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.
Throughout Europe there is an ever‐increasing number of properties or areas protected due to their cultural heritage interest. This results in obligations for owners (duties to maintain, keep in good repair, etc.). However, it is generally accepted that laws and policies must provide positive incentives as well as the negative controls in order to successfully preserve and use this heritage. In the UK there is now a well‐developed system of grant aid and a few fiscal measures but demand for assistance outweighs supply. In Ireland a limited amount of financial support measures have recently been provided. Looking further afield, this study examines the need for developing specific measures according to European policy and identifies practice in European Union countries and North America in relation to grant assistance, loans, fiscal and compensation measures. A second paper will examine economic arguments and methods of combining support to sustain the built heritage.
This paper develops the issue of funding from a first paper`C onservation finance 1: support for historic buildings''), which highlighted specific measures in use including direct grant aid, low-interest loans, fiscal relief, tax credits, the transference of development rights with associated funding measures and compensation schemes. Further consideration is given to other avenues for raising finance in support of the built heritage from public and also other sources as a part of the process of developing integrated conservation strategies (such as via foundations, lotteries, revolving funds and non-profit organisations, combining methods of financing for individual properties including for housing rehabilitation and through area-based schemes). Taken together, the two papers examine different approaches to funding the built heritage by reference to practice in western Europe and North America.
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