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It's 100% true that the University is negotiating with FIJI to buy their house to expand the law school- so yes, there is land available.
But it's one of the conditions of extension that the chapter would be extending without the promise of being able to build a house. IU has a huge space issue right now. The University has over 40,000 students now and the dorms are filled to the gills. Classrooms are overcrowded- there isn't enough space. The other land is being saved for building new academic buildings and for relocating....
What the University is hoping to do is buy out all the sororities (Kappa, Pi Phi, Alpha PHi, Tri-Delt) and fraternities (Lambda Chi, Delta U, Delta Chi, Acacia, and FIJI) on third street and move them to the extension. They're saving the few lots of land for that.
The best hope for any chapter wanting to extend is to purchase a house from a fraternity that gets removed from campus. But let me make it clear-- IU Panhellenic has stated that there is no promise that a chapter that extends will be able to build a house. So while all the sororities on campus want the new chapter to have a house, it is unlikely for them to get one.
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