Familiar Places, Fresh Faces … New Owners at Favorite Spaces

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When taking a spin around the Lake to check in with longtime businesses that have changed ownership this past year or so, a common thread emerges: The more things change, the more they stay the same. Rather than a large Company XYZ taking over and resting on reputational laurels from decades of the past owners’ work, the trend is toward individual generational ownership, either within families or among younger people. And they all seem keen on holding onto traditions, while keeping an eye on how to keep customers coming back for more.

Let’s take a little Circle Tour of just a few established places now under new ownership.

Wisconsin

Blue Wave Inn – It took a year or so for things to shake out, but Katie Gellatly now thinks the Blue Wave Inn with its restaurant and retail space in Ashland is finally realizing its original vision.

“We’re back to an awesome Lake experience,” Katie says. She and her husband, Dave, took over the entire operation of Blue Wave this year.

Jim and Beth Hagstrom donated the complex to Northland College in 2016, something it was willing to take on to continue a “vision of a space where the public can eat, sleep, recreate, meet and just sit and enjoy Lake Superior.”

The Gellatlys continued to operate Solstice Outdoors while the inn and restaurant went to a more boutique and farm-to-table route. Today, Katie says, its back to the basics.

After putting $40,000 into remodeling the restaurant, it was renamed the Sandbar in May and offers what Katie calls “common food done uncommonly well.”

“The restaurant business isn’t easy,” she says, and a move back to more approachable menu items was their choice to encourage repeat customers.

“People had good experiences here,” Katie says. She’s confident that positive connection with Blue Wave will continue.

It makes sense that a one-stop place with multiple ways to enjoy the Lake fall under one management team, she adds.

The origin of the distinct building came when Jim Hagstrom, a molecular biologist and inventor, wanted to add vibrancy to his oft-revisited hometown. In 2012, Jim and Beth purchased a property at Maslowski Beach and, with their son, Brian, as architect, created the nautical looking complex then known as Blue Wave on the Bay.

It opened in 2015 with Beth managing the three enterprises before turning them over in late 2016. The multi-use building has hotel rooms, a restaurant and coffee shop. A commercial retail space is leased to Solstice Outdoors, the Gellatlys’ recreation business where you can launch rented kayaks and stand-up paddleboards right outside the door.

The Copper Trout – Mike and Kerry Ernster bought Ethel’s at 250 in Bayfield, which already had a loyal following, and they have recreated it with a new name and an emphasis on Lake Superior-inspired dishes. Like Ethel’s, though, the Copper Trout will keep to a seasonal opening, essentially in summer on Tuesdays through Sunday. From the locally brewed tap beers to the caught-today fish options, The Copper Trout stays focused on the south shore.

“Every morning, we pick up lake trout and lake whitefish from local fishermen to serve as fresh as possible,” touts the website. “We serve desserts and salads that showcase the beautiful Bayfield berries as they cycle in and out of season over the course of the summer. Our desserts and ice cream are made by talented local bakers, dairy farmers and pastry chefs from Washburn and Bayfield.”

Michigan

Keweenaw Mountain Lodge – When John Mueller walks the grounds of the Keweenaw Mountain Lodge, he is shaken to the core by its historic heft. He soon realized that he bought much more than an old publicly-held resort this past summer.

“It all became a lot more emotional,” he says.

John bid on the lodge in July and lost out. But the top bidder had second thoughts and asked for a buyout from him. The Texas native took it for $1.3 million.

John believes in the potential of Copper Country becoming a tourism mecca. His son is attending Michigan Technological University in Houghton, and John and his wife have expanded a gelato food truck business into the area. They plan to create a store in Calumet – what John calls a “cool little town” – for a permanent presence for the business.

He had only been at the helm of the lodge for three weeks this fall when asked about any future plans. He said he was thankful the staff stayed on for the season and were sharing their institutional knowledge. The property will close this winter, but John will assess the viability of the lodge being open year-round.

“It’s all about marrying the history with the future,” he said. He said the structure is in good architectural shape, with only a few areas that need shoring up. He wants the Keweenaw Mountain Lodge to play a larger role in supporting ecotourism in the region, a key to increasing overall visitors, he said.

The lodge had been a burden on Keweenaw County in recent years as debts piled up for the main building, its cabins and golf course. The county tried to sell the property in 2017, but a series of deals fell through.

Keweenaw Mountain Lodge was forged out of the Great Depression and the departure of the mining industry in the early 1930s. The county had one of the highest unemployment rates in the nation at 75 percent.

Federal road programs brought work to the area and also an idea. A copper company donated 167 acres to the county in 1933 on the promise it would build a golf course and keep it open for the public to use. Construction on the nine-hole course, clubhouse, lodge and cabins soon began. The property remained in public hands until Mueller took over in September. It is listed on the National Register of Historic Places.

The county began collecting debt when it tried to make the lodge a year-round enterprise by winterizing buildings and constructing a conference center off the main lodge. By its own admission, and outlined in a county-backed study of the property, the cost of the renovations and heating bills in the winter quickly outgrew any profits. The recommendation in 2016 was to find a company to manage the property while keeping it in county hands. Last year, one such company backed out, saying the remodeling restrictions that come with the state and national “historic” designation would limit its ability to turn a profit.

