Atlantic|Pacific Companies agreed to acquire the affordable housing division of Carlisle Development Group, a major affordable housing developer that is under investigation by a federal grand jury in Miami.
Financial terms of the acquisition weren’t disclosed. Atlantic|Pacific, a Miami-based real estate firm, announced the deal in a statement and declined to elaborate.
Atlantic|Pacific said Miami-based Carlisle’s affordable housing business will become A|P Communities, headed by Kenneth Naylor.
As reported in May, a federal grand jury is examining allegations that Carlisle defrauded the U.S. government of millions of dollars in tax subsidies used to finance more than a dozen rental projects in Miami-Dade and Broward counties.
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Carlisle is Florida’s biggest and the nation’s third-largest affordable-housing developer and has completed more than 80 projects valued at $1.4 billion. The company is suspected of committing fraud by padding construction costs of rental apartments to generate higher government-issued tax credits for itself and its investors, according to sources familiar with the investigation.
According to a subpoena issued in January, a copy of which was obtained by the Miami Herald, the investigation is focused on two of Carlisle’s chief executive officers, Matthew S. Greer and retired CEO and founder Lloyd J. Boggio, and a general contractor, Michael K. Runyan, president of BJ&K Construction Services in Fort Lauderdale.
Carlisle officials couldn’t be reached for comment.
A|P said it is a fourth-generation real estate company with more than 650 employees, more than 23,000 units under management, and a presence in Florida, California, Texas, Georgia and the Carolinas.
In a statement, Randy Weisburd, chief operating officer of Atlantic|Pacific, said “We are excited to welcome a leading affordable housing company to the A|P family. The new company will leverage the extensive experience of both organizations to bring state-of-the-art affordable housing to the communities we serve.”