#London #United Kingdom #shareholder activism #Saba Capital #Workspace Group

Saba Capital Pushes for Transformation at Workspace Group

In a recent communication addressed to the shareholders of Workspace Group plc, Saba Capital Management L.P., the company’s second-largest shareholder, has emphasized the urgent need for strategic changes within the organization. Holding approximately 24.7% of the outstanding shares, Saba Capital believes that a significant gap exists between Workspace's current share price and the true value of its property portfolio.

Saba Capital began investing in Workspace in August 2025, motivated by what they perceived as an undervaluation of the company’s real estate assets. The investment firm pointed out several reasons for Workspace's persistent underperformance against peers and the considerable discount to its net asset value (NAV)—the highest among 19 comparable UK Real Estate Investment Trusts (REITs). Factors contributing to this situation include strategic inconsistencies, management changes, and a poorly timed execution of prior sales.

In November 2025, Saba management met with Workspace’s leadership to propose a strategic direction aimed at reducing the NAV discount. However, their suggestions were met with a lack of engagement and outright rejection from the Workspace Board. Subsequent to this, Saba Capital took the notable step of issuing an open letter on January 8, 2026, detailing a clear framework for unlocking shareholder value. The plan involved strategically selling properties, repaying debts, and returning capital to shareholders to address the substantial discount effectively.

Despite Workspace's Board dismissing these proposals as imprudent, Saba pointed out recent property transactions that indicated the market's appetite for a more expedient sales approach. They suggested that executing a well-planned disposal program could provide a substantial return for shareholders, particularly if supported by share buybacks.

On May 20, 2026, in response to the Board's refusal to adopt Saba's more aggressive strategy, Saba initiated a requisition to replace incumbent non-executive directors with a slate of six highly qualified nominees. These candidates are positioned to bring much-needed expertise in real estate management, capital allocation, and shareholder engagement necessary for the company's revitalization.

The new executive leadership introduced at Workspace—including CEO Charlie Green and CFO Tom Edwards-Moss—has unveiled a strategy focused on transforming the business to prioritize earnings. However, Saba expressed concern about the risks associated with this approach, arguing it may prolong the timeline for generating significant shareholder returns.

In reiterating their Value Creation Strategy, Saba emphasized the advantage of prioritizing property sales over large-scale reinvestments. They proposed a structured roadmap for asset disposals, aimed at realizing value while allowing for market flexibility. This roadmap envisions three phases for property sales: an initial focus on 21 non-core assets, followed by 19 additional properties, culminating with a targeted portfolio of 16.

Saba's intentions extend beyond property sales, as they plan to enhance operational efficiency through outsourcing property management and implementing focused refurbishments to boost occupancy and rental income. They have engaged credible firms to handle property management in various Workspace locations under a more disciplined capital expenditure policy.

Saba contends that the existing Board has not demonstrated the capability necessary to manage shareholder interests effectively, as indicated by the significant NAV discount. The firm has urged fellow shareholders to support their nominees, whom they believe are capable of steering the company toward a profitable future.

Looking ahead, Saba Capital remains committed to engaging with other shareholders to discuss these crucial strategies. They encourage everyone involved to review their detailed assessments regarding Workspace's performance and the potential paths available for realizing value for all stakeholders.

As the situation evolves, all eyes will be on the shareholders—will they support Saba's nominees and realize the need for considerable change within Workspace Group plc?