GRANDVIEW INVESTMENT TRUST, N-30D, 1998-05-29

GRANDVIEW INVESTMENT TRUST
N-30D, 1998-05-29

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1998 Annual Report
GrandView Investment Trust
Post Office Drawer 69
Rocky Mount, North Carolina 27802-0069
May 25, 1998

Telephone: 919-972-9922
U.S. WATS: 800-525-FUND
Facsimile: 919-0442-4226

To the Shareholders of the GrandView S&P(R) REIT Index Fund:

We are pleased to present our third annual report for the GrandView S&P(R) REIT
Index Fund. The table below presents our results for the year along with the
appropriate market benchmarks.
<TABLE>
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- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Period Ending Dow Jones S&P 500 REIT Benchmark GrandView GrandView
Utility Index Index Composite S&P REIT(R) Index S&P REIT(R) Index
(Total (Total Return) (GrandView Fund (NAV) Fund (MOP)
Return) /S&P)* (Total Return) (Total Return)
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Three Month 5.68% 13.95% -0.62% -1.22% -4.18%
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Six Months 22.38% 17.22% 0.13% -0.33% -3.32%
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
One Year 36.65% 48.00% 15.27% 15.54% 12.07%
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Two Year 48.21% 77.34% 49.36% 48.87% 44.40%
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Since Inception 62.48% 112.93% 66.64% 58.40% 53.65%
From 7/03/95
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
NAV = Net Asset Value (Without Sales Load)
MOP = Maximum Offering price (With Sales Load)
</TABLE>

The role of an index fund is to provide you, the investor, with a cost
efficient, "market" return that correlates well with its underlying benchmark.
With that as the Fund's objective, last year can be viewed as a success. Your
Fund's returns (less operating expenses) were representative of the REIT market
as measured by the Fund's benchmark with a correlation co-efficient that
exceeded 99.9%. However, the overall REIT market did not compare favorably with
the rest of the equity markets for the last twelve months. REIT industry total
returns trailed both the S&P 500 and the Dow Jones Utility indexes. Being
representative of the REIT industry, your Fund also trailed these indices. The
Fund paid out $0.6425 per share in dividends and $2.75 in capital gains over the
last twelve months. The dividend payout was an increase over last year as
numerous REITs raised their dividends throughout the year. The high capital
gains distribution was unusual for a fund of this type but was attributable to
redemptions as investor interest in the REIT industry and hence your Fund ebbed
over the period.

Of particular note, now that the Fund is developing some significant performance
data, is how it correlates (a Fund's Beta) with the S&P 500. Many investors use
individual REITs or a REIT Fund as an asset class for diversification purposes.
It is believed that by adding investments that have different Betas you can
reduce the risk of an overall investment portfolio. Real estate has long been an
asset class that has been held as a balance against the more volatile general
equity market. We are pleased that Micropal, Inc., a non-affiliated data
service, has published data on your Fund's Beta. That data indicates that its
beta is one of the lowest in the industry with a range of 0.20-0.25 for the year
versus the S&P 500 beta of 1.00. For comparison, most utility funds are in the
0.50 range. This would suggest that your Fund is a good candidate for those who
are seeking appropriate diversification in relation to the overall market.

<PAGE>
In last year's report we indicated that Fund investors should anticipate total
returns throughout a prolonged investment period (3-5 years) in the low to mid
teens. Well, at just over 15.5% for the year it seems that we are right on
target. However, during the last six months, the Fund has not been meeting that
type of return. Are we in a lull or the beginning of the end for the great bull
REIT market? No one knows for sure but we can identify two negatives in the
market today that were not there this time last year. The first is that Congress
has indicated that they want to change some of the tax regulations for a certain
type of REIT called a "paired share". Although only impacting four REITs out of
over two hundred, the fear of this unknown impact of future legislation has had
a dampening effect on the overall REIT market. The second issue that has not
gotten as much attention as the first, is the flat shape of the interest rate
curve. This curve measures the difference between short and long term rates.
This rate spread is used to determine profitability for all mortgage and many
hybrid REITs. Historically, interest rates for longer-term money yields far more
than short-term money. But over the last six months, this "spread" has been
historically small. This "flatness" has provided good opportunities to borrow or
refinance long term debt but it has not been good for profits at some REITs.
These two "negative" events, occurring within the same general time frame, have
more than offset what continues to be a good overall real estate market.
Property construction still is under control, the overall economy is good and
rents are generally rising as demand for well-located real estate exceeds
supply.

We continue to think the future is positive for real estate securities. With a
good economy and stable interest rates, real estate supply and demand is still
in the demand side of the cycle. There are many institutional owners of real
estate who are interested in selling to public real estate companies providing
good opportunities for continued public company growth. There will always be
occasional bumps in the road such as "tax" issues, interest rate curves and
foreign economies, but these bumps also provide good investment opportunities.
We think that by investing in your Fund, you are in a good position to take
advantage of these opportunities. We continue to expect low to mid-teen annual
returns throughout a 3-5 year investment period for the REIT industry and hence
for your Fund.

