Huge projects led by the Elliot Group could soon be taken over and finished by other firms after talks began with "several developers".
One such scheme is Aura in Islington, Liverpool - a project intended to see 1,000 student accommodation units erected close to the Royal Liverpool Hospital - but construction works stopped in January .
The stop to works came after both the group's owner Elliot Lawless and council regeneration chief Nick Kavanagh were arrested in December on suspicion of fraud.
Mr Lawless denies all allegations against him, while Mr Kavanagh has not spoken publicly since his arrest.
On Wednesday, a spokesman for Elliot Group confirmed that "several developers" are in talks to take over projects in Elliot Lawless' firm's portfolio, including Aura.
Vermont, which had been working on the Aura site as a contractor, is believed to be one of those firms.
A spokesman for the Elliot Group confirmed discussions were underway - but said "no deal has yet been signed".
It's understood Elliot Group wants to agree a fee for a third-party firms to deliver the developments, while ownership remains with Mr Lawless' firm.
Mr Kavanagh was arrested on suspicion of conspiracy to defraud and misconduct in a public office back in December with Mr Lawless, one of the city's leading property developers, also arrested on suspicion of conspiracy to defraud, bribery and corruption.
Neither Mr Lawless nor the council official have been charged with any offence, with both subject to a continuing investigation by Merseyside Police .
In a statement released last week, a spokesman for the firm said Mr Lawless may inject "short-term funding" to keep both the Aura and Infinity Towers project - where work also stopped pending the police investigation - afloat.
The Infinity Towers project once complete will see three huge buildings housing over 1,000 apartments on Leeds Street.
The spokesman also pledged funds for the Residence project in Salford, a two-tower scheme where it was revealed last month that works had also stopped.
He said that would happen "while responsibility for completing the scheme is mandated to another developer".
It's as yet unknown which other Elliot Group projects aside from Aura may be affected by the ongoing talks.
Vermont was contacted for a comment.
