1 Revitalisation of cultural heritage and historical objects: from fragility to sustainable management in tourism Gregor Jagodič 1 , Vita Petek 2 Abstract: Purpose of the article – this paper explores the revitalisation of historic buildings through the lens of financial sustainability, community engagement, and regional development, arguing that heritage renewal should transcend mere technical restoration. Research methodology – the study integrates an extensive review of both domestic and international literature with qualitative analyses of selected good practices. It focuses particularly on financing models, tourism integration, public-private partnerships, the role of local communities, and the contribution of digital technologies. Findings – the research highlights that the success of revitalisation projects depends primarily on diversified funding sources, strategic content development, and the creation of sustainable business models that combine public and private interests. Active community participation and the use of digital tools—such as augmented and virtual reality—further enhance the appeal and long-term functionality of revitalised heritage sites. Keywords: revitalisation, cultural heritage, sustainable development, tourism, digitalisation JEL classification: H75, L83, R11, Z11 Revitalizacija kulturne dediščine in zgodovinskih objektov: od krhkosti do trajnostnega upravljanja v turizmu Povzetek: Namen članka – prispevek preučuje revitalizacijo zgodovinskih stavb s poudarkom na finančni trajnosti, vključenosti skupnosti in regionalnem razvoju, ki presega zgolj tehnično obnovo. Metodologija raziskave – študija združuje pregled domače in mednarodne literature s kvalitativno analizo dobrih praks, pri čemer se osredotoča na modele financiranja, vključevanje v turizem, javno- zasebna partnerstva, vlogo skupnosti in uporabo digitalnih tehnologij. Ugotovitve – raziskava poudarja, da uspeh projektov revitalizacije v prvi vrsti temelji na raznolikih virih financiranja, strateškem razvoju vsebin ter oblikovanju trajnostnih poslovnih modelov, ki povezujejo javne in zasebne interese. Aktivno sodelovanje skupnosti ter uporaba digitalnih orodij – kot sta obogatena in virtualna resničnost – dodatno povečujeta privlačnost in dolgoročno funkcionalnost revitaliziranih dediščinskih območij. Ključne besede: revitalizacija, kulturna dediščina, trajnostni razvoj, turizem, digitalizacija 1 PhD, University of Maribor, Faculty of Tourism, Slovenia, gregor.jagodic1@guest.um.si 2 PhD, University of Maribor, Faculty of Tourism, Slovenia, vita.petek2@um.si ©Copyrights are protected by = Avtorske pravice so zaščitene s Creative Commons Attribution- Noncommercial 4.0 International License (CC BY-NC 4.0) = Priznanje avtorstva- nekomercialno 4.0 mednarodna licenca (CC BY-NC 4.0) DOI 10.32015/JIBM.2025.17.2.2 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management ISSN 1855-6175 2 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 1 INTRODUCTION Cultural heritage stands as a vital bridge between the past, the present, and the future. It embodies collective memory, creativity, and identity—elements that sustain social continuity and a sense of belonging (Lowenthal, 2015). In the twenty-first century, however, the idea of heritage has evolved well beyond the static notion of preservation. It now represents a dynamic system that shapes spatial development, fosters cultural participation, and contributes to economic resilience. As UNESCO (2015) notes, cultural heritage today is not only an object of protection but also a catalyst for innovation, education, and sustainable growth. Historic structures, like castles, monasteries, manor houses, and industrial complexes, are tangible expressions of this legacy. They reflect centuries of architectural and artistic achievement while narrating the socio-economic stories of their communities. However, these structures are increasingly vulnerable: physical decay, demographic shifts, limited maintenance, and inadequate adaptation to modern functions threaten their survival. The loss of such sites diminishes not only architectural variety but also the continuity of collective memory. Hence, heritage preservation must be understood as a social responsibility as much as a technical task—a commitment to maintaining the meaning and identity of place. Revitalisation provides a pathway between conservation and development. When approached strategically, it can transform abandoned or neglected sites into lively cultural and social spaces that generate employment, tourism, and creativity. Properly managed revitalisation enhances community identity and encourages inclusive growth by forging a dialogue between the past and the present. However, many initiatives still struggle with fragmented legislation, scarce financial resources, and weak stakeholder cooperation (Pintossi et al., 2023). The central challenge lies in finding equilibrium: preserving authenticity while allowing adaptive reuse that ensures relevance in contemporary society. Over the past decade, both global and European policy discourses have increasingly called for integrated and sustainable approaches to heritage management. Successful revitalisation depends on harmonising technical conservation, economic viability, community participation, and long-term governance. Bozoğlu et al. (2024) observe that projects flourish when public institutions, private investors, and civil society collaborate to create spaces that are at once culturally meaningful and economically sustainable. Meanwhile, the digital turn in heritage—through tools like 3D scanning, augmented reality, and online storytelling— has opened new horizons for interpretation, access, and education (Bekele et al., 2018; Forte & Campana, 2016). In Slovenia, as in many other European countries, numerous heritage sites remain underutilised despite their symbolic and spatial potential. Projects such as the renovation of Cukrarna in Ljubljana or Rajhenburg Castle demonstrate how forgotten buildings can be reimagined as multifunctional centres for culture, art, and tourism (Cukrarna, n. d.; Rožman, n. d.). These examples show that heritage can act as a strategic asset for sustainable development when revitalisation is guided by