Global private equity giant Blackstone Group, billed as the world’s largest commercial property owner, may have a new type of investment target in mind: professional sports teams.

“These are very large businesses,” Jonathan Gray, Blackstone's president and chief operating officer, said Thursday at a business conference hosted by news website Axios in New York.

“They're super valuable, because they're monopolistic in their markets, for the most part. They're the one thing all of us as human beings watch live,” Gray said. “So they are very valuable, more than their economic value, particularly if you think about streaming and the migration, ultimately, from the linear model of TV and cable to what I think will be a streaming model.”

But don’t assume the potential appetite means Blackstone would assume “outright ownership,” he said.

“Given the size of these businesses, there are multiple needs in the capital structure, so it could be some debt [or] it could be in the form of preferred equity,” Gray told a crowd of about 400. With “pure equity investments, because there is a sort of a precious painting quality to them, [it] is a little harder to underwrite from a cash flow standpoint, but … within those capital structures, are there opportunities that exist? I think there will be, and I would definitely never say never.”

Blackstone’s potential interest in professional sports teams comes as major leagues, including the NBA and MLB but with the exception of the NFL, are said to have loosened ownership rules involving private equity firms.

Some 63 major North American sports teams valued at $205.9 billion have private equity connections, with the NBA and MLB the top targets, according to a study released in September by PitchBook, which tracks global capital markets.

“Private equity sports investment is on the rise,” PitchBook said. “Dealmakers spy opportunities to gain outsized returns and cultural influence. … It's no wonder why: U.S. sports teams' valuations have grown faster than the S&P 500 in recent decades.”

Blackstone may not be putting money in a professional sports league yet, but one of its top executives already has: David Blitzer, the global head of Blackstone’s “tactical opportunities group” and a member of the firm’s management committee, is said to own stakes in teams including the Philadelphia 76ers.

Meanwhile, as higher interest rates have seized up deal activity industrywide, Gray said Blackstone has plenty of strategies to benefit from that, including its private credit lending business, which he said is almost entirely made up of floating-rate debt. The higher-rate environment also lends to the opportunity of buying at a lower price, he said.

“We were talking about buying into a business that others had bought into 18 months ago” at a materially higher price, Gray said. “I often say that the purchase price is permanent, [but] your financing is temporary. We're able to buy an asset in a higher-rate environment and get a lower price. Ultimately, you can refinance down the road. … Our business, private equity in particular, can thrive in this kind of environment.”

The investment firm, which in July said it crossed $1 trillion in assets under management, also sees “inflation coming down.”

“If you look at our portfolio, we see it in wages,” Gray said. “That market is less tight than it was 12, 18 months ago. Shelter cost, which is a big component, we are seeing rents coming down. … The Fed is … generally winning the war on inflation.”

A case in point, a recent study found Manhattan’s apartment vacancy rate topped 3% for the first time in more than three years with the median rental price in September dropping from a record high in August. CoStar data also shows national multifamily vacancy rate rising.

Still, Gray said even as rents are easing “given a large amount of multifamily supply,” the long-term outlook on the sector remains very promising.

“I would differentiate between maybe the short term and the long term,” he said. “We have been underbuilding housing in this country pretty significantly, since the financial crisis. We've had a surge in multifamily building, so that could put some … pressure downward modestly … in the near future. But the longer-term picture for rental housing is pretty strong. We just have this imbalance right now.”

As rates have moved up, Blackstone saw a 40% decline in construction and residential starts both in multifamily and single-family homes in August, he said.

Gray also said the logistics sector, Blackstone’s biggest property type representing 41% of its portfolio, continues to see “incredibly strong” fundamentals. On the office sector, now less than 2% of Blackstone’s U.S. portfolio, versus 60% in 2007, Gray said the “structural headwinds from remote work,” coupled with capital spending rising “much faster,” has led both debt and equity investors to get “much more cautious.”

As to Blackstone Real Estate Income Trust, which has faced investor redemption requests since late last year that led to a cap on withdrawals, Gray said the requests in the past nine months have slowed by more than 60%.

“The product is continuing to perform well particularly considering the environment,” he said. Skeptics are going to be “proven wrong.”