Capitol Hill residents call the brick turreted house at 2 6th St. NE "the castle." Recently, the long-vacant property was purchased by businessman Mark Simon and his wife Adele for $110,000. Simon said a crew is renovating and upgrading the former boarding house. He said he and his wife plan to live in the 16-room house and are spending about $70,000 fixing it up. "It was an eyesore for a long time and we hope to make it both livable and aesthetically pleasing," said Simon, a distributor for those soda-water-dispensing "snakes" used in bars. The Simons currently live in an apartment in Crystal City.

Alan Kay, co-partner of the Rozansky-Kay firm that recently purchased the Rockefeller estate on Foxhall Road NW for a housing development, said this week that his firm has entered into an agreement with the Crowell-Baker firm to build single-family houses for the site that will be priced from $350,000. Arthur Cotton Moore will design the houses.

The former Presidential Arms banquet rooms at 1320 G St. NW will be converted into a racquetball and squash club. The 56-year-old building, originally a men's club, was a hotel with public banquet rooms in later year. Realtor William P. Delaney said that a group headed by David Lawson has leased the site and plans to convert the upper three floors of the Presidential Arms into a million-dollar racquetball facility and restaurant. It is to open in 1979.