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Steamtown Mall in Scranton, PA | ExLog 63

Updated: Feb 23, 2023

The Steamtown Mall is such an amazing place, and the story of how it got here is even more incredible. Albert Boscov moved mountains to bring this mall into the world. Here is a slightly truncated version of the exact script I wrote for ExLog 63.

In the 1980’s, Al Boscov had been pitching a downtown mall concept to accompany his robust Boscov’s Department Store chain.  Mr. Boscov was absolutely fed up with the suburban mall idea, and thought that downtown areas were making a comeback.  Amidst his crusade to build the perfect Boscov Mall, he had been eyeing Scranton Pennsylvania, where he proposed a mall on the southside of Lackawanna Avenue, which would extend to the railroad property behind it, which was called “Steamtown USA”. At the time, the Democratic Mayor of Scranton, James Barrett McNulty had offered Boscov the old Oppenheim’s building with the crumbling parking garage.  Boscov wasn’t too keen on this idea, and instead came back with a plan to demolish an entire block of local business buildings to bring his Lackawanna Avenue project to life.  McNulty ghosted Boscov for over a year, but on April 4, 1986, it was reported that the two agreed on a two anchor mall nestled between Lackawanna Avenue, and the Steamtown USA yards.  One month later, Mr. Boscov formally announced that his limited partnership with New York-based Shopco Group called Scranton Mall Associates were doing topographical studies on the land to finalize the construction planning, and in the months to follow, they would attend Scranton local business meetings, courting the favor of local merchants to support the mall plans.  However, Mr. Boscov would face opposition later in 1986 from the Architectural Heritage Association, who argued that Boscov was “locking the city into a plan from the 1950’s”.  But in reality, these were local businesses afraid to have their work siphoned away from a shiny new mall, who complained to groups with voices large enough to properly advocate for them.  David J. Wenzel, the new Republican Mayor of Scranton came to the rescue, making an official statement on the matter, saying “as far as [Scranton] is concerned, there is only one plan — Boscov’s”.  What a stand up dude, Wenzel rocked.  Yet another roadblock was hit on January 14 1987 when a federal lawsuit was filed on behalf of the Concerned Citizens for the Preservation of Historic Commercial Scranton; downtown merchants Howard Ufberg, Samuel Starr and Ronald Crisci and the Architectural Heritage Association.  The suit sought an injunction against any further progress in the development of the mall.  Yet again, Mayor Wenzel came to Boscov’s side stating “the city will do whatever is necessary to see that [the mall] is built…Ninety-nine percent of the people are in favor of this project and we are going to proceed as planned.”

The major argument against the development of the mall was the proposed expansion into the Steamtown yard.  preservation groups and historic councils rallied against the development.  However, on September 28, 1987, it was announced that the National Park Service came to an agreement with Boscov and the developers to preserve the Steamtown USA Yards, and to build the Lackawanna Ave Mall around it.  Because of this agreement, the development was kicked back into high gear when the US Department of Housing and Urban Development approved a $13mil Urban Development Action Grant.  Despite the positivity surrounding the National Park Service offering its blessing, many would still seek a date in court with Boscov to stop the mall development.  On September 22, 1989, Lackawanna County Court Judge Cheseter Harhut dismissed a case brought by owners of 6 abandoned buildings on Lackawanna Ave which alleged they were illegally condemned.  The judge ruled that the condemnation was legal, therefore bringing the mall one step closer to reality.  In May of 1991, Boscov and his team had acquired all of the funding required for the project, and as a result, on June 4, 1991, a notice to vacate came down for the 19 businesses along Lackawanna Ave who originally opposed the mall project with their lawsuit, which was subsequently dismissed.  By the time the 90-days were up in August, there was only silence coming from Mr. Boscov and his team…but by the end of the month, all of the businesses had formally moved out.  

