What’s new: Real estate firm Soho China’s property management affiliates have been fined a total of 115 million yuan ($18 million) for charging extra electricity fees to clients, according to the market regulator of Beijing municipality.
The 15 units of Soho China in the Chinese capital provide property management services for commercial buildings developed by Soho. In Monday statements, the regulator blamed the affiliate companies for illegally charging additional fees for electricity on top of the average fee that power companies charge, ordering them to refund the extra fees to users.
The context: Soho China’s business has been hit by several blows over the past two years, affected by the Covid-19 pandemic and tightened real estate regulations. Earlier this month, it announced it was offering 32,000 square meters of residential and commercial properties in Beijing and Shanghai at a 30% discount.
The proceeds from sales would be used to repay some of the maturing debts as financial institutions are currently reluctant to issue loans to the real estate industry, Soho China Chairman Pan Shiyi has said.
Soho had planned to sell a majority stake in the company to U.S. private equity giant Blackstone Group Inc., but the two sides failed to reach a deal last year.
Related: Blackstone Drops $3 Billion Bid to Buy Chinese Developer Soho After Progress Hits a Wall
Contact reporter Guo Yingzhe (yingzheguo@caixin.com) and editor Flynn Murphy (flynnmurphy@caixin.com)
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