The buyer exercised a contractual right to scrap the acquisition during the property’s inspection period, according to a Wednesday filing with the Securities and Exchange Commission. This reversal forces Elme to seek a new buyer pool for the 1,222-unit complex, a task the company acknowledges will be more complex than selling its other multifamily holdings.

This failed sale directly complicates Elme’s broader liquidation strategy, which received shareholder approval in October. With the deal off the table, the firm has withdrawn its liquidation distribution guidance and signaled that its planned delisting from the New York Stock Exchange will likely miss the third-quarter target. The company’s stock has suffered a 93% decline year-to-date, reflecting deep investor skepticism regarding the timeline for asset disposal.