interdisciplinary planning, creative vision, and community participation. This article, therefore, aims to trace how revitalisation can progress from isolated restoration projects toward a comprehensive, sustainable practice that links preservation with innovation. By analysing theoretical perspectives, international experiences, and Slovenian examples, it identifies the principal factors determining success: adaptive reuse, community involvement, innovative financing, and digital transformation. It contends that revitalisation is not merely about safeguarding the past but also about crafting the future— where cultural memory and contemporary life interact productively. Building on these introductory reflections, the following section develops a theoretical and conceptual framework for understanding cultural heritage revitalisation. It explores how the interrelated ideas of authenticity, adaptive reuse, and sustainability have evolved in scholarly debate, forming the foundation for responsible and forward-looking heritage management in the twenty-first century. 3 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 2 THEORETICAL AND CONCEPTUAL FRAMEWORK FOR CULTURAL HERITAGE REVITALISATION 2.1 Theoretical and management foundations of revitalisation Cultural heritage revitalisation is an inherently interdisciplinary field, positioned at the crossroads of conservation, spatial planning, economics, and the social sciences. Contemporary theory no longer treats revitalisation merely as the physical restoration of deteriorating buildings; instead, it views it as a multidimensional practice that produces cultural, social, and economic value (Labadi & Logan, 2015; Lowenthal, 2015). In this light, revitalisation has evolved into a form of cultural management that unites the safeguarding of tangible and intangible values with the broader principles of sustainable development, inclusivity, and community well-being. From a theoretical standpoint, three complementary paradigms underpin current revitalisation practice. The conservation paradigm, rooted in the Venice Charter and the Nara Document on Authenticity, prioritises the safeguarding of original design, materials, and meaning. The development paradigm frames heritage as a potential catalyst for regional growth—an idea aligned with the UN Sustainable Development Goals (SDGs), which connect preservation to innovation, economic diversification, and tourism (De Medici et al., 2020). Finally, the participatory paradigm defines heritage as a living, evolving process shaped by collective memory, civic engagement, and local identity (Colomer, 2023). Taken together, these paradigms establish a holistic conception of heritage as both a conservation effort and a developmental instrument. This dual perspective transforms monuments from static relics into dynamic social and economic resources. Such an approach—combining authenticity with adaptive reuse—is particularly relevant in smaller European contexts such as Slovenia, where historical buildings often lose their original function but retain substantial symbolic and spatial value. Achieving this transformation depends largely on governance structures that can align diverse stakeholders, secure long-term funding, and maintain transparency. Traditional, top- down systems of heritage management—typically reliant on public budgets and bureaucratic oversight—have frequently proven too rigid and financially fragile (Pintossi et al., 2023). Consequently, innovative governance and financing models, especially public-private partnerships (PPPs), have gained attention as effective mechanisms for mobilising resources, expertise, and creativity while safeguarding public interest (Borin, 2017). Within PPP frameworks, the public sector usually retains ownership and ensures heritage protection and accessibility, while private partners contribute capital, operational skills, and marketing capacity. The result is often faster project implementation, higher efficiency, and improved financial resilience. Well-known international examples—such as the transformation of Tate Modern in London or adaptive reuse projects in Germany— demonstrate how carefully structured PPPs can reconcile cultural and economic goals when backed by clear legal and ethical guidelines (Groer et al., 2025). Beyond PPPs, hybrid financing models that blend public, private, and community resources have become increasingly important. Italy’s Art Bonus initiative, for instance, offers a 65% tax credit to individuals and companies supporting cultural heritage, successfully stimulating private donations (Dubini et al., 2012). Similar mechanisms could enhance Slovenia’s capacity to attract private investors while reducing reliance on short-term EU funding cycles. The concept of heritage governance extends even further, encompassing not just formal public-private partnerships but also public-civil and public-private-community collaborations (Žuvela et al., 2023). Such pluralistic frameworks encourage participatory decision-making, shared accountability, and open dialogue between government bodies, municipalities, and civil society. By distributing responsibility and fostering mutual learning, these models promote resilience, broaden expertise, and reinforce democratic legitimacy in heritage management. For Slovenia, establishing transparent, systemic governance mechanisms— such as a national revitalisation fund supported by fiscal incentives—could provide a stable foundation for long-term sustainability. Ultimately, innovative governance is not solely an 4 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 administrative or financial concern; it is a form of social contract. It ensures that cultural heritage remains a living, evolving public good that contributes actively to collective memory and sustainable development. 