What is net asset value?

For private real estate funds, NAV is the primary metric used to track portfolio value and is typically updated on a quarterly or semi-annual basis using independent third-party appraisals of the fund's properties. NAV per share may also serve as the reference price for purchasing or redeeming shares, depending on the fund's offering terms. It is important to understand that NAV is an estimate, not a real-time market price. Because private real estate assets are not traded on public exchanges, there is no continuous price discovery process- the appraised value reflects a professional opinion of what the assets would sell for under orderly conditions, which may differ from what they would actually fetch in a distressed or rapid sale. Quarterly NAV adjustments capture changes in property values, market conditions, occupancy trends, and other factors, but there will always be some lag between market conditions and the reflected NAV. Investors should treat NAV as a reasonable approximation of value rather than a precise or guaranteed figure.