Key Takeaways
- • Saba Capital escalates activist campaign: The US hedge fund, holding an 18.2% stake in Workspace Group (WKP), has issued a requisition notice to remove five non-executive directors and appoint four new NEDs, intensifying pressure on the £786m REIT.
- • Managed wind-down proposal with aggressive timeline: Saba urges Workspace's board to adopt a one-year managed wind-down plan involving portfolio asset sales, debt repayment, and capital returns to shareholders, with a February 20 deadline for board adoption.
- • Significant NAV discount signals market skepticism: Workspace trades at a 45% discount to net asset value—the widest among 19 UK REITs—despite stable operations and capable management, indicating persistent shareholder distrust in the company's ability to deliver equity returns.
- • Refinancing risk threatens dividend sustainability: Saba warns that Workspace's 7% dividend yield may become unsustainable when below-market-rate debt matures in coming years, creating pressure to preserve capital through leverage reduction.
- • Structural barriers and illiquidity trap: The campaign addresses concentrated shareholding, illiquid stock preventing shareholder exit, and a multi-year share price decline from £12.68 to 405p, reflecting broader market rejection of the flexible office space sector.
Summary
Boaz Weinstein's Saba Capital has escalated its activist campaign against Workspace Group, one of the UK's largest flexible office space providers and a £786m real estate investment trust. With an 18.2% stake in the company, Saba has submitted a requisition notice to the board proposing the removal of five non-executive directors and the appointment of four new NEDs—a direct challenge to board control and strategic direction.
The core of Saba's intervention centers on a managed wind-down proposal. In an open letter dated May 2026, the hedge fund has urged Workspace's board to execute a systematic portfolio liquidation over the next 12 months, redeploy proceeds to debt reduction, and distribute remaining capital to shareholders. Saba portfolio manager Paul Kazarian framed this as addressing a persistent market failure: despite Workspace maintaining a stable operating platform and competent management, the stock has traded at a 45% discount to net asset value—the steepest discount among 19 UK REITs surveyed. This widening gap signals deep market skepticism about the company's ability to create shareholder value through traditional operational improvement.
Kazarian's proposal emphasizes two strategic pathways: a steady asset disposal program or an outright portfolio sale to larger acquirers with lower financing costs. Either approach would realize NAV directly rather than relying on market sentiment to eventually recognize intrinsic value. The initiative also addresses secondary shareholder concerns, offering a clean exit mechanism for investors trapped in an illiquid stock. Critically, Saba has flagged refinancing risk as the timeline tightens—the company's currently below-market-rate debt matures within the coming years, and elevated refinancing costs could force dividend cuts on the 7%-yielding position, further eroding shareholder returns.
Saba's optimism about execution rests on a favorable market backdrop for high-quality income-producing real estate assets, which it argues would prevent fire-sale liquidation at distressed valuations. The requisition notice includes a firm deadline of February 20 for board adoption of the proposal. This represents Saba's latest activist intervention following similar campaigns targeting Edinburgh Worldwide and other UK investment vehicles, establishing a pattern of board replacement pressure when management strategies fail to close persistent valuation discounts.
The core of Saba's intervention centers on a managed wind-down proposal. In an open letter dated May 2026, the hedge fund has urged Workspace's board to execute a systematic portfolio liquidation over the next 12 months, redeploy proceeds to debt reduction, and distribute remaining capital to shareholders. Saba portfolio manager Paul Kazarian framed this as addressing a persistent market failure: despite Workspace maintaining a stable operating platform and competent management, the stock has traded at a 45% discount to net asset value—the steepest discount among 19 UK REITs surveyed. This widening gap signals deep market skepticism about the company's ability to create shareholder value through traditional operational improvement.
Kazarian's proposal emphasizes two strategic pathways: a steady asset disposal program or an outright portfolio sale to larger acquirers with lower financing costs. Either approach would realize NAV directly rather than relying on market sentiment to eventually recognize intrinsic value. The initiative also addresses secondary shareholder concerns, offering a clean exit mechanism for investors trapped in an illiquid stock. Critically, Saba has flagged refinancing risk as the timeline tightens—the company's currently below-market-rate debt matures within the coming years, and elevated refinancing costs could force dividend cuts on the 7%-yielding position, further eroding shareholder returns.
Saba's optimism about execution rests on a favorable market backdrop for high-quality income-producing real estate assets, which it argues would prevent fire-sale liquidation at distressed valuations. The requisition notice includes a firm deadline of February 20 for board adoption of the proposal. This represents Saba's latest activist intervention following similar campaigns targeting Edinburgh Worldwide and other UK investment vehicles, establishing a pattern of board replacement pressure when management strategies fail to close persistent valuation discounts.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.