Grealish struggled for a regular start with the Premier League champions last season.
"If you're buying Grealish, are you buying him as a winger? Tottenham like pace, Jack is not blessed with pace. You'd have to play him in a number 10 role, and they already have James Maddison for that," Waddle told Betway.
"So Spurs no, and I wouldn't say Arsenal either. Liverpool play a very high tempo game, so I'm not sure about there too. What you're looking at is, would you play Grealish as a winger or a number 10, or midfield player? If I was buying him I'd be looking to play him in the middle. He does a job on the wing, but wingers create, get round the back, and Jack can't get round the back.
"Yeah, he doesn't give the ball away and doesn't take a lot of risks, gives the side balance. But I think I'd be looking at his old club Aston Villa, I'd be looking to play him in that three in the middle of the park. I'm not sure about Newcastle, they play a high tempo and press. I think he has to go to a side where they are looking to play him as a midfield player.
"Chelsea could be an outside bet with Gallagher possibly going, you could see him playing that midfield role. He'd be more effective there. He's got vision, he can see things, he's good at give and go. But he's stuck on that wing, you're thinking there is surely more in his locker.
So if I was a top club looking for a winger, I'd be looking at players ahead of Grealish."