Community members had rallied to save the bowling lanes near the corner of 16th Avenue and Arbutus Street in recent weeks, saying they were a valuable community facility. About 700 people use the lanes as league bowlers they say.
But Brian Jackson, the general manager of planning and development, said the board does not have the authority to order Cressey Developments to include a bowling alley in its development.
The permit board did criticize Cressey for a lack of community consultation, he said.
"The board made it clear that it was disappointed the developer had not been able to accommodate this important neighbourhood feature in its scheme," said Jackson.
Cressey spokesman Hani Lammam says a bowling alley doesn't make business sense and noted no one from the bowling alley approached him with any business offer.
"This is a use that belongs in a community centre. Maybe that's where it should end up. I understand the City of Vancouver has heard the message. And that they intend to explore the idea of incorporating a bowling alley into a future, whether it's a renovation or a new community centre," he said.
Lammam said he was disappointed the board criticized Cressey for a lack of consultation, saying they did consult, and the board got it wrong.
Coun. Adriane Carr also said she was disappointed with the outcome, saying the developers have a duty to work with neighbours.
"When the development community keeps pushing projects that the community doesn't want, there is a divide that I think is very problematic for the city of Vancouver."
The board did cut the original five-storey proposal down to a four-storey development. No construction date has been set for the project.