Oh, you're using the old lxcbr0 bridge and yeah, it's got a 250 IPs
limitation due to it being a /24.

So run: sudo dpkg-reconfigure -p medium lxd

And answer the questions, giving it something bigger than a /24,
probably a /16 and entering a matching number of max dhcp hosts, that
should fix things for you.

** Changed in: lxd (Ubuntu)
       Status: Incomplete => Invalid

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https://bugs.launchpad.net/bugs/1571862

Title:
  No IP is issued for more than 251 containers

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