MUCH-BALLYHOOED and monumental in its ultimate dimensions, construction is finally under way to return splendor to Pennsylvania Avenue and its immediate environs -- and it should be money well spent. But only a few blocks uptown from this grand avenue is another corridor, just as symbolic in its local way, which -- slowly and painfully -- may at last undergo important physical change. It is the LeDroit Park and Howard University/Hospital area on and around the once grand lower Georgia Avenue. There city-dwellers in general and black people in particular have seen their hopes for a successful minority-owned-and-operated hotel nearly crushed by its financial complications.

Up to now, most reports have necessarily focused on the hotel -- Harambee House -- and its difficulties. But a critical element in any possible success of this venture is what the government, planners and private businesses do to make the whole neighborhood more attractive. The hotel, brainchild of businessman Ed Murphy and once planned as a model of federal-minority-enterprise cooperation, has had business problems ever since it opened with great ceremony in 1978.

Aside from disputes that still are going on about the management of the hotel, one of the biggest obstacles to its success has been its surroundings. By day, there is the view of a huge junkyard and several dilapidated buildings; by night, there is the dark, storeless and cabless emptiness of a deserted avenue unconnected with the heart of downtown.

But now there is optimistic word from the federal and city governments about the future of the hotel as a privately and locally owned minority venture; officials say they will be paying attention to, and money for, neighborhood improvements as part of a plan to return Harambee House to local minority ownership. The U.S. Commerce Department will provide money to clean up the junkyard for interim use as a parking area and eventually for housing and commercial development to make Georgia Avenue "the attractive corridor it once was." A relatively small amount, $152,150, will be provided by the District.

As for Harambee House, Commerce's Economic Development Administration, which has acquired the property temporarily, plans to turn it over to the D.C. Development Corporation -- also for temporary holding, with a moratorium on principal and interest payments on the unpaid balance -- until it can be sold to local minority private interests.

This is not just a case of big government spending merely to prop up a flop indefinitely. Neither government nor local business interests should expect to put a hotel in an isolated urban trash heap and expect patrons to flock there. With sensible, comprehensive planning, Georgia Avenue can be turned again into an attractive, prosperous complement to the center of the city.