Centex Corp., the Dallas-based home builder that rattled neighbors earlier this year with plans to turn a grassy hill beside the new, multimillion-dollar Strathmore Hall into housing, said yesterday that it has scaled back its project slightly and will donate half of the land to Montgomery County.

The decision means that summer outdoor concerts and a film festival that have been held on the property for years can continue, community leaders said.

Under its new plan, Centex said, it would donate half of its 18 acres at Rockville Pike and Strathmore Avenue in North Bethesda for public use. On the remaining land, it would construct 112 townhouses, of which 17 will be "moderately priced," dropping a proposal to include 31 single-family homes in the project.

Centex bought the property in February from the American Speech-Language-Hearing Association, which plans to move its headquarters to a larger building in Rockville in 2007. Neighbors and politicians, who had long considered the land to be a part of Strathmore's view, objected to the original proposal and pressured Centex to change its plans.

"Our basic concern was the amount of development they were proposing would have put single-family houses and townhouses literally up against our property line," said Eliot Pfanstiehl, president and chief executive of Strathmore. "It would have eliminated the film festival."

Under the original proposal, houses would have been built within 20 feet of a white gazebo on Strathmore's lawn.

"It's the last village green between Rockville and Bethesda," said Pfanstiehl of the hill next to his concert hall. He said the new plans "generally sound like this is moving in a favorable direction."

County council member Howard A. Denis (R-Potomac-Bethesda), who represents the area and had tried to stop the development, said he met with Centex's land-use lawyers and was pleased with the developer's new plans.

"This is very encouraging," Denis said. "They appear to be working with the community, and they're making efforts to mitigate the development and make it more user-friendly."

The project still must be approved by the county's planning board. Centex said it plans to start construction of the housing project, called Symphony Park, in 2007 when the speech association moves.

Strathmore's Eliot Pfanstiehl said the original plans would have canceled the film festival.