The fate of the Albee-Keith's The after Building, a Beaux Arts-style landmark at 15th and G Streets NW which once housed a vaudeville and movie palace, will be decided in D. C. Superior Court tomorrow.

Don't Tear It Down, Inc., a local preservations group, is seeking an injunction to stop the razing of the building by the Oliver Carr Co., which plans a $60 million office and shopping complex on the block.

The Albee-Keith's Theater Building is one of three structures listed on the National Register of Historic Places that stand in the path of the proposed development. Last week, developer Oliver T. Carr Jr. offered to incorporate the facade of another landmark, the National Metropolitan Bank Building, into the new development and to donate the Rhodes Tavern, the city's oldest surviving commercial building, to a "responsible group" willing to move it with a $100,000 subsidy from Carr.

Carr's offer, however, carries conditions.

"The preservation elements of the project will only proceed if the mayor and City Council approve legislation limiting the 15th Street 95-foot height restriction to a depth of 35 feet from the street and closing the public alley in the block and deeding it to the company at no cost," said a Carr Company official.

Although zoning regulations allow building heights of 130 feet in most parts of downtown, a 1910 law limits buildings along the two blocks of 15th Street the face the Treasury Building to 95 feet. In January, City Council member John Wilson (D-Ward 2) introduced a bill amending the 1910 act by allowing buildings on those blocks to rise to a height of 130 feet after a 35-foot setback at the 95-foot level. The bill was later tabled at Wilson's request after preservationists condemned it as special interest legislation.

Don't Tear It Down is taking legal action partly on the grounds that Carr, during almost a year of negotiations, based his request for a subsidy to cover the added costs of retaining the landmarks on the assumption that he could build to 130 feet along 15th Street.

During the negotiations that were required before a demolition permit for the Albee-Keith's Theater building could be issued, the developer presented figures arrived at through a complex formula. According to the developer, the figures represented the difference between the income that would accrue from the project if the buildings were razed and the income that would result if the buildings were retained, which, Carr said, would mean less rentable space.

Under current law, Carr could build only up to 95 feet along 15th Street, or the approximate height of the existing Albee-Keith and Metropolitan Bank Buildings. Therefore, the preservation group contends, Carr has inflated his needed subsidy by basing his calculations on a building taller than he could legally build.

According to Carr, preserving facades of the Albee-Keith's Theater Building, the Metropolitan Bank Building and the Rhodes Tavern would require a subsidy to the developer of more than $7 million.

Last Friday, Assistant City Administrator James O. Gibson met with preservationists in an attempt to "get a coherent position for the administration" on the matter.

"There's a feeling of distrust between the community and the Carr Company," Advisory Neighborhood Commissioner Ann Loikow told Gibson. "All his figures are based on a building he didn't have a right to build."

Joseph Grano, president of a group called the Citizens Committee to Save Historic Rhodes Tavern, asked Gibson to commission an impartial feasibility study of the cost of saving the landmarks. Gibson promised to explore this possibility.

On Monday, Gibson met with representatives of federal agencies and White House officials in an effort to find funds to save the Albee-Keith's Theater Building. A spokesman for Gibson said that the officials showed interest in saving the building but that no promise of funding were obtained.

The Carr Co. obtained a demolition permit for the Albee building the day before the city's new landmark law took effect but agreed not to use it until the results of an application for a $7.2 federal grant were known. The city withdrew its support for the grant because, according to Gibson, the application "didn't reflect the proper sense of priorities in relation to the city's needs." On April 20, Carr began demolishing the building.

On April 23, a D. C. Superior Court judge issued a consent order, allowing demolition work to continue but barring the developer from razing the 15th Street terra cotta facade and part of the G Street facade at least until after tomorrow's court hearing.

Carr does not have demolition permits for the bank or tavern buildings and would have to comply with the new landmark law in order to alter, raze, or move either building. Under the new law, Carr would have to prove either that any change would be in the public interest or that denial of a permit would cause him "unreasonable economic hardship."

Gibson said that the city was in the process of formulating a position on those issues, too.

A Carr Co. spokesman said that "appropriate applications for the actions affecting the other landmark buildings . . . will be submitted in the near future." The developer also will submit an application for permission to relocate the interior of the Old Ebbit Grill to another location within the planned complex.

Reaction on the part of the local preservations to Carr's offer to help relocate the Rhodes Tavern, built about 1800 and used as the British command post during the burning of the White House in 1814, was negative.

"You're talking about moving it somewhere else where it doesn't have historical context," said John Kinnard, an official of a group called the Committee to Preserve Rhodes Tavern and the National Processional Route. Kinnard's group is backing a bill introduced in Congress by Rep. Morris Udall (D-Ariz.) that would authorize the Secretary of the Interior to acquire the three landmark buildings.

Preservationists at last week's meeting also reacted negatively to the concept of the development sketched by architects from the firm of Skidmore, Owings, and Merill.

"It looks like 20th and K with a mansard roof," said Tom Lodge, an advisory neighborhood commissioner.

A representative of the architectural firm said that the drawing was preliminary and represented "an attempt to create a facade with depth, with shade and shadow, largely to respect the Treasury building across the street and in some measures because of what the public is used to seeing on that site."

Plans call for the marble arches of the 1907 bank building to serve as an entrance to an atrium lined with restaurants and shops and linked with Garfinckels.

"This is a key private development project in the old downtown area east of 15th Street, outside the Pennsylvnia Avenue Development Corporation boundaries," said Carr. "The project will provide more than 2150 new jobs when completed, a large portion of which would be in the lower-skilled categories, and will provide increased tax revenues to the District of Columbia in excess of $2.5 million."

"We have two contending goods," said Gibson. "We have a development program for a square where we desire development . . . but, simultaneously we have interests with respect to historic preservation. We recognize that we will set some precedents in this case." CAPTION: Illustration, Oliver T. Carr's proposed 15th Street facade for his Garfinckel's block development, provided he is given a 130-foot height allowance after set-back. The Metropolitan Bank building is included in the facade.