Pyramid Management Group has reached an agreement with its current lender that will give it enough time to close on the new financing for Walden Galleria and stave off foreclosure, Pyramid announced Thursday.
The deal is expected to close by the end of the year.
“I am extremely proud of the Pyramid team for successfully negotiating a resolution with our current lender and putting in place new financing for Walden Galleria,” said Stephen J. Congel, Chief Executive Officer of Pyramid Management Group.
It is a positive development for the shopping center, which is a large employer and taxpayer in Cheektowaga. A foreclosure could have led to a sale of the mall if Pyramid and its lender had not been able to strike a deal.
“Our focus will now turn to closing on the new financing before year end,” Congel said. “The successful result of this process will ensure the continued strength and growth of Walden Galleria as Western New York’s premier shopping, dining and entertainment destination.”
Pyramid Management Group has won its fight to remain property manager of the Walden Galleria while the mall navigates the mortgage foreclosure process.
Wells Fargo Bank kicked off the foreclosure process with a complaint filed in May, after Pyramid defaulted on a $220 million loan backed by the property.
The mall’s value has dropped so much over the years − due to a storm of factors such as changing consumer habits and the decline of brick-and-mortar retail − that the mall itself is worth only about $219 million.
When the value of properties such as the Galleria has plunged, it makes refinancing extremely difficult – if not impossible. When refinancing is no longer an option, it typically leads to foreclosure.
Here’s a look at the challenges – and the opportunities – local malls are facing.
Court filings show that occupancy at the mall has increased from 83% in 2021 to 90.6% in 2024, and that Walden Galleria has the highest sales per square feet in Pyramid’s portfolio, at $653 in April.
The mall is currently up to date on its tax payments and has public safety under control, according to the Town of Cheektowaga.
“We remain committed to the shopping center and the community we serve, and we are very excited about the future for both,” Congel said.
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Samantha Christmann
News Business Reporter
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