The National Construction College has demanded more money from the funding body it is hoping will save its Norfolk headquarters from closure.
ConstructionSkills wants the Learning and Skills Council to give it £17.1 million - a figure more than £2 million higher than it previously said it would ask for.
It upped its demand earlier this month but was told by the LSC that the college must raise £4.3 million itself in order to get its hands on the money.
Bosses at the training body are now hoping to sell part of the land at the Bircham Newton site for a development of 25 houses to trigger the cash lifeline from the LSC.
The college submitted a revised planning application for the development to the Borough Council of Kings Lynn and West Norfolk last week.
An LSC spokesman said: "The LSC normally expects its providers to make a contribution for any funding.
"We have noted that the NCC has submitted these revised plans for a housing development and we hope to give them a decision on the outcome of the funding submission by the middle of October."
Under its latest plans, the college would stay open to deal with specialist training such as heavy plant and tower crane skills.
Other training, such as light plant, scaffolding and roofing, will be delivered from other sites and colleges across the country.
If successful, some of the proceeds of the land sale will be used to support funding for a new swimming pool and sports facilities that will be used by NCC students and the local community. The college must also replace rundown -accommodation.
A college spokesman said a minimum of œ5 million in funding would be needed to regenerate the campus accommodation and leisure facilities at Bircham Newton.
The cash crisis arose when the Government blocked plans to raise money by selling part of the site to housing developers in 2004.
NCC's original housing submission, which included plans to build 250 new homes, was rejected because the Department for Communities and Local Government said the housing did not come under the council's local -development plan. Around 50 of the 700 staff at Bircham Newton will lose their jobs as part of a cost-cutting drive.