Throughout the 1980’s, Al Boscov had been pitching a downtown mall concept to accompany his robust Boscov’s Department Store chain.  Mr. Boscov was absolutely fed up with the suburban mall idea, and thought that downtown areas were making a comeback.  Amidst his crusade to build the perfect Boscov Mall, he had been eyeing Scranton Pennsylvania, where he proposed a mall on the southside of Lackawanna Avenue, which would extend to the railroad property behind it, which was called “Steamtown USA”.  After years of legal trouble, fighting stubborn businesses to move out, and amplified federal oversight from the National Park Service…on Saturday, October 23 1993, The $101mil 558,816 sq ft Mall at Steamtown had it’s long awaited ribbon cutting and grand opening celebration, formally dedicating the mall with senior anchors Boscov’s, and Montgomery Ward, with an enclosed 31,000 sq ft bridge traversing Lackawanna Avenue to The Globe Store, serving as a connected, but technically outparcel anchor.  Now, when I say this mall was years in the making, I really mean it.  This mall was Al Boscov’s baby.  He fought like hell to get this place built, and didn’t rest until that ribbon was cut.

Back in the 90’s, Boscov’s and Wards were seen as formidable senior anchors, and often brought droves to shopping malls throughout the 90’s.  However, as the third wheel to this lineup, The Globe Store, which as a company had been in operation since 1883, and once owned by Wannamakers, just couldn’t perform in the modern retail scene.  They filed for bankruptcy protection on February 7, 1994, and by May they were closed, after extended going out of business sales tarnished the appearance of the new mall, forcing the Scranton Mall Associates to file suit to have bankruptcy proceedings expedited.  The mall owners stated that “the mall looks more like a flea market than an upscale shopping center”.  PNC Bank seized all assets to liquidate, leaving the Mall at Steamtown with two anchor spaces just 6 months after opening.  Immediately after the Globe Store closed, multiple tenants showed interest in leasing the massive bridge over Lackawanna Ave to use for selling product.

After a few years of robust sales and thriving traffic numbers, Montgomery Ward was suffering.  In December of 1997, the company filed for Chapter 11 bankruptcy protection, and as a result, the Steamtown location would shutter on May 31, 1999, despite the chain being bailed out three months later, when GE Capital purchased the Wards Corporation for over $650mil.  The Steamtown location just wasn’t economically viable, and therefore had to be closed.  Jan 7, 2000 Bon-Ton announced it was to fill the 100,000 sq ft vacancy left by Wards, but that they would be expanding their presence by 12,000 sq ft, absorbing 4 in-line tenant spaces on the first floor which used to be occupied by Nail Trix nail salon, Abbey Green Irish Shop, B&L Imports, and an Off the Wall picture framing store.  After 9 months of construction, the Bon-Ton had its ribbon cutting ceremony on November 1, 2000 firmly cementing the Mall at Steamtown with a solid anchor lineup, giving it a great leg up in the new millennium.  To offset and consolidate outstanding debts, Boscov and his team secured a $41mil mortgage from Switzerland-based banking outlet UBS in 2003, working through LNR Partners who were representing the Swiss bank.  The mall was in great shape, and in very solid financial standing.

By 2005, the Boscov’s Department store chain had over $1bn in yearly sales.  They were killing it, and Al Boscov saw his company rise to the ranks of one of the country’s most successful Department Store chains, and he was able to bring his mall to fruition.  It was also in 2005 that NBC’s The Office first aired on March 24th, which is set in Scranton, PA, and would feature the Steamtown Mall in a few episodes.  They didn’t actually film at Steamtown, though.  The Office “Steamtown Mall” segments were actually shot at the Westfield Fashion Square out in Sherman Oaks, CA.  Anyway, Albert Boscov had a lengthy and fruitful career, and in 2006, he retired as chairman of the Boscov’s board, transferring his power to his nephew Ken Lakin.  Lakin began aggressively borrowing money from banks, spending money like crazy in an irresponsible manner, getting totally stupid with the company checkbook...paying more than $400mil for 10 Strawbridge’s stores in 2006 alone while Federated Department Stores was in the process of acquiring the May Department Store Company, of which the Strawbridge and Clothier chain was dissolved.  The dude legitimately paid a half a billion dollars for some Strawbridge’s.  He was completely and entirely out of pocket.   On March 29, 2007, major competition would confront the Mall at Steamtown when The Shoppes at Montage opened in Moosic, PA, with a focus on high end shopping.   Back at good old Steamtown though, Lakin was busy converting his 10 shiny new stores to Boscov’s, riding that sweet wave of short-term financing head first into the 2008 recession.  Boscov’s filed for chapter 11 on August 4, 2008.  Al Boscov, resting comfortably in retirement shook his head and hobbled back to the company.  He came out of retirement to guide the company out of bankruptcy, re-acquiring the Boscov’s chain from creditors in a $307mil deal.  In his first moves to save the company, the 10 new stores his nephew bought were immediately liquidated to offset the overall debt.  He visited stores, talked with community members, and worked 16-hour days in a relentless bid to keep the chain which his father Solomon Boscov started in 1914, after he emigrated to the United States from Russia to Reading PA, with $1.37 in his pocket, and $8 worth of merchandise to sell.  Al was successful in saving his dads company, and Boscov’s emerged from bankruptcy protection on September 17, 2009, having all debts to creditors paid, and the company afloat.  Al Boscov celebrated by exiting the courtroom and grabbing a hotdog from the cart outside the courthouse.  

