Paul's assumption that some believers, himself included, might live to see the return is not an isolated phrase. Within the New Testament itself, 2 Peter already answers scoffers who ask where the promised coming is, since the fathers had died and everything continued as before, evidence that the delay was felt as a real problem within a generation or two of Jesus's death.
Albert Schweitzer's 1906 study of nineteenth century Jesus scholarship argued that Jesus himself expected the Kingdom to arrive within his own generation, citing his instruction to the disciples in Matthew that the Son of Man would come before they finished going through the towns of Israel. On Schweitzer's reading, later New Testament writers, Paul above all, had to work out a theology for an interim they had not expected, and that unmet timetable, not a later loss of faith, is what drove much of early Christian doctrine. The idea entered New Testament scholarship as the delay of the parousia and remains a live category in historical study of the earliest church.
Mainstream Christian theology does not treat the prophecy as failed. It reads Jesus's own statement, a few verses after the Olivet Discourse's time marker, that of that day and hour no one knows, not even the Son, as making the timing deliberately unknowable, and treats "generation" in the Greek text as open to reference beyond a single lifetime. The historical-critical and the theological readings of the same passage have not converged.
Sources The Quest of the Historical JesusAlbert Schweitzer with The New Testament, Gospel of MatthewAnonymous