2.2 Adaptive reuse, authenticity and sustainability Adaptive reuse has emerged as one of the most influential paradigms of modern heritage revitalisation. It refers to the transformation of historic structures for new purposes while preserving their architectural integrity and symbolic essence (Vafaie et al., 2023). Unlike traditional restoration, which seeks to recover a specific historical state, adaptive reuse extends the lifespan of heritage by embedding it in contemporary social and economic systems. This approach recognises that a site’s actual value lies not only in its physical fabric but also in its capacity to evolve and remain meaningful across generations. At the heart of adaptive reuse lies the idea of authenticity, which has expanded considerably over the past few decades. The Nara Document on Authenticity (1994), further elaborated by Jokilehto (2019), broadens the concept from a purely material criterion to one encompassing historical, cultural, and spiritual dimensions expressed through design, form, and meaning. Revitalisation, therefore, demands a subtle balance—preserving the genius loci, or “spirit of place,” while introducing new functions that respond to present social and economic realities. Several international projects illustrate this delicate balance. London’s Tate Modern, a former power station reimagined as an art museum, retains its industrial identity while generating immense cultural and economic value (Shin, 2024). Similarly, Germany’s Zollverein complex—once a coal mine—has become a thriving cultural and tourism hub, exemplifying how industrial heritage can drive regional regeneration (Zollverein, n. d.). In Slovenia, the Cukrarna in Ljubljana and Rajhenburg Castle stand out as models of how adaptive reuse can harmonise historical identity with contemporary cultural programming and community participation (Cukrarna, n. d.; Rožman, n. d.). Adaptive reuse also intersects directly with sustainable development, understood through three interdependent dimensions: economic, social, and environmental (De Medici et al., 2020). Economic sustainability calls for viable business models capable of ensuring continuous operation through tourism, creative industries, or cultural entrepreneurship (Rossitti, Oppio & Torrieri, 2021). Social sustainability underscores participation and inclusion, as revitalisation reinforces identity and cohesion when local actors are involved in decision-making and everyday use (Bozoğlu et al., 2024). Meanwhile, environmental sustainability promotes resource conservation, energy efficiency, and waste reduction through the repurposing of existing structures and integration of renewable technologies. Together, these dimensions illustrate that adaptive reuse is not simply a design or conservation strategy but a holistic framework for sustainable development. By merging authenticity with innovation and ecological awareness, reuse ensures that cultural heritage remains an active component of modern life—one that continues to inspire, educate, and bind communities through time. 2.3 Tourism, community engagement and digital transformation Tourism and community engagement represent two interdependent pillars of successful heritage revitalisation. Together, they determine not only the immediate appeal of revitalised sites but also their capacity for long-term sustainability. When managed responsibly, heritage tourism transforms historic environments into living spaces of cultural exchange, education, and creativity (Richards, 2018). However, its success depends on transcending narrow economic objectives and embracing authenticity, local participation, and environmental responsibility (Cave & Dredge, 2020). Within this framework, tourism acts simultaneously as a driver and a consequence of revitalisation. Adaptive reuse and conservation create new opportunities for cultural and creative industries, while increasing tourism visibility and economic viability (Fennell, 2021). 5 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 However, the sustainability of such processes hinges on the involvement of local communities. When residents participate actively in storytelling, event planning, or management, they help preserve authenticity and a sense of ownership (Li et al., 2020). Through these participatory practices, heritage sites evolve from static attractions into dynamic cultural arenas that nurture social capital and intergenerational dialogue. Slovenian examples provide compelling illustrations of this process. The Cukrarna in Ljubljana, once an abandoned industrial structure, now operates as an inclusive cultural centre where art exhibitions, educational programmes, and community events coexist. Its management model reflects a careful balance between professional oversight and community participation, ensuring that heritage remains meaningful to diverse audiences. Such practices demonstrate that heritage tourism achieves its true potential only when it becomes rooted in local experience rather than imposed from above. While participation strengthens the social dimension of heritage, digital transformation expands its interpretive and educational potential. In the digital age, cultural heritage no longer ends at the site’s physical boundaries—it extends into virtual and interactive spaces that connect local narratives with global audiences. Technologies such as 3D scanning and photogrammetry provide precise digital records that support both conservation and research (Forte & Campana, 2016). Moreover, augmented and virtual reality (AR/VR) tools enable visitors to explore reconstructed environments and interact with historical content through multi-sensory experiences (Bekele et al., 2018; Serravalle et al., 2019; Jagodič et al., 2021). Digital communication also plays a crucial role in broadening access and engagement. Virtual exhibitions, interactive websites, and social media storytelling enable institutions to reach younger, more diverse audiences (Gorenak et al., 2025). These tools bridge physical distance and invite new forms of participation that align with contemporary expectations of immediacy and interactivity. Despite these benefits, integrating digital technologies is not without obstacles. High development and maintenance costs, insufficient technical expertise, and the rapid obsolescence of digital systems present significant challenges. Smaller institutions often struggle to sustain digital innovation beyond the initial implementation stage. Overcoming these barriers calls for long-term strategic planning and collaboration among heritage experts, technologists, and policymakers. Effectively integrated digital transformation becomes an instrument for education, identity-building, and sustainable management. It complements community-based tourism by offering new ways to interpret and communicate meaning while supporting environmental goals through reduced reliance on physical materials. Ultimately, tourism, community engagement, and digital innovation form a synergistic triad that operationalises the core principles of heritage revitalisation. Tourism generates economic and experiential value; community involvement secures authenticity and inclusivity; and digital tools enhance accessibility and interpretation. Together, these processes turn revitalised heritage from static monuments into dynamic ecosystems of learning, creativity, and growth—spaces where the memory of place interacts continuously with the possibilities of the present and the digital future. 