These are all considerations for John as he tries to turn the profitability corner at the lodge. At one point, the county was losing more than $200,000 a year. John said the latest figures show the lodge “cash flow neutral.”

He said the recent history of the lodge can’t overshadow the 80 years of memories at the property. He feels that on his walks, and he feels that as he gets to know more people.

“I believe in this area.”

Ontario

Lake Shore Salzburger Hof Resort – When Ralph and Ann Elsigan found their dream resort in 1972, they wanted to put a stamp on it that spoke to their home country of Austria. There was a lot of work ahead of them in forging the hodgepodge Superior Wonderland property into today’s Salzburger Hof on Batchawana Bay in Ontario.

“It was important to her to maintain that Austrian feel,” daughter Karen Elsigan-Van Der Swan said recently. That meant flowers, plenty of geraniums, throughout the resort, including flower boxes in the windows. It’s those flowers that Karen looks at today to remind her of her mother. Ann Elsigan died this past spring shortly after being diagnosed with cancer.

The guests that keep coming to Salzburger Hof are also a salve to the four daughters who have never stopped helping run the resort. “They all want to talk about her. Every day,” Karen says. “That is important.”

There’s something from each of Karen’s parents in every inch of the resort, she says. The daughters – Karen, Sylvia, Doris and Robin – “were treated like laborers” in keeping the resort in shape, which they did so willingly and will continue to do so, Karen says. Their husbands and Elsigan grandchildren are now in on the act, too.

“We’re continuing as in the past. We have the same chef, the same staff out front,” Karen says. “We intend to be here and stay here.”

Salzburger Hof has been awarded “best restaurant” by this magazine and other publications multiple times for its take on Austrian and German fare. The resort consists of a motel, studios, chalets and two dining sites.

Ralph and Ann Elsigan immigrated to Canada from Salzburg, Austria, in the late 1950s. They sold minnows and worms to tourists out of Sault Ste. Marie to make a down payment on their first resort and air service in 1960. After 12 years, they found the 1960s-era resort on Batchawana Bay. Ralph, who also chartered fishing expeditions, died in 1994. Taking over the resort along with Karen are sister Sylvia Elsigan-Tempesta and her brother-in-law Armando “Army” Tempesta.

Minnesota

By far the most turnover of established places has been on the Minnesota shore, including some iconic lodges.

Lou’s Fish House – She is likely the youngest manager of any business around the Lake. But this isn’t forced child labor. Ashleigh Swanson, now 17, convinced her parents they shouldn’t just buy the venerated Lou’s Fish House in Two Harbors as an investment property for lease. Aside from the retail smokehouse, attached is a six-room motel. They should run a business out of it, Becky, her mother, recalls her then 16-year-old saying early this year.

Ashleigh and her older sister, Callie, 18, wanted to sell ice cream after a deal to lease the smokehouse portion of the property fell through. Eventually, tradition won out after so many curious passersby dropped in with excitement that Lou’s was open again after sitting empty for four years. And they wanted fish.

“We bought without any idea to open it ourselves,” Becky says. “But Ashleigh wanted to do something.”

Becky says customers assume her daughters are merely helping out at a family business and don’t know that they are actually running the place.

The daughters are learning how to smoke local trout, herring and whitefish. Everything at Lou’s is done in-house. And Becky is working on getting the rooms in order. One was ready for guests this fall.

Wisconsin native Lou Sjoberg grew up in Duluth and was known as a man with many hats. He served in the Navy during World War II and then had stints as a professional wrestler and welder. He could also smoke some tasty fish. He operated Duluth Fresh Fish on London Road for several years beginning in 1975, then later opened Lou’s Fish-n-Cheese House up the shore in French River. He moved to Two Harbors with his wife, JoAnn, in 1981 and opened another Lou’s Fish-n-Cheese House in 1985. When Lou died in 2003, JoAnn took over until selling in 2006, but the new owner closed the business in 2014.

Lou’s has been mentioned in national magazines for its quality of fish since Lou began it, and the Swansons hope to carry on the culinary tradition. Business has been good and steady, Becky says. “People tell us they’re glad we’re open again.”

Lutsen Resort – Farther up the Minnesota shore, the granddaddy of the state’s resorts, Lutsen, was sold this past summer with a multi-million price tag. The high numbers brought fears from resort fans of corporate takeovers and a loss of the personal feel that mom-and-pop ownership brings. But Lutsen, like other resorts in the region, remains in the hands of individuals. A mother-son business from Canada, North Shore Resort Company, took ownership at Lutsen from Nancy Burns and Scott Harrison on August 15. Bryce and Sheila Campbell are from Reston, Manitoba, west of Winnipeg, and part of their portfolio is the Copper River Inn in Fort Frances, Ontario.

