NEW YORK, Jan. 23, 2023 — Pretium, a specialized investment firm with more than $50 billion in assets under management, today released the following letter sent by Don Mullen, the firm’s Founder and CEO, to President of the United States Joseph R. Biden, Jr.

Dear Mr. President:

I am writing regarding your Administration’s ongoing efforts to address some of our nation’s most urgent housing challenges. The government, in good faith partnership with the private sector, has a tremendous opportunity to drive long-term, sustainable housing affordability and supply. At Pretium, we have more than $50 billion in assets under management and more than 4,000 employees supporting residential investments (including residential real estate and mortgage finance), as well as corporate and structured credit. Our single-family rental (SFR) platform, Progress Residential, currently manages over 90,000 homes across 30 markets in the United States. Our size and scale provide a unique vantage point from which to advocate for innovative ways the public and private sectors can work together to achieve long-term economic growth and equality. Through collaboration, we can increase rental housing supply, invest in historically disinvested neighborhoods, and eliminate outdated and discriminatory zoning laws. 

Progress Residential has already outlined a comprehensive housing affordability plan, and we appreciate the opportunity to participate in recent White House-led conversations with housing providers about resident-centered property management practices. We look forward to continuing to engage in conversations regarding viable public-private housing solutions and, to that end, encourage consideration of the following proposals by your Administration and bipartisan policymakers in Congress: 

• Revitalize Single-Family Housing Supply. Freddie Mac has estimated the undersupply of homes at nearly 4 million units¹, a supply-demand imbalance that has been building for several decades. The problem is particularly acute in the market for entry-level homes. According to the Bipartisan Policy Center, the number of new entry-level homes built in the 1970s routinely surpassed 420,000 every year. By comparison, in 2020, just 65,000 new entry-level homes were built.²
• Revitalize Single-Family Housing Supply (continued). Exacerbating this problem is what the Joint Center for Housing Studies of Harvard University refers to as “rental deserts” – the absence of rental housing options in 31 percent of all neighborhoods nationally – which contribute to ongoing socioeconomic inequality and racial segregation.³ We believe there is an urgent need for the federal government to partner with real estate owners to revitalize single-family homes and create programs that support comprehensive housing supply efforts. One policy initiative that the federal government could model or further incentivize are the real estate tax abatements that select states, counties, and cities have offered to encourage longer-term affordable housing, such as the development of new and the preservation of existing SFR housing. A second policy initiative we support, and have submitted public comments on, is extending the Green and Resilient Retrofit Program (GRRP), created by the Inflation Reduction Act of 2022 (Pub. L. 117–169), to single-family assisted housing as well.
• Increase Private Sector Participation in the Section 8 Housing Choice Voucher (HCV) Program. Today, a persistent gap exists in many public housing authority jurisdictions between the number of Housing Choice Vouchers authorized by the U.S. Department of Housing and Urban Development (HUD) and the number of vouchers actually being used, due to a lack of rental owners’ participation in the program. In order to increase owner-operator participation in the HCV program, Pretium and Progress Residential join other private sector colleagues – including the National Apartment Association and the National Multifamily Housing Council – in endorsing the bipartisan Choice in Affordable Housing Act (S. 1820/H.R. 6880) to reduce administrative burden. In addition, we support the full and immediate implementation by HUD of the flexibilities provided through the Housing Opportunity Through Modernization Act of 2016 (HOTMA; Pub. L. 114-201) including, but not limited to, biennial inspections, paying Housing Assistance Payments (HAP) to landlords prior to inspection, and use of remote virtual inspection. Finally, to provide the benefits of housing innovations and efficiencies to HCV residents, we also propose a new HUD pilot program within Moving to Work (MTW) agencies in 3-5 geographically diverse cities focused on promoting housing choice and equitable access to single-family neighborhoods.
• Enhance Single-Family Homeownership Opportunities for Underserved Communities. To increase access to homeownership for underserved communities, we propose a new HUD demonstration program where SFR owner-operators could partner with HUD and third-party community-based nonprofit organizations through the currently underutilized HCV Homeownership Program. Participating owner-operators would provide homeownership inventory for the program. In addition to the expenses currently covered under the HCV Homeownership Program⁴, piloted expenses paid for by HUD would include financial literacy education, homeownership counseling, down payment and closing cost assistance, and coordination with the Federal Housing Administration (FHA) single-family first-time homebuyer programs to eliminate regulatory obstacles.
• Create Viable Rent-to-Own Options for Consumers. While the United States continues to enjoy historically high homeownership rates (the national homeownership rate was 66% in the third quarter of 2022)⁵, we could do even more to promote sustainable homeownership. As a 2017 study by the Terner Center for Housing Innovation at the University of California Berkeley noted, “public policy can play an important role in supporting the development of new private mortgage products, and ensuring they benefit consumers…FHA already has the authority and infrastructure in place to offer an assumable mortgage, which would benefit both nonprofits and private entities seeking to launch lease-purchase models. In addition, the complexity of lease-purchase – and determining whether it is the best option based on a household’s finances and future expectations about mobility and house prices – means that any lease-purchase product needs to be accompanied by transparent contracts, effective regulations, and consumer education. FHA and the Federal Housing Finance Agency (FHFA) are in a unique position to provide that type of stewardship and oversight, as well as help to analyze data and evaluate programs to identify and support the expansion of responsible, scalable models.”⁶ We propose the establishment of a public-private working group – that builds upon FHA’s and FHFA’s existing authority – to create viable SFR rent-to-own options for consumers nationwide. Coupled with the aforementioned proposals to augment our nation’s SFR housing supply, we could meaningfully increase homeownership conversion rates for individuals and families who currently rent, but aspire to be homeowners.
• Provide Federal Tax Credit for Renters. At Pretium and Progress Residential, we strongly believe in the dignity of renting. As the Urban Institute points out, “US tax policy has historically discriminated against renters and favored homeowners”⁶ thereby contributing to racial and economic inequality. During your Presidential campaign, you proposed a refundable tax credit for renters equal to the difference between 30 percent of household income and the lesser of gross rent paid and local fair market rent. We encourage you to endorse this proposal again and to push for bipartisan passage in the House and Senate. 

