Four years after receiving approval to build a 354-unit luxury apartment tower in North Miami Beach, Turkish developer Celal Ozkan has lost control of the project site following bankruptcy proceedings.
An affiliate of CEO Contract, the development firm led by Ozkan with offices in Istanbul and New Castle, Delaware, will transfer the nearly one-acre property at 16300 Northeast 19th Avenue to Safe Harbor Equity. Safe Harbor Equity, based in Miami Beach, had provided an $8.5 million loan for the site in 2022, according to court records.
The transfer follows a decision last week by federal bankruptcy court Judge Laurel M. Isicoff in Miami. The judge approved the sale of the property to Safe Harbor’s distressed debt fund 3. A source familiar with the case said that a planned bankruptcy auction for September 26 was canceled, likely due to a lack of qualified bidders who would have needed to offer at least $4.55 million for the site.
The dispute between CEO Contract and Safe Harbor has been ongoing for several years. Chris Spuches, attorney for Safe Harbor Equity, stated: “This is a fantastic property that we are excited to work with a developer to sell this asset,” adding that Safe Harbor does not plan to develop it themselves.
Representatives and attorneys for CEO Contract did not respond to requests for comment.
CEO Contract acquired the vacant property through its affiliate Sky Gardens Residences in 2022 for $5.2 million. The company had secured final approval in 2021 for a planned 20-story tower named Sky Gardens Residences, which was designed to include rooftop gardens and amenities; however, construction never began.
In 2022, CEO Contract took out an $8.5 million loan from Safe Harbor at an interest rate of 8.75 percent with options for extensions. Debt guarantees were provided by CEO Contract and its affiliates as well as by Celal Ozkan and Cagatay Emre Ozkan, COO of CEO Contract. These personal guarantees would only be enforced under certain conditions such as fraud or misappropriation.
Safe Harbor alleged that CEO Contract defaulted on payments due in August 2022 and January 2023 and failed to pay full property taxes on time. A subsequent agreement allowed CEO Contract to reduce its principal balance to $7.7 million while extending the loan term.
Litigation followed when Sky Gardens Residences sued Safe Harbor last year in Miami-Dade Circuit Court over claims including usury and disputes about tax payments and fees related to loan extensions. The lawsuit accused Safe Harbor of running a “‘loan-to-own’ scheme” aimed at taking over the site and impairing refinancing efforts by CEO Contract.
Safe Harbor responded with a countersuit seeking foreclosure based on allegations of payment defaults.
In January this year, CEO Contract filed for Chapter 11 bankruptcy protection—halting both lawsuits then pending in state court; no foreclosure order was issued before bankruptcy proceedings began.
According to court filings, the property is appraised at $18 million with an estimated value of $161 million upon completion and lease-up of the proposed project. The transfer will leave only a Miami-Dade tax lien totaling $114,000 related to property taxes owed for 2024 and 2025 attached to the site.
