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ixth Street, a private equity firm, has made a significant investment in the San Francisco Giants, including its real estate ventures along the city's downtown waterfront. This deal marks a major milestone for Mission Rock, a public-private partnership that has been years in the making. The project, which spans 28 acres and includes office and residential buildings, is expected to generate substantial revenue streams for the team.

    The investment values the Giants at $4.2 billion, with Sixth Street taking a 10% stake. This move highlights the growing trend of private equity firms investing in sports teams as a way to tap into their lucrative real estate opportunities. The Giants' partnership with Tishman Speyer on Mission Rock is a prime example of this strategy.

    Real estate has become an essential component of sports team ownership, providing year-round income and ancillary revenue streams. The Golden State Warriors' Chase Center in San Francisco is a notable example, featuring office buildings, retail space, and underground parking. Similarly, the Braves' mixed-use development around their stadium, The Battery Atlanta, has proven to be significantly more profitable than the team itself.

    Private equity firms like Arctos Partners have been actively investing in sports teams with substantial real estate holdings, including the Cubs, Red Sox, and Dodgers. The Giants themselves have partnered with Tishman Speyer on Mission Rock, a project that's expected to become a major asset for the organization.

    Giants CEO Larry Baer emphasized that no money from the MLB team is diverted to the real estate project, and vice versa. The partnership is 50-50, with each party responsible for its own financial obligations. Despite the Giants' recent struggles on the field, including declining attendance and limited playoff appearances, Mission Rock offers a promising opportunity for growth.

    Sixth Street's investment in the Giants is part of its broader sports portfolio, which includes Legends, Bay FC, and minority stakes in several high-profile teams. The firm has also received advice from PJT Partners and Latham & Watkins LLP on this deal.