The $430 million mortgage on New York’s largest mall will transfer for under 20 cents on the dollar, marking one of CMBS’s largest losses.
Pyramid Management Group is set to acquire the $430 million mortgage on Destiny USA, a 2.4-million-square-foot mall in Syracuse, for less than 20 cents on the dollar. The deal, expected to close by August 2026, reflects a steep discount as the property’s appraised value has plummeted by roughly 75%.
The mall’s CMBS debt remains behind $235 million in senior PILOT bonds, despite strong tenant retention and improving foot traffic. The transaction underscores the risks of overleveraged enclosed malls in the commercial mortgage-backed securities market.
Destiny USA, which includes retail, hotels, and entertainment venues, was originally valued at a much higher level but has struggled to justify its debt load. The loss on this mortgage will rank among the largest in CMBS history.