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Danke Apartments: an alternative for college graduates

March 9, 2018

konjaku: urban villages function as entry-points for people flooding into Beijing. Villagers for whom farming is no longer viable put up illegal buildings, and make a good income renting cheap rooms. When villages are demolished as part of the urban-rural unification plan undertaken by Beijing city, the need for cheap rentals does not disappear. As we saw in Xiaojiahe, a mix of ex-villagers, squatters, and entrepreneurs continue to put up illegal buildings wherever they can in the surrounding area, and college graduates will rent a small bare room in a simple building put up in a vegetable field, as long as it provides the bare essentials for living and there is mass transportation to reach their place of employment. The landscape of this next phase of the urban village, a quasi-village without any history or boundaries, is a place in which “the road is only wide enough for one car to pass at a time, and on both sides between the low-lying houses, narrow alleys like capillaries wind off into the distance.” If the local town government is unwilling or unable to allocate money to destroying the illegal buildings on land which is not part of some grander development plan, an improvised urban fabric continues to exist.

The replacement housing for Xiaojiahe villagers is a nice new residential complex, built conveniently over the new Nongdananlu subway station, called Xiaojiahe New Village. It also includes some buildings managed by Danke Apartments (dànké, “eggshell). “If you are a 2017 college graduate, you can participate in the Danke Apartments Starling Plan and get 1000 yuan in credits.”

Danke Apartments may represent an attempt by the market to offer an alternative in affordable housing that will lessen the demand filled by urban villages or unmanaged spaces — but only for college graduates and white-collar workers.Their promotional blurbs, in which the word “white-collar” appears frequently, make it clear who may apply. Danke Apartments does not own property, but it finds apartment buildings it can furnish, maintain, and rent — to college graduates and white-collar clients. The rental market in China is unstable, with distrust on both sides. Property owners do not trust tenants, therefore they demand at least three months rent in advance. Tenants worry about false advertising, slippery contracts, and being saddled with debt. The challenge for Danke Apartments and companies like it is to rationalize the housing market. They offer a “one month deposit, one month’s rent in advance” contract (although there is a catch, as we will see) to encourage those who cannot scrape together the larger “traditional” advance. Also, they find roommates for tenants, allowing them to group single persons in larger apartments, and presumably that also helps people live in larger, nicer spaces for less money.

This is Danke apartments advertisement of its Starling Plan for 2017

http://www.dankegongyu.com/market/starling2017

The plan:
When you sign a contract for one year, after 6 months you can switch one time free of charge to another Danke apartment anywhere in the country
Refund of 1000 yuan: on every months rent, we put aside 125 yuan to you as credit, at the end of 8 months, the full amount is eligible to be returned ([1000 yuan, $159]. After one more month has passed, within three working days we give you the full amount. At that point the earned credit agreement is complete.

Eligible persons: any person who graduated from college in 2017 (full time students, from undergraduate or graduate course of studies)

This offer ends 2017-07-15.
For those who change apartments during the period of earned credits, including switching free of charge, the earned credit plan will be terminated.

The tenant must have a WeChat account that is tied to a bank account passbook number, otherwise it is illegal to return the credit as payment.

In applying for this offer, the applicant must present a genuine student card. If on re-examination this card is found to be a forgery, we will revoke the credit offer and nullify the free-switching offer.

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“You’d better rent a nice space to start practicing your Beijing accent.”

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“A good apartment in the Shanghai alleyways will up your “face value” [social status]”

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“During the day enjoy Hong Kong and Macao– at night, sleep in Danke apartments in Shenzhen”

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“A young woman from Chengdu: good things happen to good people.

After graduating, she lived with her boyfriend in a Danke apartment, and the starling plan really lessened their financial burden. Their room had a balcony on which they could practice yoga or chit-chat with other people, making their life in Beijing rich with possibilities.”