The Campbells have operated a handful of hotels in Canada since 2002 under the Campbell Hospitality Group name. This is their first foray into the full-service resort world. They are known for taking on downtrodden properties and sprucing them up with a boutique style.

Bryce told his hometown newspaper, the Reston Recorder, there wouldn’t be any major immediate changes at Lutsen, saying, “We’re going to make the lodge a luxury boutique lodge in years to come and build a Nordic spa up there to tie into the Scandinavian theme of the resort.”

The reputation of Lutsen is what sold Bryce on the property, he told the Duluth News Tribune in September. “We’ll, of course, tie into the historic feel of it because that’s one of the things we loved about it, that it’s historic. But we will try and update the guest rooms, keeping that history in mind.”

Lutsen is 133 years old and has had just two ownership teams since the original homesteading Nelson family began taking visitors 133 years ago. Burns and Harrison owned Lutsen for 30 years.

The property has room for 700 people in its historic main lodge, cabins, condos and townhomes. The Nelsons started the ski resort inland from Lutsen and sold it off in 1980.

“I’ve always admired historic lodges,” Bryce says on the lodge’s blog about purchasing the property, “so I’m proud to be able to carry on with Lutsen’s legacy.”

Cascade Lodge – Up the road, Thom and Jelena McAleer of Alaska are making a go of Cascade Lodge after signing a $2.25 million contract for deed in June 2017 with Michael and Maureen O’Phelan, who had owned the historic inn and restaurant since 2004.

The McAleers have a long history in the hospitality business and had been looking for the right property to match their skills and provide a suitable atmosphere for raising their young children.

“We were searching for an iconic location with perennial demand,” Thom told our sister publication BusinessNorth last summer. “Our plans honor the history and 90-year tradition of this property. That means making sure guests feel welcome from the minute they arrive.”

The couple plans room makeovers, streamlining the restaurant service and expanding the menu at the Cascade Lodge Restaurant & Pub.

Cascade Lodge opened in 1927 under Edward Ogilvie. Like many resorts of that time, it served visitors coming by boat as well as those traveling on the then new highway from Duluth to Canada.

The move brings the couple closer to Thom’s family roots in Iowa. Jelena is from Croatia.

“It didn’t take much time to learn that northern Minnesota offered everything we sought,” Jelena writes on the Cascade website. “A great tourism business and an outdoor lifestyle suited to our family needs.”

Gunflint Lodge – On the Gunflint Trail outside Grand Marais, the Gunflint Lodge is legendary, in part because the former owners – the Kerfoot family – are legendary. Justine Kerfoot was the subject of books and admiration. Justine bought the lodge with her mom, Mae Spunner.

Given the long family ties, it was a big move in 2016 when the third generation of Kerfoot owners, Bruce and Sue, sold the lodge, outfitter operation and zipline to John and Mindy Fredrickson. Both the business of hospitality and a community where everyone knows their neighbors are new to the Fredericksons, who had corporate jobs in large cities, John in telecommunications and Mindy in human resources for Delta Airlines.

After two full seasons as resort owners, John and Mindy have adjusted. John counts as a big life-change advantage “the area where we live – the beautiful area bordering the boundary waters to one side and Lake Superior on the other. There’s nothing like it.” Plus, he adds, “the Gunflint Trail and the community have been so welcoming.”

Dockside Fish Market – The North House Folk School in Grand Marais doubled its campus earlier this year by purchasing Dockside Fish Market. It’s now leasing that business to two longtime suppliers for the market, Stephen and Ellen Frank, owners of two Morey’s Seafood Market businesses in the Brainerd area.

The longtime owners, Harley and Shele Tofte, are retiring from the fish business after building a solid reputation (the Dockside’s fish & chips won Best Local Fish Dish from Lake Superior Magazine’s readers.) The Toftes come from a long history of commercial anglers on Lake Superior. They opened Dockside in 1998.

The new owners, too, have a long reputation of great fish products with Morey’s, which has excellent smoked fish. The Franks have family ties to the area and have often worked with the Toftes, trading products.

Since they liked what the Toftes built up in Grand Marais, they will keep things the same at the market, though Steve told the Cook County News Herald they will add seafood and deli from their Brainerd locations.

More Newbies

Other owners new to established Minnesota hospitality businesses:

Rockwood Lodge, Gunflint Trail, owners Carl Madsen and Stephanie Lightner and Brian and Carol Seim

Poplar Haus, Gunflint Trail, owners Brian Gerrard, Lynse McDonough, Kippy Kuboy and Stacey Palmer

Skyport Lodge, Grand Marais, owners Cory and Rachelle Christiansen

Wunderbar Glampground & Eatery, Grand Marais, owners Teri Davis-Downing and Chris Downing

Tuscarora Lodge & Canoe Outfitters, Gunflint Trail, owners Andy McDonnell and Ada Igo

Cliff Dweller on Lake Superior, Tofte,­ owners Todd and Michele Katzenberger

Outpost Motel, Grand Marais, owners Holly Johnson and Todd Zins

Duluth freelance writer and editor Mike Creger is a regular contributor to Lake Superior Magazine.