By October 2009, over $37.7mil was still owed on the principal note for the Mall at Steamtown, with a total debt of well over $60mil owed for the mall cited in 2010 tax documents.  By 2012, Jones Lang LaSalle had been called in to manage day-to-day operations of the mall, and as we all know, they’re only called in to be the babysitter of an already failing property.  The Office aired its final episode on May 16, 2013, ending the weekly reminder that Scanton, PA was a place to visit after 9 wonderful seasons, and then, on July 11 2013, the maturity date came for the Mall at Steamtown's mortgage.  Boscov owed over $36mil in principal, and he struggled to find the money to pay the bill, citing the major competition from The Shoppes at Montage, massive debt incurred by their Strawbridge acquisition, and a struggling economy as the reasons for failing to pay down their mortgage principle.  As a further blow to the mall, the Bon-Ton chose not to renew their lease, as the company was facing a serious drop in revenue, and would cease operating at Steamtown on January 31, 2014.  Just over a month later, on March 6, amidst rumors swirling of foreclosure, 84-year old Albert Boscov, while speaking to reporters choked up, with his lower lip quivering, holding back tears, engaging in lachrymose badinage with those in front of him on the personal significance of his Mall at Steamtown, and how he fought so hard to build it, and fought so hard to keep his company afloat.  He said “This one is critical…because we worked so hard to get it.”  One day later, the mall was foreclosed on.  

On July 15, 2014 a Sheriff’s auction took place, with a reserve price set for $37.3mil, and a requested price of over $44mil.  There was only one bid by Robert Bolus, who offered to pay $1 plus taxes and court fees.  The judge ruled that there were to be no contingency bids, and smacked the gavel, returning the property to the bank through LNR Properties.  They were ordered to pay court fees and taxes, and a total of $1,567.71 for the property.  Al Boscov looked on while his mall was sold back to the bank for less than $2,000, in proceedings that took under 2 minutes.  

One year later, the mall was auctioned off again by LNR Partners on behalf of their Swiss Client.  Bidding started on June 22, 2015 with a starting bid of $700,000.  Al Boscov entered a bid for the property, but sadly he did not win.  The winning bid coming in from John Basalyga, representing his group of investors.  The sale closed on July 28, 2015 for a total of $5.25mil.  Basalyga ows Eastern Roofing Systems Inc., but has experience in real estate through JBAS Realty LLC, and JBAS Holdings Inc., through which he owns a number of industrial and commercial buildings in the area.  Basalyga formally announced that he had no plans to redevelop the mall, but was excited to navigate the mall to a more profitable future.  Shortly after the mall was sold, Al Boscov stepped down into retirement for a second time.

Crunch Fitness, of which John Basalyga is a 50% owner in the franchise opened in the 31,000 sq ft bridge over Lackawanna Ave on May 10, 2016.  As John Basalyga was bringing sweeping change to the mall, on June 1, 2016 he announced that it would be rebranded and renamed to Marketplace at Steamtown.  A couple months later, Luzerne County Community College opened a new facility in the former Montgomery Ward turned Bon-Ton space with a ribbon-cutting ceremony at 11am, on Tuesday August 23.  One year later, the entire food court was converted into the Scranton Public Market, opening on Saturday December 16, 2017, where local vendors can rent stalls to sell their wares, with stuff ranging from delicious peach cobblers, to weird leggings.  It’s such an innovative idea, and I have to commend Basalyga on this initiative.  He’s totally killing it right now, and really doing great work to bring this mall back. 

On Saturday October 13, 2018, the Electric City Aquarium and Reptile Den had its grand opening.  As of today, the entire mall is closed due to Covid-19, along with the Aquarium, but I do know that someone is tending to the creatures inside.  I’m positive that Steamtown will reopen after the pandemic.


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