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Here is the issue I am receiving. When trying to create new site collection in SharePoint management panel (https://bluekarbon-admin.sharepoint.com/_layouts/online/SiteCollections.aspx) I get to the "administrator" section. If I pick "All Users" from the people picker - and attempt to create a site collection - there will be no error message and the site collection will not be created nor will the system let me delete the record later. Although someone seems to have deleted the record for me few weeks later.
I have confirmed that new sites hang in "creating" stage when a group is selected as "administrator" rather than a single user. It does reject having more than one user, but not a group.