The 'Elevation' rocker – whose real name is David Evans – had a proposal to construct five mansions overlooking Malibu rejected by the California Coastal Commission on Thursday, despite making reassurances that the venture would be environmentally-friendly.
After turning down the scheme by a vote of 8-4, the commission's executive director Peter Douglas said: "In 38 years of this commission's existence, this is one of the three worst projects that I've seen in terms of environmental devastation
"It's a contradiction in terms -- you can't be serious about being an environmentalist and pick this location."
The commission cited the effects on habitat, land formation, scenic views and water quality as their reason for refusing the project.
Reports twice recommended rejecting the proposal, arguing it would scar a rugged ridgeline and expressed concerns that it could pave the way for other landscape-altering projects in the region.
The commission admitted they expect the matter to end up in court.
The Edge – was has fought since 2006 to receive permits for the proposal – had hired prominent lobbyists and promoted the development as environmentally-friendly in a bid to earn approval.
Last year, Malibu Mayor Pro Tem Jefferson Wagner blasted the proposals, insisting the development would be out of character for the area.
He said: "This is not what Malibu is about. These kind of places are ego run riot."