HOMES AWAY FROM HOME
HOUSE-SHARING HAS ITS APPEAL AND ITS DOWNSIDES. THOMAS AND ALEX ORMEROD’S BUSINESS LUXICO IRONS OUT THE WRINKLES IN THE MODEL WHILE OFFERING ONLY THE TOP PROPERTIES IN THE COUNTRY.
It was an epic Melbourne storm that would set Thomas Ormerod on a new career path. The former property industry executive left his position as managing director of project marketing at Knight Frank Victoria in 2012 and took time out to think about his next move. Understandably, part of his sabbatical from the corporate world involved international travel with his family. Like many people, he decided to defray the cost of his adventures by leasing out his own home in Melbourne short term. What he wasn’t counting on was one of the worst storms to hit the Victorian capital in decades and the damage it would do to his house while he was away from home.
“It was just one of those crazy things,” says Ormerod. “I found I was on the phone trying to coordinate tradespeople in Australia from the other side of the world and it was just too difficult. And we had a really irate guest who was having to manage tradespeople coming and going and communicate with me in a different time zone. On both sides of the transaction – the renter and the owner – we saw a problem.” It was an epiphany for Ormerod and what eventually lead him to come up with the idea for Luxico: a holiday home rental service with a difference.
The best way to describe Luxico is that it’s like Airbnb but with only the best houses in the area. On top of that, Luxico properties come with a hotel-style 24/7 concierge to greet guests on arrival, explain how everything in the house works and be on call during your stay. Since launching in 2013 Luxico has grown from managing a handful of properties to having more than 200 homes in its portfolio in Melbourne, Sydney, the Mornington Peninsula in Victoria and Palm Beach north of Sydney. It’s a service that’s clearly resonating with travellers: according to Ormerod, Luxico achieved 45 per cent year-on-year revenue growth for the 2016-17 financial year with more than 10,000 room nights booked. “It’s almost self-perpetuating: guests have become owners and owners have become guests.”
When it comes to the growth of the business, Ormerod says he and wife Alex have two goals. The first, he says, is to have 500 properties in Australia on the books, the second is to have 1000 homes throughout the Asia Pacific in about four years.
Despite his enthusiasm for the unique accommodation business he’s created, Ormerod virtually had to be dragged into it. “We certainly weren’t looking to start a business like this when I left my previous job,” says Ormerod. “To be honest I really wasn’t sure what I wanted to do. I had a little office that I would go to in Sorrento and just procrastinate. But then based on our experience of renting out our own home, we had someone approach us and say, we have a property that we don’t use, would you consider taking it on for us? After the experience we had with our own home we said no and that we just wanted some time out. They were quite persistent about it, though, and so eventually we took that property on. It went really well and then it kind of became a referral business and one after the other we started to take on more properties.”
About the same as leaving his corporate career, the Ormerods had a second child – another inspiration for Luxico as their travel needs changed from hotel rooms to homestays. As luck would have it, Alex Ormerod’s professional background was in advertising, working with travel and tourism companies, as well as a six-year consultation with Melbourne Airport to help bring more inbound international travellers to the city.
“With Tom’s property background and my
advertising and travel background, Luxico is a pretty good hybrid,” says Alex. With Luxico, she says, Thomas’s focus is on the property owners and hers is on the guests.
“We’re not just about the accommodation – we’re about all of the other touch points that make a holiday a memorable experience,” says Alex. “We always talk about the accommodation being the starting point for your holiday, but really the memories are made from the experiences you have within it.” Luxico offers guests more than just an updated list of local restaurants and services – it operates in much the same way as a luxury hotel does. Theatre tickets, restaurant reservations, private tours, chauffeur-driven cars, a home-cooked meal, massages and spa treatments, babysitting and grocery shopping are just some of the add-ons available to Luxico guests.
There is also a consistent level of presentation to all Luxico properties. The company has a strict ratings system in assessing whether to represent a property or not. As well as location and proximity to things of interest, Luxico properties must be completely renovated and well designed. Luxico accepts less than 20 per cent of applicants into its network. The company supplies all its properties with the same high-quality bed linen and towels as well as Aesop bathroom amenities. A gourmet hamper with locally sourced produce and bare essentials is also supplied to guests. “We try and instil confidence that our guests will have the same experience wherever they stay with us,” says Alex. “The common thread is they want certainty that they have someone on hand when they need them, or someone to speak to if there is a problem.
“The biggest challenge has been how to scale operations with such big geographic areas and be sure that we can deliver a consistent level of service,” she continues. “And that has taken a bit of time to get right.” In August Luxico acquired the San Franciscobased technology startup Hello Scout to help its concierge team better service guests. Hello Scout was developed for hotels to take the pressure off their front desks and provide local, expert information – booking activities, finding a nearby café – via text message.
“We will use it for our guests,” says Thomas Ormerod. “If they want to organise, for example, a boat trip on Sydney Harbour, we will send back a quote from a service provider and when a guests accepts it the activity will be booked and the charges will go on to their account, like charging something to a hotel bill. If we have an incredible property that doesn’t have on-site staff because of its location, then we have the technology to be able to support training somebody to be able to deliver a Luxico standard in that location.”
Luxico’s guest profile is close to 50 per cent domestic travellers and 50 per cent international, according to Alex, with guests from the UK and the US representing 36 per cent of all international bookings. Luxico has also partnered with luxury tour operator Abercrombie & Kent as its preferred home accommodation provider in Australia. By the end of the year the company plans to offer properties in Byron Bay in northern NSW, the Sunshine Coast and Port Douglas in Queensland.
“The accommodation is the starting point, but the memories are made from the experiences you have.”
Alex and Thomas Ormerod started Luxico after a troublesome experience leasing out their own house.