The second option is, he looks at you funny and then runs away. Admittedly, it's more likely for the second option to happen than the first. But the good news is that a guy with whom you have a strong friendship will usually be so flattered that he will be eventually be able to internalize your compliment, and you can both move past any embarrassment into acceptance of platonic love. The other reason to tell him your true feelings is because if you don't, some other girl will. And few things are worse than being in love with a guy who is in love with someone else.
Great romance is always in order.