Finally, we want to take this opportunity to address the much publicized "Year
2000" problem for our shareholders. All major service providers to our Fund,
First Union National Bank, the Fund's custodian; The Nottingham Company, the
Fund administrator and North Carolina Shareholder Services, the Fund's transfer
agent all have implementation plans that address the issue. These service
providers indicate that their year 2000 plan will be completed prior to the
occurrence of any problem. Although issues may develop as the time gets closer,
we want to assure you that your management team is aware of the issue and is
doing everything within its power to minimize its impact on the Fund.

We want to again thank you for your support as shareholders. If you ever have
any questions or desire additional information, please feel free to contact the
Fund Administrator at 1-800-525-3862, or the offices of GrandView Advisers at
1-800-578-4301.

Winsor H. Aylesworth
President
GrandView Advisers, Inc.

- ---------
* Benchmark used in the table and assoicated graph is a combination of two
indices. The GrandView Total Return REIT Index is used from Fund inception until
December 31, 1997. At that time, the Fund's objective was changed to provide
returns that correspond and are highly correlated to the S&P REIT Index. All
benchmark references incorporates this change.

<PAGE>

GrandView S&P(R) REIT Index Fund

Performance Update - $10,000 Investment
For the period from July 3, 1995 (commencement of operations) to
March 31, 1998

Grandview
GrandView S&P(R) S&P 500 Dow Jones Total Return/
REIT Index Fund Index Utility Index S&P REIT Index

7/3/95 9,700 10,000 10,000 10,000
9/30/95 9,991 10,748 10,722 10,472
12/31/95 10,351 11,395 11,451 10,944
3/31/96 10,321 12,007 10,963 11,157
6/30/96 10,726 12,545 11,503 11,646
9/30/96 11,335 12,933 11,491 12,353
12/31/96 13,413 14,011 12,488 14,512
3/31/97 13,298 14,387 11,890 14,457
6/30/97 13,935 16,899 12,490 15,142
9/30/97 15,415 18,164 13,277 16,642
12/31/97 15,554 18,686 15,374 16,768
3/31/98 15,365 21,293 16,248 16,664

This graph depicts the performance of the GrandView S&P(R)REIT Index Fund versus
the S&P 500 Index, the Dow Jones Utility Index, and the GrandView Total Return
Index (prior to 12/31/97)/ S&P REIT Index (subsequent to 12/31/97). It is
important to note that the GrandView S&P(R) REIT Index Fund is a professionally
managed mutual fund while the indexes are not available for investment and are
unmanaged. The comparison is shown for illustrative purposes only.

Annualized Total Return

- --------------------------------------------------------------
Since Inception One Year
- --------------------------------------------------------------
No Sales Load 18.24% 15.54%
- --------------------------------------------------------------
Maximum 3% Sales Load 16.94% 12.07%
- --------------------------------------------------------------

The graph assumes an initial $10,000 investment at July 3, 1995 ($9,700 after
maximum sales load of 3.0%). All dividends and distributions are reinvested.

At March 31, 1998, the GrandView S&P REIT Index Fund would have grown to $15,365
- - total investment return of 53.65% since July 3, 1995. Without the deduction of
the 3.0% maximum sales load, the GrandView S&P REIT Index Fund would have grown
to $15,840 - total investment return of 58.40% since July 3, 1995.

At March 31, 1998, a similar investment in the S&P 500 Index would have grown to
$21,293 - total investment return of 112.93%; the Dow Jones Utility Index would
have grown to $16,248 - total investment return of 62.48%; the GrandView Total
Return/S&P REIT Total Return Index would have grown to $16,664 - total
investment return of 66.64% since July 3, 1995.

Past performance is not a guarantee of future results. A mutual fund's share
price and investment return will vary with market conditions, and the principal
value of shares, when redeemed, may be worth more or less than the original
cost. Average annual returns are historical in nature and measure net investment
income and capital gain or loss from portfolio investments assuming
reinvestments of dividends.

<PAGE>
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GRANDVIEW S&P(R) REIT INDEX FUND

PORTFOLIO OF INVESTMENTS

March 31, 1998

- ------------------------------------------------------------------------------------------------------------------------------------
Value
Shares (note 1)
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - 99.41%

