Franklin Mall in Northeast Philadelphia, widely known by its original name Franklin Mills, has been listed for sale following sustained declines in valuation, occupancy, and foot traffic. The property is located at Knights and Woodhaven Roads and occupies more than 137 acres. The listing is being marketed by Jones Lang LaSalle, also known as JLL, and excludes the separately owned parcels that contain Sam’s Club and Walmart.
The mall originally opened in 1989 as an outlet shopping center and was promoted at the time as the largest outlet mall ever built. The one-story structure features a zigzag-shaped concourse measuring approximately 1.2 miles in length. During its peak in the 1990s, the property attracted about 20 million visitors per year. According to figures provided by JLL, current annual visitation has declined to roughly 5.6 million.
Franklin Mall contains approximately 1.6 million square feet of retail space and is the second-largest mall in the Philadelphia region, behind King of Prussia. Jones Lang LaSalle states that about 68% of the space is currently occupied, while more recent data from Morningstar Credit, based on reports from the property’s special servicer, places occupancy at 65.4%. Current retailers include Saks Fifth Avenue OFF 5TH, Polo Ralph Lauren Factory Store, and Reclectic. Jones Lang LaSalle states that the average remaining lease term for existing tenants is 1.7 years.
The mall has experienced multiple ownership and branding changes over time. In 2007, Simon Property Group acquired the property as part of its takeover of the Mills Corp. Simon completed renovations in 2014 but classified the mall outside its core property portfolio. The loan tied to the 2007 acquisition has been intermittently distressed since 2012. An April 2024 report from Morningstar Credit stated that the property had once again entered special servicing.
When the loan matured in July 2024, it carried an outstanding balance of nearly $250 million. At that point, Simon stepped away from day-to-day management. Philadelphia-based OPEX CRE Management was appointed as receiver for the distressed property. The mall’s name was reverted to Franklin Mall because the “Mills” name is trademarked by Simon Property Group.
The property’s valuation has declined significantly over time. Franklin Mall was valued at $370 million in 2007, $201 million in 2012, and $76 million in its most recent appraisal conducted last year. Morningstar Credit has indicated that a new appraisal is expected within the next month.
Financial performance has also deteriorated. Cash flow was reported at $17.5 million in 2019, $11 million in 2022, and $9.5 million last year, which was the lowest level recorded since Simon took ownership in 2007. According to Greystone Servicing Co., the property’s special servicer, cash flow has declined further this year.
JLL’s listing presents the property as suitable for continued retail use or redevelopment. The site is zoned for auto-oriented commercial use. JLL states that this zoning could support industrial redevelopment, and the property’s infill location and highway access make it suitable for that purpose. The listing indicates that an investor could potentially pursue the development of up to 1.4 million square feet of new warehouse space under existing zoning.
Residential redevelopment is also referenced in connection with the site. Mayor Cherelle L. Parker’s administration has stated that it intends to implement a 20-year property tax abatement for the conversion or demolition of outdated commercial properties into housing, pending enabling legislation from Harrisburg. The current zoning for Franklin Mall does not allow residential development, meaning any such project would require approval from the city’s Zoning Board of Adjustment or a legislative zoning change by City Councilmember Brian O’Neill.
