Cheektowaga, N.Y. (WBEN) - Shoppers at the Walden Galleria mall won't see any difference as owner Pyramid faces a foreclosure after failing to pay a $220 million balloon payment last month.
What will it mean for shoppers?
"It means that the status quo is going to be maintained despite what's going on in court, it should be business as usual at the mall," says attorney Scott Bogucki.
As far as the foreclosure proceedings, Bogucki says the lender has the opportunity to, perhaps, renegotiate the terms of the the mortgage, and note the underlying debt instruments with the borrower, Pyramid Management Corporation.
"If that is unsuccessful, then the matter will move towards foreclosure as part of the relief that's being sought in the complaint," he explained. "Wells Fargo is looking to have a rent receiver appointed. So essentially, although it's going to be status quo and business as usual for everybody that uses the mall in its facilities for pyramid Management Corporation, that essentially means that they're going to be, you know, divested of their ability to really manage the property."
Bogucki adds rents are going to be taken directly by Wells Fargo, and along with the other relief that they're seeking in the complaint. It's also possible the property gets put up for auction, and that's going to include not just the real property, but in the complaint.
"They have the ability to also sell anything that's considered personal property, which is everything that isn't real property. So it could be any equipment, any fixtures, things like that, would proceed to the the auction block," Bogucki noted.
Bogucki says if the parties involved enter into productive settlement agreements, it could remain on pause.
"I don't want to say, indefinitely, but that would be up to the parties who are involved," he said. "If it does move forward, for example, if Pyramid Management Corporation decides to, I'll speak colloquially here, decide to just walk away within six months to a year, the property could be put up for sale. It's highly unlikely that a company like Wells Fargo will want to take over permanent management of the facility. So the thought would be again with with what they're looking for in the mortgage foreclosure complaint is that it will go up for sale again, probably within a year to 18 months."
The Walden Galleria opened in 1989.