Marjo project now official

TOWER—The sound of construction echoed along the East Two River this week as what may well be the largest single development project in Tower’s history got underway on property just behind the Marjo Motel.
After addressing a permitting hiccup last week, a crew from the local area worked alongside workers from Norway this week as the walls and roofs on the first two homes quickly went up. The walls for the initial three units had arrived in sections last month, all the way from the Tinde Hytter factory in Vinstra, Norway.
The foundations, poured just last week, came out right to spec, which was easing the positioning of the wall segments. Starting Monday, using two cranes to lift the wall segments into place, the workers had the walls up on two of the units by Tuesday morning, when project manager Orlyn Kringstad put together a ribbon cutting to mark the project’s launch. More than 50 people turned out for the event, including project owners Luke Kujawa and Michael Jellish, Tinde CEO Audun Skattebo, Kringstad’s Norwegian business partner Lars Hanstad, along with IRRR Commissioner Ida Rukavina and business development director Matt Sjoberg.
Standing on a makeshift stage of stacked wooden pallets, Kringstad joked that Kujawa and Jellish had finally agreed to buy the Marjo property for a development project just to get him to stop talking about it.
“And yet he’s still talking!” Jellish shot back in response.
Skattebo, in his own comments on Tuesday, credited Kringstad and Hansted with helping him envision a new market for the high-quality cabins that his company builds. He noted that Tinde Hytter was now in its 22nd year of operation and has manufactured over 3,000 cabins of various sizes during that time. In Norway, he said the mountains and the seacoast are the main attraction for vacation homes, while Minnesota’s thousands of lakes provide their own opportunity for growth for his company. “The future and the opportunities are ahead of us,” he said. “We must carry the right vision and the right values with us, then success will come.”
Many of those attending on Tuesday were there to get a first look at the attractive and highly energy-efficient cabins produced by Tinde Hytter and the reaction was overwhelmingly positive.
Watching the market reaction
Skattebo was in Tower all week, keeping a close eye personally on the progress as the units were assembled by local construction workers with help and advice from two of his Norway crew who came along to help with the training. So far, it’s gone smoothly, said Skattebo, even with the required conversion for the U.S.-based contractors to accommodate the use of the metric system in Norway. “They’re getting it, that’s for sure,” he said.
This is Tinde’s first entry into the U.S. market, so a lot is riding on the successful completion and marketability of the units.
“This is all part of the market survey, in my opinion,” said Hanstad, who was in Tower as well this week. Hanstad said he’s encouraged but not surprised by the interest in the “Tinde” cabins. He said he had talked with several different manufacturers in Norway before determining that Skattebo and Tinde had the right combination of expertise, capacity, and personality to be a good fit for both the U.S. market and the U.S.-affiliated company, Tinde-USA, that Hanstad and Kringstad recently launched to begin marketing the Tinde cabins all across the Upper Midwest. You can learn more at their new website, Tinde-usa.com.
Both Skattebo and Hanstad will be watching closely to see what kind of interior fixtures and finishes Minnesotans prefer and if the clean Nordic-style and ultra-high energy efficiency of the units are appealing to customers in America.
The potential for market growth in the U.S. is almost limitless compared to in Norway, which has a nationwide population on par with Minnesota. While the company has sold a few units in Sweden, their market has been mostly limited to Norway— at least until now.
The Tower development, owned and funded by Your Boat Club principals Michael Jellish and Luke Kujawa, is expected to eventually include as many as 49 units spread across a site totaling 23 acres, although those numbers could change as they finalize their site plan. In either case, it’s likely to be the largest single development project in Tower’s history.
The development is located adjacent to the Your Boat Club marina and Jellish and Kujawa anticipate many of the units will be for short-term rental or fractional ownership for club members when they’re visiting the Lake Vermilion area. The marina, located on the East Two River, provides direct water access to Lake Vermilion.
The next three units are expected to arrive yet this year and should be erected before the snow flies. The remaining units should start arriving next spring, assuming the developers can complete the necessary documents for the planned unit development.
Potential for new factory in Tower
Assuming the Tinde cabins find an interested market here in the U.S., the shift of manufacturing to Tower could happen relatively quickly. Skattebo toured a facility this week that could provide space for three production lines initially, which could produce about 100 units per year.
Manufacturing the cabins in the U.S. could substantially lower the price point of the units, given that shipping costs and the time delays involved were problematic for the first three units. Labor and material costs are also generally lower in the U.S. than in Norway, which could also help keep the unit prices at an attractive level.