In July and August of 1901, the Chicago, Milwaukee, and St. Paul Railway created their right-of-way with the purchase of a 100 foot wide strip of land that ran through the Trondhjem settlement and was therefore also a few miles south of Veseli. At the end of 1901, landowner Thomas Wilby entered into an agreement with the Milwaukee Land Company to develop 40 acres of his property. But the contract stipulated that he must first convey land to the Chicago, Milwaukee, and St. Paul Railway that was necessary to build a train depot. The Milwaukee Land Company would then survey and plot the remaining acres of Wilby's land in order to establish a village. By January of 1902, a total of 80 acres had been plotted as a new town site. On July 16, 1902 a grand opening of the town of Lonsdale was held as lots were auctioned for sale. Businessman Martin Benzik purchased several of these lots, and constructed the first buildings in Lonsdale: a saloon, a hotel and a livery stable.