2.4 Comparative models of cultural heritage revitalisation 2.4.1 Overview of international approaches The preservation and revitalisation of cultural heritage are inherently complex endeavours, influenced by diverse historical traditions, governance systems, and financing mechanisms. While most countries share similar overarching goals—preserving identity, fostering cultural participation, and ensuring sustainability—their pathways toward achieving these aims vary considerably. Comparative international experience, therefore, provides valuable insights into how cultural heritage can function simultaneously as a public good, an economic asset, and a driver of social development. 6 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 In France, heritage management is highly centralised and rests on the principle that heritage constitutes a national asset under state authority. The Heritage Code delineates hierarchical regimes for the protection of national, regional, and local assets (Collot, 2020). Oversight is carried out primarily by the Ministry of Culture through its regional directorates (DRAC), ensuring rigorous conservation standards and consistent funding. However, this centralisation often entails bureaucratic rigidity and limited opportunities for local engagement. Financing largely depends on the national budget, supplemented by tax relief schemes allowing owners of protected properties to claim up to 50% of restoration costs (Borin, 2017). The restoration of Notre-Dame Cathedral exemplifies the French model’s ability to combine state leadership with exceptional public fundraising in times of crisis. By contrast, the United Kingdom follows a decentralised, market-oriented approach shaped by strong private and non-profit involvement. The state primarily acts as a regulator and facilitator, while independent bodies such as Historic England, English Heritage, and the National Trust manage heritage sites through membership contributions, donations, and commercial revenue (Rossitti, Oppio & Torrieri, 2021). The Heritage Act 2010 emphasises both public accessibility and financial autonomy, encouraging innovation and entrepreneurial management. However, critics have warned that such market dependence can lead to excessive commercialisation and unequal access (Van der Borg, 2022). The conversion of the Tate Modern from a disused power station into a world-renowned cultural landmark illustrates how private vision and creative planning can successfully revitalise industrial heritage (Tate, 2025). The German model combines state coordination with local autonomy through a federal structure. Each of Germany’s sixteen federal states enacts its own monument protection laws, producing diverse yet contextually responsive approaches (Michalak, 2021). The Nationalkomitee für Denkmalschutz coordinates national policies, while most implementation occurs at the regional level (Groer et al., 2025). This decentralised system encourages community participation and flexible management. A notable example is the revitalisation of the Zollverein Industrial Complex in Essen, where multi-level cooperation and public-private partnerships transformed an industrial site into a vibrant cultural and economic centre (Zollverein, n. d.). In Italy, home to the world’s highest concentration of UNESCO sites, the legal protection of heritage is well developed under the Code of the Cultural Heritage and Landscape (2004). However, chronic underfunding continues to challenge implementation. To compensate, Italy has introduced innovative financial mechanisms, such as the Art Bonus, which grants donors a 65% tax credit, and concession models that allow private management of heritage sites in exchange for commercial rights (Dubini et al., 2012). While these mechanisms stimulate preservation and revitalisation, they also raise concerns about the potential erosion of public access. The Norwegian system, on the other hand, emphasises local empowerment and sustainability through the Cultural Heritage Act (Kulturminneloven). The Directorate for Cultural Heritage (Riksantikvaren) provides expertise and oversight, but decision-making authority primarily rests with municipal and regional bodies (Colomer, 2023). Active participation by local associations and volunteers reflects a deeply rooted culture of community stewardship and ensures that revitalised heritage remains closely tied to everyday social life. Collectively, these international models illustrate a broad spectrum of approaches—from highly centralised systems (France, Italy) to decentralised and participatory frameworks (Germany, Norway), and market-driven arrangements (United Kingdom). Each system offers distinct advantages and trade-offs: strong conservation standards versus flexibility, financial stability versus inclusivity, and innovation versus risk of commodification. 