The city was not swayed by the developers' appeal for a 260-unit complex with 130 affordable apartments.
The application for a housing complex on the Spenger's parking lot — which has faced opposition from Native American activists — is now in the property owners' hands.
The group that wants to build 130 units of affordable housing on Fourth Street says it offered several options to address Ohlone concerns but was rebuffed.
Ohlone tribe members are trying to stop a development on Fourth Street. They say the site was home to their ancestors. The developer says no evidence of that has been found.
West Berkeley Investments recrafted its proposal to make 50% of the units affordable and to meet Berkeley's zoning laws. The project could be approved in 180 days.
What lies beneath the Spenger's parking lot has been hotly debated in recent months as discussions proceed about what might one day be developed there.