It’s a “separate continuity” entirely as per WB Games.
WB Games Montreal debuted the first trailer and in-engine gameplay for Gotham Knights, its upcoming co-op action title. However, when we saw Bruce Wayne sending out the message to the Bat Family following his “death”, many assumed this to be a sequel to Batman: Arkham Knight. As it turns out, both games are set in separate universes.
Kotaku’s Stephen Totilo received clarification on the same from WB Games’ PR, and tweeted that “Gotham Knights is not set in the Arkham games universe. Separate continuity.” That would explain a number of things, such as the changes to combat (which doesn’t seem to be using Freeflow Combat) or the whole soft reboot approach to everything. There’s also the fact that Batgirl and Robin are fairly different from their Arkham universe counterparts.
Gotham Knights is currently slated to release in 2021 for Xbox One, Xbox Series X, PS4, PS5 and PC. Its campaign, which features the Court of Owls as the main baddies, can be played solo or in co-op. Though it’s not classified as live service, WB Games Montreal did talk about the game offering new challenges over time. Stay tuned for more details in the coming months to see what that means.
Clarification from WB games PR is that Gotham Knights is not set in the Arkham games universe. Separate continuity.
— Stephen Totilo (@stephentotilo) August 22, 2020