Tenants at The Roosevelt apartments for senior citizens on 16th Street NW have decided to join forces with a local couple to buy and rehabilitate their building, despite a recent offer by the District government to take over the building and renovate it.

Stanley and Catherine Boucree, the couple selected as developer, submitted a proposal that estimated acquisition and rehabilitation costs at $8.54 million and offered the tenants a 5 percent interest in a joint partnership to own the building.

The District government estimated that it would require at least $17 million to do the type of renovation it favored for the building, said D.C. City Administrator Thomas Downs. Downs said that the city recently identified $4 million it could use to buy the building and that the renovations would have to be funded in phases.

The tenants had been looking for a developer since October, after the current owner, Frances Pew Hayes, entered into a sales contract with a private McLean-based group, North American Financial Investments and Management Group NV, to sell the property for $2.58 million.

Under District law, the tenants have the first right to purchase their buildings, and the residents at The Roosevelt have until April 15 to match North American's offer.

But the city government recently reached agreement with North American to buy the company's right to purchase the building if the tenants' attempt to buy it fails, said Ned Walsh, real property administrator in the D.C. Department of Administrative Services.

About half of the elderly residents at The Roosevelt, 2101 16th St. NW, receive federal rent subsidies for low-income persons. The eight-story, 359-unit building has been cited by the city for numerous safety and fire code violations and has a vacancy rate of about 25 percent. Rents, including meals and housekeeping, range from $570 to $715 a month.

Walsh and the Boucrees yesterday attended a meeting of about 65 tenants and tenant representatives from MUSCLE Inc. and University Legal Services. Some tenants have questioned the decision to forgo the city's offer, but Holly C. Malloy of University Legal Services told tenants at the meeting that the city had waited until the last minute to make a financial commitment to the project and has not put its promises in writing.

"I don't think it would be wise to put all your eggs in the city's basket," she said.

Downs said that if the city acquired it, the building would be used not only as elderly housing but for other "special population" groups, such as the physically handicapped. Some tenants said they want the building to remain for elderly persons only.

Other tenants asked Boucree, an oral surgeon, if his financial backing to buy the building was firm, and he said it was. He declined to tell a reporter where the financing would come from, but the developers' proposal to tenants said that Matthews and Wright Inc., a Wall Street firm, would provide the financing. CAPTION: Picture, Renovation costs at Roosevelt apartments have been estimated as high as $17 million.