Phoenix Tree Holdings Limited, or known as Danke Apartments in China (NYSE: DNK) is at high risk of going bankrupt, according to multiple local news reports.
Proclaiming to be one of the fastest-growing co-living platforms in China, Danke operates 419,030 apartment tunits in China as of March, up 47% from the same time last year.
However, local reports said more than 140 landlords and tenants were protesting outside of Danke’s headquarter in Beijing over the past week, demanding their money back and waiting to communicate with the staff.
Dreary Days Ahead for Danke?
Former employees told reporters that the company may declare bankruptcy very soon.
According to different news sources, Danke’s tenants in Hangzhou have no internet for a while now. Landlords in Shenzhen have begun to kick out tenants because they haven’t received payments from Danke for months. The same thing also happened in Wuhan, where landlords are contacting tenants directly to pay rent because they didn’t get any payment from Danke. In addition, it is reported that a large number of Danke employees haven't been paid for months.
Following the news, Danke quickly refuted the accusation on its official Weibo account, saying: "We are not going bankrupt and we will not run away. Please do not believe in rumors. "
A report by Anjuke on the rental market in China's key cities showed that in May, Danke was the top rental platform in Beijing, Shenzhen, and Guangzhou, while Shanghai-based Q&K International Group Ltd. (Nasdaq: QK) ranked first in Shanghai.
Established in 2015, the company aims to provide young people with comfortable and affordable homes.
In mid January, Danke went public on the New York Stock Exchange in a downsized initial public offering worth $129.6 million.
Shares of Danke have plunged more than 90% from its IPO pricing of $13.50 apiece. It closed at $1.37 per share in New York today, down nearly 9%.