The city would only pay for redevelopment if it owned the land underneath and that land was unsellable. And if that's the case, the city has bigger problems than the mall (something like Detroit, where, for many years, there was simply nobody there to buy/use/redevelop).

Provide the right financial incentives and a developer should be able to do it on terms favorable to the city (vs getting little/no revenue from a derelict mall complex).