- Stephen Scherr, former CFO of Goldman Sachs, is joining Pretium as co-president, alongside Jon Pruzan, former CFO of Morgan Stanley.
- Pretium, led by Don Mullen, manages a $55B portfolio focused on U.S. single-family rentals and has recently expanded into multifamily properties and real estate debt.
- Pretium aims to capitalize on opportunities in residential lending as traditional banks pull back from construction financing, positioning itself as a key player in private credit.
According to Bloomberg, Stephen Scherr, former CFO of Goldman Sachs, is making a return to Wall Street by joining Pretium as co-president.
He will lead the firm alongside Jon Pruzan, a former Morgan Stanley executive, to help expand the $55B real estate investment giant, which has become one of the largest landlords of U.S. single-family homes.
Wall Street Reunion
Scherr’s appointment adds another heavyweight to Pretium’s leadership. He will share responsibilities with Jon Pruzan, who joined the firm last year.
Both were longtime rivals at their respective firms, Goldman Sachs and Morgan Stanley, but now join forces at Pretium, led by Don Mullen, another former Goldman executive.
Mullen, who founded Pretium after betting big on single-family homes post-financial crisis, aims to steer the company through a phase of disciplined yet ambitious growth.
A Controversial Player
Pretium, founded in the wake of the 2008 financial crisis, has amassed nearly 100K rental homes, making it one of the largest institutional landlords in the U.S.
Initially focusing on distressed properties, Pretium has diversified into multifamily housing and real estate debt. The firm has also begun originating and servicing home loans, and it plans to grow further in these areas as investors increasingly seek alternatives to traditional banking.
As institutional ownership of rental homes grows, Pretium has faced criticism amid the ongoing shortage of affordable housing. Both Republican and Democratic leaders have argued that large landlords are making homeownership harder for first-time buyers.
Mullen acknowledged this criticism, stating that Pretium aims to be part of the solution by working with local governments to address housing challenges.
Expanding Beyond Rentals
As banks reduce their exposure to construction lending—down from 8% of their loan portfolios in 2006 to 4% today—Pretium sees a fresh opportunity to finance homebuilders and developers.
Their pivot is part of a broader trend in the private credit market, as non-bank entities like Pretium move to fill the lending gap left by regional banks.
Scherr and Pruzan are taking the reins at Pretium during a pivotal time for the firm. The firm is focusing on growing its presence in the housing market while seizing opportunities in residential real estate financing.
Scherr highlighted that Pretium understands its strengths and intends to leverage them before expanding into other areas. “There’s a lot to do there long before we go further afield,” he said.
