SYRACUSE (TNS) — Destiny USA’s owner isn’t letting lenders grab its Walden Galleria mall near Buffalo without a fight.

Judge Emilio Colaiacovo, of state Supreme Court in Erie County, appointed a receiver for Walden Galleria on June 5, taking control of the Cheektowaga mall from Syracuse-based Pyramid Management Group pending the mall’s foreclosure by lenders.

Now, Pyramid is asking the judge to reverse his order and allow it to continue operating the mall while it tries to refinance a $220 million mortgage that went into default in May.

Pyramid’s mall empire is crumbling. Lenders foreclosed on its Hampshire Mall in Hadley, Massachusetts, and its Palisades Center in West Nyack last year.

And Destiny USA, the largest mall in New York, defaulted on a $300 million mortgage when the loan came due last June, putting the mall at risk of foreclosure.

The company founded by the late Robert Congel is arguing in a court filing that there is “no one better” to manage Walden Galleria than Pyramid.

In fact, compared with similarly situated malls operated by Pyramid, including Destiny USA, Walden Galleria has performed the best since 2021, the company says.

For example, Walden Galleria had $628 in sales per square foot in 2024, while Destiny USA in Syracuse had $533 per square foot and Crossgates Mall near Albany had $617 per square foot, according to Pyramid.

That same year, Walden Galleria had an occupancy level of 90.6%, versus Destiny USA’s 78.2% and Crossgates Mall’s 88.2%, the company says.

Opened in 1989, Walden Galleria is Western New York’s biggest mall, drawing 13.4 million visitors a year (up to 40% of them from Canada), according to Pyramid. (Syracuse’s Destiny USA, by comparison, was drawing more than 26 million visitors a year prior to the pandemic, according to the company.)

Even with the setbacks of the Covid-19 pandemic, Walden Galleria “has maintained a proven track record of community service, operating performance, stability, and growth due to Defendants’ management,” the company said.

Wells Fargo Bank, acting as trustee for holders of Walden Galleria’s commercial mortgage-backed securities loan, began a foreclosure against the Cheektowaga mall on May 29. The action came after Pyramid missed a May 1 deadline to pay off or refinance the loan’s $220 million balance.

In a foreclosure, lenders take control of a property and can seek a buyer for it, barring some last-minute deal on the loan that allows the borrower to hold onto it.

At Wells Fargo’s request, Colaiacovo appointed attorney William Savino as receiver to manage the mall and collect rents from its tenants. Receivers are typically appointed to protect the lender’s collateral during foreclosures and bankruptcies.

In its request, Wells Fargo said the mall’s loan documents entitled it to have a receiver appointed in the event Pyramid defaulted on its loan.

Pyramid does not dispute that. But in its filing, it said the court has discretion under the law to refuse to appoint a receiver, no matter what the mortgage document says.

“Appointment of a receiver is an extraordinary and drastic remedy, warranted only when necessary to preserve the value of the property and to prevent waste,” Pyramid’s lawyers wrote.

The company said a receiver for Walden Galleria is unnecessary because it is managing the mall well and all rents are being paid directly to an account controlled by the lenders and have been used to pay principal and interest on the now-matured loan.

It also said the “stigma” of having the mall managed by someone else will seriously hinder “if not altogether thwart” the company’s efforts to obtain replacement financing.

Pyramid argues that the appointment of a receiver could actually damage the performance of the mall because tenants and prospective tenants will be less likely to rent new space or extend leases for existing space when a receiver is in place.

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