New Residential Investment Corp., the mortgage real estate investment trust and parent company to nonbank lender Newrez, is changing its name to Rithm Capital.
The rebranding is meant to signal a new chapter for the company, emphasizing its diversified offerings in financial services and real estate, said CEO and President Michael Nierenberg.
“We have changed dramatically since our inception, from an owner of MSR assets to a company with complementary operating companies and a unique portfolio of investments,” said CEO and President Michael Nierenberg in a press release.
“The new name and brand help distinguish us from our operating companies, including Newrez, and reflect our culture, team and ambitions for growth beyond residential mortgages,” he added.
The company expects the name change to become official on or around August 1 and will come with a new branded website.
The move comes just a year after New York-based New Residential announced the acquisition of Caliber Home Loans, adding the lender’s assets to those of Newrez. It later followed that deal with a purchase of Genesis Capital, a real estate finance company specializing in business-purpose loans to residential single and multifamily investors, and also houses an investment division.
The change also occurs during a challenging period for the home lending industry, in which a steep decline in refinances and a rapid jump in interest rates have led to staff reductions at several mortgage companies. In the first quarter, profits from New Residential’s originations segment fell by 67%, leading Nierenberg to issue a bleak forecast for the industry and hint at his hopes of turning New Residential into a “real full-scale financial services company.”
Along with the rebranding, New Residential announced an internalization of its management functions, effective immediately. Fortress Investment Group had been managing New Residential, providing personnel as well as corporate infrastructure. As Rithm Capital, the company will continue to be led by Nierenberg as board chairman, CEO and president, and Nick Santoro remains as chief financial officer and chief accounting officer.
New Residential expects to save between $60 to $65 million with the internalization and agreed to pay Fortress $400 million for the separation.
“We believe the internalization positions the company for long-term success. We view this transaction as a way to drive value for shareholders with expected cost savings,” Nierenberg said.