Hitchin has been unsuccessful in its bid for a cut of the government’s Future High Street Fund.
The fund was set up with the aim of revitalising and evolving the nation's high streets, and has £675 million available to 50 successful areas to make their town centres fit for the future.
If successful, Hitchin would have received up to £25 million to support well-anticipated regeneration projects.
Hitchin's proposal for funding centred on well-needed refurbishment to Churchgate Shopping Centre, off Market Place.
The recent announcement has left an aura of uncertainty over revitalisation of Churchgate, which has been anticipating a revamp since 1986.
Although he expressed his disappointment that Hitchin and other towns in the area didn't make the shortlist, Councillor Ian Albert, Chair of North Herts District Council's Hitchin Committee, highlighted his pride in the town's application.
"A lot of excellent work was done cross-party and with local organisations in putting forward a credible expression of interest to the government," he said.
"We can still continue with developing these plans and options for Churchgate and our town centre, working alongside and actively engaging with the local community."
In a survey carried out by the district council last year, 93 per cent said that they supported investing in Hitchin - especially its marketplace - to ensure it is fit for the 21st century.
Of those who answered, 71 per cent said better quality shops would entice them to shop in Churchgate, with further statistics suggesting that different types of shops, more attractive storefronts and food and drink outlets were needed to boost Churchgate's popularity.
Hitchin and Harpenden MP Bim Afolami said: "While it was disappointing that Hitchin was not selected for phase two of the Future High Streets Fund, like every other application from Hertfordshire, the work achieved to put together the application has provided an outline for how Hitchin can become a sustainable 21st-century market town.
"All involved have agreed to meet in September to discuss next steps and evaluate additional ways that we can improve the town."
Hitchin town centre manager Tom Hardy added: "Although Hitchin is one of the most investable market towns in the country, it is by no means the most deprived or challenged.
"There are a lot of people still determined to see some major improvements to Churchgate and I am confident that, with the new administration, plans will continue to progress."
For a full list of towns through to the next phase of the project, go to www.gov.uk and search 'Future High Streets Fund'.
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