GUILDERLAND – Nearly $244 million in mortgages given to Crossgates Mall’s over the years is being auctioned off to the highest bidder, according to a Bloomberg News report published Thursday.
Bloomberg’s John Gittelsohn wrote that Newmark, a commercial real estate services firm, will conduct the sale of $243.7 million in loans that came due last month.
Syracuse-based Pyramid Management Group, which owns Crossgates, could not refinance the loans before they fall into default, Bloomberg reported.
It is unclear if Pyramid will bid on the loans. Bloomberg reported that the buyer of the debt would take ownership of the property. Pyramid Management did not respond to a request for comment.
Neither did Newmark, the commercial real estate management firm that will conduct the sale. The mall has 1.7 million square feet of space.
Issues with Pyramid’s mortgages on malls it owns across upstate and elsewhere have been occurring for several years now after the pandemic forced many of its tenants into bankruptcy and forced the mall to renegotiate leases, usually at much lower rents.
Ratings agencies have been downgrading the credit of debt securities backed by indoor shopping malls for years now on falling occupancy rates and rents. Wall Street investors have also “shorted” bonds backed by shopping mall debt, putting even more pressure on malls to do better financially.
Pyramid was able to get an extension on repaying the Crossgates loans until May this year.Â
Last June, Pyramid was able to refinance the mortgage it had on Crossgates Commons, the Big Box shopping complex across Washington Avenue Extension from the mall.
The sale of the Crossgates mortgages is not expected to have any impact on another Pyramid project to build a Costco store near the mall, which is located in Guilderland off Western Avenue.
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