Jemal Real Estate, DivcoWest and JLS form DC office-to-apartment conversion venture

Jemal Real Estate, DivcoWest and JLS Capital have formed a joint venture to convert a 342,000-square-foot office building in Washington's West End into 323 apartments.

Madison Realty Capital provided a $40 million loan to support the acquisition and predevelopment, Commercial Observer reported.

DivcoWest owns the eight-story property at 1255 23rd Street NW and will retain an equity stake alongside Jemal Real Estate. Fillat+ Architecture is designing the conversion.

About 36 of the apartments are designated affordable, and 22,000 square feet of ground-floor retail stays in place. Built in 1982, the building has 257 covered parking spaces and sits a few blocks from the Foggy Bottom-GW University Metro station, between Georgetown, George Washington University and Dupont Circle.

Norman Jemal, a senior managing principal at Douglas Development, launched Jemal Real Estate in late 2025 to target conversions of this kind. "Despite being an office building, 1255 23rd Street NW has the geometry and bones for a stunning residential building," Jemal said in a statement.

Jemal Real Estate has led the adaptive reuse of a Syracuse, N.Y., office and mixed-use property into 57 apartments, and a 20-story office tower in Richmond, Va., into 288 apartments and 210 hotel rooms.

The Jemal family has been buying around the Greater DMV as well. Matthew Jemal's Jemal Equities paid $92 million for a 254,000-square-foot office building in Dupont Circle, its fourth D.C. office purchase in about 14 months.

Madison Realty Capital, which has $5.6 billion in regulatory assets under management, has funded larger deals in recent weeks. It wrote a $127 million take-out on a 502-unit Fort Lauderdale project that was still leasing up, and a $77 million construction loan for a Whole Foods-anchored project outside Dallas.