Real Estate Investment Trusts - 99.41%

American Health Properties, Inc. ........................................... 273 $ 7,234
Apartment Investment & Management Company .................................. 357 13,611
Arden Realty, Inc. ......................................................... 423 12,056
Avalon Properties, Inc. .................................................... 305 8,769
Bay Apartment Communities, Inc. ............................................ 197 7,314
Boston Properties, Inc. .................................................... 480 16,890
Bradley Real Estate, Inc. .................................................. 265 5,515
CBL & Associates Properties, Inc. .......................................... 279 6,853
CCA Prison Realty Trust .................................................... 153 6,340
CRIIMI MAE, Inc. ........................................................... 465 7,178
Camden Property Trust ...................................................... 235 6,962
Capstead Mortgage Corporation .............................................. 432 8,532
Capstone Capital Corporation ............................................... 250 6,078
CarrAmerica Realty Corporation ............................................. 475 14,250
CenterPoint Properties Corporation ......................................... 228 7,909
Charles E. Smith Residential Realty, Inc. .................................. 172 5,719
Chateau Communities, Inc. .................................................. 186 5,533
Chelsea GCA Realty, Inc. ................................................... 132 4,884
Colonial Properties Trust .................................................. 245 7,794
Commercial Net Lease Realty ................................................ 313 5,458
Cornerstone Properties, Inc. ............................................... 771 13,974
Cousins Properties, Inc. ................................................... 233 7,194
Crescent Real Estate Equities Company ...................................... 650 23,400
Developers Diversified Realty Corporation .................................. 209 8,543
Duke Realty Investments, Inc. .............................................. 604 14,723
Dynex Capital, Inc. ........................................................ 506 6,072
Equity Inns Inc. ........................................................... 402 6,206
Equity Office Properties Trust ............................................. 1,753 53,686
Equity Residential Properties Trust ........................................ 632 31,758
Essex Property Trust, Inc. ................................................. 194 6,657
Excel Realty Trust, Inc. ................................................... 155 5,522
Federal Realty Investment Trust ............................................ 290 7,123
FelCor Suite Hotels, Inc. .................................................. 294 10,896
First Industrial Realty Trust, Inc. ........................................ 279 10,044
Gables Residential Trust ................................................... 257 6,987
General Growth Properties .................................................. 287 10,476
Glenborough Realty Trust, Inc. ............................................. 234 6,801
Glimcher Realty Trust ...................................................... 277 6,059
Health Care Property Investors, Inc. ....................................... 230 8,496

(Continued)
</TABLE>
<PAGE>
<TABLE>
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GRANDVIEW S&P(R) REIT INDEX FUND

PORTFOLIO OF INVESTMENTS

March 31, 1998

Real Estate Investment Trusts - (Continued)

Health and Retirement Property Trust ....................................... 805 $ 16,301
Healthcare Realty Trust, Inc. .............................................. 225 6,356
Highwoods Properties, Inc. ................................................. 388 13,677
Horizon Group, Inc. ........................................................ 386 4,753
Hospitality Properties Trust ............................................... 313 11,092
INMC Mortgage Holdings, Inc. ............................................... 500 12,500
Irvine Apartment Communities, Inc. ......................................... 232 7,308
JDN Realty Corporation ..................................................... 215 7,350
JP Realty, Inc. ............................................................ 202 5,126
Kilroy Realty Corporation .................................................. 179 5,113
Kimco Realty Corporation ................................................... 310 10,966
LTC Properties, Inc. ....................................................... 288 5,562
Liberty Property Trust ..................................................... 379 10,186
Mack-Cali Realty Corporation ............................................... 413 16,133
Manufactured Home Communities, Inc. ........................................ 287 7,426
Meditrust Companies ........................................................ 501 15,406
Merry Land & Investment Company, Inc. ...................................... 305 6,824
Mid-America Apartment Communities, Inc ..................................... 198 5,581
Mills Corp. ................................................................ 269 7,044
National Health Investors, Inc. ............................................ 187 7,457
Nationwide Health Properties, Inc. ......................................... 332 8,217
New Plan Realty Trust ...................................................... 509 12,789
OMEGA Healthcare Investors, Inc. ........................................... 142 5,538
Pacific Gulf Properties, Inc. .............................................. 218 5,000
Patriot American Hospitality, Inc. ......................................... 590 15,930
Post Properties, Inc. ...................................................... 254 10,144
Prentiss Properties Trust .................................................. 279 7,289
Price REIT, Inc. ........................................................... 137 6,139
Public Storage, Inc. ....................................................... 658 20,316
RFS Hotel Investors, Inc. .................................................. 285 5,219
Realty Income Corporation .................................................. 301 8,183
Reckson Associates Realty Corporation ...................................... 277 7,306
Security Capital Group - WT ................................................ 279 924
Security Capital Pacific Trust ............................................. 803 19,322
Security Capital Atlantic Incorporated ..................................... 356 7,476
Security Capital Industrial Trust .......................................... 657 16,836
Shurgard Storage Centers, Inc. ............................................. 210 5,906
Simon DeBartolo Group, Inc. ................................................ 686 23,538
Spieker Properties, Inc. ................................................... 274 11,303

(Continued)
</TABLE>
<PAGE>
<TABLE>
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GRANDVIEW S&P(R) REIT INDEX FUND

PORTFOLIO OF INVESTMENTS

March 31, 1998

Real Estate Investment Trusts - (Continued)

Starwood Hotels & Resorts .................................................. 1,285 $ 68,667
Storage USA, Inc. .......................................................... 210 8,059
Summit Properties, Inc. .................................................... 274 5,514
Sun Communities, Inc. ...................................................... 187 6,498
Taubman Centers, Inc. ...................................................... 604 7,852
The Macerich Company ....................................................... 192 5,712
TriNet Corporate Realty Trust, Inc. ........................................ 50 1,916
United Dominion Realty Trust ............................................... 679 9,845
Urban Shopping Centers, Inc. ............................................... 203 6,699
Vornado Realty Trust ....................................................... 416 18,122
Walden Residential Properties, Inc. ........................................ 206 5,201
Washington Real Estate Investment Trust .................................... 416 7,150
Weingarten Realty Investors ................................................ 205 9,174
--------

Total Common Stocks (Cost $904,751) ........................................ 949,441
--------

INVESTMENT COMPANY - 0.73%

Evergreen Money Market Treasury Institutional Money
Market Fund Institutional Service Shares (Cost $6,971)............... 6,971 6,971
--------

