The inner core of Sombor, known as “Venac”, is probably the best-preserved one among medium-sized cities in Serbia. The stagnation of Sombor during the 20th century and its urban shrinkage in the 21st century have prevented significant transformations of the core, enabling its preservation under state protection as an urban heritage site. However, the recent rise of cultural tourism has triggered urban regeneration. As the city is still unprepared for this change, this regeneration has mostly omitted the inner core. Realising this, local representatives and experts have started rethinking innovative approaches to its regeneration, including the concept of Albergo Diffuso. This sustainable concept is created to revive the historic cores of small, shrinking cities and towns. Basically, it represents a hotel situated in several old buildings dispersed throughout a historic urban fabric, fitting perfectly into the regeneration of Venac. However, the current lack of precise spatial indicators and thresholds makes their incorporation into the planning process challenging. Considering this, this study focuses on the current spatial development of tourism in Venac, analysing the elements that would support and facilitate the application of this concept in the future. This article also proposes a set of new planning measures to support a strategically organised approach—from the emphasis on urban reuse and physical renewal to multileveled linking of basic concept conditions to the prioritization of pedestrian-friendly places and the application of innovative urban design in open public spaces. By connecting the selected Albergo Diffuso approach with spatial development and its analysis, this study also contributes to the spatial imprint of the concept’s implementation.