2.4.2 Slovenia in the European context Situated at the intersection of these European traditions, Slovenia combines elements of centralised governance with growing dependence on project-based financing, particularly 7 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 from the European Union. The Cultural Heritage Protection Act (ZVKD-1) (UL RS, 2008) defines heritage as a public good and assigns primary responsibility to the state, while delegating implementation to municipalities. The Institute for the Protection of Cultural Heritage of Slovenia (ZVKDS) oversees planning, supervision, and conservation work. Although the legal and institutional framework is relatively robust, Slovenia continues to face persistent challenges: limited investment, fragmented ownership, and the absence of a systemic financing model. Most revitalisation projects rely on EU structural funds, such as the European Regional Development Fund (ERDF), and on the Recovery and Resilience Plan (RRP). While these instruments enable substantial physical renovations, they often result in fragmented, short-term interventions lacking sustainable follow-up mechanisms. Once external funding concludes, many sites struggle to secure operational stability and long-term maintenance. Public-private partnerships, although permitted by law, remain rare. Most projects continue to depend on municipal budgets and national grants, with limited engagement from private investors or community organisations. As a consequence, many restored sites remain financially dependent on state support. Nonetheless, several projects—such as Cukrarna in Ljubljana, the Minorite Monastery and Regional Museum in Ptuj, the House of Experiments, and Kromberk Castle in Nova Gorica—illustrate that sustainable and socially inclusive outcomes are achievable when public resources are combined with community participation and creative management (Cukrarna, n. d.; Pokrajinski muzej Ptuj Ormož, 2020; Hiša eksperimentov, 2014; Goriški muzej, 2021). These examples highlight Slovenia’s potential to evolve toward a hybrid, partnership- oriented model that integrates heritage preservation with economic viability. By building on interdisciplinary collaboration, diversified funding, and active local participation, Slovenia could develop a system capable of sustaining cultural heritage as both a public value and a living economic asset. 2.4.3 Comparative synthesis and lessons learned Comparative analysis of the above cases reveals three dominant governance and financing models along a continuum from centralisation to decentralisation and from public to private funding: − Centralised state model – typified by France (and partly Italy), this model guarantees high conservation standards and reliable state funding but suffers from bureaucratic rigidity and limited local engagement. − Private and philanthropic model – represented by the United Kingdom, it promotes innovation and self-sufficiency through non-profit leadership but carries the risk of over- commercialisation and unequal access. − Decentralised and participatory model – evident in Germany and Norway, it fosters flexibility, local initiative, and community ownership, though it depends on regional capacity and can produce uneven protection standards. Slovenia occupies an intermediate position among these models. Like France and Italy, it maintains a strong public role in protection and management, yet it relies heavily on external project funding from the EU. Unlike Germany, where public-private partnerships are systematically integrated, or the United Kingdom, where non-profit organisations play a central role, Slovenia still lacks the institutional structures and funding diversity needed for sustained management. 8 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 Table 1: Comparative analysis of international approaches to cultural heritage revitalisation (source: Jagodič & Petek, 2025) Criterion Slovenia France United Kingdom Germany Italy Norway The dominant model Hybrid (centralized + EU) Centralised (state) Private / Philanthropic Federal / Decentralised Centralised / Concessionary Decentralised / Participatory Legal framework ZVKD-1 (2008) Heritage Code (2004) Heritage Act (2010) Monument Protection Act (federal states) Codice dei beni culturali (2004) Cultural Heritage Act (1978) Source of funding EU funds, state budget State budget, tax breaks Donations, lottery, membership fees A mix of federal and provincial funds State budget, Art Bonus, sponsors State and municipal budget, volunteering Management Public sector, partly PPP Central Government, strict services Non-profit organisations (National Trust) Federal states (Länder), local authorities State ministries, concessions Local community, associations Key challenge Dependence on tenders, lack of funds for ongoing maintenance Bureaucracy, high renovation costs The danger of over- commercialisation Uneven protection between regions Bureaucracy, lack of resources Dependence on volunteer work A synthesis of best practices across these systems highlights several key requirements for sustainable revitalisation: − The establishment of diverse and stable financing mechanisms that combine public investment, private capital, and community participation. − The creation of flexible governance structures that balance national oversight with local autonomy. − The cultivation of a participatory culture that treats heritage as a shared responsibility rather than a bureaucratic obligation. For Slovenia, this implies a gradual shift from fragmented, project-based approaches toward a long-term, partnership-driven model aligned with both European best practices and domestic capacity. Implementing a national heritage revitalisation fund, expanding fiscal incentives, and empowering community-led initiatives would strengthen resilience and enhance the cultural sector’s contribution to sustainable regional development. 3 RESEARCH QUESTIONS, METHODOLOGY AND RESEARCH APPROACH Based on the preceding theoretical and comparative framework, this research addresses several conceptual and practical challenges inherent in the sustainable revitalisation of cultural heritage. It investigates how deteriorating historical structures can be transformed into dynamic cultural and economic assets through innovative governance, financing, and participatory approaches. The following research questions guide the analytical framework and synthesis: − RQ1: What are the key challenges in the financial and operational management of deteriorating cultural monuments, and what innovative financing and management models can ensure their long-term sustainability? − Q2: How can integrating tourism, education, and cultural programs contribute to the sustainable revitalisation of cultural heritage sites and increase their attractiveness and visitor engagement? − RQ3: What role do digital technologies play in the preservation and interpretation of cultural heritage, and how can they attract new audiences and enhance cultural participation? 