Matt Kryger / AP

In this 2004 photo, Mel Simon, right, looks towards his brother, Herb, during an interview in their office in Indianapolis.

updated 11:15 p.m. ET Sept. 16, 2009

INDIANAPOLIS - Building suburban indoor malls that drew generations of American shoppers was Melvin Simon’s specialty. He was among the first to jump on the trend in the 1960s, starting a company that eventually made him a billionaire and became the largest in the business.

Simon, who led what is now Indianapolis-based Simon Property Group Inc. for nearly 40 years and also owned the NBA’s Indiana Pacers with his brother, died Wednesday at age 82, company spokesman Les Morris said. Details on the circumstances were not released.

Simon had not made any public appearances in recent months and his brother had asked for prayers for him at a July event during which the two were honored as Indiana legends.

Simon was working for an Indianapolis real estate company when he and his younger brother, Herbert, started their own company in 1960. Simon Property Group, a real estate investment trust, now has full or partial ownership of more than 300 shopping malls in the United States, Europe and Japan, netting Simon a fortune that Forbes magazine estimated this year at $1.3 billion.

Norman Kranzdorf, a Philadelphia-area developer who built shopping centers throughout the East Coast, said Simon helped lead the suburban mall trend by signing up major tenants such as J.C. Penney and Sears.

“He was one of the first developers to establish a rapport with the big department stores to be the anchors in his malls,” said Kranzdorf, who knew Simon since the early ’60s. “There just were no malls when he started.”

Simon’s interests also extended to politics and the movies. He and his wife were major Democratic Party donors, and he was best known in Hollywood for producing the raunchy teen comedy “Porky’s.”

Simon, who grew up in the Bronx as the son of a New York City tailor, arrived in Indianapolis in the 1950s when he was stationed at the Army’s Fort Benjamin Harrison and entered the commercial real estate business in the city after his discharge.

“I enjoyed it, but in a couple of years I decided I wanted to be the person to make the decisions,” Simon told Indiana Business magazine in 1991. “That’s how we got into developing.”

Melvin Simon & Associates initially concentrated on strip malls anchored by grocery stores and pharmacies. The scale of its projects grew until the company opened the Mall of America in a Minneapolis suburb in 1992. It also built the Circle Centre Mall in downtown Indianapolis in 1995.

The Simon brothers were credited with keeping professional basketball in Indianapolis when they bought the Pacers in 1983 at the behest of city leaders to head off a deal that could have seen the team move — less than a year before the NFL’s Colts moved to the city from Baltimore.

“Mel Simon, as much as any person over the last 40 years, is responsible for Indianapolis becoming a big-league city,” said Pacers Sports & Entertainment President Jim Morris, a former president of the Indianapolis-based Lilly Endowment, one of the nation’s largest philanthropies. “His efforts transformed our community.”

While Simon’s guests at his estate in suburban Carmel included former President Bill Clinton and his philanthropy gave $50 million for Indiana University’s cancer center and $10 million to the Indianapolis Museum of Art, he kept a low profile, rarely speaking in public or giving interviews.

The Simon family has remained the largest shareholder in Simon Property Group, and when the founding brothers stepped down as co-chairmen in 2007, they turned the chairmanship over to Mel’s oldest son, David, who had been its CEO since 1995. One daughter, Deborah Simon, leads the Simon Youth Foundation and another, Cindy Simon Skjodt, heads the Pacers Foundation.

Like other real estate investment trusts, Simon Properties has been grappling with the fallout from the recession and the financial crisis.

The mall operator’s vacancies spiked this year as many retailers cut back on space or were forced out of business. But Simon has fared better than others, notably rival General Growth Properties Inc., which filed for bankruptcy protection in April. Simon has raised more than $1.6 billion in capital from investors this year and its stock has climbed 42 percent since the start of the year.

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