Total Value of Investments (Cost $911,722 (b)) ......................................... 100.14 % $956,412
Liabilities In Excess of Other Assets .................................................. (0.14)% (1,345)
------ --------
Net Assets ...................................................................... 100.00 % $955,067
====== ========

(a) Aggregate cost for federal income tax purposes is $919,325. Unrealized appreciation (depreciation) of investments for
federal income tax purposes is as follows:

Unrealized appreciation $55,322
Unrealized depreciation (18,235)
-------

Net unrealized appreciation $37,087
=======

See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
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GRANDVIEW S&P(R) REIT INDEX FUND

STATEMENT OF ASSETS AND LIABILITIES

March 31, 1998

ASSETS
Investments, at value (cost $911,722) ......................................................... $956,412
Income receivable ............................................................................. 5,139
Receivable for investments sold ............................................................... 19,432
Deferred organization expenses, net (note 4) .................................................. 12,253
Other assets .................................................................................. 1,232
Due from advisor (note 2) ..................................................................... 4,735
--------

Total assets ............................................................................. 999,203
--------

LIABILITIES
Accrued expenses .............................................................................. 7,228
Distributions payable ......................................................................... 21,395
Payable for investment purchases .............................................................. 8,789
Disbursements in excess of cash on demand deposit ............................................. 6,724
--------

Total liabilities ........................................................................ 44,136
--------

NET ASSETS
(applicable to 86,343 shares outstanding; unlimited
shares of no par value beneficial interest authorized) ....................................... $955,067
========

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE
($955,067 / 86,343 shares) .................................................................... $ 11.06
========

OFFERING PRICE PER SHARE
(100 / 97% of $11.06) ......................................................................... $ 11.40
========

NET ASSETS CONSIST OF
Paid-in capital ............................................................................... $911,481
Distribution in excess of net realized loss ................................................... (1,104)
Net unrealized appreciation on investments .................................................... 44,690
--------
$955,067
========

See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
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GRANDVIEW S&P(R) REIT INDEX FUND

STATEMENT OF OPERATIONS

March 31, 1998

INVESTMENT INCOME

Income
Dividends ..................................................................................... $ 72,221
--------

Expenses
Investment advisory fees (note 2) ............................................................. 5,370
Fund administration fees (note 2) ............................................................. 3,452
Distribution and service fees (note 3) ........................................................ 1,912
Custody fees .................................................................................. 5,866
Registration and filing administration fees (note 2) .......................................... 2,425
Fund accounting fees (note 2) ................................................................. 16,200
Audit fees .................................................................................... 7,500
Legal fees .................................................................................... 5,254
Securities pricing fees ....................................................................... 2,595
Shareholder recordkeeping fees ................................................................ 629
Shareholder servicing expenses ................................................................ 3,464
Registration and filing expenses .............................................................. 8,710
Printing expenses ............................................................................. 1,585
Amortization of deferred organization expenses (note 4) ....................................... 5,442
Trustee fees and meeting expenses ............................................................. 512
Other operating expenses ...................................................................... 3,318
--------

Total expenses ........................................................................... 74,234
--------

Less:
Expense reimbursements (note 2) .................................................... (49,107)
Investment advisory fees waived (note 2) ........................................... (5,370)
Securities pricing fees waived ..................................................... (2,595)
Distribution and service fees waived (note 3) ...................................... (1,054)
--------

Net expenses ............................................................................. 16,108
--------

Net investment income .............................................................. 56,113
--------

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS

Net realized gain from investment transactions ..................................................... 232,663
Decrease in unrealized appreciation on investments ................................................. (46,110)
--------

Net realized and unrealized gain on investments ............................................... 186,553
--------

Net increase in net assets resulting from operations ..................................... $242,666
========

See accompanying notes to financial statements
</TABLE>
<PAGE>
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GRANDVIEW S&P(R) REIT INDEX FUND

STATEMENTS OF CHANGES IN NET ASSETS

- ------------------------------------------------------------------------------------------------------------------------------------
Year ended Year ended
March 31, March 31,
1998 1997
- ------------------------------------------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS

Operations
Net investment income ................................................................... $ 56,113 $ 26,606
Net realized gain (loss) from investment transactions ................................... 232,663 (3,402)
Increase (decrease) in unrealized appreciation on investments ........................... (46,110) 91,681
---------- ----------

Net increase in net assets resulting from operations ............................... 242,666 114,885
---------- ----------

Distributions to shareholders from
Net investment income ................................................................... (56,113) (26,606)
Tax return of capital ................................................................... (14,856) (5,692)
Net realized gain from investment transactions .......................................... (229,983) (479)
---------- ----------

Decrease in net assets resulting from distributions ................................ (300,952) (32,777)
---------- ----------

Capital share transactions
Increase (decrease) in net assets resulting from capital share transactions (a) ......... (453,745) 1,132,197
---------- ----------

Total increase (decrease) in net assets ....................................... (512,031) 1,214,305

NET ASSETS

Beginning of year ........................................................................... 1,467,098 252,793
---------- ----------

End of year ................................................................................. $ 955,067 $1,467,098
========== ==========

(a) A summary of capital share activity follows:
--------------------------------------------------------------------------
Year ended Year ended
March 31, 1998 March 31, 1997

