Yes, I do remember that post, but as a former college governor I think it's highly unlikely that the college's legal advisors or their funding council (the EFA) would permit the college to procure a new building in such a roundabout way. Even simple construction contracts are a lawyer's paradise, with complex legal agreements between all parties involved, and serious liabilities and penalties for any party which fails to comply with its contractual obligations. The mind boggles at the legal agreements which would be required if a college building were contracted out to a supermarket, which the sub-contracted it to a construction firm! It's all too risky.
And why would anyone want to do it that way anyway? I can't see any reason why 'Asda would have an interest in ensuring that the proceeds of the sale are spent on the rebuilding of Buxton Lane'. If the joint planning application is successful, the college and Asda will no doubt enter in to a binding agreement, with an agreed date for the completion of building works at Buxton Lane and the resulting vacating of Hibbert Lane by the college. If Asda can't get on site at Hibbert Lane by the due date, because the Buxton Lane development has overrun, there will be penalties paid by the college to Asda.