Matt Grunow couldn't expand the steakhouse without killing the thing that made it famous. So he walked up the hill and built something else.

Lolo Creek Distillery: The Fire Pit Problem That Built a Distillery

The fire pit was the problem.

Matt Grunow and his father Mike had been running Lolo Creek Steakhouse since 2006, when they bought it from Guy Leibenguth, a family friend who'd built the place in 1987 from 150-year-old trees logged near Lolo Pass. The open wood-fired grill anchored the dining room. It was the centerpiece, the thing that made steaks taste the way they did and the reason Food Network eventually named it among the top steakhouses in the country. Customers waited two hours for a table. The Grunows needed more room. But the moment they opened a wall, regulations would require them to remove the grill.

So Matt looked up the hill.

The log yard sat just above the restaurant, the spot where they'd been cutting wood for the fire pit for years. One afternoon, standing there with an armload of timber and a clear view of Lolo Peak across the Bitterroot, he decided this was the right place for something new. Not a bigger dining room. A distillery.

Lolo Creek Distillery opened in April 2018 on Highway 12 in Lolo, Montana, about ten miles south of Missoula. The centerpiece is a 500-gallon hybrid pot still, built in Boise and shipped over in pieces. It stands more than 16 feet tall. By most accounts it's the largest operating still in Montana, and it's versatile enough to produce vodka, gin, whiskey, rum, and brandy from the same setup. Head Distiller Ryan Arthur runs day-to-day production.

Matt and his wife Kasie are fourth-generation in the liquor business, a detail that shows up in ways you wouldn't expect from a craft distillery that's been open less than a decade. Their grain comes from a relationship the family has held for 20 years with a seventh-generation farmer in Montana's Golden Triangle, the wheat belt north of Great Falls. The Haunted Waters Bourbon, a 4.5-year aged spirit, is loosely based on Matt's great-grandfather's recipe. Their two sons appear on the bottle labels, which is either a branding decision or a dare aimed at the next generation. Probably both.

What Lolo Creek Distillery Actually Pours

The tasting room runs cocktails for $5 to $8. Flights are around $2.50 a pour. That puts it closer to a casual stop than a destination splurge, which matters for a place that depends partly on steakhouse overflow. A golf cart shuttle runs guests up the hill while they wait for a table downstairs.

The Honey Huckleberry Vodka is the bottle most reviewers mention first. One Tripadvisor visitor compared it favorably to Grey Goose, Tito's, and Ketel One, which is a strong claim for a young distillery. The hucked whiskey and the gin fill out a lineup that's broad for a small operation but consistent with what a hybrid still allows.

The space itself leans into where it sits. An outdoor patio faces Lolo Peak. An indoor fireplace carries a longhorn mount named Stanley, borrowed from the neighboring Holt Ranch. Much of the woodwork was done by the same craftsman who built out the steakhouse more than 30 years earlier. The two buildings look like they belong to each other, even though one opened three decades after the first.

The Grunow Family on Highway 12

Matt Grunow didn't always plan on running a restaurant. As a kid, he wanted to be Notre Dame's head football coach. That didn't happen. What did happen was growing up in Lolo, watching the original steakhouse get built after a fire leveled the previous one, Campbell's Steakhouse, and absorbing the rhythms of a family that kept finding its way back to the food and liquor business. He left for a while, worked at Texas Roadhouse in Billings, then came home when Guy Leibenguth put the steakhouse on the market.

"My Dad used to play Santa Claus for their family and they used to babysit for us," Matt told Missoula Electric Cooperative in a 2021 interview. The purchase wasn't a cold transaction. It was a handoff between neighbors.

The steakhouse has since pulled David Letterman and the cast of Yellowstone through the door. Food Network has featured it on at least two shows: The Best Of and I Hart Food. But the line that sticks from Matt's own description of the place is simpler than any of that: "We serve anyone from prom dates to loggers and hunters coming off the hill."

The distillery is a different animal. It doesn't have 35 years of reputation stacked up behind it. It's a member of the Montana Distillers Guild and appears on the Lewis and Clark Trail tourism listings and Visit Montana's directory, which gives it reach beyond Lolo. But the aged spirits are still young — the bourbon carries a 4.5-year age statement, and whiskey programs need time the way restaurants need fire. The Grunows know this. The business plan wasn't to launch with a 12-year single barrel. It was to start pouring what the still could produce now and build the rest over the next generation.

Which brings up the bottles again. Two sons on the labels. A great-grandfather's bourbon recipe. A 20-year grain supplier. A craftsman who built both rooms. Every connection in this business points backward and forward at the same time, which is either the Grunow family's business strategy or just how a fourth-generation Montana family operates when it builds something.

The view from the tasting room patio, with Lolo Peak, the Bitterroot Range, and the steakhouse below, was there the whole time they were cutting firewood. It took a building code to make them notice.