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In pre-Cataclysmic times, the Knights of Solamnia first constructed the fortress of Despair as a foothold into the ogre realm of Blöde. However when the Cataclysm struck and the New Sea flooded the area, Despair found itself cut off from the rest of Solamnia. Refugees fleeing the devastation of the Cataclysm overran the walls of Despair and the waters of the New Sea also collapsed part of Despair, killing many of its residents. The ogres of Blöde later came and conquered the fortress under the leadership of the ogre-mage Elrauth Seerheart, who also directed his troops to rebuild the fortress of Despair and then construct a settlement around the keep, which blossomed into a prosperous port town.

Despair became home to ogres, as well as pirates, smugglers and any other undesirable who chooses to call it home. The ruler of Despair lives within the ancient fortress that lies in the centre of the town, and pays fealty to the king of Blöten. For centuries the port town lay west of the Khalkist Mountains in the far northwest of the Blöde region. However with the coming of the dragon Onysablet during the Age of Mortals, Despair now lies on the northern fringes of the dragon's swamp, which has consumed the western reaches of Blöde.

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