Shares Value Shares Value
--------------------------------------------------------------------------

Shares sold ............................................ 23,316 $ 304,629 100,474 $1,238,757
Shares issued for reinvestment
of distributions .................................. 21,072 253,406 2,066 24,781
---------- ---------- ---------- ----------

44,388 558,035 102,540 1,263,538

Shares redeemed ........................................ (75,098) (1,011,780) (10,250) (131,341)
---------- ---------- ---------- ----------

Net increase (decrease) ........................... (30,710) $ (453,745) 92,290 $1,132,197
========== ========== ========== ==========

See accompanying notes to financial statements
</TABLE>
<PAGE>
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GRANDVIEW S&P(R) REIT INDEX FUND

FINANCIAL HIGHLIGHTS

(For a Share Outstanding Throughout the Period)

- ------------------------------------------------------------------------------------------------------------------------------------
For the
period from
July 3, 1995
(commencement of
Year ended Year ended operations) to
March 31, March 31, March 31,
1998 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------------

Net asset value, beginning of period ..................................... $12.53 $10.21 $10.00

Income from investment operations
Net investment income ......................................... 0.49 0.50 0.33
Net realized and unrealized gain on investments ............... 1.45 2.38 0.32
---------- ---------- ----------

Total from investment operations .......................... 1.94 2.88 0.65
---------- ---------- ----------

Distributions to shareholders from
Net investment income ......................................... (0.49) (0.50) (0.33)
Tax return of capital ......................................... (0.17) (0.05) 0.00
Net realized gain from investment transactions ................ (2.75) (0.01) (0.11)
---------- ---------- ----------

Total distributions ....................................... (3.41) (0.56) (0.44)
---------- ---------- ----------

Net asset value, end of period ........................................... $11.06 $12.53 $10.21
========== ========== ==========

Total return (a) ......................................................... 15.54 % 25.85 % 6.40 %
========== ========== ==========

Ratios/supplemental data

Net assets, end of period .......................................... $ 955,067 $1,467,098 $ 252,793
========== ========== ==========

Ratio of expenses to average net assets
Before expense reimbursements and waived fees ................. 4.84 % 7.59 % 20.63 % (b)
After expense reimbursements and waived fees .................. 1.05 % 1.04 % 1.05 % (b)

Ratio of net investment income (loss) to average net assets
Before expense reimbursements and waived fees ................. (0.13)% (2.16)% (13.66)% (b)
After expense reimbursements and waived fees .................. 3.66 % 4.38 % 5.86 % (b)

Portfolio turnover rate ............................................ 63.15 % 23.38 % 47.46 %

Average broker commissions per share (c) ........................... $0.0697 $0.0698 -

(a) Total return does not reflect payment of sales charge.
(b) Annualized
(c) Represents total commission paid on portfolio securities divided by total portfolio shares purchased or sold on which
commissions were charged.

See accompanying notes to financial statements
</TABLE>
<PAGE>
GRANDVIEW S&P(R) REIT INDEX FUND

NOTES TO FINANCIAL STATEMENTS

March 31, 1998

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND OTHER INFORMATION

The GrandView S&P(R) REIT Index Fund (the "Fund") is a diversified
series of shares of beneficial interest of the GrandView Investment
Trust (the "Trust"). The Trust, an open-ended investment company, was
organized on February 6, 1995 as a Massachusetts Business Trust and is
registered under the Investment Company Act of 1940, as amended. The
primary objective of the Fund is long-term growth of capital by
selecting investments which are equity securities of real estate
industry companies which are undervalued or have significant
"turnaround" potential. The Fund began operations on July 3, 1995.
Shares of the Fund purchased are subject to a maximum sales charge of
3.00%. Shares of the Fund redeemed are subject to a 1.00% redemption
fee, which applies to redemptions during the first six months after
share purchases. The redemption fee is subsequently reduced after the
first six months and is eliminated after one year. The following is a
summary of significant accounting policies followed by the Fund.

A. Security Valuation - The Fund's investments in securities are
carried at value. Securities listed on an exchange or quoted on a
national market system are valued at the last sales price as of
4:00 p.m., New York time on the day of valuation. Other
securities traded in the over-the-counter market and listed
securities for which no sale was reported on that date are valued
at the most recent bid price. Securities for which market
quotations are not readily available, if any, are valued by using
an independent pricing service or by following procedures
approved by the Board of Trustees. Short-term investments are
valued at cost which approximates value.

B. Federal Income Taxes - At March 31, 1998, the Fund was considered
a personal holding company as defined under Section 542 of the
Internal Revenue Code since 50% of the value of the Fund's shares
were owned directly or indirectly by five or fewer individuals at
certain times during the last half of the year. As a personal
holding company the Fund is subject to federal income taxes on
undistributed personal holding company income at the maximum
individual income tax rate. No provision has been made for
federal income taxes since substantially all taxable income has
been distributed to shareholders. It is the policy of the Fund to
comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies and to make
sufficient distributions of taxable income to relieve it from all
federal income taxes.

The character of distributions made during the year from net
investment income or net realized gains from investment
transactions may differ from their ultimate characterization for
federal income tax purposes. Also, due to the timing of dividend
distributions, the fiscal year in which amounts are distributed
may differ from the year that the income or realized gains are
recorded by the Fund.