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“The first thing this very smart woman did after graduating from Peking University was to rent a Danke apartment.
A Danke apartment is perhaps not perfect in every way, but she says that for a recent graduate it is entirely appropriate, and she is satisfied with her apartment. She is pleased with the process of renting, the care and service she received as a potential customer. She is happy with the room’s lay-out and the ingenuity of the person who designed the room. She is gratified by the thoroughness of the cleaning ayi [cleaning women], and even more, she is glad to receive credits on her rent.”

konjaku: Danke Apartments offers a special status to those “very smart” millennials,who have graduated from a Beijing University. People who have moved to the capital from elsewhere might expect to be disparaged as outsiders, but here, since they are college graduates, they are the target of an ad campaign and given special treatment. As a graduate, it is good to be a young woman from Chengdu who lives with her boyfriend (Danke makes it possible for them to share the rent), is acquiring a Beijing accent, and does yoga on her balcony. She can benefit from the savings of 1000 yuan now, but in the future she may enter a prestigious field — high-tech or media –and rise far. The next promotional article makes it more explicit that Danke Apartments attracts the young highly-educated elite — one of whom will be your roommate.

konjaku: this article refers to the first year the starling plan was offered, 2016
http://www.sohu.com/a/86688372_419164

2016-06-28
Danke Apartments Starling Plan comes back for a surprise second attack!

2400 people has applied for the starling plan, from 2016 -05-25 up to now (06-28), and 1412 of their fellow students have gotten apartments. Danke apartments has shown a praiseworthy concern and a sense of social duty for these recent graduates and their urgent need for housing.
Starting 07-01 they will do a “second launch” of the plan, and respectfully invite all of this year’s graduates who have not yet found housing to apply.

In the first launch of the starling plan, Beijing college and university students were “favorably positioned,” and managed to snag 40 percent of the openings. Those with M.A. degrees or above got 25 percent of the slots. And among successful applicants, there was no shortage of students who had studied overseas. In other words, the cream of the crop. In former times a wise mother would pack up and move anywhere to put her child in the best environment for his or her education. Today, there is Danke Apartments. If you live there, your neighbors will be “scholar-tyrants” [superb students], associating with those of such excellent character, their best qualities will rub off on you.

The tenants who have flocked to Danke Apartments represent the highest level of those going into all the different professions: languages, design, economics, computer hardware and software, the media. Your roommate may be a future t.v. star, or perhaps an influential authority on the internet, or a “language emperor” who can speak seven languages, or one of those programmers who doesn’t speak much but earns a lot, or a trader who plots out a new algorithm strategy…at Danke you will have the opportunity to meet the heros of the future, who will help you on your way as your close friends!

At the second launch of the starling plan, on 07-01, there will be a raffle drawing for a big prize (which remains a secret). We invite all to participate!

konjaku: the following article explains Danke Apartments basic business model. They help you find a suitable apartment and roommate, and they clean, service, and repair the apartments they manage. One can look at apartments for rent at their site:

https://www.dankegongyu.com

A typical apartment has two bedrooms, a common living room, a well-appointed kitchen, and a bathroom with toilet, shower, and a washing machine for clothes. [Washing machines are smaller than the western models, and can fit in a bathroom].

Danke Apartments matches into Shanghai
2016-09-03

http://www.sohu.com/a/113488575_419164

 

Shanghai is a large metropolis, and international city. Every year thousands and thousands of people come to work –college graduates, all kinds of white collar workers. After getting a job, finding a place to rent is the next most important thing. However, renting is not an easy matter –there are many prospective tenants who come to grief, who may even get duped or cheated out of their money. Already regarded as one of the leading brand names in high-end white-collar apartments, in the 7th month [July] Danke Apartments formally opens into greater Shanghai. For white-collar workers looking for a place to rent, this will be an earth-shaking transformation.

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Danke Apartments already has fans in Beijing and Shenzhen. Starting in Beijing, it has established itself as a brand name of high-end products for white-collar workers looking for for a high-quality rental experience. Danke Apartments is not traditional type of rental agency, but an internet company, in asset-management, with no intermediaries. Relying on the “internet plus real estate properties plus financing” model, Danke Apartments received an A+ round of $14 million in its capital fund. Its apartments, beautifully furnished, stocked with brand name electric appliances, and accompanied by top grade service, have won the praise of its customers. In 2016 it was awarded the prize of all-China superlative internet product.

