Holy Cross College, trying to resolve its financial problems, has agreed to sell 75 acres of land to the University of Notre Dame and then lease the property back.
Holy Cross approached Notre Dame with the proposal and "an agreement on all sides has been reached," the college said in a news release Friday night.
Holy Cross officials say they are confident the deal will stabilize the college's finances.
"Holy Cross and Notre Dame have successfully collaborated on a number of formal and informal initiatives over the years, and both institutions recognized that this was another good opportunity to work together," Dave Bender, chair of the Holy Cross board of trustees said in a statement.
Bender added that Holy Cross would not release details of the deal but assured "the entire Holy Cross community that it will have a stabilizing impact on the college and will allow us to confidently plan for the future."
In a later phone interview, Bender said discussions by the board over accreditation and the challenges faced by small colleges have been ongoing for more than a year.
"We have been talking to Notre Dame a lot about this," he said, including the possibility of collaborating on academic programs.
Holy Cross, facing similar financial pressures as other small liberal arts colleges, has been ordered by an accrediting agency to develop a four-year plan to stop increasing yearly borrowing and keep its budget balanced.
Cash flow required the college to use all of its $2 million line of credit, as well as a $1 million bridge loan from the Brothers of the Holy Cross, until tuition revenue was received for fall 2016, according to a recent report by the Higher Learning Commission, an accrediting agency.
The Holy Cross College endowment totals about $1.5 million. In comparison, the endowment of neighboring Saint Mary's College totaled $160 million in fiscal year 2016, and the endowment of Goshen College totaled $101 million.
Last week, an email from a Holy College administrator painting a bleak picture of the school's finances was mistakenly sent to the entire student body.