Trust chairman Mohammad Alayan said the trust planned to establish the An-Nur Kiwi Academy (AKA) at the former St Patrick’s Primary School in Melbourne St.
The $8 million secondary boarding school for Muslim boys was expected to educate about 100 year 11-13 boys from across the country, and was supposed to open in 2014.
However, the trust had struggled to gain the funding needed to establish the facility, he said.
"This project is a great plan. However, it requires multi-million dollars for establishing the school facility, and funding has been very difficult in the last three years to secure."
In light of the situation, he said the trust was now considering using the premises to establish a Muslim co-educational primary school for the Dunedin community.The arrival of Syrian refugees to the city had prompted the idea, he said.
"Certainly the arrival of the Syrian refugees will make the roll more financially feasible in terms of operating a Muslim primary school."
Dr Alayan said planning for the school was still in the very early stages and it was not yet known how many pupils it would cater for, or when the school was likely to open.
He said more details would become available once the business plan for the project had been completed.
The trust has already established the An-Nur Education and Care Centre, an early childhood education centre, in two classrooms on the premises.
It catered for more than 30 children from the Dunedin Muslim community.
"Dunedin has been moving from strength to strength. Now the programme is fully licensed by the Ministry of Education, and received a "Well Placed" valuation from the Education Review Office recently."
Dr Alayan hoped the centre would be able to move to its new purpose-built facility on site later this year or early next year.
"Most of the building work has been completed," he said.
Dr Alayan previously said the trust wanted to establish Muslim education in Dunedin because it believed Muslim children attending state secular schools in the city were subjected to an educational environment that pressured them to adopt values that contradicted Islamic values, such as the evolution theory, sexual relations outside marriage and drinking alcohol.
The trust aimed to provide high-quality education with an emphasis on Islamic values.
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How do these people expect to be accepted by NZ society when they reject the values of that society? Diversity is the social reality we live in, tolerance and appreciation of many beliefs, ideas and lifestyles is essential to maintaining peace and economic prosperity - everyone needs to learn to get along with everyone else and an education system that embraces children of all races, religions, and economic backgrounds is a key to that. Religious and other groups that seek to shield their children from the full reality of the surrounding society can only serve to create narrow minded separatists intolerant of all difference.