Muller Property Group's proposed mixed-use scheme, Old Mill Quarter, was refused by Cheshire East Council but the developer said it was minded to appeal.
The local authority planning committee rejected the plans on the grounds of the threatened impact on existing retailers and highways.
However, Colin Muller, chief executive of Muller Property Group, said: "Clearly we are disappointed in the council's decision, as we feel our plans for Old Mill Quarter will bring many benefits to the local area. Our proposals will not only deliver the shops and services that so many local residents have said they would like to see in the town, but also create 600 plus new jobs, something that is badly needed in the current economic climate.
"Our scheme has the full support and commitment of named occupiers [premier Inn, Marstons]: there is no other scheme in Sandbach that can guarantee delivery of jobs – we can and the Old Mill Quarter development will deliver the majority of these jobs within the next three years."
The proposal included a 40,000 sq ft net food store with petrol filling station, 50,000 sq ft garden centre, drive-thru restaurants, 62-bed Premier Inn hotel, Marston's pub and parking for 840 cars. There would be up to 25,000 sq ft of trade counter business units. The site is located next to the town's only other main supermarket, Waitrose.
Muller added: "Old Mill Quarter would also stem the loss of trade from the town, reduce the number of trips by car and generate new business for existing retailers. As I have previously said, Sandbach is desperately in need of alternative retail choices to Waitrose and Aldi. The hotel and garden centre will help to bring new people into the town from outside of the local area.
"Sandbach has no available start-up business units for new or expanding small businesses, Mullers' proposal to offer a subsidiary of half market rent for the first two years of occupation is a unique initiative and would help attract new employment to the town.
"We think the council's analysis of the highways and retail information is flawed and as such we intend to appeal the decision.
"As I see it, the council have missed a valuable opportunity to improve choice for local shoppers and support the longer term vitality of the town.
"There has been no account taken by the Council of the Governments policy initiatives contained in the National Planning Policy Framework published in March of this year which seeks to promote sustainable development, build a strong competitive economy and ensure the vitality of town centres. This policy strongly advocates a presumption in favour of sustainable development which should be seen as a golden thread running through both plan making and decision taking.
"When it comes to making the big decisions that help to boost the country's economic recovery it strikes me that Councillors are just not able to step up to the mark."
Pegasus Group advises Muller.