By Joshua Franklin

NEW YORK (Reuters) - Blackstone Group LP <BX.N>, the world's largest manager of alternative investments such as private equity and real estate, said on Friday it could be overseeing $1 trillion in assets by 2026.

The firm currently manages $439 billion, a five-fold increase since it went public in 2007.

The ambitious target highlights how Blackstone, like many peers, is eager to take advantage of healthy investor demand for private equity and other forms alternative asset management.

There is, however, concern in the industry that fundraising will suffer when the next economic downturn comes, as it did in 2009 during the financial crisis.

"Now you may ask ... have you tapped out? Are you hitting some ceiling? The answer to that is a definitive 'no,'" Blackstone President and Chief Operating Officer Jon Gray said at an investor day event, the firm's first since 2014. Gray was promoted earlier this year from head of Blackstone's real estate division.

In a presentation, Blackstone said assets under management could hit $600 billion in the next two years or so, $800 billion in four to six years and pass $1 trillion in eight-plus years.

The outlook underscores comments by Blackstone Chairman and Chief Executive Stephen Schwarzman in July about the alternative asset management industry entering a fundraising "super cycle," and his belief that Blackstone still has plenty of room to grow.

A growing asset base will boost the amount Blackstone earns from management fees, typically 1.5 percent to 2 percent of the assets it manages. These fees tend to be valued at a premium by investors because they are considered more stable than performance fees, Blackstone's other main revenue stream.

In its presentation, Blackstone said it had a "clear path" in the next two years or so to achieve at least 50 percent growth in fee-related earnings.

Blackstone shares rose as much 5.1 percent, reaching $39.70, their highest since July 2015.

In January, Blackstone agreed to buy a majority stake in the Financial and Risk business of Thomson Reuters Corp <TRI.N> <TRI.TO>, the parent of Reuters News, in a $20 billion deal. Reuters News will remain part of Thomson Reuters.

(Reporting by Joshua Franklin in New York)