9 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 − RQ4: How can local communities and public-private partnership models contribute to successful revitalisation and promote comprehensive, sustainable development of regions? Given the interdisciplinary nature of the topic—which spans cultural heritage management, economics, urban planning, tourism, and sociology—a qualitative research design was adopted as the most suitable approach to explore the complex interconnections between theory and practice (Richards & Munsters, 2010). The study is both descriptive and analytical, aiming to capture the diversity of revitalisation practices and to derive generalisable insights from them. The research relied exclusively on secondary data and unfolded across several key stages: − Comprehensive literature review: Academic studies, policy papers, and professional reports were examined to identify dominant theoretical frameworks and models of heritage revitalisation. − Comparative analysis: International and national case studies were compared to reveal patterns and contrasts in governance, financing, and community participation (Jagodič et al., 2025). − Synthesis of findings: Insights from the literature and case studies were integrated to formulate recommendations that extend beyond individual contexts and address systemic issues in heritage management. Core sources included documents from international organisations (UNESCO, European Commission), national legislation, and project evaluations, supplemented by academic articles and publicly available datasets. To ensure analytical consistency and depth, data were processed through thematic analysis, which identified and interpreted recurring themes across multiple sources. This process involved several iterative phases: − Familiarisation with the data through detailed reading and coding; − Identification of central themes, particularly financing models, participatory governance, and digital innovation; − Cross-comparison of themes to link theoretical concepts with empirical examples, thus highlighting transferable lessons and best practices. The integration of theoretical insights with international evidence strengthened the study’s validity and enabled a nuanced understanding of how financial, managerial, and social dimensions intersect within cultural heritage revitalisation. 4 DISCUSSION OF RESEARCH QUESTIONS The discussion synthesises findings from the comparative analysis to answer the research questions and explore what constitutes meaningful and sustainable revitalisation of deteriorating heritage sites. The study confirms that no single, universal model exists— success depends strongly on contextual factors such as governance systems, economic capacity, and social dynamics. Slovenia currently employs a hybrid model that combines centralised protection with project-based financing, which is effective for large-scale renovations but weaker in ensuring long-term sustainability and community participation. A sustainable transition requires a proactive mixed model that integrates public interest with market-oriented innovation, transforming cultural heritage into a dynamic contributor to future tourism and development. Research question 1 was: What are the key challenges in the financial and operational management of deteriorating cultural monuments, and what innovative financing and management models can ensure their long-term sustainability? Managing deteriorating monuments involves a delicate balance between limited public funding, maintaining authenticity, and ensuring long-term economic viability (Labadi & Logan, 2015; Pintossi et al., 2023). Persistent challenges include chronic underfunding, high 10 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 maintenance costs, rigid regulations, and a lack of entrepreneurial vision (UNESCO, 2015). Other obstacles—such as fragmented ownership, bureaucratic delays, and weak community engagement—further hinder sustainability (Bozoğlu et al., 2024). To address these issues, public-private partnerships (PPPs) have emerged as vital tools for blending public oversight with private investment. In successful PPPs, private actors assume responsibility for operational management and marketing, while public institutions safeguard cultural integrity and provide regulatory guidance (Borin, 2017). Additional sources of funding include EU structural funds, tax incentives, crowdfunding, and philanthropy—mechanisms already well-established in countries like the UK and Italy (Dubini et al., 2012; Van der Borg, 2022). Long-term viability also depends on diversified revenue models, such as cultural events, venue rentals, and tourism-based activities, which reduce reliance on short-term subsidies (Rossitti, Oppio & Torrieri, 2021). Meanwhile, digital technologies such as 3D scanning, VR, and AR enhance visibility and visitor engagement, but high initial costs remain a limiting factor (Forte & Campana, 2016). Both Slovenian and international evidence confirm that unstable financing remains the principal barrier. In Slovenia, reliance on public or EU project funding results in isolated restoration efforts with limited follow-through (UL RS, 2008, 2022). Examples such as Cukrarna Ljubljana and Kromberk Castle show strong initial outcomes but ongoing challenges in achieving financial self-sufficiency. Comparatively, France ensures stability through state support but lacks flexibility; the UK promotes innovation and independence but risks excessive commercialisation (Rossitti, Oppio & Torrieri, 2021); and Germany’s decentralised PPP model allows flexibility but introduces regional disparities (Groer et al., 2025). Overall, the findings point to the need for multi- layered solutions—stable financing mechanisms, strategic business models, cross-sector collaboration, and greater use of digital technologies—to ensure that revitalised sites remain both authentic and economically resilient. The second research question was how integrating tourism, education, and cultural programs can contribute to sustainable