‘Lohas’ spells ‘opportunity’ for developers

6:00 PM Friday October 13, 2017 Colliers International’s marketing team

The Bosco Verticale buildings in Milan are examples of sustainable construction. Photo / Supplied

Developers of apartment complexes have the opportunity to win over ‘Lohas’ consumers – a market which is underdeveloped, says Josh Coburn, site sales director for Colliers International

“Lohas stands for ‘lifestyles of health and sustainability’— and this has been described by the New York Times as ‘the biggest market never heard of,’” Coburn says.

He says the annual value of Lohas is estimated at $190 billion a year in the United States and $18b in New Zealand.

Coburn says residential developments that emphasise the health and lifestyle benefits of sustainability could stand out in an increasingly competitive market.

“While some New Zealand developers and architects have used green building practices, the lifestyle aspects of sustainability are often overlooked.

“Lohas consumers aren’t radical environmentalists, but are defined by their values and attitudes, which are individualistic and market-driven, with a strong emphasis on conscious consumerism, personal health and wellbeing.

“Notably they are not thrifty in their spending habits but combine ecological activism with concern about the environment’s impact on their own health — supporting sustainable products and clean technology, like recycled building materials and solar power. 

“They are interested as much in personal wellbeing as the health of the planet. Their dedication to healthy outdoor lifestyles also influences how and where they choose to live. Easy access to the likes of beaches, parks, native bush and mountain bike trails is often more important than traditional green concerns, such as closeness to sustainable public transport.”

Coburn says the Lohas concept goes beyond simply incorporating green building principles. “Developers need to ensure their products are sustainably and fairly sourced, healthy and, where possible, all-natural.”

He says the benefit to developers is that there’s money to be made. “In 2007, New Zealand Trade and Enterprise commissioned Moxie Design Strategy and TNS Research to conduct a study on the local market for sustainable products and services.

“The study found 26 per cent of New Zealanders were part of the global Lohas market segment,” Coburn says. “This is significant, as Lohas consumers have money to spend; research suggests they skew towards wealthy, well-educated demographics.

“They are likely to pay a premium — in some cases, up to 20 per cent more — for healthy, sustainable products.”

Since this report, the Lohas market has nearly tripled in value in Australia, from $13b to $32b, according to the Living Lohas report from Mobium Group Research.

Pete Evans, Colliers’ national director of residential project marketing, says developers need to consider where Lohas consumers want to live. “Given their emphasis on health and outdoor lifestyles, Lohas consumers want to be close to nature and outdoor amenities, which makes greenfield and urban fringe developments much more desirable.

“The Lohas consumer wants to either live permanently in a master-planned community or will have two residences; possibly an apartment in the city fringe, and traverse between lifestyle amenity and tranquil retreat.

“The rise of hybrid and electric vehicles has made it much more sustainable to live further from the city centre, which has removed the ‘green guilt’ barrier of living in exurban areas and driving into town.

“With the rise of fast broadband and flexible employment, many more people are also choosing to work from home, which negates the need to commute into town.”

Evans says developers need to consider what shared spaces and amenities they offer. “Lohas consumers want to be part of a sustainable community of like-minded people,” he says. “Shared organic gardens, green roofs and fruit trees are relatively inexpensive to provide, but can make a big difference to that sense of community.”

Developers willing to invest more could offer clean tech such as solar and wind power, battery storage and grey water systems.

What’s important is to embrace the philosophy fully, Evans says.

“Lohas consumers are informed and technologically savvy,” he says.

“The NZTE-commissioned report noted they are seeking authenticity from the brands they engage with. Traditional marketing approaches won’t work; be honest and authentic, and the benefits will follow.”