CHEEKTOWAGA, N.Y. (WKBW) — The future of the Walden Galleria, the largest shopping mall in Western New York, is uncertain as it faces potential foreclosure due to a $220 million loan that is now past due.
The mall, which opened in 1989, has been a significant contributor to the local economy and a major employer within the community.
According to a report from Buffalo Business First, the property owner, Pyramid Management Group, missed a mortgage payment due on May 1. The financial challenges stem from a loan taken out for the Galleria's expansion in 2007-2008, which aimed to adapt to changing consumer behaviors, including the shift toward online shopping.
Charles Lindsey, an associate professor of marketing at the University at Buffalo, noted that the Galleria's issues are not unique, as many malls across the country have faced similar fates in recent years. He pointed out that the appraised value of the Galleria has dropped significantly, declining by 64 percent from 2012 to 2020. In 2022, it was appraised at $219 million, less than the outstanding mortgage.
"We’re seeing a lot of malls struggling, and this could lead to their downfall," Lindsey said. "They were trying to expand to compete with changes in consumer behavior, but that strategy may have backfired."
Cheektowaga Town Supervisor Brian Nowak emphasized the importance of the Galleria to the local economy, noting that it pays approximately $3 million annually in taxes to the town, county, and state. Despite the financial challenges faced by Pyramid, he remains hopeful about the Galleria's future, citing its occupancy rate of above 80 percent in recent years.
"There's a lot of things going in the mall's favor," Nowak said. "But if you look at other malls in New York State and across the country, they are all struggling."
As Pyramid Management seeks forbearance from lenders, options appear limited as they may have exhausted any possibilities for extending their payment terms. Efforts to contact Pyramid Management for comment were not successful.
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