The Arlington County Board cleared the way yesterday for two new development projects: a large office complex to replace the Washington-Lee Shopping Center and a residential project that won the last-minute backing of its Colonial Village neighbors.

On a day filled with development issues, the board unanimously approved the closing of a portion of South Wayne Street, which will enable a Fairfax County developer to consolidate an 11-acre site across Rte. 50 from Fort Myer for a $65 million low-rise office complex of five buildings.

The Sequoia Building Corp. plans to raze the Washington-Lee Shopping Center, some small nearby businesses and the Byrd Theater, known for its adult-fare movies, which now occupy the site. After the board rejected Sequoia's earlier plans for a high-rise office complex there, the firm scaled down the project.

Sequoia will have to pay the county $250,000 for closing South Wayne Street. Business owners in the area asked the board to consider using some of the money to help them relocate.

Luis Ochoa, whose parents own a market on the site, told the board, "It has been my mom and dad's identity in the community . . . the family's main form of income . . . . "

"We think we've already paid dearly to develop the property as it's zoned," said William B. Lawson, Sequoia's attorney, explaining that the firm has spent more than $1 million redesigning the project.

After board members were told by County Attorney Charles G. Flinn that state law prohibits financial assistance for such business relocations, they agreed to set up a task force to devise ways of helping the business owners relocate.

In another unanimous vote, the board approved plans by the Calibre Co., a Northern Virginia development firm, to build a $20 million rental complex off North Rhodes Street in the Colonial Village residential complex.

Residents of Colonial Village had opposed the project until Friday night, when Calibre officials agreed to modify the plans so that a wooded hillside will be preserved.

As part of the agreement, Calibre scaled down its project by 24 units, to a total of 366 units in four six-story buildings. Calibre also agreed to put 269 of its planned 441 parking spaces underground.

Colonial Village resident Kevin Coyle said objections to the development were dropped because "they've protected our view and protected the wooded site."

Lawson, who is also Calibre's lawyer, said the firm will sign an agreement with neighbors of the site to preserve the wooded area in its present state.