Because of an editing error in a story in Saturday's real estate section, rents at the Washington Square complex at Connecticut and L streets NW were incorrectly listed. The rents are in the mid-to high $30s per square foot.

Commercial landlords in Washington, finding themselves with empty space in the heart of town, have stopped playing hard-to-get with prospective tenants and now are actively courting them with substantial concessions.

There are even a few cases reported of building owners taking the previously unheard-of action of lowering their quoted rents, but these are still the exceptions. Rents generally have leveled off, but landlords are offering to tenants upfront incentives that have basically the same effect as a rent cut.

These may include free rent for an initial period, favorable expansion clauses, free layout plans, and added extras such as partitioning, special lighting or flooring.

"If you walk in with a warm body, they landlords are not going to let you walk out without making it clear they really are talking about less" than the asking rent, said Joel M. Orenstein, senior vice president at Arthur Rubloff & Co. Finishing offices to a tenant's specific requirements may save a renter initial costs of as much as $15 to $20 a square foot--a total of perhaps $200,000--for a large law firm, or between $5 and $7 per square foot for a small company, he said.

Bargaining with concessions rather than rent cuts even has its own term, "Mickey-Mousing."

The phrase was used in the '60s and again when the market turned soft in the 1973-4 recession--and now once again is in vogue, Orenstein said.

To help tenants get over the initial cost of moving, some landlords are waiving rent for the first two to six months of a contract, leasing experts said. For tenants with growth plans, expansion clauses are more liberal than in the recent past: before, tenants had to take the total amount of space they would need in the future and try to sublease what they couldn't use immediately; now they are negotiating for future guaranteed expansion without having to take the space now.

Orenstein has been predicting for some time that Washington's ultratight vacancy rate of under one percent for the past several years would be rising this year to about 5 percent, and now he says that prediction has been fulfilled.

A 5 percent vacancy rate still would not be high compared with most other cities, but it is far higher than the District has experienced in the recent past.

The actual vacancy rate is a matter of debate among commercial leasing experts, but the experts generally agree there is substantially more space available now than in the past because of new building, cutbacks in needed space as a result of the current recession, and the government's concerted efforts to reduce its space requirements.

This has led to competition among landlords. Some say, in fact, that 1982 will be "the year of the tenant."

Landlords have lowered their expectations of what prices they can command for new space, said George Voris of Coldwell-Banker. Building owners who thought they would enter the market with rents per square foot in the high $30s for prime space now are looking more to the low $30s, he said.

At the massive Washington Square complex at Connecticut Avenue and L Street NW, which for many appears to be a benchmark in setting top price, the developer is setting rents in the mid- and high $30,000s--but there is still much space to lease, industry sources indicate.

"The market has taken on a new tone," said Stephen Goldstein, vice president of Julien J. Studley Inc. realty firm. "Landlords are aggressively pursuing tenants; tenants are having a good time negotiating leases."

One example of some recent hard bargaining has been between Rose Associates and MCI, a locally based telecommunications firm, over Rose's new building in Pentagon City.

During their talks, MCI successfully insisted that the developer stop negotiating with another possible tenant, the Air Force Association, which was in the market for only part of the building, according to sources. Rose and MCI still are negotiating MCI's possible occupancy of the entire building, already completed and standing empty despite its prime location across from a Metro stop.

In addition to the new space now available, large amounts of sublease space all over the city is on the market, commercial leasers say.

New development that will add to future supplies is increasing rapidly, as well. This has started affecting development here, as some projects that have not broken ground are being postponed until the market turns around, experts report.

Julien J. Studley, Inc.'s list of new developments in the District has 11 recent additions, all of them new buildings being started this quarter and due for completion by 1984, company executive Goldstein said.

These newly listed buildings would add another 3.5 million square feet to the market, and the firm now expects total office space in the District to grow 20 percent from the current 50 million square feet to about 60 million by 1984, he said.

The listing also does not yet include Cadillac-Fairview's massive mixed-use development that will have about 700,000 square feet of space on Pennsylvania Avenue. Ground has not yet been broken on the project, but a spokesman for Cadillac-Fairview said construction will begin in June. Final approval on the project is expected by the Pennsylvania Avenue Development Corp. in about two weeks.

Projects that already have begun will continue as quickly as possible, because carrying costs are too high on building-in-progress for them to be postponed, experts say. But plans that have not started are being stalled by onerous financing terms and the current unfavorable market, they add.

This has broad implications for renewal areas, particularly east of 14th Street, which city and local industry officials had hoped would be redeveloped quickly. Because of the softer market, this development will be slower than anticipated, the experts now say.

But slower development may then complete the cycle, leading to an eventual return to a tighter leasing market. Rubloff's Orenstein, for example, sees a soft market lasting for perhaps two years and then tightening again. This in turn would lead to a spurt of new growth.

But Orenstein adds a caveat with his predictions, saying the market is not reacting the way it has in the past, making accurate forecasting more game than art.

"The word predictable is going to be scratched from the dictionary. To forecast two or three years down the line, well, you'd better not do it," he said. "You're just throwing darts at a board."