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March 11, 2022 Deal Watch

Quietly, former dentist Amit Lakhotia becomes one of New Britain’s most prolific apartment developers

HBJ PHOTO | STEVE LASCHEVER Developer Amit Lakhotia is renovating the top two floors of the Doris Building, a former Main Street rooming house in downtown New Britain, into 24 market-rate apartments.
Check out Amit Lakhotia’s New Britain apartment project pipeline
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Amit Lakhotia jokes he doesn’t know how to drive a nail into a wall, but during the past year the former dentist from India has become one of the most active landlords and housing developers in New Britain.

At the helm of a string of project-based limited liability companies, Lakhotia has bought nine New Britain properties – a mix of lots, apartments and office buildings for market-rate apartment developments.

Between the purchase of existing units, ongoing construction, and developments in the planning pipeline, Lakhotia is on track to control about 285 apartments in the Hardware City, with more on the horizon.

The buying spree began in early March 2021, with the $2.5 million purchase of a 42-unit apartment building with first-floor retail at 38 Main St.

On Feb. 18, Lakhotia paid another $2.5 million to make his largest New Britain purchase so far – a 135,000-square-foot office building that was once part of Stanley Black & Decker’s campus along Myrtle Street.

Lakhotia said he expects to spend around $7.5 million converting the building at 480 Myrtle St. into at least 106 studio and one-bedroom apartments. He plans to launch work shortly and wrap up construction within 15 months. The apartments will rent for about $1,300 to $1,500 a month, he said.

New Britain Mayor Erin Stewart said Lakhotia is turning around neglected and underused properties that others would be reluctant to tackle, something she describes as “transformative.”

“It makes me feel good as mayor of the community that he’s looking at New Britain and proving you will get a return on your investment,” Stewart said. “I think when other developers are seeing that, this is where we are getting a lot more interest expressed from smaller guys, smaller owners, who are saying: ‘What do you have to offer? What have you got going on there?’ ”

Outside investors

New Britain has seen a surge in development interest in the past few years, Stewart said.

Developer Avner Krohn has launched construction of a $14 million, 107-unit apartment building near City Hall, his fifth New Britain project in 15 years.

In just a year, Lakhotia has stacked up an array of projects and properties. Smaller investors have been buying and rehabbing multifamily properties on New Britain’s side streets, Stewart said.

Erin Stewart

Stewart partially credits development-friendly efforts at City Hall. The 2015 opening of the New Britain-to-Hartford rapid transit busway has also proved a key attraction, she said. The booming statewide housing market of the past two years has helped as well.

Eric Amodio, of Farmington-based Amodio & Co. Real Estate, brokered the sale of 480 Myrtle St. After many years of relatively stagnant activity, investment has poured into New Britain in the past five years, Amodio said.

“It was the Land of Steady Habits,” Amodio said of the years before the influx of investors. “Nothing really moved in terms of improvements to multifamily properties. I think locals were intimidated or didn’t have the capital to pull off a project.”

Once a few investors started to discover New Britain, others followed, Amodio said.

“I think as one started to make improvements, others started, and rents started to increase,” Amodio said. “I’ve never seen the rents this high, and I’ve never seen demand this high, which is incredible.”

Data center boost

In 2019, developers announced plans for a $1 billion data center park on parts of what used to be Stanley Black & Decker’s Myrtle Street campus. That project stumbled during the pandemic, but is still trying to push forward.

Eric Amodio

Massachusetts-based EIP LLC recently submitted modified plans for the data center development to the Connecticut Siting Council. The state agency has authority to approve an array of fuel cells needed to power the data center.

Lakhotia dreams of providing housing to the future data center workers in his converted building at 480 Myrtle St., as well as a 56-unit, mixed retail and apartment development he plans to build nearby. That second development would rise on a collection of four derelict properties on the northwest corner of the intersection of Myrtle and Burritt streets.

The former Stanley office building occupies the southeast corner of that intersection.

Lakhotia and town officials said they’ve formed a solid working relationship. Lakhotia said his growing investment in the city is spurred by a forward-thinking and business-friendly administration.

“The [city] here has so much vision, especially the mayor’s office,” Lakhotia said. “She is young and energetic. They are constantly investing in their [city]. They go above and beyond to help you.”

City inspectors reviewing his projects always offer helpful suggestions when issues arise, rather than simply issue a rejection, Lakhotia said.

“They want everything to code, but at least you can have a discussion, come up with a solution, not just get a ‘no,’ ” Lakhotia said. “The projects just keep moving. And time is money for everybody.”

New Britain Economic Development Director Jack Benjamin said Lakhotia is eager to work with the town, seeking, and more importantly, accepting guidance on design and code.

“Amit is bright-eyed and bushy-tailed,” Benjamin said. “He definitely has got big goals, but he also has a vision, and he comes through.”

An immigrant entrepreneur

Lakhotia, now 43, moved to Connecticut in 2006 for love and opportunity. A dentist in India makes far less than their American counterparts, Lakhotia said. And while his dentist credentials aren’t recognized in the U.S., there was more opportunity, he said.

“You can be successful in America if you work hard and are smart,” Lakhotia said.

Lakhotia’s 2006 move was also motivated by a desire to be close to his wife’s parents in Norwalk. That made his wife happy. And her parents have played a big role in the upbringing of his daughters, Isha, 8, and Rhea, 7.

After first moving to Connecticut, Lakhotia made a living managing dental offices. Then he worked as a consultant establishing new dental practices in partnership with licensed dentists.

Lakhotia tried his hand at becoming a landlord in 2012 to supplement his income, starting with two- and three-family buildings in New Haven and Bridgeport. As he gained confidence, he invested in larger and larger buildings. Eventually he decided to focus exclusively on residential investments. The apartments Lakhotia is building in New Britain have been entirely market rate.

Pooled investment strategy

Today, Lakhotia said he manages a portfolio of about 500 apartments in 20 buildings in Bridgeport, New Haven and New Britain. He raises project funding through an extended circle of family and friends who buy shares in each venture.

That investment strategy is playing out in Lakhotia’s transformation of a former downtown New Britain rooming house known as the “Doris Building.”

The first floor of the brick building at 27-31 Main St. has six retail tenants, but the upper two went vacant for decades before Lakhotia bought it for $1.1 million in March 2021.

Lakhotia has hired New Britain-based TLong Construction Co. to transform the empty floors into 24 apartments, a roughly $2.2 million project he expects to complete this month.

Seven investors have pooled their money for the Doris Building redevelopment. The largest is in for $300,000; the smallest for $100,000. Lakhotia has $250,000 of his personal money invested.

“I don’t just play with investors’ money,” Lakhotia said. “I put my own money down. In each building, my skin is in the game. That gives my investors confidence.”

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