South African tycoon Stephen Brookes’ Balwin hit by Airbnb court dispute

A dispute over short-term rentals is dividing residents and investors at one of South Africa’s largest housing estates. The conflict centers on Blyde Riverwalk Estate in Pretoria, a development by Balwin Properties, led by South African tycoon Stephen Brookes, over whether Airbnb-style rentals should be permitted in lifestyle estates.

The estate has delivered 14 phases of the project with more than 1,100 units completed. Once finished, the estate is expected to hold over 3,200 homes alongside a man-made lagoon designed to give residents a “beach in the city” experience.

Residents began moving in back in 2018. During South Africa’s 2020 COVID-19 lockdown, the estate gained popularity as a local vacation spot, with many units rented to families looking for short getaways within Gauteng. What began as a temporary convenience has since escalated into a wider dispute over property use and community standards.

South Africa court backs HOA rules

Permanent residents said short-term visitors brought late-night noise, overcrowding at the lagoon, and an increase in security incidents. The homeowners association (HOA) said it had to hire additional guards and management staff, raising operating expenses.

In 2020, the HOA introduced new conduct rules requiring owners to obtain trustee approval for rentals shorter than three months. Violations carried fines equal to 90 percent of monthly levies. The Community Schemes Ombud Service (CSOS) later endorsed the rules.

Eighty-one unit owners challenged the decision in court, arguing the restrictions were unreasonable and limited their right to rent their properties. The dispute reached the Johannesburg High Court earlier this year.

Last month, Acting Judge M. Nair ruled that although CSOS had approved the rules, the adjudicator had exceeded their authority by replacing some of the HOA’s powers.

The judge allowed the rules to remain in force pending an appeal but noted that a complete ban on short-term rentals could financially affect owners dependent on rental income. The court ordered the 81 owners to pay the legal costs of the application.

Developer under pressure

For Balwin Properties, founded by Brookes in 1996, the legal battle comes at a delicate time. It has grown into one of South Africa’s top developers, targeting low- and middle-income buyers with sprawling estates. Brookes, who holds a 33 percent stake worth $28.4 million, has spent nearly three decades shaping the group into a listed real estate powerhouse. 

But rising borrowing costs and political uncertainty have slowed sales. Balwin’s revenue for fiscal 2025 slipped 6 percent to R2.2 billion ($127.3 million), though net profit improved 8 percent to R234 million ($13.5 million) as cost controls took hold. 

In April, the developer secured a R1 billion ($57.8 million) loan from the International Finance Corporation to speed up its Mooikloof Smart City project in Tshwane, underscoring its push to keep building even as market headwinds grow. 

The altercation at Blyde Riverwalk demonstrates how South Africa's housing market is clashing with emerging property uses, leaving investors, developers, and locals grappling with striking a balance between the prospect of short-term rental income and community living.