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Danke Apartments Shanghai office interior

Now, Danke Apartment fans in Shanghai will have the chance to live in a white-collar apartment that will enhance their “face value” [social status]. In recent years, young people have had a love/hate relationship with Shanghai –steadily rising rents has caused them “to retreat from difficulties” and move away, taking their hopes with them. In the Shanghai market for white-collar renters there is a mix of good and bad: some tenants face noisy environments that force them to terminate their leases, some in the name of sharing a lease have to deal with over-crowding. There is layer upon layer of hidden hazards due to lack of fire prevention measures and general oversight. These problems have a pervasive effect on the rental experiences of 3 million to 4 million renters in Shanghai, including white-collar workers. Danke Apartments has chosen this opportune moment to march into Shanghai and offer a reliable, first-class product paired with excellent service. It will usher in a new era in rentals for white collar workers, showing that high quality does not have to mean a high price tag.

Danke Apartments’ most cherished undertaking is its “one month deposit, one month’s rent in advance” plan. It overturns the huge burden of pressure that the traditional “one month deposit, three month’s rent in advance” provision imposes on prospective tenants, taking leave of that awful era in which renting an apartment “left the inside of your purse cleaner than your face.” The apartments are completely renovated. A special design team made up of architectural designers of the 80s generation have done everything in their power to create a warm living space that is simple, yet complex. The beautiful interiors in TV dramas you vainly dreamed about have actually become reality. We will help you select your lease-partner, and will strictly limit the number of people who can be in one apartment. These basic provisions will open up a high-quality life for you: a public and transparent process, no extra charges or surcharges, free maintenance and repair service, free WIFI. You can relax, knowing that with one phone call you can make an appointment for a professional serviceperson to come and fix whatever problem you have. The apartment will always be kept sparkling, the public spaces in the apartment [excluding bedrooms] will be cleaned every two weeks. If you need to change locations, sublet, or terminate the lease, we will take your needs into consideration and do our best to satisfy you. In order that a larger amount of white-collar renters can enjoy Danke Apartment advantages, we are offering various “Celebrate Shanghai” promotions: new clients can get, 200, 500, or 800 yuan off, and old customers can get a coupon for cash back if they introduce new clients — no limit on how many coupons you can get. To our beloved long-time customers: Can you pass this up?

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Our ad covering a bus

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a prospective customer

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The Danke Apartments Shanghai team

konjaku: here is a profile of a Danke Apartments service manager. This is not the whole article.

 

https://www.dankegongyu.com/zhuanti/story?storyID=1

Danke apartment manager Wang Huanlin: if you put in hard work, it will result in a good reputation

https://www.dankegongyu.com/zhuanti/story?storyID=1

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12:30, a half hour after midnight. Beijing, Changping district, in Tiantongyuan. A room in a Danke Apartments building suddenly lost heat due to a burst radiator, and needed urgent repairs. From his location 10 kilometers away Danke apartment manager Wang Huanlin immediately rode his bicycle to the building, and contacted the building supervisor to stop the water. By 3 A.M. they had managed to effect a solution.

Wang Huanlin applied to be transferred to building manager on his own initiative. Why? This young man with a sunny disposition started to laugh, “When I was a rental agent, I kept hearing from customers their opinions about how to maintain the buildings, and the difficulties they had coordinating the different tasks that were needed.”

Beijing in the 11th month: the temperature suddenly drops, the heating gets turned on, and it is difficult to avoid the problems of pipes leaking or bursting.

One night, a tenant’s electric touchscreen door lock lost power. The device took 9 volt batteries, but they were a special type. Wang Huanlin spent an hour going to five or six different hardware stores until he found the right batteries.
“Being the building manager is much busier than being a rental agent.” But Wang Huanlin had no regrets.

konjaku: the article goes on to say that since Wang Huanlin’s face appears on the site when a customer looks for a room, many people have recognized him when he responds to a call for service.

