By Muskan Arora
The $144B Oregon State Treasury is making unconventional bets through a lesser-known $2.9B Opportunity Portfolio — targeting private credit, sports franchises, and dislocation situations — as it seeks differentiated returns outside its traditional asset classes.
Established in 2005, the Opportunity Portfolio was designed as a flexible sleeve for strategies that don’t fit into core asset buckets. Currently, at roughly 3% of Oregon’s $98.4B Public Employees Retirement Fund (OPERF), it has become a launching pad for niche strategies, emerging themes, and one-off market dislocations. For the 10 years ended June 30, 2025, the Opportunity Portfolio has delivered a 9.1% net return, which was only exceeded by OPERF’s private and public equity allocations.
Private credit, the biggest bucket of the portfolio, has backed managers like Sixth Street, Blue Owl, Dawson Partners, Pathlight, and Oak Hill Advisors. The pension plan prefers firms that offer both stringent credit underwriting and downside protection.
“We generally don’t go looking for themes, we hire managers that can do that” said Michael Mueller, head of the portfolio, in an exclusive interview with Markets Group. “We look for managers with a strong underwriting discipline and long-term alignment. In private credit, the real value is in avoiding losses.”
In 2020, Oregon’s $200M contingent capital commitment to Sixth Street’s TAO fund was deployed rapidly amid pandemic dislocations — offering a case study in flexible, high-conviction deployment. Additional commitments followed to Oak Hill and Clearlake funds focused on opportunistic and distressed situations.
For now, pacing is cautious. No new illiquid manager relationships have been added to the portfolio since 2021 as OPERF continues to manage an over allocation across its private market asset classes, amid overall fund illiquidity running above its 40% target.
Still, Oregon officials are exploring a longer-term goal: elevating private credit into its own strategic asset class, outside the Opportunities sandbox.
“It’s no longer experimental; the first Opportunity Portfolio investment in 2006 was a real estate private credit mandate,” added Mueller. “In many ways, this portfolio has been a testing ground for what could eventually move into a core allocation. We did something similar before real assets became a strategic allocation for the fund.”
Recently, the Opportunity Portfolio has embraced another unconventional frontier: professional sports. In 2021, Oregon was among the first institutional limited partners to commit to Arctos Sports Partners, which was given league approval to purchase passive equity stakes in teams across the NBA, MLB, NHL, MLS and, more recently, National Football League. A $150M follow-on commitment in 2023 helped Arctos close its second fund at $4.1B .
Through Arctos, Sixth Street, and Clearlake, OPERF now has indirect exposure to franchises such as the Buffalo Bills, Golden State Warriors, San Antonio Spurs, Los Angeles Dodgers, Chelsea F.C. and Paris Saint-Germain. As sports teams’ valuations rise — the average NFL franchise is now worth $5.9B — institutional capital is gaining access to an asset class once dominated by billionaires and family offices.
“Sports franchises are finite, cash-generative, and have strong pricing power through media rights since sports are best consumed live,” said Mueller. “They also tend to be uncorrelated with market cycles — which makes them uniquely valuable in a diversified portfolio.”
Arctos-backed research estimates North American franchises have generated annualized returns of 13% over the past 60 years — exceeding public markets and on par with private equity but with lower volatility.
Within sports investing, liquidity is limited and often depends on controlling owners’ willingness to sell. Most franchises do not pay dividends, and partial exits can take years. Oregon’s exposure to sports remains relatively modest — less than 0.3% of total pension assets — but it may increase if liquidity improves and pricing holds.
Further, the pension plan sees growing opportunities within women’s sports investing, including the National Women’s Soccer League (NWSL) and the Women’s National Basketball Association.
