It's entirely possible they're making a new IP, or a game that uses new technology, or that moving their game from Wii U to Switch has caused development problems. There is evidence that whatever Retro started work on in early 2014 changed direction or was even scrapped in the first 18 months of development. Kensuke Tanabe worked with Retro on every major game of theirs from Prime 2 onwards (so Echoes, Corruption, Trilogy, DKC: Returns, DKC: Tropical Freeze), but has spent the last few years working with Next Level on Federation Force, and now (presumably) Metroid Prime 4, among other things (Paper Mario: Color Splash, for example).
In February 2014, around the launch of Tropical Freeze, both Tanabe and Michael Kelbaugh (Retro Studios) confirmed development had begun on a new title. By August 2015, however, after the reveal of Next Level's Federation Force, Tanabe commented he had no idea what Retro Studios were currently working on. So clearly, within that 18 month period, Tanabe stopped working with Retro Studios and whatever project Retro were making was either scrapped, or changed direction.
A lot of people here are assuming that whatever Retro started work in in early 2014 is whatever they might be working on. There's some evidence that suggests that's not the case, given Tanabe's seeming departure from working with the company. It's also a very simple truth that games development is lengthy, complicated and prone to delays. I would assume Retro still have their own title in development, but that it has encountered delays, or perhaps it's even the case an early build or early project was scrapped entirely.
I don't see Retro making a Prime Trilogy HD. Nintendo could outsource that to Tantalus, or Monster Games, for example. More likely the former than the latter. Nintendo have a lot of patience when working with their studios, and I think they'll still be backing Retro to finish whatever game they've been developing. Looking into Xenoblade Chronicles' development history demonstrates the extent to which Nintendo will support projects coming from talented developers, allowing significant delays in order to get the game right. It's likely Retro now have a new producer from Nintendo's internal structure working with them, and that they're making their first major game without Tanabe's input since the original Prime, which Miyamoto produced.