By 9:30 each morning Ivan Valtchev and his crew of six are perched atop their scaffolds at the Hotel Washington. While nearby construction crews work feverishly to put up a new retail and office complex, Valtchev and his crew toil gingerly to restore ancient symbols.

Since May, Valtchev has supervised the restoration of so-called sgraffito designs on the walls that span seven stories of the hotel at 15th Street and Pennsylvania Avenue NW. In sgraffito, a near-extinct Italian technique, a design is carved into an outer coating of plaster to reveal a plaster of a different color.

Before the eyes of downtown passers-by Valtchev and his crew have slowly turned huge, dull red blocks into a brilliant display of arabesque art in red and white.

Included in the work are Masonic signs from the ancient Coptic religion, symbols for "life after death" and "illumination in the present life," as well as more contemporary designs such as the portraits of Washington, Lincoln and Jefferson.

"Sgraffito is unique and very rare in Washington and that's why it's so valuable," explained Gustavo Araoz of Marioni and Associates, preservation advisers to the Pennsylvania Avenue Development Corp.

It was PADC that identified the sgraffito as worthy of restoration, and the group is splitting the $300,000 cost of the project with the hotel owners, the Galveston, Tex., Moody family, whose foundation has run the hotel since 1940.

When PADC looked around for someone to do the restoring, it found only two men with the necessary qualifications. Ivan Valtchev, a New York artist, sculptor and art restorer, won the bid for the job.

As Valtchev slowly uncovered the sgraffito and retraced the designs, he was astounded to find mixed in with the ornamentation, symbols he says "are from a kind of fraternal order, probably Masonic in nature. "I don't think there is anything like it in the United States," said Valtchev. "I have never seen such a bold display of Masonic symbols on a public buildings. I have found these symbols mixed with other decorations, but nothing of this magnitude."

Araoz, the preservation adviser, is not so sure that the creator of the designs knew what the symbols meant. "People were so academic at the turn of the century," he said. "Still, wouldn't it be something if they put the symbols on the building without knowing what they meant?"

The name of the artist who created the designs has been lost.

The building itself was designed in 1917 by John Carrere and Thomas Hastings, both of a noted New York architectural firm responsible for the main building of the New York City Public Library and the old 1908 House and Senate buildings.

Because different artisans worked on the sgraffito, the styles vary and Valtchev has had a difficult time identifying some of the portraits. But he said that on the top row now observers can see "Thomas Jefferson, the artist Rafael, either Milton or Shakespeare he just isn't sure which , Abraham Lincoln and George Washington."

Among the Masonic symbols there is an Aladdin's lamp, representing "illumination" and bats beside an urn, representing "night and death," Valtchev said.

Also on the wall is the Hotel Washington crest, which includes a swan "for beauty and nobility, two bars for courage and three stars for influence," said Valtchev. The crest is very similar to the George Washington family crest.

Working about 12 hours a day, seven days a week, Valtchev and his crew have completed restoration on the Pennsylvania Avenue side of the hotel and are now working from scaffolds on F Street. Next, the team will restore the sgraffito over the main entrance to the hotel on 15th Street. The project should be completed by early October.