revitalisation and increase the attractiveness and visitation of historical sites. Revitalising heritage sites requires more than structural restoration; it necessitates active programming that sustains use and public interest (Labadi & Logan, 2015; Bozoğlu et al., 2024). The integration of tourism, education, and cultural initiatives gives heritage spaces new meaning and purpose. Tourism generates economic returns through events, hospitality, and ticketing (Rossitti, Oppio & Torrieri, 2021); educational programmes foster awareness and knowledge transfer (Jokilehto, 2019); and cultural activities—exhibitions, concerts, festivals—revitalise spaces while strengthening social bonds (Li et al., 2020). Environmentally, reusing existing structures also contributes to sustainability by minimising new construction and material consumption (De Medici et al., 2020). Successful revitalisation, therefore, depends on careful destination management, balancing visitor flows with preservation goals to avoid the pitfalls of overtourism (Dodds & Butler, 2019). In Slovenia, projects such as Cukrarna, Kromberk Castle, and the House of Experiments demonstrate how cultural and educational programming can sustain interest and strengthen community connections. Internationally, examples such as Tate Modern (London), Zeche Zollverein (Essen), and The High Line (New York) confirm that multi-purpose programming attracts diverse audiences and stimulates urban regeneration (Tate, 2025; Zollverein, n. d.; The High Line, 2020–2025). Common success factors include coherent long-term strategies, community engagement, and diverse cultural offerings. While global examples often grapple with overtourism, Slovenian sites face the opposite challenge: insufficient visitor numbers to achieve financial independence post-funding. In both cases, a strategic balance between cultural value, economic return, and social inclusion remains crucial. Research question 3 was: What role do modern digital technologies play in the preservation and interpretation of cultural heritage and in attracting new target groups of visitors? 11 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 Modern digital tools are increasingly reshaping heritage management across documentation and interpretation. 3D scanning and photogrammetry allow precise archival recording essential for restoration planning (Forte & Campana, 2016). Virtual and augmented reality (VR/AR) create immersive, interactive environments that make historical narratives more engaging (Bekele et al., 2018), while digital platforms and social media extend outreach and interaction (Serravalle et al., 2019). Empirical examples confirm their transformative potential. In Cukrarna Ljubljana, digital storytelling and interactive displays have broadened audience appeal, particularly among younger visitors (Cukrarna, n. d.). Kromberk Castle employs multimedia presentations that enrich traditional exhibitions (Goriški muzej, 2021). Abroad, Tate Modern integrates digital marketing and audience analytics to expand its global reach (Tate, 2025), and Zeche Zollverein uses AR to virtually recreate industrial life (Zollverein, n. d.). Although these innovations enhance accessibility and learning, barriers persist—chiefly high costs, limited expertise, and rapid technological change (Wang et al., 2025). Despite such challenges, the long-term benefits—greater visibility, deeper engagement, and new forms of cultural participation—make digitisation an indispensable component of modern heritage revitalisation. Research question 4 was: What is the role of local communities and public-private partnership models in successful revitalisation, and how can these models promote comprehensive and sustainable development of the region? The literature consistently identifies community participation and PPPs as essential for the enduring success of revitalisation. Active engagement fosters ownership, strengthens local identity, and ensures that revitalised spaces serve genuine social needs (Bozoğlu et al., 2024; Li et al., 2020). Communities function not only as beneficiaries but as co-creators, contributing local knowledge and volunteer effort (Colomer, 2023). PPP, meanwhile, provide structural and financial stability. In these arrangements, private partners typically manage operations and assume risk, while public authorities protect heritage values and guarantee accessibility (Abdou, 2021). When properly designed, PPPs can increase efficiency, accelerate project delivery, and promote innovative business models that ensure long-term sustainability (Žuvela et al., 2023). In Slovenia, projects such as Cukrarna, the House of Experiments, and the Goriški Museum illustrate that early and inclusive community participation leads to stronger public support and longer-term success. However, PPPs remain sporadic and underdeveloped. Unlike Germany or the United Kingdom, where such models are institutionalised, Slovenia still faces legal, administrative, and perceptual barriers. Expanding tax incentives, clarifying the law, and encouraging participatory planning could help unlock the potential of these partnerships. International experiences, such as Zeche Zollverein in Germany and The High Line in the USA, demonstrate how combining PPP financing with strong community participation can generate not only heritage revitalisation but also broader urban renewal and regional economic benefits. 