In September 1890, the mosque of Makbul İbrahim Paşa was badly damaged in the great fire that swept through the city of Salonica. For the next fifteen years—a period otherwise marked by economic growth and spatial expansion for the cıty—the pious foundation (waqf) associated with the mosque failed to raise the necessary resources for its restoration, leaving the building to languish as a burnt shell. In my paper, I propose to explore this paradoxical decline of major mosque and waqf in a period of general economic growth. Using primary material from the Vakıf Genel Müdürlüğü archives in Ankara, as well as the Historical Archives of Macedonia, I seek to connect this decline to broader themes concerning the historiography of the Late Ottoman Empire, such as the history of the Ottoman reform period and the urban transformation of the empire’s major cities. When Makbul İbrahim Paşa converted Salonica’s 8th century Haghia Sofia basilica into a mosque in 1526, he had made it the center of his personal pious foundation, endowing the complex with a significant amount of properties in Salonica. In the following century, the relation between the waqf, its administrators, and the local merchants and businessmen who rented its extensive properties determined much of the city’s economic activity. During the 1840s, however, as part of the Tanzimat reforms, the Ottoman state ended the autonomous function of awqaf across the empire, placing them under the jurisdiction of the newly founded Ministry of Pious Foundations. In the same period, Salonica’s commercial elites began to invest their earnings from trade and money-lending into local real-estate, creating a booming property market at odds with the complex structure of parallel ownership that had underpinned the waqf economy. In my paper, I contend that the loss of institutional autonomy of the waqf, together with the challenge posed by the emerging real-estate market, can explain the gradual decline of the mosque and its foundation, to the point that its administrators proved unable to respond to the devastating results of the 1890 fire. By highlighting these two processes, I aim to contribute to the little-studied evolution of this crucial Islamic institution, the waqf, during the long and turbulent Ottoman nineteenth-century, and at the same time use my case-study as a lens with which to study the broader process of spatial transformation in a major Ottoman urban center.