Colonel Hankinson moved his family to Brightwood Township, Dakota Territory in 1881. He came on a soldier's Homestead and tree claim. He settled on the shores of Taylor's Lake, named after the original owner, Ben Taylor of Wahpeton. It covered 600 acres and had sandy beaches. He later purchased more land until he had 2,500 acres primarily around Taylor's Lake which was now called Lake Hankinson. He renamed the lake in 1892 to Lake Elsie, for his and his second wife Ms. Etta's daughter Elsie Etta Hankinson.
The house was built in 1884 and contained three stories with a nine foot fieldstone basement. It was built in Queen Anne style and contained seven bedrooms, an assortment of dining rooms, parlor, kitchen and pantry. The house had solid oak woodwork and had doorcases and railways ornately carved.
Colonel Hankinson had a dream of building a city on Lake Elsie. He platted the streets and avenues on the lake shore. He built a general store in 1886 and sold merchandise at reasonable prices, saving many settlers trips to Wahpeton for supplies. He also opened a post office, calling it Kelly, and became its first postmaster in 1885. In the same year, the Hankinson Independent School District was also started on the shores of the lake. Later other settlers would come and locate small businesses on the lake. His dream of building a town on Lake Elsie came to an end when the two railroad companies raced each other into the area and laid tracks two miles north of the lake and he then realized that the town would have to be moved to the railroad.
Colonel Hankinson moved his post office and general store to the present townsite. He remained postmaster until 1889 when he ran for the North Dakota Legislature. The school was also moved to the town in 1890 along with other merchants. He named the town Fort Hankinson to commemorate the near battle of the railroads that raced for "Squatter's Rights". The use of the word "Fort", also gave new settlers a sense of security. There were still some businesses that remained on the lake and, according to the old township minutes, the lake area was called the town of Brightwood.
The Hankinson's moved shortly after his death in 1911, but the family returned for several summers. In 1929 though, Colonel Hankinson's and his first wife Ms. Sarah's son Herbert sold their land and home in Hankinson to a friend of the family, Max Wipperman, Sr.