The District of Columbia urban renewal agency sold a two-acre parcel on 14th Street yesterday to a development team that includes a local community organization, marking the first time a local citizens' group will share in the profits from a redevelopment project in its neighborhood.

The D.C. Redevelopment Land Agency sold the parcel between 14th Street and University Place, Fairmont and Girard streets NW for $215,686 to a team that includes the 14th Street Local Development Corporation, a community group organized in late 1979 to spur development in the area, one of three corridors badly damaged in the 1968 riots.

Local Development Corporation chairman Dick Jones said yesterday that his group expects to receive $250,000 in profits over the next 10 years and will use the money to aid some businessmen and to help community residents become homeowners.

The developers plan to rehabilitate 88 decaying houses on the site and build 35 new apartments, all to be rented to families eligible for federal housing subsidies.

The sale was opposed by an advisory neighborhood commissioner and some residents who complained that 14th Street is saturated with subsidized housing and that the project would take part of the community's largest playground for a parking lot.

The developers said only a small part of the playground would be taken. RLA board members said the city badly needs housing for families earning less than $25,000 a year.

The 14th Street Local Development Corporation is an outgrowth of the 14th Street Project Area Committee, which lost a $250,000 city government contract last September after two audits found its financial records in "extremely poor condition" and about $12,000 in petty cash unaccounted for. Housing director Robert L. Moore said there appears to be no evidence of wrongdoing.

Jones, who is also president of the PAC, said the new group is completely independent.