Colonie Center Default

Colonie Center’s lenders have foreclosed on a $110 million loan the mall received in 2014.

Colonie Center’s financial troubles mirror those of Crossgates Mall in Guilderland, which previously defaulted on a $300 million loan from 2012. Malls and many retail businesses have struggled to stay afloat in the wake of the COVID-19 pandemic, which forced the closure of indoor malls during the initial 2020 surge of the virus in the U.S.

Since then, shopper habits have drastically changed as consumers have sought to buy items online through Walmart, Target and Amazon rather than brick-and-mortar stores. In response, malls have changed their strategy by bringing in more lifestyle and entertainment tenants that offer a unique experience. Shoppers should notice no difference at the mall while the case plays out in court.

Colonie Center is owned by the Los Angeles-based real estate investment firm Pacific Retail Capital Partners.

Colonie Center’s owners were sued in state Supreme Court in Albany County on Tuesday. They were sued by Deutsche Bank, which operates as the trustee of the loan, which is held by Citigroup Commercial Mortgage Securities. The original default on the loan happened back in 2023.

Colonie Center’s owners could not immediately be reached for comment.

The company only owns half of the 1.3-million-square-foot mall. Macy’s, located on the north side of the mall, owns its own space. The southern end of the mall was owned by Sears when Sears had a store there. The real estate holding company of Sears that ended up surviving sold off its part of the mall last year for $28 million.