Farmland bequeathed to St Flannan's College in Ennis, Co Clare, in the 1940s is expected to provide a €7 million windfall to the college when it is sold.
At a public auction in the town the 35-acre plot was withdrawn after bids failed to top 7.1 million.
However, the unknown highest bidder was last night in negotiations with the Killaloe Diocesan Trust and the school president, Father Brendan Moloney.
The land has supplied food to students at the boarding school over the past half-century. The boarding school is closing its doors next June after 120 years.
The parcel of land, zoned residential, has extensive frontage on the N18 route linking Limerick and Galway.
It is located on the outskirts of Ennis, adjacent to the 190 million bypass currently under construction.
At yesterday's auction, bidding opened at €4 million, before reaching 7.1 million, valuing the site at more than €200,000 per acre.
With the zoning, the site will be able to accommodate 560 houses, putting an eventual overall value of more than €100 million on the development.
In recent years St Flannan's has been engaged in a significant expansion programme.
The money accrued from the sale of the farm is to be ringfenced for the development of the boarding school building.
The farmer who bequeathed the land to the college inserted a condition that proceeds from the land be used for the boarding school only.
St Flannan's College dates from the 19th century and is a protected building in the Ennis and Environs Development Plan.
