A proposed deal to sell the management of Robert C. Morgan's apartment communities to a Virginia company has fallen through.
Norfolk, Va.-based Harbor Group International had been in talks with Morgan Communities to acquire the management rights to Morgan's 140 properties in 14 states.
The potential deal was intended to "stabilize" the Morgan portfolio of 36,000 apartments, the future of which became uncertain after Morgan was indicted last month on federal charges of mortgage, insurance and wire fraud. Morgan also faces a civil fraud lawsuit from the U.S. Securities and Exchange Commission.
Harbor Group is "no longer pursuing a transaction with Morgan Communities," according to an email sent Friday from Harbor Managing Director Lane Shea to lenders and servicers of loans on Morgan properties. The email did not explain the decision.