However, Danke Apartments cannot overcome the prevailing distrust in the rental market that easily.

Danke Apartments rent payment system hits a snag: it actually involves taking out a loan and paying it back by installments

Renters beware of the trap of internet loans

Source: Beijing Evening News
http://economy.china.com/consume/11173302/20170601/30621518_all.html

2017-06-01

In the season for college graduates to rent an apartment, if one sees slogans like “one month deposit, one month rent in advance” [instead of the standard: one month deposit, three months rent in advance], and “no middleman fees,” it all sounds pretty attractive, especially in Beijing, where it is not easy to find a good deal.

However, these attractive terms conceal fishy problems and risks, and it is possible to fall into a trap. A reader. Ms Liu, recently reported to this paper several problems she encountered when trying to rent. “The broker kept telling me it was ‘one month deposit, one month rent in advance.’ In a muddle I signed the contract, then right away I discovered that I had committed to the full amount for one year’s rent.” Ms Liu wanted to rent a room from Danke Apartments in Chaoyang district [Beijing], but only after she signed the contract did she find out she had committed to one year.

“As for the ‘one month deposit, one month rent in advance,’ this involved making a second contract with a finance company called Huifenqi on an internet platform, in which I would pay one month’s rent at a time to them. In other words, the internet company paid Danke Apartments a year’s rent on my behalf, and I was pledging to pay that amount back to Huifenqi, one month at a time.
One thing that disturbs me is that a Danke Apartments staff member told me, and the application form also states, that there is only one condition, which is clearly and unequivocally stated: the “one month deposit, one month rent in advance.” However, when I signed the contract, this somehow changed to “one year.” Another thing Ms Liu worries about, is whether the money she pays in monthly installments to Huifenqi, will really be credited to Danke Apartments. In the end, is there really a connection between Huifenqi and Danke Apartments? There is nothing written in the contract spelling out their relationship, so she wonders if they are really connected.

“It’s not clear who I’m renting from, and who I am paying. If I’m paying the rent to a third party, it seems fishy. The average consumer can’t tell what is true from what is a sham.” Afterwards, Ms Liu made a strong request to cancel the contract with Danke Apartments.

This reporter made an inquiry to an employee, who said “Danke Apartments” was the trademark for a product line of high-end apartments for white-collar workers, operating under the Ziwutong Property Management firm, based in Beijing. The company was founded in 2015-01, and is officially entered into the O2O rental property market. [O2O stands for “Online to offline.” It is a digital online platform that connects buyers with offline goods and services, comparable to Groupon, Uber, and OpenTable.] They are not in the traditional sense a property rental company, but instead an online platform that offers rental properties, which they also manage. Starting with eleven employees, they now have over 400, and have expanded from Beijing to Shenzhen and Shanghai.

As this reporter found out, Danke Apartments is not a centralized company, but rather one which makes agreements with landlords in dispersed places, to manage their properties as trustees. Danke Apartments does the actual renting, and for larger apartments, such as three bedroom apartments, it rents rooms in the apartment separately, and the individual tenant pays a portion of the rent [shares it with two other roommates].
In the “Terms and Conditions” section of the Danke Apartment website, it clearly states, “the method of payment is one month deposit, one month rent in advance. You will never again have to worry about digging into your pocket for up three months rent in advance.” There is no mention anywhere here of the installment plan as being paid through an internet platform.

In the Huifenqi application, it says the renter will pay to the Huifenqi platform instead of a landlord, and that the renter will pay back a portion of the loan each month as a month’s rent. This arrangement will ease the pressure on renters, it says. They can either pay by registering with Huifenqi, or by using their WeChat account number. But this service is not free. There is a charge of 4 percent at the quarter year mark, 5 percent at the half year, and 8 percent at the one year mark. If one does not pay before the monthly deadline, a penalty of 1 percent is assessed per day.

