Abstract
Abstract: Historical buildings have high historical, cultural, and architectural values. This research aims to provide an overview of the economic benefits for building owners when utilizing the building. Case studies, the qualitative methods and Value Engineering were used in this research. This study identified three building functions to add economic value and are feasible in terms of investment value. The buildings are a budget hotel, restaurant/cafeteria, and co – working space. IRR value for budget hotels is 14.29%; the NPV value is IDR 58,375,939,253; 14 years payback; the distribution of the financing scheme 30% landowners and 70% investors; 30-year concession. Restaurant / café and co – working space; the value of IRR is 12.47%; the value of NPV is IDR 4,727,841,299.58; Payback 8 years. This research is useful for historic building owners, government, and academics to utilize their assets to have economic value. Â
Highlights
IntroductionAs an added economic value, heritage can be used as commercial, residential, or tourism, which offers cultural experiences for tourists
In a heritage building that serves as a pilot project, its functions can be identified: Budget Hotel; restaurant / café; coworking space
This three functions were chosen based on a feasibility study considered a suitable part and economic value
Summary
As an added economic value, heritage can be used as commercial, residential, or tourism, which offers cultural experiences for tourists. The study case conducted by Ruijgrok in Netherland found that the benefits bigger than the cost of renovation for ten years based on the present value method. Based on the exposure of the 2016 – 2019 priority tourism destination development by the Tourism Ministry, the number of foreign tourists visiting according to 2014 data was around 116,461. This number is still far behind compared to the old city of Sukhothai, Thailand, which can attract 1,000,000 tourists, and the city of Malacca, Malaysia, which was even able to attract 3,900,000 tourists in 2014
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