Embattled Chinese rental property provider Ziroom is facing yet another lawsuit. The latest involves 26 Ziroom tenants and more than 20 lawyers who say the company’s apartments contained unsafe levels of formaldehyde, Voice of China reported Thursday.
All participants in the lawsuit, which is being heard by a court in Beijing this week, said they had experienced uncomfortable physical symptoms after moving into recently redecorated Ziroom apartments.
If that sounds familiar, it’s because these 26 people aren’t the first to have accused the company of providing unsafe accommodation. In September, the wife of a former Ziroom tenant sued the company, saying that hazardous formaldehyde levels caused her husband to die from leukemia.
Ziroom attracted $621 million U.S. in series A financing in January 2018. Led by Warburg Pincus, other investors included Sequoia Capital, Tencent, and Sunac. With a $3 billion U.S. valuation, it’s China’s first rental housing tech “unicorn.”
The company was spun off from Lianjia (AKA, HomeLink) in 2016. Lianjia is one of China’s largest rental platforms, claiming to own more than 50 percent of the real estate rental market in Beijing and Chengdu. It now operates in 25 cities in China.
Ziroom is currently facing a lawsuit resulting from the death of a 36-year-old Alibaba employee, who rented a room through the platform in January and died of acute myeloid leukemia in July. His wife believes that his death is directly linked to an unsafe level of formaldehyde found in the apartment.
Addition reporting: Caixin Global