of the nation’s leading property agents.
No terms were given for the size of the stake that Vanke would receive from the investment.
But Vanke pointed out it has a previous joint venture with Lianjia, called Vanlian, which provides home renovation services. Vanke said that venture will receive the new capital injection. Lianjia declined to comment.
Created in 2015, Vanlian now gets more than 1,000 orders a month in Beijing, according to Vanke.
The latest fundraising comes about a year after Lianjia reportedly raised 6 billion yuan from a group that included Tencent Holdings Ltd. and Baidu Inc., two of China’s leading internet companies. In January this year, smaller property developer Sunac Real Estate said that it paid 2.6 billion yuan for 6.25% of Lianjia, valuing the company at 41.6 billion yuan.
Founded in 2010, Lianjia mainly operates in Beijing and Shanghai, two of the nation’s hottest real estate markets. It has been speeding up its fundraising ahead of an anticipated IPO, which previous reports have said could come in Hong Kong.
But the company has also been the source of controversy due to aggressive tactics it uses to sell homes.
Last year, the city of Shanghai told commercial banks to cut their ties with Lianjia and five other big real estate agents for a month after determining they had illegally secured funds to help potential buyers make down payments on home purchases. China often requires larger down payments than many Western markets as part of an effort to curb speculative buying that has made homes unaffordable for average Chinese in major cities like Beijing and Shanghai.
Contact reporter Yang Ge (email@example.com)