Daily News from New York, New York • 190

Armory holds the line against building plan By RANDY SMITH Brigade commander, 42d Division, New York Army National Guard, which is based at the armory. But builder Jerry Speyer, managing partner of Tishman-Speyer Properties, who proposed the plan last November in a letter to Morgado, offering "a substantial, eight-figure price" for the site, said yesterday: "We regret the decision." THE IDEA, STATE sources said, would have been to offer developers the chance to bid for the right to raze the cavernous drill shed, which covers three fourths of the block and extends all the way to Lexington Ave. In its place they could have built a hotel or apartment tower behind the more distinctive Park. Ave. fortress, much as the Helmsley Palace Hotel stands behind the landmark Villard Houses on Madison Ave.

Morgado attributed the no-go decision to the fact that the UDC is busy with construction of the West Side Convention Center and Battery Park City, and to a "lack of clarity as to ownership" of the site, especially "who is entitled to the air rights." Although the city owns the entire block of land, the 100-year-old building technically is owned by senior officers of the regiment, who are appointed by the state. And although the city in 1975 declared the armory a landmark, complicating any development plans, some state officials had questioned the city's legal right to restrict the use of state property. The State Urban Development Corp. "has finished studying it. It's dead," said spokesman Michele de Milly, adding that Carey and Mayor Koch concurred in the decision.

NEITHER OF THE two city officials studying the proposal, General Services Commissioner James Capalino and Planning Commissioner Herb Sturz, could be reached for comment Koch assigned them to the project at Morgado's request "I don't believe they're calling it off until I see it in writing," said crusty, retired Air Force Col. Benjamin Fowler, chairman of the Save the Armory Committee. "We're going ahead with our meeting." "That's wonderful," said a more trusting Col. Bernard G. Ehrlich, 2d Top aides to Cov.

Carey have done an about face and called off a controversial city state study of proposals for a hotel or high-rise apartments on the back end of the landmark Seventh Regiment Armory. Carey's secretary, Robert Morgado, said the decision was "not particularly" prompted by organized opponents of the plan, who had enlisted the support of Jacqueline Kennedy Onassis and Mrs. Douglas MacArthur. Yesterday's announcement came on the eve of a meeting of the Save the Seventh Regiment Armory Committee, scheduled for 7:30 p.m. tonight in the armory, whose front tower faces Park Ave.

from 66th to 67th St. A new search in Atlanta-boy missing after school Save 46 Both cases were being handled by the missing persons department and had not been handed over to the special task force handling the slayings or disappearances of 21 other black children. Nineteen of those on the task force's list have been found dead nine by strangulation. Two others are still missing Darron Glass, 10, and Curtis Walker, who vanished less than two weeks ago. The Atlanta Constitution reported Wednesday the FBI had turned over to local police a psychological profile of the child killer.

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