Speaking with Japanese gaming magazine Famitsu, Kitase had this to say when asked if he had ambitions to launch Final Fantasy 7 Remake in 2016:

As his comment implies, it seems as though Kitase does not believe that Final Fantasy 7 Remake will launch in 2016. However, the door is still open for the first episode of Final Fantasy 7 Remake to release in 2017. It could even be early 2017, so Square Enix could spread the release of all three episodes planned for Final Fantasy 7 Remake throughout next year.

That being said, Kitase could be underselling how well development is going with Final Fantasy 7 Remake in order to keep fan expectations in check. After all, Final Fantasy 7 Remake is a game that has been a decade in the making, and there is a lot of hype surrounding it. The recent Final Fantasy 7 Remake gameplay trailer made it seem as though a lot of progress has been made on the game since its announcement, so perhaps the first episode could hope to see release by the end of the year.

Of course, it’s also possible that Kitase is being forthright in his comments about Final Fantasy 7 Remake, and he honestly doesn’t expect the first episode to launch in 2016 at all. This wouldn’t be surprising in the least, considering game director Tetsuya Nomura is still busy working on Kingdom Hearts 3. Moreover, with Final Fantasy 15 launching in 2016, it wouldn’t make sense for Square Enix to steal its own thunder by releasing Final Fantasy 7 Remake in close proximity.

Whatever the case may be in regards to the development progress of Final Fantasy 7 Remake, hopefully we see more of the game soon. The footage that Square Enix has offered so far has been exciting, and it will be interesting to see more classic characters and locations powered by Unreal Engine 4 in Final Fantasy 7 Remake.

Final Fantasy 7 Remake is currently only confirmed for release on the PlayStation 4.

Source: GameSpot