BEIJING — My courtyard home in the heart of old Beijing has a view of the Drum Tower, which for centuries helped citizens keep track of the time.

The tower still rolls its drums daily for tourists. But over the past few weeks a different rumbling could be heard in the public square where it stands: the sound of sledgehammers knocking down surrounding buildings.

For years, the government has proposed leveling the zone around the Drum Tower and the neighboring Bell Tower, known in Chinese as Gulou and Zhonglou, respectively. In 2010, local media reported that except for the two towers, the area, a maze of snaking hutong alleyways and ramshackle courtyard homes, would be demolished to make way for a new “Beijing Time Cultural City” and underground mall.

That did not come to pass. But in late 2012, the government posted new notices ordering local businesses and residents to vacate by Feb. 24. My home, which is one hutong down from the square, will be spared, but dozens are slated for destruction. Many residents have already left; those who have stayed are demanding more compensation....