A Florida dreamer bought a mostly empty Pennsylvania mall. Can he save it by himself?

RICHLAND TOWNSHIP, Pa. — He walked the tiled floors of the mostly empty mall alone, smiling at the occasional speed walker and chatting up the folks selling empanadas in the food court.

“Hey, Leo,” store owners said as he passed by.

He moved furniture and picked up dead leaves beneath a ficus tree. If Leo Karruli knew how to repair escalators, he would. Earlier that November day, Karruli even drove 300 miles to North Jersey to buy a snowplow for the parking lot. That’s how it goes when you buy a mall by yourself.

The Johnstown Galleria, on the outskirts of Cambria County’s biggest city, sold for $57 million in 2008. Karruli, an Albanian immigrant who ran his own Italian restaurant in Florida, paid $3 million for it at an online auction last year. Since then, he’s taken a community-oriented approach to running a mall, wielding hope, humor, and sweetheart deals to local businesses and restaurants like a shield against the forces of capitalism.

Karruli, 54, said he’s raised occupancy by 50% and scoffs at statistics showing places like the Johnstown Galleria are shuttering and losing value in Pennsylvania, that indoor malls, all across America, are ...

“Don’t say it,” Karruli said. “The mall isn’t dead. It’s not dying.”

Still, experts say even the “zombie malls” still hanging on have become almost a self-fulfilling prophecy, unable to recapture the buzz they had for Generation X teens and their baby boomer parents in the ‘80s and ‘90s, no matter what owners come up with. The advent and continued rise of online shopping, compounded by the COVID-19 pandemic, have proven to be too much for many.

“I think we’re talking about dreams vs. reality here,” Mark Cohen, director of retail studies and adjunct professor at Columbia Business School, said of Karruli’s plans. “There’s always a chance you can get the burners relit, but I wouldn’t bet 5 cents that’s likely to happen.”

According to Capital One, there were approximately 25,000 shopping malls in the United States in 1986 and they closed at a rate of 581 per year. Starting in 2017, however, malls began closing at a rate of 1,170 per year. Some estimates say there’s approximately 700 left today. Even Philadelphia’s Fashion District, which first opened in 1977, has struggled, despite a $400 million makeover. Earlier this month, the Pennsylvania Real Estate Investment Trust (PREIT) gave up its share of the Fashion District as part of a bankruptcy reorganization.

In Berks County, the Berkshire Mall where Taylor Swift once shopped is barely hanging on. According to a recent Wall Street Journal story, anchors have closed there, the parking lot is pocked with potholes, and local officials wish its owners would sell.

The two-story, glass-gabled Galleria at Johnstown opened in 1992, and at 894,646 square feet, it’s one of the larger malls still open in Pennsylvania. While it originally had four anchor department stores, only two — Boscov’s and JCPenney — remain.

Boscov’s CEO Jim Boscov wishes more people like Karruli would buy malls.

“It’s refreshing, a pleasure to be dealing with someone trying to get things done,” Boscov said.

The Bon-Ton department store closed at the Galleria in 2018 and now looks like a dark castle with its steep walls and turret-like entrance in an unlit corner of the parking lot. Back in September, a storage facility operator outbid Karruli in an auction for the Galleria’s shuttered Sears anchor, a move he’s actively fighting.

“First off, it’s not retail,” he said. “It’s all wrong for the place and I’m trying so hard here.”

Like all mall owners, Karruli would love to woo large, popular brands back to the Galleria. He has a Hot Topic, T-Mobile, and Auntie Anne’s Pretzels but heavyweights like Target and Chick-fil-A remain out of reach. Some businesses in the mall close earlier than others, he said, giving it a half-open feel on a weeknight, and others have perplexing business models.

“I have this guy,” Karruli says, pointing to a closed mattress store, ”who only sells the beds online or by appointment. This guy was here before I got here.”

Karruli has been filling vacancies, however. The occupancy rate was 30% when he purchased the mall and, today, he claims it’s up to 80%. The food court, for instance, is full for the first time in years and most of the eateries are local. He lets local business owners rent by the month, too, instead of forcing long-term leases. He helped turned one storefront into a skating rink. Another one sells produce; another, called This N That Bargains & Bins, sells, well, this and that: appliances, tools, pet food, etc.

“I don’t think most people know the mall isn’t dead, that there’s new businesses here,” said owner Mandy Layton, 36. “Leo’s been doing a good job. He’s really trying.”

Mister Jay’s Comics, Toys, and Games tried to get a space in the Johnstown Galleria before but the previous owner wasn’t interested. Karruli found the store’s information left behind in the mall office, so he reached out and made them an offer. Mister Jay’s moved into a space in June, then a larger one a few months later.

“Leo’s been nothing but fantastic,” said co-owner Jodi Rupert. “He has that go-get-em attitude.”

Mister Jay’s was hosting a gaming event that weekend. Karruli has been trying to host events at the mall, including church groups, live music in the food court, and car shows.

Karruli’s focus on local business and community is akin to an indoor flea or farmers market approach.

“It’s mom-and-pop and I like mom-and-pop,” he said.

Jenna Sullivan, a manager at the Berlin Farmers Market, which has indoor and outdoor space in South Jersey, said all 76 of its indoor stores are filled. None of them are franchises. You can get clams and tires there, plus new keys, old guitars, haircuts, knives, and horchatas.

“It’s a very down-to--earth place to shop,” she said.

If they’re not demolished outright, most malls have looked to mixed-use repurposing, with offices and professional services, or gyms, filling in the retail void. In Camden County, Voorhees moved some of its official government offices into the former Echelon Mall. Karruli has done a little bit of that, too, with a chiropractor and AAA offices, but he also rents out space to the Selfie Museum.

Through it all, the Johnstown Galleria’s Rise & Stride Walkers continue to rack up the miles.

“Leo’s a very nice guy, let me start out with that. He’s doing a hell of a job trying to get people in there,” said Mark Sawyer, a Johnstown resident who’s been walking the mall since 2015. “We’re hoping for the best.”

Karruli, who lived in Italy and later Queens, where he perfected a chicken Parmesan, said he can work with hope.

“I say, ‘Forget what you knew about this place and give it a chance,’” he said.

In late November, the Johnstown Galleria’s Christmas display was still a work in progress, its hree Wise Men offering gifts to a blank wall. Winter was around the corner and Karruli had to find a snowplow driver.

“Or, you know,” he said, “I’ll do it myself.”