Making News

Tax Credits Help Bozeman’s Rainbow Motel Renovation

Bozeman’s longstanding Rainbow Motel is undergoing a $9.5 million renovation and will reopen as a boutique hotel and event center in early 2018. Called the RSVP Motel, the new hotel will contribute to the ongoing revitalization of North Seventh Avenue in midtown.

The 1960s-era Rainbow Motel previously operated as a budget motel and was sold to the Folkvord family in 2016. The renovation will transform the property and an adjacent building into an independently operated boutique hotel with 37 rooms and suites, a juice and sandwich bar, an outdoor pool and a 7,000-square-foot event center.

Dean Folkvord, who founded Wheat Montana, has previous experience renovating hotels, including the Sacajawea Hotel in Three Forks and a Super 8 in Dillon. The family also recently converted the Fort Three Forks Motel at Three Forks to an upgraded Travelodge property.

Dean said, “Montana & Idaho CDC and the New Markets Tax Credit Program, along with our partners at Big Sky Western Bank, have allowed us to expand the scope of our project, including the adjacent event center, which will make the RSVP Motel a desirable destination for tourists as well as local groups looking for a special place to hold weddings, exhibitions, meetings and more.”

The NMTC Program is a federal program that helps incentivize and finance economic development projects in low-income communities around the country. Montana & Idaho CDC works with investors to turn the credits into cash, and then uses that cash to fund catalytic development projects in Montana and Idaho. In November 2016, the U.S. Treasury Department announced an award of $90 million in New Markets Tax Credits to the Montana & Idaho CDC. It was the seventh award the Montana & Idaho CDC received since 2008 and brought its cumulative total to $431 million.

U.S. Sens. Jon Tester and Steve Daines have been supportive of the NMTC Program for years and would like to see it used more in Montana.

“The renovated Rainbow Motel will be a boost for Bozeman’s North Seventh Avenue, helping create good-paying jobs and bolster the local economy,” Tester said. “This is a great use of the New Markets Tax Credit, helping Bozeman attract visitors looking for a place to stay with multiple services.”

“The New Markets Tax Credit has created good-paying jobs across our state and today’s announcement of the Rainbow Motel renovation will continue to do that right in my own backyard,” Daines said. “I can’t wait to see the Rainbow Motel reopen.”

Dean Folkvord’s daughter, Hillary Folkvord, has been closely involved with the hotel’s concept, architecture and interior design.

“We’re tapping into a bigger movement in the industry around updating old roadside motels and motor inns,” said Hillary Folkvord, who will oversee the RSVP Motel when it opens next year. “Today’s guests – especially millennials – are less interested in big box hotels. They want authenticity, like original architecture that’s been updated with creative, modern, personal touches. That’s the experience we’re aiming to create with RSVP.”

To realize her vision, Folkvord is engaging a “power team” of Bozeman firms Love|Schack Architecture, Abby Hetherington Interiors and Prime Inc. “The style will take inspiration from classic mid-century hotels that you see in places like Palm Springs and Austin,” she said.

  • Rendering courtesy of Love|Schack Architecture.