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Investment Leverage for Adaptive Reuse of Cultural Heritage

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  • Tracy Pickerill

    (School of Surveying & Construction Management, TU Dublin, Bolton Street, D01 K822 Dublin, Ireland)

Abstract

This article tracks the design of a panoptic toolkit of complementary financial (grant and endowment, tax, debt and equity) and non-financial (regulation, real estate, risk mitigation and performance, capacity building, impact metric and digital network) instruments, designed to leverage capital investment and engender collaborative partnerships, to encourage investment capital to flow to cultural heritage adaptive reuse activities. Cultural heritage activities encompass adaptive reuse and energy retrofit of built heritage structures, protecting natural eco-systems and enabling local community enterprise activities. These activities embody circular economy dimensions, that stimulate social, cultural, environmental and economic regeneration, within the global value chain. Many cultural heritage investments entail long-term time horizons, requiring patient investment strategies. Consideration of the financial landscape, with regard to capital investment leverage is as much about understanding the motivations of participants to engage in the capital markets, as about innovations in financial instruments to safeguard cultural heritage values. Individual financial instruments, within the toolkit, such as debt and equity tools, are not new and some have a long association within traditional capital markets. What is new, is a framework for the engagement of blended complementary instruments, pooled within diverse multidisciplinary collaborative social enterprise fund structures, to achieve intentional and measurable impact investment returns. Risk adjusted investment return metrics include the analysis of socio-cultural and environmental impact returns in unison with market based financial returns, including below market returns in some instances. A case study of a revolving social impact fund is provided to give a practical example of combined complementary hybrid financial instruments within a collaborative funding structure. The ultimate choice and design of blended and pooled hybrid tool combinations and hybrid fund structures will change from building to building, and community to community, but must always prioritize the need to protect people and ecosystems in parallel with saving vulnerable cultural heritage resources. The selection of tailored hybrid financial instruments, to enhance circular economy transitionary ambitions, must remain flexible within a long-term collaborative investment strategy. The key change in mindset, central to cultural heritage financial toolkit development, is the enablement of capital leverage investment strategies that prioritize people and the ecosystem over pure profit motivation.

Suggested Citation

  • Tracy Pickerill, 2021. "Investment Leverage for Adaptive Reuse of Cultural Heritage," Sustainability, MDPI, vol. 13(9), pages 1-20, April.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:9:p:5052-:d:547155
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    References listed on IDEAS

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    2. David Throsby, 1997. "Seven Questions in the Economics of Cultural Heritage," Palgrave Macmillan Books, in: Michael Hutter & Ilde Rizzo (ed.), Economic Perspectives on Cultural Heritage, chapter 2, pages 13-30, Palgrave Macmillan.
    3. Shirley Kempeneer & Michaël Peeters & Tine Compernolle, 2021. "Bringing the User Back in the Building: An Analysis of ESG in Real Estate and a Behavioral Framework to Guide Future Research," Sustainability, MDPI, vol. 13(6), pages 1-12, March.
    4. Michael Hutter & Ilde Rizzo (ed.), 1997. "Economic Perspectives on Cultural Heritage," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-25824-6.
    5. James Leigland, 2018. "Public-Private Partnerships in Developing Countries: The Emerging Evidence-based Critique," The World Bank Research Observer, World Bank, vol. 33(1), pages 103-134.
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    Cited by:

    1. Christer Gustafsson & Elisabetta Lazzaro, 2021. "The Innovative Response of Cultural and Creative Industries to Major European Societal Challenges: Toward a Knowledge and Competence Base," Sustainability, MDPI, vol. 13(23), pages 1-20, November.
    2. Mohamed Ibrahim El-belkasy & Sahl Abdullah Wahieb, 2022. "Sustainable Conservation and Reuse of Historical City Center Applied Study on Jeddah—Saudi Arabia," Sustainability, MDPI, vol. 14(9), pages 1-21, April.

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