The popularity of American malls experienced a great decline throughout the 2000s. In recent years, their decline has accelerated, with projections indicating that 87% of large shopping malls could be closing within the next 10 years.
Likewise, according to reports, 2 million square feet of mall space was demolished in 2022. This has recently led to efforts to repurpose the spaces as residential, new types of retail, or a mix of both. Unfortunately, before they are demolished or repurposed (if ever), they often become property maintenance headaches.
Municipalities have some authority to address aging, vacant malls, but the process of doing so is long. Recently, in Century III Mall PA., LLC, v. West Mifflin Borough and West Mifflin Borough Council, a Borough ordered an abandoned mall to be condemned for being a public nuisance. Despite the owner’s claims that its Due Process rights had been violated, the Commonwealth Court affirmed the Borough’s decision. This case is integral to understanding the important relationship between municipalities and property owners; specifically, owners of properties containing potentially dangerous abandoned structures. As more malls continue to close, the more relevant this case will become for municipalities and owners alike.
Before its closing, the mall in question had received multiple citations from the Borough for failure to mow the premises, and then later for failure to snow plow the parking lot in the winter. However, the real catalyst for the mall’s closure came in 2019, when it flooded significantly. This event happened because the sprinkler system pipes burst in an area where the owner had turned off the heat. When the owner failed to fix the pipes, the Borough eventually notified the owner that it would be closing the mall. It stated that without heat or a functional fire suppression system the mall would be “unoccupiable and unsafe.” Consequently, placards were placed around the premises prohibiting occupancy.
For the next 5 years, the Borough pressed the owner to remediate the mall’s code violations. These demands were disregarded, and the mall continued to deteriorate. In 2023, the Borough sent the owner a letter stating that it had received complaints that the mall was in hazardous condition. After verifying these claims, the Borough directed that the owner file an application for a demolition permit. It did not do so.
The following month, the Borough issued a Notice of Condemnation that the mall would need to be demolished, stating it was rundown, in a state of collapse, and in irreparable condition with a present fire hazard. This notice informed the owner that it had the right to defend against these allegations. At the council hearing of Borough meeting, the owner denied the Borough’s claims and even brought its own structural engineer to testify against the conclusions of the Borough’s structural engineer. Despite this, overwhelming evidence was presented through many witness and expert testimony from the Borough. Evidence included testimony regarding every single glass window being broken, black mold on the walls and floors, hanging drywall, direct openings in the roof, an elevator completely missing (leaving the elevator pit open to an 8-foot drop), and more. Following this hearing, the Borough’s Council issued a written adjudication, finding the mall structurally unsound and not feasible for rehabilitation. Thus, it declared the mall a public nuisance and ordered it to be razed.
The owner ultimately appealed the issue to the Commonwealth Court, first claiming that the Borough violated its Due Process rights by not providing adequate notice before the hearing. The owner stated that Borough’s notice failed to cite any particulars regarding the mall and did not cite any Borough ordinances regarding the condemnation. However, the Court noted that the owner responded to the notice and acknowledged it would be prepared to attend the hearing and defend against the specific allegations mentioned. Thus, the Commonwealth Court held that the owner’s own letter to the Borough proves that the notice clearly and sufficiently presented the allegations.
The owner next claimed a violation of its due process rights, since the borough did not provide evidence for the mall being irreparably rundown before the hearing. However, the Commonwealth Court held that this is allowable since “hearings before local agencies are governed by the Local Agency Law, which does not provide for discovery or application of the Rules of Civil Procedure.” Among other things, the borough was not required to inform the owner of its expert report before the hearing. Interestingly, the owner still brought his own structural engineer to testify contrary to the Borough’s engineer (regarding the structural soundness).
Lastly, the owner argued that there was no substantial evidence provided to support the Council’s finding that the mall was structurally unsound and therefore unfeasible to rehabilitate. However, the Commonwealth Court found otherwise. It cited witness testimony presented by the Borough including testimony from the Fire Chief (who is also the code enforcement officer and the building inspector), who stated that the mall had caught fire multiple times in the last 5 years, including a structural fire involving 3 floors. The Police Chief also testified and stated officers could only enter the mall with protective gear due to its hazardous conditions.
A structural engineer also testified for the Borough and opined that due to structural deficiencies, the mall was in danger of imminent collapse. The owner’s own structural engineer even concurred that some portions were susceptible to failure. Likewise, the owner’s chief operating officer admitted that he and other members of his maintenance crew only wear hazmat suits when entering the mall, that vandals have destroyed and completely damaged the mall, and that the owner has done nothing to remedy this. Thus, the Commonwealth Court affirmed the Borough’s adjudication. All told; however, the effort took years.
Old school malls are a dying breed. Consequently, municipalities are often left to deal with the baggage of these abandoned properties, especially with their recent increase in closure. As seen in this case, any effort to effectively deal with these potential hazards can take a substantial amount of time. Transparency and cooperation from mall owners is necessary to allow the process to go as smoothly as possible. Unfortunately, this is not always the case, and municipalities must prepare to face potential difficulties in regulating their malls.
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