Several former tenants will soon move back into the Warner Apartments, an 81-year-old building that has yet another owner in a long, troubled history of deterioration, mismanagement, greed and unrealistic expectations. By the time the last group of tenants left four years ago, a succession of landlords, tenants and city authorities had managed to reduce the once-graceful red-brick structure in Columbia Heights to an uninhabitable mess.

It is a story all too familiar in the District of Columbia, where thousands of poor residents live in substandard or overcrowded housing while an estimated 4,000 to 5,000 empty units are in boarded-up buildings.

But Naomi Scott, the former president of the Warner tenant association, and others say they believe the Warner's downward spiral of disaster may have been halted. The three-story building at 2622 13th St. NW has been rehabilitated by a private developer with financial help from the District and federal governments and two local lenders. All of the Warner's 44 units will go to low-income residents, who will receive federal rental assistance.

"My heart is full at coming back. I'm overjoyed," Scott said last week at an opening ceremony in which she received the building's key from Mayor Marion Barry. She will move into the first-floor apartment she lived in for 12 years.

Developer Joseph G. Kisha said he met Scott when he went to look over the apartment building, believing he could convert it to condominiums. But he said he was "touched" by Scott and her ties to the neighborhood where she had lived for many years. Kisha said he and his business partner, Thomas D. Warner, decided "we could do something good and still make money" by rehabilitating the building but reserving it for low- and moderate-income residents.

That was in mid-1984 and Kisha had hoped to have the work completed by Christmas three years ago, but "we didn't know how risky {the project} was going to be until we got into it." City financial assistance in acquiring the land was a major factor in finally getting the project completed, he said.

The Warner is the first completed project among 12 being rehabilitated in a $15 million plan to reclaim vacant, privately owned, disintegrating apartment buildings and turn them into housing for low-income District residents. The city began accepting proposals from developers in early 1986 and all of the money has been committed to the various projects, according to William Hobbs, acting administrator of the Housing and Community Development Department's neighborhood improvement administration.

Private developers and D.C. housing officials said the program is one of the most successful efforts of its kind, in large part because the city pays for the land, often the most expensive element in the reclamation process. Another powerful incentive for developers is that their renovated buildings are exempt from rent control as long as at least 20 percent of the units are rented to low- and moderate-income tenants. Many developers argue that rent control regulations keep the income from a building low and unprofitable.

Developer Thomas P. Gallagher, who is rehabilitating a Southwest D.C. apartment complex using the land acquisition program, said city government representatives tried to interest his firm in the project several years ago, "but we didn't see a way to resolve the rent control problem."

After the city buys the land, it leases the property back to developers for 50 years at monthly rates equal to about one-third of the cost of a 30-year loan at 11 percent interest, and does not charge the owner property taxes, according to Hobbs. The city also pays for site improvements. Developers must purchase the buildings on the property, but the city helps them get low-cost loans from private banks and the federal government.

Although owners of at least three projects plan to hold all of their units for low- and moderate-income tenants, most will reserve the minimum 20 percent for poor residents. In return, they are free to rent the remainder of the apartments at market rates.

Another aspect of the program is that owners may buy the land from the city at any time during the 50-year lease period. A formula in the lease agreement provides for some price discount if land values are higher than when the lease was signed, but the sale price can never be lower than the amount the city paid for the land originally, Hobbs said.

He said "it is certainly the District's intent" that some of the units remain available to low-income residents, even after the developer buys the land under his project.

Rental assistance for tenants is provided through the city or federal governments, depending on the circumstances of the project, while federal rental rehabilitation loans and low-income tax credits are available to developers in most cases.

Developer Kisha said he believes that not enough attention has been directed at the time when the initial rent subsidies expire. He said he and his partner plan to own the building until 15 years from now, when the low-income assistance runs out, "and I don't know what happens then," he said.

Without the low-income tax credits and rent subsidies being used at the Warner, the company would not be able to afford to keep rents low enough for low-income residents, he said.

Hobbs said landlords must continue renting 20 percent of their apartments to low-income residents as long as the city owns the land. When city and federal rental assistance expires, in most cases within five years, it is likely to be renewed or some other kind of aid provided, he said.

Supporters of the housing rehabilitation program said they hope the city administration will find money for more projects. Charlene Drew Jarvis, head of the City Council's housing and economic development committee, called the program "very, very effective" and said she planned to push for additional funds to keep it alive.

Jarvis said another factor in the success of the land purchase plan is "a new willingness" by banks to make loans for low-income projects. Recent legislation requires banks to make loans in "underserved" areas of the District.

Robert Pohlman, acting director of the D.C. Department of Housing and Community Development, said, "We hope that we have demonstrated the success of this program and can get more money" from the city budget. "We're also looking for other sources of funds ... such as Community Development Block Grant money and other housing programs."

Housing officials said they were surprised at the enthusiastic response from developers. "One reason for this success is that all the parties involved really believed the city was serious this time," said Duryea Smith, manager of the land acquisition plan.

In addition to the Warner, apartment complexes being rehabilitated include the Park Naylor Apartments at 2562 Naylor Rd. SE, the Roosevelt Apartments at 2101 16th St. NW, the Plaza West Cooperative at 1669 Columbia Rd. NW, Hawaii Gardens on Fort Totten Place NE, Mt. Vernon Plaza at 10th and M streets NW and buildings at 500-504 3d St. NW, 4th and T streets NE, 5th & I streets NW and 1340 Howard Rd. SE.

Two others, Jeffrey Gardens at 4201 7th St. SE and Oak Park Apartments at 130 Irvington St. SW are large complexes that have been virtually empty at several points during their existence.

"We've been trying to get something done with them for years," Pohlman said. Together, the two complexes contain nearly 700 units.

Jeffrey Gardens tenants "have really suffered because of the neglect by previous owners and the poor maintenance," Smith said.

Nearly two-thirds of the apartments have been vacant for several years, and crime and drug problems were pervasive, he said.

The city paid $682,500 for the land and will spend more than $1.7 million for site improvement and landscaping, including transplanting mature trees and shrubs onto the grounds.

Development plans also call for construction of a swimming pool and a gate house where a guard will be able to announce visitors through a buzzer system, Smith said.

Last week, tenants began moving into newly renovated units at Oak Park, the second project to have some apartments ready for residents.

Work is still in progress on many structures in the 407-unit, 60-building complex atop a hill in Southwest Washington near the Prince George's County line.

More than 300 Oak Park apartments have been empty for about 10 years, Smith said.

Market rate rents at Oak Park will be $500 for a one-bedroom apartment, $600 for a two-bedroom unit and $800 for a three-bedroom unit, said Gallagher, the developer. Utilities are not included.

Gallagher said he is confident that he can draw about 40 percent of his market-rate tenants from workers at the nearby D.C. police and fire academies and St. Elizabeth's Hospital.

Trinity Landholding, a nonprofit organization formed by the Trinity Lutheran Church, will restore an apartment building it owns at 500-504 3rd St. NW.

The church will get $200,000 of the $1.5 million the John Akridge Co. gave the city for low-income housing in return for permission to build a larger office building downtown than the zoning for the site would normally allow.

Another nonprofit group, So Others Might Eat, plans to convert a 68-year-old structure at 4th and T streets NE into 88 units for single adults. Many of the single adults have been displaced by downtown redevelopment, and now live in overcrowded quarters or temporary residences, according to Richard Gerlach, SOME's program manager. The units will be available principally to elderly people, working adults, and disabled, independent adults.