Palisades Center Mall operator avoids financial calamity (for now)

Pyramid Companies reaches forbearance agreement with special servicer on $389M CMBS loan

TRD New York /
Jul.July 17, 2020 04:50 PM
The Palisades Center and Pyramid Management Group CEO Steve Congel (Google Maps)

The Palisades Center and Pyramid Management Group CEO Steve Congel (Google Maps)

One of the nation’s largest malls has come to an agreement with its lender to stave off foreclosure.

After temporarily closing due to the coronavirus shutdown, Palisades Center Mall owner Pyramid Companies risked defaulting on its $388.5 million CMBS loan. The loan fell into special servicing in April.

But according to the standstill agreement detailed on Trepp, Pyramid on June 19 received a moratorium on debt service payments or reserve deposits until September 9. Pyramid originally sought relief through 2022, but after talks with special servicer Wells Fargo it changed its request to a six month deferral, an extension of the loan and modifications to the cash flow and use of reserve funds, Trepp reported.

The maturity date for the loan is now extended to either October 2021 or whenever Palisades Center pays off the last of the 12 monthly installments, whichever comes first.

Robert Congel’s Pyramid Companies developed the mall in 1998, and it’s the 11th largest in the country.

The debt was originated by JPMorgan Chase and Barclays in 2016 and was included in a single-asset CMBS transaction, with Wells Fargo as both master and special servicer.

The loan covers 1.8 million square feet of retail space at the property, and excludes space occupied by Macy’s and Lord & Taylor. The mall’s capital stack includes an additional $141.5 million in mezzanine debt, according to rating documents.

The mall was fully leased in 2016, but has since been faced with the departure of J.C. Penney, Lord & Taylor and Bed, Bath & Beyond, dropping the occupancy rate to 82 percent.

Coronavirus has also heavily impacted some of its other tenants, including AMC, which has been attempting to avoid bankruptcy.

Generally, malls in New York have been stifled by Gov. Andrew Cuomo. Under new guidelines, malls may only reopen if they install enhanced air filtration systems — a restriction that no other retailer faces. However, according to its website, Palisades Center Mall is open.

Contact Sasha Jones at [email protected]


Related Articles

arrow_forward_ios
To get a better idea of where violations are occurring, The Real Deal mapped out areas getting the most 311 calls related to social distancing (iStock)

NYC neighborhoods and restaurants with the most social-distancing complaints

NYC neighborhoods and restaurants with the most social-distancing complaints
Bloomingdales at 2085 Broadway (Google Maps, iStock)

Bloomingdale’s sued for $2.5M in missed rent

Bloomingdale’s sued for $2.5M in missed rent
Brookfield’s Ric Clark and Simon Property Group’s David Simon (Getty)

Simon, Brookfield in talks to buy bankrupt J.C. Penney

Simon, Brookfield in talks to buy bankrupt J.C. Penney
Donald Trump (Getty, iStock)

Federal aid dries up and eviction bans loom over landlords

Federal aid dries up and eviction bans loom over landlords
Neiman Marcus at Hudson Yards (Getty)

Neiman Marcus committed to 50 years at Hudson Yards. It lasted 16 months.

Neiman Marcus committed to 50 years at Hudson Yards. It lasted 16 months.
Thomas Keller with Bouchon Bakery and TAK Room in Hudson Yards (Taylor Hill/FilmMagic, Bouchon Bakery by David Escalante via Thomas Keller Restaurant Group; TAK Room by John Lamparski/Getty Images for The Conservatory NYC)

Thomas Keller closing TAK Room, Bouchon Bakery at Hudson Yards

Thomas Keller closing TAK Room, Bouchon Bakery at Hudson Yards
A Stein Mart location (Getty, iStock)

Discount retailer Stein Mart files for bankruptcy, plans to close most stores

Discount retailer Stein Mart files for bankruptcy, plans to close most stores
Judge Lawrence Marks (Getty, iStock)

Evictions filed pre-Covid can move forward

Evictions filed pre-Covid can move forward
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...