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Tri-State

Pyramid’s $244M debt on Crossgates Mall to be auctioned after default

Retail landlord failed to refinance after securing one-year extension last spring

Pyramid Management Group's Stephen Congel, 1 Crossgates Mall Road (Google Maps, Linkedin, Getty)
Pyramid Management Group's Stephen Congel, 1 Crossgates Mall Road (Google Maps, Linkedin, Getty)

Mall owner Pyramid Management Group has spent the past few years fighting fires across its portfolio, but it may soon have one fewer property to deal with. 

Three mortgages totaling $243.7 million on Pyramid’s Crossgates Mall outside of Albany are headed to auction after the Syracuse-based developer failed to refinance the debt and defaulted last month, according to the Times Union. Bloomberg Law first reported the sale, which is being conducted by Newmark.

The default comes after Fitch downgraded the debt in March, citing both performance decline and concerns that Pyramid wouldn’t be able to refinance despite extending the maturity date by a year.

The debt sale could spell the end of the road for Pyramid at the Crossgates Mall, one of the largest in the state. The buyer of the loans will have the power to take control of the property. Pyramid, which did not respond to the Times Union’s request for comment, could bid on the debt, though it could also be an opportunity to walk away from a struggling property.

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The Crossgates debt first hit special servicing due to delinquency in 2013, only a year after it was originated, according to Morningstar. It returned to special servicing in April 2020 — along with loans on multiple other Pyramid properties, including the Palisades Center in West Nyack — over an imminent monetary default.

Pyramid’s retail portfolio has endured blow after blow. The value of its Poughkeepsie Galleria in the Hudson Valley has declined 71 percent since 2011 ,from $237 million to $68 million as of March, according to CRED iQ appraisal data. Pyramid has also run into trouble with New York’s largest mall, Destiny USA in Syracuse, where it secured a five-year extension on $430 million worth of debt originally due to mature last summer.

— Holden Walter-Warner

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AlbanyMallsPyramid Management GroupReal Estate Finance