The proposed scheme includes over 300 homes, a new sports centre for students and nearby residents and community hub.
Developers will also refurbish and renews the site’s listed mansion building to return it to residential use.
The College has faced major financial challenges in recent years.
An investigation into subcontracting uncovered a debt of £25m that is due to the Education and Skills Funding Agency.
A new leadership team is now in place and has worked up this development plan which will repay the debt.
Bosses say that without the sale of land for residential development, the college would be in an insolvent position.
This could result in its forced closure and
the land sold to a developer.