Two Harbors residents renew 20-year fight to block development on Lighthouse Point

TWO HARBORS, Minn. — Twenty years after a Twin Cities businessman purchased Lighthouse Point with contentious ideas to turn parkland into townhouses, a new plan for this undeveloped land has some residents in a familiar battle — one they thought was over.

Developers have proposed building 24 townhouses and one commercial building on 5 acres of what was formerly railroad property — a thrust of land between Agate Bay — site of the ore docks — and its larger neighbor, Burlington Bay.

During a meeting last week in council chambers, about a dozen residents asked city councilors to reject the plans, for reasons ranging from the way it will affect the green space to whether the structures violate an old agreement between the city and original developer Sam Cave.

Resident Luann Udenberg said that 20 years ago, she learned something new about her hometown.

"I didn't know it was possible to come to this city and buy a harbor," said resident Luann Udenberg, who described Lighthouse Point to city councilors as a place to connect with nature.

The proposed homes — square, modern structures with large windows facing Lake Superior — would be expected to sell for about $700,000, in a city where the median home price in 2022 was $238,000 according to the Lake Superior Area Realtors.

And the project is near a piece of the city's history: the Two Harbors Lighthouse, which has remained largely unchanged since it was built in 1892. It is in the care of the Lake County Historical Society and continues to host tours and bed-and-breakfast guests in its keepers' quarters and neighboring skiff house.

Ellen Lynch, executive director of the Historical Society, did not comment directly on the proposed development, but wrote about her concerns of obstructed sightlines and the integrity of this famed structure in a letter to the City Council in January.

"Not only are we concerned about the historic viewshed," she wrote, "but also potential damage from blasting close to this historic landmark, a true treasure of the community."

Point's past

In 2002, Cave bought Lighthouse Point, in addition to Pork City Hill west of Burlington Bay, from the Duluth, Missabe and Iron Range Railroad for $1.4 million. It was the beginning of a tug-of-war between the Roseville-based real estate developer and residents of this small city on the North Shore who were determined to keep the waterfront land as the natural retreat they had always known it to be.

Cave's intentions for Lighthouse Point shifted a few times, according to news reports. He offered to sell it to the city, then seemingly changed his mind. He had plans first for townhouses, then for a grand hotel. But Cave struggled to clear these ideas and his rezoning needs with the City Council. Along the way, he sold of parts of Lighthouse Point to the city and the Department of Natural Resources.

But he remained unable to build what he wanted to build.

In 2006, Cave and city officials went into negotiations to address his zoning frustrations and the several lawsuits he had filed against Two Harbors. Then-Mayor Randy Bolen recently recalled a 13-hour marathon session that ended with a deal: Cave got a 25-year tax-increment financing agreement for various properties he owned in Two Harbors and retained a bit of land on Lighthouse Point that was rezoned from parks and recreation to mixed-use waterfront. That would allow him to build a small hotel or townhouses — with very specific regulations on how many could be built and how high the structures could sit.

The city, in turn, got more land.

"Essentially, the city got the majority of Lighthouse Point," Bolen said. "My understanding is that the agreement in place was concrete and stood by for many, many years."

That wasn't the end of the Cave story, though. He didn't build. And when he didn't show the city development plans in 2011, he was court-ordered to give up the deeds to two more pieces of land. In 2013, the small acreage he retained was passed along to Acre Development, the company of his operations manager Craig Ankrum, according to news reports.

New plans

Ted Stocke of Stocke Construction, who was hired by Ankrum, has created a preliminary plan for Lighthouse Point — with townhouses either one or three stories tall. There are low sloped roofs, with large overhangs over private patios and decks, cement board siding and wood accents in soffits and walls.

Stocke's style can be seen on Duluth's London Road, where he has built similar homes as part of the London East project.

"Some people hate them or some people love them — they're not boring," said Stocke, who said he is tired of cookie-cutter homes.

Stokke said he has already invested a lot of resources into the Lighthouse Point Project and imagines the homes will be built. He has taken suggestions from residents, including the removal of a roof deck to lower the height of some of the homes.

Ankrum did not respond to messages.

For years, there had been little movement on this piece of land. Talk of revisiting the development started up again within the past year, a period when some residents had worked successfully on efforts to recall former Mayor Chris Swanson. Now many members of the Resign or Recall group were back in council chambers with this old cause newly refreshed: Whether developers would be able to build on this bit of acreage, and what they would be allowed to build.

"A lot of people invested a lot of time into the Lighthouse Point situation years ago and thought we had come up with a palatable compromise and, well, I guess not," said resident Todd Ronning.

At last week's public meeting, residents questioned the idea of building expensive homes in a city with a housing shortage, and the effects of development on land that is so close to the Two Harbors Lighthouse. One resident wondered about the fate of the hundreds of birds on this acreage.

"It's not the city's job to help developers make a profit," said resident Judy Olson.

Not everyone is opposed to development, but there are opinions on how it should be done. Ronning went into initial meetings expecting to see plans for a boutique hotel — a small, commercial property of a certain size that would benefit the city. He left with questions about storm drains, preserving the Quarry Trail, and whether the beacon light from the lighthouse will be sweeping past residents' windows.

"It was déjà vu all over again," Ronning said. "Back to 20 years ago to the same things that were rejected 20 years ago."