Most Helpful Guy
Of course he's going to be sad. That's part of life. You are not a bitch for being truthful. If you can meet him in a private place, tell him in person, face to face. You can tell him he's fine, but not the guy you are looking for. Be firm. Tell him as soon as possible, not 'later'.
Most Helpful Girl
Tell him what you just said. It's not rude and it delivers the message