Saba Capital takes up to 4% economic stake in Unite Group

Activist hedge fund Saba Capital has accumulated an economic exposure to Unite Group equal to as much as 4% of the company’s shares through derivatives, according to people familiar with the matter. The position was built during the spring. Saba and Unite declined to comment.

The US-based firm has added Unite to a list of UK-listed companies it has flagged for shareholder engagement. Saba is currently pursuing an activist campaign at a London office landlord where it has pushed for the removal of non-executive directors, the sale of a multi-building portfolio and the return of proceeds to shareholders.

Unite Group is Britain’s largest student accommodation operator, managing rooms for about 72,000 students and holding a property portfolio of roughly £9 billion. The company benefited after the Covid-19 pandemic from a shortage of purpose-built student housing and a return to in-person teaching, which supported rents and occupancy, particularly among international students.

Over the past year those conditions weakened. Unite has repeatedly trimmed its forecasts for occupancy and rental growth. Its share price has fallen about one-third in the past 12 months and the stock trades at an estimated 43% discount to the stated value of its property portfolio. The company was removed from the FTSE 100 toward the end of 2025.

The UK student housing market has faced a mix of higher supply in some university cities, tighter visa rules that have reduced demand from international postgraduates, and a rise in domestic students choosing to live at home to cut costs. Several universities have reduced the number of rooms they commit to buy from Unite. The operator has cut rents in local markets including Leicester, Nottingham and Sheffield to attract occupants.

In response, Unite is shifting its portfolio toward accommodation linked to higher-tariff universities and has put up to £400 million of assets and land associated with lower-ranked institutions up for sale. The company has said some proceeds may be used for share buybacks. In May it sold a 571-bed property near London’s St Pancras for £186 million to its own Unite UK Student Accommodation Fund, in which Unite holds a 32% stake.

Analysts have argued that further disposals to external buyers may be required to better demonstrate the underlying value of the portfolio to investors. The combination of a wide discount to asset value and recent operating weakness has drawn attention from investors who focus on unlocking value through restructurings and asset sales.