Actually, there are now many internet platforms now that offer the service of paying monthly rents, and these have broken the tradition of “one month deposit, three months rent in advance” or “one month deposit, six months rent in advance” which existed before. They advertise themselves as “rental properties plus financing plus internet company.” The traditional brick and mortar rental broker Woaiwojia [“I love my home”] now offers a long-term rental service through an internet platform called Fang siling [“Home Commander”]. In 2015, JD.com [one of China’s largest e-commerce companies] paired with Ziru Apartments to offer “Ziru Vouchers,” a service to pay for a year-long rental product. 58.com started a rental pay-by- monthly installments service called “58 monthly pay.”

These internal rental companies fall into two types. One type offers the user apartment listings based on whatever preferences the user inputs, and offers the “one month deposit, one month rent in advance” option. This includes Home Commander, Ziru Vouchers, and 58.com. The other type only offers the installment plan of paying monthly rent, but not housing resources, such as Huifenqi and Quzu. In other words, users find the apartment they want to rent by themselves, and once they have finalized the rental agreement with the landlord (amount of rent and payment method), they apply to the internet platform (such as Huifenqi) to borrow the amount. The internet platform pays the landlord, and they pay back the amount monthly to the site.
When renting through an internet platform, what if the internet company does not pay the landlord? It is possible that the landlord, who was perhaps not directly involved in the rental agreement, may still seek out the tenant and demand the money, or force the tenant to leave the apartment. The tenant would be exposed to the double risk of “no home, and no money.” How can one guard against being cheated?

Liu Shuaijun of the Beijing City Jingde Law Firm warns tenants that signing a rental contract and a loan contract means that you are signing two completely separate, unrelated contracts, and this mat be to your disadvantage in case there is any sort of dispute. He advises that whenever the tenant communicates with the renter, the tenant should take careful notes of the conversation or record it. These can become evidence in the event of a lawsuit.

Liu Shauijun said that in the afore-mentioned Ms Liu’s case, Danke Apartments and Huifenqi have a cooperative agreement, similar to that between a real estate developer and a bank, but there is a difference: Danke does not offer a guarantee in regards to the loan taken out by the prospective tenant. The renters are right to be worried if there is no mention in both contracts of the relationship of the one entity to the other.

Liu Shauijun recommends that tenants demand a contract signed by all three parties, stating clearly that Huifenqi will represent the tenant in making a one-time payment of in the amount of the year’s rent to Danke Apartments; that the tenant will thereafter pay back the loan as monthly payments to Huifenqi; that Danke Apartments will provide a written notice to the other two parties that it has received the full amount due, and henceforth the tenant will only owe the agreed upon amount to Huifenqi.

An industry insider said, “Right now it is pretty easy to set up an internet rent-paying site, and most of the platforms offer virtually the same services. These sites even maintain their capital fund through peer-to-peer networks of small lenders.”

iResearch reports that internet finance service is a growing field. Supported by national policy, it is occupying a larger space in the capital market. Internet financing is a especially convenient way to get and make loans. Conventional finance companies need several days to a week to vet a loan, but internet services using AI to comb through data can approve a loan in several hours, or even just several minutes, making the process that much easier for the consumer.

However, because paying rent through internet platforms is relatively new, and still in its first stages, there is inadequate oversight. Many areas are non-standard, one should exercise caution.

konjaku: one can see why Danke Apartments would want tenants to commit to a one year lease. At the same time, tenants may balk at committing to pay through an internet finance company, which is perhaps still a new and unfamiliar arrangement. In time, perhaps these difficulties with the contract process will be cleared up. In other desirable cities in the world in which rents are high, there are similar ventures trying to combine less expensive rents with more services. For instance, in San Francisco there is Starcity, although their focus is more on communal living (including shared kitchens and bathrooms), they also offer free WIFI, cleaning and maintenance in their package.

https://starcity.com/lifestyle

 

Huifenqi 会分期  https://www.huifenqi.com
Woaiwojia 我爱我家
House Commander 房司令  http://www.58fangdai.com
Danke Apartments 蛋壳公寓
JD.com 京东
Ziru vouchers 自如白条   http://www.ziroom.com/zhuanti/zrbaitiao/

 

 

 

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