5 RECOMMENDATIONS FOR PRACTICE Building on the findings and comparative insights, this section proposes concrete measures to strengthen the Slovenian model of cultural heritage revitalisation. The recommendations aim to bridge the persistent gap between the country’s theoretically advanced legislative framework and its practical implementation, which remains overly dependent on short-term, project-based funding. One of the key findings of this study is that the financial sustainability of Slovenian revitalisation efforts is endangered by their reliance on temporary project grants, especially those from EU programmes and the National Recovery and Resilience Plan (UL RS, 2022). While these funds are invaluable for physical renovation, they rarely guarantee ongoing 12 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 maintenance or management. Slovenia, therefore, needs a diversified financing model that includes private investment, philanthropic support, and community participation. A promising solution would be to introduce systemic tax incentives for individuals and legal entities that contribute to heritage preservation. The Italian Art Bonus system— granting a 65% tax deduction for cultural donations (Dubini et al., 2012)—offers a relevant example. Slovenia could adapt this approach through cooperation between the Ministry of Finance and the Ministry of Culture, supplemented by a digital platform to facilitate donations, crowdfunding, and corporate sponsorships. Oversight could be shared among ministries, chambers of commerce, and tourism bodies to ensure transparency and accountability. Although Slovenian legislation formally allows public-private partnerships (PPPs), their implementation remains sporadic. To encourage broader participation, a transparent and standardised legal framework should be established. A governmental working group could develop model contracts, procedural guidelines, and a publicly accessible database of heritage properties available for revitalisation, complete with cultural and market assessments. Such tools would enhance investor confidence while ensuring the protection of public interest. Equally important is the role of local communities. Without community participation, revitalised sites risk becoming static monuments devoid of social relevance (Colomer, 2023). Inspired by the Norwegian model, local heritage councils could be formed at the municipal level, giving residents a formal voice in decision-making. These councils could collaborate with municipalities, the Institute for the Protection of Cultural Heritage of Slovenia (ZVKDS), NGOs, and local businesses. Moreover, a national register of volunteers and small grants for non-profit heritage organisations could stimulate civic participation, following the example of the UK’s National Trust, where volunteerism and membership fees contribute significantly to the sustainability of heritage (Groer et al., 2025). Digital technology also represents an underused asset in Slovenia’s heritage sector. In contemporary tourism, digitisation not only enhances accessibility and visitor engagement but also amplifies economic potential. Revitalisation projects should routinely include mobile applications, interactive content, and augmented reality features to offer immersive experiences and virtual reconstructions. A dedicated national digital heritage fund could be created to finance such initiatives, uniting ministries, research institutions, IT companies, and cultural organisations around shared digital objectives. Finally, each revitalisation project must include a comprehensive business plan that defines programme content, target audiences, market potential, and long-term financial projections. Too often, projects in Slovenia have focused narrowly on physical renovation, with insufficient attention to management and post-project sustainability (UL RS, 2022). Mandatory business plans, supported by feasibility studies and marketing strategies, would ensure that renovated sites remain functional, relevant, and financially viable long after initial funding ends. 6 CONCLUSION The revitalisation of cultural heritage is one of the defining challenges of contemporary societies that seek to honour historical identity while pursuing sustainable economic and social progress. This study, grounded in comparative analysis and theoretical reflection, demonstrates that while there is no universal model for successful revitalisation, certain principles consistently underpin positive outcomes: long-term financial sustainability, strategic planning, and meaningful community participation. In Slovenia, the current hybrid system—characterised by centralised oversight and heavy reliance on EU project funding—has proven effective for restoring physical structures but less so for ensuring lasting management and economic stability. Without systemic reforms, 13 Mednarodno inovativno poslovanje = Journal of Innovative Business and Management 2025 / Vol. 17 / No. 2 the model risks creating revitalised spaces that remain financially fragile or socially underutilised. The research underscores three pivotal insights. First, diversified and stable funding is essential. Slovenia should complement public investment with private capital, fiscal incentives, and philanthropic mechanisms that encourage long-term commitment. Second, a clear and transparent framework for public-private partnerships is needed to attract investment while maintaining cultural integrity and public accountability. Third, community participation—including volunteerism, education, and co-management—must be embedded from the earliest stages of revitalisation to foster social ownership and sustainability. The study also highlights the transformative role of digital technologies, which extend the reach of heritage beyond physical boundaries and engage younger, digitally literate audiences. Integrating tools such as augmented reality, virtual exhibitions, and interactive marketing can make heritage more accessible and relevant to contemporary life. It should be acknowledged that the findings are based on a qualitative approach focusing primarily on Slovenia and selected international cases. As such, they may not be directly applicable to countries with different institutional or financial systems. Moreover, potential changes in legislation or funding policies could alter the long-term relevance of the recommendations. Nonetheless, the core message remains: heritage revitalisation must evolve from isolated restoration projects into a coherent system that balances cultural, social, and economic goals. Future research could build on this work through quantitative analyses of the economic and social impacts of revitalisation, or through cross-national comparisons of funding mechanisms and governance models. Further investigation into how digital tools and creative industries enhance accessibility, youth engagement, and regional identity would also provide valuable insights into the future of sustainable heritage management. 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