Gross Asset Value (GAV)

GAV is the sum of all fund assets at fair value, including investments, cash and receivables. Subtracting liabilities gives net asset value. In leveraged funds or real estate funds with property-level debt, GAV can be substantially higher than NAV.

GAV matters operationally because some fund documents calculate management fees on GAV rather than NAV, which effectively charges fees on borrowed capital. GAV is also used in some regulatory reports and leverage calculations.

Pitfalls include applying the fee rate to the wrong base, inconsistent definitions of GAV across documents (for example whether undrawn commitments or look-through property values are included), and failing to reflect leverage changes promptly in fee accruals. Where fees are charged on GAV, the fee base should be shown clearly in the NAV pack so that investors and auditors can recompute it, and the definition used should be applied consistently across periods.

Example

A fund has total assets of $250M and liabilities of $2M, so NAV is $248M. A 1.5% annual management fee charged on GAV is $3.75M; the same rate on NAV would be $3.72M.