it's a pity

It was already commented by Hilary Metcalf, and I agree with her in basicaly. (In many cases, that's too bad/that's a shame/that's unfortunate.) 'ざんねん(残念)'は、おもったとおりにならなくて、あきらめきれないことや、くやしいとおもうことをしめしています。 (My poor english, when things will not go as expected, can not give up to think about those things) 　ざんねんでした = それはわたしにとってもざんねんなことでした おもったとおりにならない、ということから、あまりよくなかったときに、ひにくをこめてつかわれることもあります。

It means that's too bad/that's a shame/that's unfortunate, etc. My friend tells me she has been sick all week - my response, ざんねんでした。it is in the past tense because you are commenting on an unfortunate event that has already occurred.