The former head of credit and mortgage for Goldman Sachs is raising $500 million for a new fund that will buy foreclosed homes and attempt to rent them out. Donald Mullen, who left Goldman in January, has been marketing his Fundamental REO Access fund for about a month, sources told Reuters. Goldman is acting as placement agent for the fund, which Mullen has told potential investors could raise as much as $1 billion.
The fund is part of a larger trend in the last year wherein financial firms have sought to profit from foreclosed homes. Alternative asset manager the Blackstone Group has spent more than $250 million so far this year buying foreclosed single-family houses with the intention of renting them out, published reports say. [Reuters] — Guelda Voien