C. Investment Transactions - Investment transactions are recorded on
the trade date. Realized gains and losses are determined using
the specific identification cost method. Interest income is
recorded daily on an accrual basis. Dividend income is recorded
on the ex-dividend date.

The Fund records distributions received from its investments in
real estate investment trusts that represent a tax return of
capital as a reduction of the cost basis of investments.

(Continued)
<PAGE>

GRANDVIEW S&P(R) REIT INDEX FUND

NOTES TO FINANCIAL STATEMENTS

March 31, 1998

D. Distributions to Shareholders - The Fund generally declares
dividends quarterly, payable on a date selected by the Trust's
Trustees. In addition, distributions may be made annually in
December out of net realized gains through October 31 of that
year. Distributions to shareholders are recorded on the
ex-dividend date. The Fund may make a supplemental distribution
subsequent to the end of its fiscal year ending March 31.

E. Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
amount of assets, liabilities, expenses and revenues reported in
the financial statements. Actual results could differ from those
estimated.

NOTE 2 - INVESTMENT ADVISORY FEE AND OTHER RELATED PARTY TRANSACTIONS

Pursuant to an investment advisory agreement, GrandView Advisers, Inc.
(the "Advisor") provides the Fund with a continuous program of
supervision of the Fund's assets, including the composition of its
portfolio, and furnishes advice and recommendations with respect to
investments, investment policies and the purchase and sale of
securities. As compensation for its services, the Advisor receives a
fee at the annual rate of 0.35% of the Fund's average daily net assets.

The Advisor currently intends to voluntarily waive all or a portion of
its fee and reimburse expenses of the Fund to limit total Fund
operating expenses to 1.05% of the average daily net assets of the
Fund. There can be no assurance that the foregoing voluntary fee
waivers or reimbursements will continue. The Advisor has voluntarily
waived its fee amounting to $5,370 ($0.06 per share) and has
voluntarily reimbursed $49,107 of the Fund's operating expenses for the
year ended March 31, 1998.

The Fund's administrator, The Nottingham Company (the "Administrator"),
provides administrative services to and is generally responsible for
the overall management and day-to-day operations of the Fund pursuant
to an accounting and administrative agreement with the Trust. As
compensation for its services, the Administrator receives a fee at the
annual rate of 0.225% of the Fund's first $25 million of average daily
net assets, 0.20% of the next $25 million of average daily net assets,
and 0.175% of average daily net assets over $50 million. The
Administrator also receives a monthly fee of $1,500 for accounting and
recordkeeping services. Additionally, the Administrator charges the
Fund for servicing of shareholder accounts and registration of the
Fund's shares. The Administrator also charges the Fund for certain
expenses involved with the daily valuation of portfolio securities.

NC Shareholder Services, LLC (the "Transfer Agent") has been retained
by the Administrator to serve as the Fund's transfer, dividend paying,
and shareholder servicing agent. The Transfer Agent maintains the
records of each shareholder's account, answers shareholder inquiries
concerning accounts, processes purchases and redemptions of Fund
shares, acts as dividend and distribution disbursing agent, and
performs other shareholder servicing functions. The Transfer Agent is
compensated for its services by the Administrator and not directly by
the Fund.

(Continued)
<PAGE>

GRANDVIEW S&P(R) REIT INDEX FUND

NOTES TO FINANCIAL STATEMENTS

March 31, 1998

Capital Investment Group, Inc. (the "Distributor") serves as the Fund's
principal underwriter and distributor. The Distributor receives any
sales charges imposed on purchases of shares and re-allocates a portion
of such charges to dealers through whom the sale was made, if any. For
the year ended March 31, 1998, the Distributor retained sales charges
in the amount of $78.

Certain Trustees and officers of the Trust are also officers of the
Advisor, the Distributor or the Administrator.

At March 31, 1998, the Advisor, its officers, and Trustees of the Fund
held 22,825 shares or 26% of the Fund shares outstanding.

NOTE 3 - DISTRIBUTION AND SERVICE FEES

The Board of Trustees, including a majority of the Trustees who are not
"interested persons" of the Trust as defined in the Investment Company
Act of 1940 (the "Act"), adopted a distribution plan pursuant to Rule
12b-1 of the Act (the "Plan"). The Act regulates the manner in which a
regulated investment company may assume expenses of distributing and
promoting the sales of its shares and servicing of its shareholder
accounts.

The Plan provides that the Fund may incur certain expenses, which may
not exceed 0.25% per annum of the Fund's average daily net assets for
each year elapsed subsequent to adoption of the Plan, for payment to
the Distributor and others for items such as advertising expenses,
selling expenses, commissions, travel or other expenses reasonably
intended to result in sales of shares of the Fund or support servicing
of shareholder accounts. Expenditures incurred as service fees may not
exceed 0.25% per annum of the Fund's average daily net assets. The Fund
waived $1,054 of such expenses under the Plan for the year ended March
31, 1998.

NOTE 4 - DEFERRED ORGANIZATION EXPENSES

All expenses of the Fund incurred in connection with its organization
and the registration of its shares have been assumed by the Fund. The
organization expenses are being amortized over a period of sixty
months. Investors purchasing shares of the Fund bear such expenses only
as they are amortized against the Fund's investment income.

