The New York based real estate investment trust and parent company of Newrez stated net proceeds from the offering would be used "for the reduction of indebtedness," including some of a previous 6.25% note offering of $550 million maturing in 2025. 

Interest on the four classes of 2029 offerings ranges from a 6.375% rate on series C fixed-to-floating cumulative preferred stock to 7.5% for series A notes. The debt will be sold in the U.S. to parties reasonably believed to be qualified institutional buyers as well as offshore investors in compliance with regulations.

Rithm's announcement comes after other leading mortgage servicers, including Mr. Cooper and Pennymac, recently issued similar long-term unsecured debt, indicating the transactions are proving to be a useful strategy to support the financial health of certain types of businesses. CEO Michael Nierenberg previously hinted at the likelihood of such deals in Rithm's future during the company's fourth-quarter earnings call. 

"If we could issue high-yield unsecured debt in the public markets, we're going to explore that heavily," Nierenberg said at the time. "We're hungry."

In conjunction with Monday's announcement, Rithm also commenced a cash-tender offer to purchase up to $275 million on its 2025 notes. The offer expires on April 1 at 5 p.m., Eastern time.  

The latest news from Rithm also arrives after it recently approved a 2024 stock repurchase program of up to $200 million in common stock and $100 million in preferred to replace a similar 2023 authorization.

The capital raised through unsecured debt sales and repurchases could possibly be allocated to support several prior and potential acquisitions following an eventful 2023 for the New York-based REIT. The company made moves to diversify its offerings beyond residential real estate sectors and establish itself as an alternative asset manager, while hinting more deals might be on the way. 

Along with a highly contested battle to acquire hedge fund group Sculptor Capital Management, Rithm also purchased $1.4 billion of prime unsecured loans from Goldman Sachs and expanded into the European market.

Among home lending deals of the past year, Rithm bought the mortgage servicing unit of Australian enterprise Computershare, including its affiliate Specialized Loan Servicing.  

Last week, Rithm also entered into an external management agreement with Great Ajax Corp. aimed at growing its asset management platform through commercial real estate investments.  

Newly raised funds could also serve the purpose of spinning Rithm's mortgage related holdings off into a new separately traded public company, a possibility it first suggested in 2020. Last spring, leadership again said it was looking at the option again, filing the necessary documentation to proceed with an initial public offering.