Region's Second-Largest Mall Hits The Market As Potential Conversion Play: The Philadelphia Deal Sheet
The massive Franklin Mall property in Northeast Philly is up for sale following a big valuation drop and cratering occupancy. It is being marketed as a potential industrial conversion play.
JLL is managing the listing for the mall, previously known as Franklin Mills and Philadelphia Mills, the Philadelphia Business Journal reported. It is owned by a joint venture between Simon Property Group and Farallon Capital Management.
The mall is the second-largest in the region at 1.6M SF and sits on a 137-acre property. JLL is marketing the property as suitable for industrial uses.
“The Property’s infill location and highway access make it a strong candidate for redevelopment into a modern industrial facility,” the brokerage's marketing flyer says.
While the mall was a regional destination when it opened in 1989, it now has a 68% occupancy rate. The property was valued at $76M in May 2024, down from $201M in 2012.
A loan the owners took out on the property had a $244M balance when it matured in June 2024. The JV then announced its intention to surrender the property.
Receiver OPEX CRE Management was ordered to continue operating the property by the Philadelphia County Court of Common Pleas as special servicer Greystone and debtholders determined its fate.
LEASES
Velocity Venture Partners has completed the lease-up of its Velocity Business Park at 8-14 Stow Road in Marlton. The most recent tenants added were MT Building Services and Four Anchors Church.
An NAI Mertz team, including Jonathan Klear and Ryan Brennan, was the exclusive leasing agent.
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Alterra Property Group’s 299-unit, office-to-residential conversion at 1701 Market St. is now 50% leased, the company announced. The former Morgan Lewis building was the first postpandemic conversion of its type in Philadelphia.
CONSTRUCTION AND DEVELOPMENT
The Port of Philadelphia has broken ground on a new cruise terminal on a 16-acre site next to the Philadelphia International Airport. It is expected to open in April 2026.
PhilaPort will handle all marine-side improvements, while its partner, Norwegian Cruise Line Holdings, will build the dry part of the terminal.
SALES
Christian college Eastern University has signed an agreement to acquire the Valley Forge Military Academy & College campus, the buyer announced Monday. Some CRE players had previously speculated that the 33-acre parcel in a land-strapped section of suburban Philly might be used for housing.
PEOPLE
JP Colussi has joined JLL’s Retail Investment Sales Team as a senior director, according to a social media post. He previously worked in the same sector at Institutional Property Advisors, a subsidiary of Marcus & Millichap.
UPDATE, DEC. 8, 10:05 A.M. ET: This story has been updated with information from JLL's marketing flyer on the Franklin Mall property.