NOTE 5 - PURCHASES AND SALES OF INVESTMENTS

Purchases and sales of investments, other than short-term investments,
aggregated $925,019 and $1,565,710, respectively, for the year ended
March 31, 1998.

<PAGE>
INDEPENDENT AUDITORS' REPORT

To the Board of Trustees of GrandView Investment Trust and Shareholders of
GrandView S&P REIT Index Fund:

We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of GrandView S&P REIT Index Fund (a portfolio of
GrandView Investment Trust) as of March 31, 1998, and the related statements of
operations and changes in net assets, and financial highlights for the year then
ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audit. The statement of changes in net assets for the year ended March 31, 1997
and the financial highlights for the two years in the period ended March 31,
1997 were audited by other auditors, whose reports thereon dated April 25, 1997,
expressed an unqualified opinion.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of the securities owned as of March 31, 1998 by
correspondence with the custodian and brokers; where replies were not received,
we performed other auditing procedures. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, the 1998 financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
GrandView S&P REIT Index Fund as of March 31, 1998, the results of its
operations, the changes in its net assets and its financial highlights for the
year then ended in conformity with generally accepted accounting principles.

Deloitte & Touche LLP

Pittsburgh, Pennsylvania
April 24, 1998

<PAGE>

1998 Annual Report
GrandView Investment Trust
Post Office Drawer 69
Rocky Mount, North Carolina 27802-0069
May 20, 1998

Telephone: 919-972-9922
U.S. WATS: 800-525-FUND
Facsimile: 919-0442-4226

To the Shareholders of the GrandView Realty Growth Fund:

We are pleased to present the annual report for the GrandView Realty Growth
Fund. The table below presents our results for the year along with the
appropriate market benchmarks.

<TABLE>
<S> <C> <C> <C> <C> <C> <C>
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Period Ending Dow Jones S&P 500 NAREIT GrandView GrandView
Utility Index Index Total Return Realty Growth Realty Growth
(Total (Total Return) Index Fund (NAV) Fund (MOP)
Return) (Total Return) (Total Return)
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Three Month 5.68% 13.95% -0.54% 2.81% -1.81%
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Six Months 22.38% 17.22% 0.51% 4.27% -0.42%
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
One Year 36.65% 48.00% 17.90% 24.80% 19.18%
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Two Year 48.21% 77.34% 54.48% 81.10% 72.95%
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
Since Inception 62.48% 112.93% 76.16% 91.43% 82.81%
From 7/03/95
Ending 3/31/98
- ------------------- -------------- ---------------- ------------------ ------------------- -----------------
NAV = Net Asset Value (Without Sales Load)
MOP = Maximum Offering price (With Sales Load)
</TABLE>

For fiscal year ending March 31, 1998 we again achieved our primary goal of
outperforming the overall REIT market as measured by the National Association of
Real Estate Trust's (NAREIT) Total Return Index. We have switched to using the
NAREIT Index as your Fund's industry benchmark this year from the GrandView
Total Return Index used in previous annual reports. This was done to provide you
a more independently generated and more broadly recognized standard to measure
your Fund's performance. Your Fund ranked 9th out of 71 real estate funds (4th
not including various share classes of the same Fund) as measured by Lipper
Analytical for the twelve month period ending March 31, 1998*. We did not,
however, outperform the overall stock market as measured by the S&P 500 or the
Dow Jones Utility Index for the same twelve-month period. Although
disappointing, we did have more favorable results against these standards for
longer investment periods.

Of particular note, now that the Fund is developing some significant performance
data, is how it correlates (a Fund's Beta) with the S&P 500. Many investors use
individual REITs or a REIT Fund as an asset class for diversification purposes.
It is believed that investments that have different Betas can reduce the risk of
an overall investment portfolio. Real estate has long been an asset class that
has been held as a balance against the more volatile general equity market. We
are pleased that Micropal, Inc., a non-affiliated data service, has published
data on your Fund's Beta. That data indicates that its beta is one of the lowest
in the industry with a range of 0.15-0.18 for the year versus the S&P 500 beta
of 1.00. For comparison, most utility funds are in the 0.50 range. This would
suggest that your Fund is a good candidate for those who are seeking appropriate
diversification in relation to the overall market.

<PAGE>
Last year's performance, as good as it was, did not meet the previous year's
45.12% return. The reasons for this are many. In general, the real estate
capital markets had plenty of cash available for companies to make acquisitions.
This provided increased competition for all the various real estate property
types. This competition led to increasing property prices and reduced returns
for investors. In addition, the first three months of this year had two
extraordinary events that, in our opinion, reduced returns. First, Congress
announced that it wanted to examine the "tax favored" status of REITs and
announced that it would address these REIT tax breaks in new legislation.
Although not enacted as of yet, the fear of this unknown has sent a chill
throughout the REIT market as evidenced by the REIT's overall poor returns so
far in 1998. The second event, that has not gotten as much attention as the
first, is the flat shape of the interest rate curve. This curve measures the
difference between short and long term rates. This rate spread is used to
determine profitability for all mortgage and many hybrid REITs. Historically,
interest rates for longer-term money yields far more than short-term money. But
over the last six months, this "spread" has been historically low. This
"flatness" has provided good opportunities to borrow or refinance long term debt
but it has not been good for profits at some REITs. These two "negative" events
occurring within the same general time frame have more than off set what
continues to be a good overall real estate market. Property construction still
seems under control, the overall economy is good and rents are generally rising
as demand for well-located real estate exceeds supply.