In closing, Mr. President, I agree with you that every American should have “access to housing that is affordable, stable, safe and healthy, accessible, energy efficient and resilient, and located near good schools and with a reasonable commute to their jobs.”⁷ To achieve this goal, however, we must build a more inclusive housing model that envisions single-family rental housing stability as a key pillar. Single-family rentals offer a unique opportunity to address our national housing crisis and have the ability to contribute to family stability, economic mobility, and positive health outcomes. SFR can provide families access to neighborhoods that have lower poverty and crime rates, higher performing schools, more mixed incomes and other amenities families seek. Pretium and Progress Residential are dedicated to creating equitable outcomes for the residents who choose to live in our communities and have adopted management practices that are designed to provide opportunities for wealth building and homeownership. 

I welcome the opportunity to discuss these proposals with you and your team in greater detail and look forward to working together to create sustainable, bipartisan, publicprivate solutions for our nation’s housing challenges. 

Thank you for your consideration. 

Sincerely, 

Don Mullen,
CEO & Founder

About Pretium

Pretium is a specialized investment firm focused on U.S. residential real estate, residential credit, and corporate credit. Pretium was founded in 2012 to capitalize on investment and lending opportunities arising as a result of structural changes, disruptions, and inefficiencies within the economy. Pretium has built an integrated analytical and operational ecosystem within the U.S. housing, residential credit, and corporate credit markets, and believes that its insight and experience within these markets create a strategic advantage over other investment managers. Pretium’s platform has more than $50 billion of assets, comprising real estate investments across 30 markets in the U.S., and employs more than 4,000 people across 30 offices, including its New York headquarters, Dubai, London, Seoul and Sydney. Please visit www.pretium.com for additional information.

Contacts

Jon Keehner / Kate Thompson / Lyle Weston
Joele Frank, Wilkinson Brimmer Katcher
212-355-4449

CHARLOTTE, NC and NEW YORK (January 19, 2023) – Crescent Communities and Pretium are pleased to announce leasing will begin soon at HARMON Five Points, the fourth build-to-rent (BTR) community under development, and the second in Charlotte, as part of their previously announced joint venture. The community is comprised of 76 BTR homes with accompanying shared amenities. Progress Residential, Pretium’s single-family rental management services platform, is providing the leasing and property management services.

