The Orioles' principal owner, Jerold C. Hoffberger, yesterday told a group of Baltimore businessmen trying to buy the club that he would withdraw his $4 million loan offer if the group included out-of-town investors.

The group has been discussing the possibility of sharing the franchise with Washington if potential investors here will put up half the $12 million asking price.

Hoffberger's announcement followed one by Baltimore Mayor William D. Schaefer, who said the city's commitment to cover the club operating losses of up to $500,000 this year has been canceled.

Schaefer said the money will be used instead to balance the city's budget. The mayor said his decision was affected by the general lack of support for the local ownership concept, lukewarm fan support for the club and the state legislature's failure to provide financial support to help new owners cover operating losses for the next five years.

"There is no question this will hurt us economically," said Bernard Manekin, a vice chairman of the Baltimore group. "It has somewhat of a negative effect on potential investors. But the action is not fatal and has not deterred the group from going forward to seek other (Baltimore) investors."

Manekin did not want to speculate on what role, if any, Washingtonians might play in a joint-purchase, team-sharing venture.

"What might happen down the road is anybody's guess," he said.

Schaefer told reporters yesterday that a group of Washingtonians interested in sharing the franchise no longer was involved. He apparently was referring to the decision by Joseph B. Danzansky, board chairman of Giant Food, to not participate.

While Danzansky is not involved, it is known that other Washingtonians still are interested in equitably splitting Oriole home games between the two cities.

"The situation is too sensitive to discuss now and I don't want to get into names," a source said.

Other Washingtonians who reportedly have been contacted include Robert I. Schattner, a pharmaceutical industry figure, and Theodore N. Lerner, a real estate developer who has built a number of shopping malls. Both have been active in past attempts to return to baseball to Washington. Neither was available for comment again yesterday.

The Baltimore group has been trying to raise $8 million. Hoffberger had offered to lend them $4 million at a low interest rate, but wants to maintain control of the club until the loan is repaid. That condition has turned away some potential investors.

Hoffberger's withdrawal of the loan severely handicap the group unless substantial new revenue surfaces. Baltimre resources have been tapped.

Explaining his decision, Hoffberger said, "I don't feel like I want to subsidize somebody who is outside of Baltimore or Maryland. I wouldn't want to subsidize anybody from New York, Philadelphia or Washington . . . This sure as hell is not an economic loan."

Asked if he planned to reverse his previous stance against refusing to sell to people who may want to move or share the franchise, Hoffberger said, "I wouldn't have anything to do with it. I'd be out of it. It would be somebody else's decision."

Hoffberger said he has not decided whether to renew the club's lease with Memorial Stadium. If no notification is received by stadium authorities by June 30, the lease is automatically extended for two years.

"One minute I feel one way and the other minute I feel the other way," Hoffberger said. "There are 1,440 minutes in a day so I really have lots of minutes to think about it."

He said he did not intend to lend the group more than $4 million and indicated he was still waiting for action from the local group:

"I've lived so long with my patience," he said. "I guess I can live a little longer with it."