The second building in the Sandy Lake Towers venture has been under construction for 10 years. The first 204-room hotel-condominium building at 6145 Carrier Drive was completed in October 1999 and is operated by Cornerstone Hospitality Group of Atlanta.

In his petition, Naya asks the court for permission to allow his company, Sandy Lake Properties, to continue operating the venture using current cash flow, generally a normal procedure in typical Chapter 11 cases. In this situation, however, the bankruptcy petition halts a pending foreclosure lawsuit filed by Naya's lenders who suspect the Chapter 11 filing was a strategic business move for Naya to gain more time in arranging new financing.

The developer has 15 days to file his complete financials, including assets, liabilities and number of creditors. Naya gained international media exposure in 1998 when his 22-story Palace II apartment building in Rio de Janeiro collapsed and killed eight persons. Naya denies defective construction work caused the collapse.