Montevideo firm adding second factory to build ice-fishing castles

It's a pretty good catch for American Surplus and Manufacturing.

The Montevideo-based company recently got a $107,500 loan from the state of Minnesota that will allow it to increase production of its ice castles, luxury ice fishing houses decked out with bunk beds, kitchens, even satellite dishes to watch TV. The houses will be manufactured in tiny Pine River, Minn., and allow the company to expand beyond its current factory in Montevideo.

"It will be hectic for a while, but it should be fun," said company founder Jeff Drexler, who closed on the $205,000 property in Pine River, population 929, late last month.

American Surplus plans to hire 20 workers for its new Pine River plant, which will be inside a former Chrysler dealership that has 10,000 square feet across three buildings. The plan is for the factory to open this spring, so the company is looking for electricians, carpenters, trim and metal workers and plumbers to build its line of wheeled fishing houses. The company expects to build 10 of the ice castles a week from the new facility. (It currently makes 60 a week in Montevideo.)

American Surplus, which sells its luxury ice shanties to 30 dealers in five states, said the Pine River location will allow it to be more centralized. "We can have a [factory and a] service center there and can take care of our customers better," Drexler said. "If they have a problem, they don't have to [come] all the way to Montevideo" in western Minnesota.

That's welcome news to ice-fishing enthusiasts who love to stay cozy indoors. The houses have built-in holes in the floor that allow ice fishers to drill holes in the ice and catch a big one without ever stepping outdoors.

While dealers say they are thrilled, state officials have their own reasons to be excited about the expansion.

The state's $107,500 loan to American Surplus helped the company buy the Pine River property. The loan was issued as part of the department's Minnesota Investment Fund.

Many of the company's ice fishing houses resemble hitchable RV campers and come with several luxury features.

One model, the King Castle, has an 8-by-24-foot cabin that comes with a furnace, air conditioner, stereo, kitchen, wooden cabinets, bunk beds, bay window and eight fishing holes. Some customized models have featured retractable wheels and hydraulic lifts. Prices start at $5,900, but can top out at more than $40,000.

The business has come a long way since Drexler founded American Surplus in 1993. At the time, he made portable storage sheds, not icehouses. That changed in 1997 when his friend, David Handeland, asked Drexler to customize a storage shed for ice fishing.

American Surplus sold 150 ice-fishing houses in 1997. It sold 2,081 units last year, reaching $23 million in sales. "This year, we are actually looking to sell 2,500 units," Drexler said.

The expansion is smart, said Mike Nussman, president of the American Sportfishing Association, adding that "ice fishing has certainly had some decent growth. In past winters, when we had warm weather, all my ice fishing guys were singing the blues and saying, 'The world will end.' But this year, they are all like, 'Yes! Let's expand.' "

The association found that ice anglers spent about $260 million on ice-fishing houses and gear in 2012, 9 percent more than in 2011. Minnesotans top the list of enthusiasts with an estimated 700,000 residents who ice fish each year. Wisconsin has an estimated 600,000 ice fishers. And those numbers are rising.

"Ice fishing is just hot right now," Nussman said.

Dee DePass • 612-673-7725