KNIFE RIVER - Gordy Olson was “absolutely numb” on Sunday afternoon as he surveyed the charred wreckage of his family business, Russ Kendall’s Smokehouse. Monday morning, he was “exhausted” after a day of dealing with a fire that destroyed much of the business early Sunday morning.

The North Shore landmark, which has sold its renowned smoked fish to legions of locals and tourists for decades, was severely damaged by a fire that Olson said started near a water heater in the smokehouse. The production area at the back of the business was gutted; the familiar red storefront and attached bar along Scenic Highway 61 remain standing but suffered significant smoke damage. No one was injured. The store was closed Sunday.

“My whole family has lost their jobs, their way of making a living - my son, my wife, myself,” Olson said. “I don’t know where to start. … I’m in shock.”

Olson said he and his wife, Kristi, were assessing the damage Sunday and still needed to go through insurance paperwork before they could make any decisions about the future of the business. The smokehouse was started by Kristi Olson’s grandfather, W.T. Kendall, and then run for many years by W.T.’s son - and Kristi’s father - Russ Kendall.

Gordy Olson said he certainly hopes the store will resume operation.

“It’s part of our culture, part of our family,” he said.

He said he’s never sought help from the community but “we might need it now.”

Word of the fire was still circulating through the community on Sunday afternoon. Down the road at Lighthouse at Emily’s restaurant, one of the owners, Andrea Darsow - a lifelong resident of the area - said the smokehouse is “an icon. They are Knife River.

“It’s just devastating to this community,” Darsow said of the fire. Russ Kendall’s is a “destination” for visitors, she said, which in turn helps the other businesses in the area.

The Two Harbors Volunteer Fire Department received notice of the fire at about 7:30 a.m. Sunday.

“Upon our arrival, the smokehouse and a structure connecting it to the store were fully engulfed,” Two Harbors Fire Chief Mark Schlangen said. “Flames were coming through the roof, and the fire was starting to extend into the store-bar area.”

Within an hour of their arrival, firefighters from Two Harbors and Clifton had contained the fire, but they remained on the scene for several hours.

Schlangen said the smokehouse and connecting structure were a total loss, but the retail space sustained mainly smoke damage. He had no preliminary financial estimate of the damage. A full investigation into the cause is continuing.

A study of camera footage confirmed what Olson and firefighters suspected after a walk through the damage Sunday night. There was a problem near a water heater and the fire started there, Olson said Monday

Long history

Russ Kendall’s Smokehouse has its origins in the 1920s when, as the legend goes, one of W.T. Kendall’s jobs was to deliver fish from the North Shore to Duluth. One day his truck broke down in Knife River; not wanting the fish to go bad, W.T. started selling them along the road - and the store was born.

His son, Russ, eventually took over the business that now bears his name. The operation also included a dance hall and tavern, before fish - smoked whitefish and herring, sugar-cured salmon and lake trout - took precedence.

Russ’ daughter, Kristi Olson; her husband, Gordy; and their family started working at the smokehouse, and they continued the business after Russ Kendall died in 2007 at age 85.

Already well-known locally and regionally, the smokehouse has drawn wider acclaim in recent years thanks to mentions on TV and online. Twin Cities-based chef and food writer Andrew Zimmern, host of “Bizarre Foods” on the Travel Channel, is a fan and featured Russ Kendall’s on his show. He also included it at No. 1 on his nationwide list of “12 Favorite Bites on the Road.”

And the business was expanding, with recent improvements to the production area.

“We just put in all-new floors and installed an additional freezer … last winter,” Gordy Olson said Sunday; the fire destroyed that section of the building.

Olson lives in Duluth and was informed about the fire by friends on Sunday morning.

After spending a lot of time, effort and money on the building in recent years, Olson said, “We had just gotten to the point where I liked it - and then something like this happens.”

News Tribune reporters Peter Passi and Mike Creger contributed to this report.