The church and hall would remain a ''holy place'' and become a spiritual retreat centre, the Anglican Bishop of Dunedin, the Rt Rev Dr Kelvin Wright, said yesterday.
The Matau St church, in the Dunstan parish, was to be sold, because it was too expensive to maintain for only a ''handful'' of parishioners, the Otago Daily Times was told in March.
Now the Otago and Southland diocese had decided to retain ownership of St Michael's and set up a trust to establish and run the retreat, Dr Wright said.
''I am delighted that the church of St Michael's will continue to be used as a holy place.''
There will be a formal ''handing over of the keys'' to Dr Wright and representatives of the proposed trust at the church on Sunday, June 7, at 3pm and the public were welcome to attend.
The church would not be deconsecrated.
The retreat would not be a business venture, he said.
It would be a place where people could stay for prayer and meditation and to be mentored.
The trust, yet to be appointed, would look at funding for the retreat and the new enterprise should be open within a year.
Dr Wright said the trust would be ''a partnership'' between himself and the local community.
No name or opening date has been decided on yet for the retreat. The 1877 church is a Heritage New Zealand category 2 building.
