The federal Fine Arts Commission rejected yesterday the proposed design for a luxury condominium building overlooking Rock Creek Park behind the Shoreham Hotel after the National Park Service and some nearby residents complained that the building was too tall and too big.

The commission, which had approved the "general concept" of the project last July, told its developer New York real estate magnate William Zenckendorf Jr., to review the height of the 231-unit building to make sure that the condominium would not mar the beauty of a heavily forested hillside in the park.

The proposed building, where one-and two-bedroom units would sell for $200,000 and up, would be 90 feet high, the same as the Shoreham, on the Calvert Street NW side of the building. But the condominium would be 137 feet tall on the sides facing the park because the structure would be built into the tremendously steep, rugged terrain sloping away from the hotel.

The commission did not suggest how tall the building should be, although one commissioner, architect Kevin Roche, said he thought the 14-story structure "is too high by about four stories."

Commission chairman J. Carter Brown, director of the National Gallery of Art, asked that the height of the trees on the hotel property be measured so that it can be determined if motorists driving through the park would be able to see the condominium tower above the treetops.

David Childs, the architect for the condominium project, said that the tulip poplars and oaks that dot the rear of the Shoreham landscape are 120 feet tall, but John G. Parson, a National Park Service official, said the trees only reach 100 feet in hieght.

The Fine Arts Commission has no outright veto power over construction of buildings in Washington, but its advisory opinions are rarely rejected by the city government. Thus the commission's views weight heavily when developers seek their required permits from the city.

Parsons said the Park Service is "quite pleased with the architechture" proposed for the condominium, a curving structure with a terraced roofline and most of the units facing the park.

But Parsons quickly added that "the 140-foot height is overwhelming and precedent-setting." He said that the Park Service knows of no buildings, other than the Watergate, that abut parkland and are taller than 90 feet.

Several residents who live near the Shoreham said not only would the building be too tall, it would be too massive compared with the maximum 40-foot-tall homes along 28th Street and McGill Terrace NW.

"The park is our back yard for recreation," one resident, Linda Sher, told the commission. The condominium "is going to loom over the park."

Howard Michnick, president of the Shoreham West Cooperative, objected to the planned use of 28th Street as the main entrance to the condominium and also asked that the condominium be terraced more than has been proposed so that the building's bulk would not be so imposing for neighbors.

Zeckendorf and Childs, who went into the commission hearing thinking they would win approval for their design, were clearly upset when they did not.

"We spent a half million dollars and nine months of work" on the plans, based on the commission's earliear tentative approval, Zeckendorf said. "We're sorry that the Department of the Interior [the Park Service] did not come in nine months ago."

Parsons apologized to the commission for the Park Service's failure to comment on the design until now. Another Park Service official later said that the agency did not know of the condominium project until a week ago.

Childs suggested that to greatly reduce the size of the condominium project may not be economical while Zeckendorf said he simply was "not sure" what he plans to do with the proposal now.

Zeckendorf and other investors, including the Dunfey Hotel chain owned by Aer Lingus, the Irish national airline, bought the Shoreham last December for $35 million and plan to start a three-year $15 million renovation of the hotel this summer.

Zeckendorf said that all the furnishings in the hotel's 675 rooms eventually would be replaced and the lobby and ballrooms redecorated. The 108-room motor inn, tennis courts and swimming pool to the rear of the hotel would be demolished to make room for the condominium.

Zeckendorf called the Shoreham "a fading first-class hotel" that "needs a hell of a lot of attention."

But he said he hopes that the renovation would bring the Shoreham back to what he said it was in the 1950s, "the finest hotel in Washington."