Colonial Village, a 45-year-old development of moderately priced garden apartments in Arlington, faces significant changes in the 1980s.

The aging "village" is likely to become citified by the 1990s -- but will not become another Rosslyn, its neighbor down Wilson Boulevard. Nor, according to a redevelopment plan worked out with Arlington County by the owners, will Colonial Village become a completely rebuilt complex or a condominium conversion project.

The 62-acre, 1,095-unit rental complex gradually will be turned into a mixed-use development of 951 rental apartments, dwellings converted to condominiumn ownership, new town houses, medium-rise condo apartments and several large office buildings.

The Reston Land Corp., a subsidiary of Mobil Oil Corp., bought the Colonial Village property for around $15 million in 1977, recognizing the potential for the location as well as the need for improvements, said James Todd, RLC president.

The location, as benefits real estate's main truism, is the key to the value of the Colonial Village site. It is between Rte. I-66 and Wilson Boulevard, opposite the new Courthouse Square Metro station on the Orange Line -- only three miles from downtown Washington.

Todd said three office buildings with more than 750,000 square feet of space will be built on the site opposite the Metro station. Only 144 apartments will be razed, he added.

For those already living at Colonial Village, montlhy rents now range from $175 for some effeciencies to $327 for three-bedroom apartments. "We are currently losing $700 a year per rental unit, even with a recent rent increase," Todd said.

Any additional increase in rents after the complex is upgraded must be within federal guidelines because of the history of FHA financing, Todd said.

Current tenants have been assured by Colonial Village, Inc., the Mobil subsidiary that operates the property, that they will not be evicted. Some tenants may have to move from one unit to another at Mobil expense, according to Todd and Amos T. Clift, Colonial Village vice president and on-site manager.

"Normal attrition, or tenant turnover, which averages less than 16 percent annually, should take care of the units that will be converted to condo ownership or razed as the site for the planned large office buildings opposite the Metro station at North Veitch and Wilson," said Clift, who has been a Village resident for 26 years.

Margaret Kilfeather, 74, said that when she and her husband moved to the complex nearly 45 years ago, they paid $31 a month for a two-bedroom apartment.

She and her husband have no desire to move, she said. "We raised two children here and sent them to college," said Kilfeather. "Now my husband is retired and we live here (at 1813 N. Rhodes St.) comfortably and paid $262 a month" plus utility charges for gas and electricity.

Thomas Parker, deputy planning director of Arlington County, regards the mixed-use plan for Colonial Village as a "well-reasoned compromise." He said a subcommittee of the Arlington County Board met for more than a year to work out a compromise between tenants and owners.

Due to the recent gyrations of the financial lending market and the housing slump, Colonial Village Inc. operations vice president Gregory Friess said no major moves are expected there this year. He said preliminary work is being done for planned conversion of the first 212 units, which will be upgraded and converted to condominium ownership.

"When the redevelopment is completed, we will still have the Colonial Village aura but with a mix of ownership and tenants, plus new dwellings and those office buildings," Friess said. "That should produce enough revenue to make the total mixed-use concept economically sound."

If Mobil's real estate team follows through on its commitment for the gradual redevelopment of most of Colonial Village, the result could be a model for local and national urbanization-preservation of large rental complexes that have become aged and unprofitable.

Indeed, the Mobil plan for Colonial Village might be even better if the economics of rental apartment contruction encouraged construction of some small new buildings for both moderate and moderately high-income tenants.

The adopted plan already calls for 75 units to be sold to a moderate-income rental housing program and another 75 to be sold to a tenant-controlled limited application cooperative venture with HUD insurance.

Mobil purchased the Colonial Village property from original developer Gustave Ring. Ring had acquired the site for not much more than a song during the Depression when -- as he recalled recently -- lenders regarded it as "too far out" for a large, pioneering rental garden apartment complex. The property formerly has been the site of the Washington Golf and Country Club now on Glebe Road.

Ring's acumen and vision won out, and Colonial Village was built as an FHA-insured group of low-rise garden apartments amidst trees that have matured and open spaces that have remained open.

Colonial Village went its own quiet way as a haven for medium-income tenants during a period that has spanned World War II, the Korean War, the Vietnam conflict of the 1960s and the area's explosive residential real estate boom of the 1970s. The village apartments have been such a bargain that there have been no paid advertisments for tenants nor any vacancies not filled from a waiting list, the owners say.

In its early years, Colonial Village housed a number of moderate-income government employes, many of whom raised families there.

Populated largely by older citizens in the mid-1970s, the complex recently has been home to more young adults. Turnover continues to be far below the area average, which was more than 30 percent a year in the 1970s.