Plans to demolish an Italian restaurant and replace it with five houses have been refused.
Councillors voted against the proposal to knock down the Miaitalia restaurant on Bye-pass Road in Bolton-le-Sands.
They agreed with Lancaster City Council planning officers that a more "robust and transparent marketing exercise" needed to take place to show "that the retention of the existing use is no longer economically viable or feasible".
"There are reasons why that site will always struggle, and even more so now, post-Covid, as a food business," said Mr Waddington.
"Bolton-le-Sands is a fantastic village to live in and the council are crying out for people to build houses in the area.
"If I thought there was trade to be had, I would have continued as a restaurant."
Mr Waddington is pressing ahead with plans to relocate the award-winning Miaitalia to Queen Street in Morecambe.
Lancaster City Council planning regulatory committee voted to refuse the planning application by a majority, during a meeting on Monday afternoon at Morecambe Town Hall.
Councillors Paul Anderton and Vicky Boyd-Power abstained, and Councillor Peter Yates voted against the refusal. All other councillors present, voted in favour of the recommendation.
"It is a fact, it does not work as a restaurant," said Councillor Yates.
Councillor Keith Budden, chair of the planning committee, was not involved in the discussions or the vote, having declared an interest as Mr Waddington is his son-in-law.
Praise for Lancaster and Morecambe youngsters who took part in 'tongue movement' project
Clinic where students offer free legal advice to reopen at Lancaster University
Lines reopen after train derailment on Scotland-London line
Police arrest two and seize illegal bike in Morecambe
ITV commissions sixth series of Morecambe crime drama The Bay
E-bike shop moves from Lancaster to new Carnforth showroom
Lancaster workshop to tackle the issue of drink and needle spiking
Morecambe raw feeds shop up for three 'Animal Star' awards
Two new festivals proposed for Morecambe entertainment venue the Platform
Second day of disruption as work continues after train derails in Cumbria
Morecambe lifeboat crew’s swift response rescues swimmer ‘being swept dangerously out to sea’
'Street Meets' announced to answer your questions amid new wheelie bin roll-out
Campaign group welcomes new "life changing" bus service to Morecambe
Lancaster prison worker jailed for drug offences
Major disruption as train derails on West Coast Main Line
Talks begin for events to mark Eric Morecambe's 100th birthday
Lancaster music venue due to shut will now stay open "well into 2026"
Halloween What's On Guide
LISTEN: Launch of new group in Morecambe to help with gambling addiction
LISTEN: New centre for people with disabilities to open in historic Lancaster location
