•A historical public building built in 19th century is selected as a case study.•Real energy consumption, temperature and relative humidity data is collected.•The dynamic building energy-performance simulations are validated by real data.•365 energy-retrofit packages are applied to reduce the total energy consumption.•The cost-optimal energy analysis of the historical building is performed. The energy efficiency concept has attracted significant attention over the last few years and has taken a prominent role in the development goals of countries. Considering that buildings have a high share in total energy consumption, it is crucial to improve their energy performance both in environmental and economic terms. Although efforts in increasing buildings’ energy efficiency have primarily focused on new buildings, existing buildings still retain their importance. Historical buildings are included in the existing building stock. It is essential to increase their energy efficiency to achieve carbon–neutral building targets set from EU Directives. In this paper, we proposed measures to improve the energy efficiency and determine cost‐optimal levels of a public historical building located in a hot-humid climate zone of Turkey. An integrated approach based on in situ measurements and building energy simulations was used to create a building energy model that was calibrated by using real measurements. Then, 365 energy-efficient measures are applied to the building and conducted an economic feasibility study by utilizing a cost-optimal envelope, lighting, heat pump and photovoltaic panel. A sensitivity analysis is performed to determine the impact of investing on optimal cost-of-energy level calculations with focus on the inflation rate, different interest rates, and calculation periods. Sensitivity analysis of discount rate has shown when the discount rate increases, global costs decrease. It is observed that the changes in economic parameters that could cause a decrease in annual costs reduced the cost effectiveness of the scenarios with high initial investment costs.