Hartford Business Journal

6 HARTFORDBUSINESS.COM | AUGUST 19, 2024 DEAL WATCH Nationwide growth Levy said Vessel targeted Connecticut because of its demographics, with many desirable cities and towns, young people moving into urban and suburban areas, and the continued demand for attainable housing. Part of the company's strategy is to develop several projects as "proof- of-concept" showpieces. Eventually, the firm wants to move away from project development and become more of a product supplier for other developers to use the Vessel model across the region, and eventually nationwide. Vessel recently announced a partnership with California-based multifamily real estate investor and operator Avanath Capital Manage- ment LLC, which is looking to develop 5,000 Vessel-style units across the country over the next five years. "What we always intended to do was to be a seller of a system that empowered other people to be able to develop their sites and to become local owner-operators in their commu- nities, activating properties that were not easy to develop," Levy said. A model of a Vessel building. Apartment redevelopment of former Stanley Black & Decker HQ in New Britain powers through financing delays Developer Amit Lakhotia and New Britain Mayor Erin Stewart toured an ongoing redevelopment of the former Stanley Black & Decker headquarters at 480 Myrtle St., into 115 apartments. HBJ PHOTO | MICHAEL PUFFER By Michael Puffer mpuffer@hartfordbusiness.com I n May 2022, New Britain Mayor Erin Stewart helped celebrate the launch of an $11 million redevel- opment of the former Stanley Black & Decker headquarters on Myrtle Street into 106 market rate apartments. At the time, the project was expected to wrap-up in a little more than a year. In early August, Stewart returned to the property to find bare metal studs outlining studio, one-bedroom and two-bedroom apartments in a project that has seen its budget jump to $18.7 million, and is now expected to be completed by June of next year. Developer Amit Lakhotia blames the delay on a longer-than-anticipated state environmental review process and financing hiccups. New Britain officials have helped, securing a $1.5 million state grant for the project and approving a 13-year tax break. Lakhotia and his investors have also dug deeper into their pockets. Lakhotia said he now expects to begin welcoming his first tenants at 480 Myrtle St. in February, and will finish off the last punch-list items in the second quarter of 2025. Design tweaks have added nine apartments to the plans. That, and higher-than-anticipated rents, will help compensate for increased costs, Lakhotia said. "I'm 100% confident the project is going to fly," he said. Active development pipeline Lakhotia said his expectations are bolstered by the city's redevel- opment efforts along the Myrtle Street corridor. Stewart noted the recent comple- tion of a nearby fuel cell power gener- ation project, an ongoing expansion by food processor Rich Products Corp., located at 263 Myrtle St., and a streetscape makeover that will push past Lakhotia's building. A massive redevelopment of a nearby public housing complex is expected to begin next year. New Britain-based TLong Construc- tion is performing the work at 480 Myrtle St. TLong President George Taweh, also an investor in the devel- opment, said funding delays have held back the project by a year, and prompted him to lend it $1.5 million. He said he is confident in a return. "If I didn't believe in the project, I wouldn't have floated it $1.5 million," Taweh said. In addition to the state grant, Lakhotia is close to securing a $4.3 million C-PACE loan for energy efficient electrical systems and appliances. Investors have contributed $4.5 million. Lakhotia personally invested $500,000, and he borrowed $7.7 million from the Norwalk office of alternative asset- based lender Silver Heights Capital at a 13.5% interest rate. Lakhotia said banks were hesitant to loan to a project requiring environ- mental review, a process he expects to clear shortly. Lakhotia said there was not much pollution and his environ- mental remediation requirements have been restricted to repaving parking lots and adding mulch to planting beds. He expects to refinance his loan at a reduced interest rate once the building is complete and tenanted. The property will feature amenities on every floor, including a small theater, fitness center, pet-washing station and more. New Britain has experienced a flood of development interest over the past few years. Lakhotia alone has four projects either underway or ready to launch. Within a month, Lakhotia said he expects to start an 80-unit apartment conversion of an office building at 102 West Main St. Plans for that building also call for a first-floor restaurant and rooftop lounge. Lakhotia said he also expects to begin moving tenants into a newly renovated, 24-unit apartment building at 27 Main St., by mid-September. He also plans to begin construction on 10 apartments in a former law office on Ash Street. Vessel Technologies Continued from page 5

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