(Yicai Global) April 6 -- KE Holdings, China's biggest real estate agent, refuted a rumor of launching a franchise model for its self-operated Lianjjia outlets nationwide despite widening its novel partnership model to improve store managers' career paths.

KE has no plan to adopt a franchise model for its Lianjia stores in 27 cities, the Beijing-based company, also known as Beike Holdings, said to Yicai Global today. Rumors on social media yesterday claimed that KE, which owns all of its Lianjia outlets, intends to start a franchise model.

However, the company is offering more responsibility to some managers. Lianjia intends to launch a partnership model 2.0 in three cities, and they are Fujian province’s Xiamen, Guangdong's Zhongshan, and Jiangsu's Wuxi, to allow store managers to become partners, it said to Yicai Global. But Lianjia still retains the city director or general manager position. The model means "running a business in partnership with direct-sales management," it added.

Lianjia launched a partnership program in some cities in 2019, allowing outstanding business circle managers to become store partners. The company is further exploring the partnership model, it noted.

Founded in 2001, KE used to be called Homelink Real Estate Brokerage. The company went public on the New York Stock Exchange in August 2020. It has three brands: Lianjia focuses on direct sales, Deyou runs a franchise model, and Beike Zhaofang is an online information platform.

The property market is recovering this year. KE expects its first-quarter revenue to rise as much as 47 percent to no more than CNY18.5 billion (USD2.7 billion) from a year ago due to the nation's supportive real estate policy, according to its earnings report released last month.

Last year, the firm reported a 25 percent decline in revenue to CNY60.7 billion from 2021 due to the bearish real estate market and the Covid-19 pandemic. Gross transaction value slumped over 32 percent to CNY2.6 trillion (USD378 billion).

The company operated nearly 40,520 outlets as of Dec. 31, 2022, down 21 percent from a year earlier, and it had a headcount of 394,020 property brokers, or 13 percent fewer from a year earlier. Lianjia's profit margins from brokering second-hand homes improved as the declining headcount resulted in lower costs.

KE's New York-listed shares [NYSE: BEKE] fell by 3.1 percent to USD18.65 yesterday. Its Hong Kong-listed equity [HKG: 2423] slid by 1.6 percent to close at HKD49.10 (USD6.30) today after a one-day pause due to a public holiday.

Editor: Emmi Laine, Xiao Yi