Kyle and Sharon Krause have bought the Arlington and Hallett buildings at 1301 Locust St., continuing their efforts to leave their mark on properties that look out on the John and Mary Pappajohn Sculpture Park.


The buildings, once destined for demolition until a handful of city leaders supported renovation efforts of former owners Jodi Beavers and Leslie Gearhart, were purchased for $3.26 million.


To date, the Krauses have purchased two buildings in the 1400 block on Locust Street, a parking lot between the buildings, and a former radiator repair shop south of those buildings on Walnut Street.


Those buildings are undergoing historic renovations, with spaces intended for restaurants, shops and other commercial uses.


"Sharon and I are strong supporters of the growth and revitalization of downtown Des Moines. We share a passion for art, and we hope that the tenants and residents of these properties will continue to enjoy the Pappajohn Sculpture Park and Western Gateway Park area as much as we do," Kyle Krause said in an email.


The Arlington and Hallett buildings are not in need of immediate repairs, said Todd Millang of CBRE|Hubbell Commercial. He represented the Krauses in the deal.


Millang said the properties have reasonable cash flows from residential and commercial tenants, including Proof restaurant, a coffeehouse and a law firm that are located on the first floor of the Arlington building.


However, returning a big profit isn't high in Kyle Krause's mind.


"He isn't looking for the returns that someone else is," Millang said.


"Kyle has the longer-term mentality with that stuff around the sculpture park," he said, noting that the Krauses are primarily focused on making sure that the "sculpture park is surrounded by the right kind of investment."


For example, It is unlikely that an out-of-state fast-food restaurant will be invited into the buildings.


The Krauses spent about $1.9 million on the properties on Locust and Walnut streets, where they plan about $6 million in renovations on a project that will be called Locust Plaza. With their purchase of the Arlington and Hallett buildings, their investment now stands at slightly more than $5 million.


One problem the couple face in acquiring downtown properties is that when word gets out they are interested, "prices get silly real fast," Millang said.


The city of Des Moines had a right of first refusal on the Arlington and Hallett properties because of financial support it gave to Beavers and Gearhart when they bought the buildings in 2000 from the former Des Moines Development Corp. The City Council recently voted to waive that right. The city also will not receive about $540,000 that was part of a recapture agreement at the time of the properties were transferred to Beavers and Gearhart.


By the city's calculations, the sale to the Krauses fell about $200,000 short of meeting the threshold that would have kicked in the recapture agreement.


The buildings were obtained by Des Moines Development Corp. as it purchased properties and razed buildings in preparing for the Western Gateway renovation project. Business leaders Bill Knapp and Jim Cownie intervened on behalf of Beavers and Gearhart, allowing their deal to go through and preventing the demolition of the buildings.