HARMON Five Points offers residents the option to rent three-story townhomes with three bedrooms, three and a half baths, outdoor balconies, private garages, and driveways. Interior finishes include modern, stainless-steel appliances, granite countertops, elevated flooring, spacious nine-foot ceilings, ample window exposure for natural light, and SMART home technology. The community is the first for the HARMON brand to be certified by the National Green Building Standard (NGBS), a residential building certification for sustainable construction and development. Each home is designed to be energy and water efficient, while offering residents a greater degree of comfort and lower utility bills.

Residents of HARMON Five Points will also have access to dedicated communal spaces such as a fire pit with outdoor lounge seating, a lawn area for gatherings and pets, and a direct connection to Five Points Park and Stewart Creek Greenway. HARMON Five Points is located two miles from Uptown and is walking distance from the Gold Line Streetcar.

“HARMON Five Points offers a much-needed new construction infill housing option to the historic West End neighborhood to accommodate the migration and population growth in Charlotte over the past several years,” said Tony Chen, Senior Managing Director of Single-Family Build-to-Rent at Crescent Communities. “We are pleased to have reached the leasing milestone ahead of schedule, and are also excited for the NGBS Bronze certification achievement. Stewardship is fundamental to Crescent Communities’ mission to build community and better people’s lives, and we are excited to extend our commitment to stewardship into our BTR platform through our goal of achieving NGBS Bronze or greater on each HARMON home. We strive to have a positive impact on the planet, people, and places we build and call home, and we look forward to seeing the HARMON Five Points community flourish.” 

“Pretium is a leading investor in homes throughout some of the most desirable areas across the country,  and we are thrilled to have another build-to-rent community welcome residents—bringing our total footprint in the Charlotte market to more than 5,300 homes and demonstrating our commitment to housing choice across growing regions,” said Matt Johnston, Managing Director and Head of Build-to-Rent at Pretium. “In addition to increasing housing access and offering consumers more choices, HARMON Five Points is delivering modern, sustainable homes that will be an important addition to the Charlotte community for years to come. We are committed to continuing our investments to increase the supply of move-in ready homes and contribute to the long-term health of our communities.”

HARMON Five Points is located at 360 Seldon Drive, Charlotte, NC, and was constructed by DRB Group. Additional partners include lender Atlantic Union Bank, landscape architect LandDesign and architectural review by 505Design. Progress Residential, which currently oversees more than 90,000 homes, is a market leader, with the people, technology, scale, and data-driven solutions that streamline operations, optimize asset performance, and provide an exceptional renting and living experience for residents.

Imagery of HARMON Five Points is available here and floorplans can be found here. For more information, please visit: www.liveatharmon.com and rentprogress.com.

About Crescent Communities

Crescent Communities is a nationally recognized, market-leading real estate investor, developer and operator of mixed-use communities. We create high-quality, differentiated residential and commercial communities in many of the fastest growing markets in the United States. Since 1963, our development portfolio has included more than 83 multifamily communities, 24 million square feet of commercial space and 60 single family master-planned communities. Crescent Communities has offices in Charlotte, DC, Atlanta, Orlando, Nashville, Dallas, Denver, Phoenix and Salt Lake City. Our residential communities are branded NOVEL, RENDER and HARMON by Crescent Communities and our industrial developments are branded AXIAL by Crescent Communities and our life science developments are branded THE YIELD by Crescent Communities.

About Pretium

Pretium is a specialized investment firm focused on U.S. residential real estate, residential credit, and corporate credit. Pretium was founded in 2012 to capitalize on investment and lending opportunities arising as a result of structural changes, disruptions, and inefficiencies within the economy. Pretium has built an integrated analytical and operational ecosystem within the U.S. housing, residential credit, and corporate credit markets, and believes that its insight and experience within these markets create a strategic advantage over other investment managers. Pretium’s platform has approximately $50 billion of assets, comprising real estate investments across 30 markets in the U.S., and employs more than 4,000 people across 30 offices, including its New York headquarters, Dubai, London, Seoul and Sydney. Please visit www.pretium.com for additional information.

About Progress Residential

Progress Residential is a market leader in intelligent single-family rental management services, with people, technology, scale and data-driven solutions that streamline operations, optimize asset performance, and provide an exceptional renting and living experience for our residents. Progress Residential’s approximately 3,000 employees currently manage approximately 90,000 homes across 30 markets. Progress Residential also offers third-party property management service for investors with mid-to-large single-family rental home portfolios and Built to Rent communities through its Progress Residential Management Services. For more information, please visit www.rentprogress.com