In light of this current environment, we thought it would be of interest to
review our five largest holdings as of March 31, 1998.

Capital Trust (NYSE, Symbol: CT, Yield 0.00%): This real estate finance company
was formerly a microcap REIT known as California REIT. Recently Sam Zell gained
control and recapitalized the company into what is now one of the largest
specialty real estate finance companies. Currently the company's current
strategy is to provide flexible mezzanine financing and advisory services to the
real estate industry. We first began investing in what was then California REIT
in 1996 at under $2.00 per share. Research had identified the company as a
possible recapitalization opportunity. Our investment has certainly paid off, as
CT was the largest percentage gainer on the New York Stock Exchange in calendar
year 1997. Our annualized return on our investment as of March 31st was in
excess of 260%.

Starwood Finance Trust (ASE, Symbol APT, Yield: 0.00%): This is almost a
duplicate of the above story with the exception that Barry Sternlich of Starwood
Capital rather than Sam Zell gained control of what was formerly known as
Angeles Participating Mortgage Trust. This company was on our top five list last
year and was one of our first investments in 1995 when we began accumulating
shares at $0.50 per share. Recently, this company has been recapitalized to over
a billion dollars in market value and has purchased a portfolio of various real
estate investments from various Starwood entities. Our annualized return on our
investment as of March 31st was in excess of 151%.

Realty Refund Corporation (NYSE, Symbol RRF, Yield 0.00%): One of our
significant new investments in 1997 has been this microcap REIT that is in the
midst of transforming itself from a mortgage REIT to a Hotel REIT. At the time
of our initial investment, this company exhibited characteristics that were in
both Capital Trust and Starwood Finance when we first invested in them. RRF's
balance sheet was liquid with minimal debt and was looking to identify an
appropriate strategy for the future. Recently, the company acquired a hotel
portfolio, changed management and established a new strategy to enhance
shareholder value going forward. We believe that it is too early in our
investment cycle to measure our performance. Our annualized return as of March
31st was a minus 14%.

Redwood Trust (NYSE, Symbol RWT, Yield 4.55%): This holding was one of our big
losers this past fiscal year. Redwood is a classic mortgage REIT that invests in
large dollar single family mortgages. Since its current profits come from the
spread it earns from its borrowing costs and its lending revenues, it has been
hurt by the flat rate curve environment. We believe that the rate curve will, at
some point, return to its historical shape. Because of this belief, we have
chosen to add to our position as the stock fell and lower our basis. We expect
Redwood to be one of this year's big winners but to date our annualized return
on our investment as of March 31st was a minus 41%.

<PAGE>
Tarragon Realty Trust (NASDAQ, Symbol: VIPT, Yield 0.00%): One of GrandView's
initial investments, VIPT continues to provide steady returns to our portfolio.
Over the past twelve months, VIPT has changed its name from Vinland to Tarragon
and has become a self managed REIT. These steps were all in preparation for the
recently announced merger with National Income Realty Trust, another Fund
holding. Once the merger is completed, VIPT will be a much larger apartment REIT
with properties throughout the southeast. With this growth, we are expecting
significant share appreciation. Our annualized return on our investment as of
March 31st was 22%.

We continue to think the future is positive for real estate securities. The
economy is good, interest rates are stable and real estate supply and demand is
in general equilibrium. There are many institutional owners of real estate who
are interested in selling to public real estate companies providing good
opportunities for continued growth. There will always be occasional bumps in the
road such as "tax" issues, interest rate curves and foreign economies, but these
bumps also provide good investment opportunities. We think that a well managed
real estate fund such as the GrandView Realty Growth Fund is in a position to
invest in these opportunities as well as in companies that offer good management
and value for shareholders. Last year we indicated that it was our intent to
provide superior returns to the overall REIT market. We accomplished this with
your support. The same objective remains for the upcoming year.

Finally, we want to take this opportunity to address the much publicized "Year
2000" problem for our shareholders. All major service providers to our Fund,
First Union National Bank, the Fund's custodian; The Nottingham Company, the
Fund administrator and North Carolina Shareholder Services, the Fund's transfer
agent all have implementation plans that address the issue. Service providers
indicate that their year 2000 plan will be completed prior to the occurrence of
any problem. Although issues may develop as the time gets closer, we want to
assure you that your management team is aware of the issue and is doing
everything within its power to minimize its impact on the Fund.

Winsor H. Aylesworth
President
GrandView Advisers, Inc.

- --------
* Ranked 9th out of 71 real estate funds based on total return for the 52 week
period ending March 31, 1998, as reported by Lipper Analytical Services, Inc.
Total returns are based on Net Asset Value (NAV) and does not take into account
any sales charges which, if paid, would reduce overall returns. Past performance
is no guarantee of future results. During the period covered by the rankings,
the Fund's Adviser waived its fee and reimbursed a portion of the Fund's
expenses, which increased the stated return of the Fund.

<PAGE>
GrandView Realty Growth Fund

Performance Update - $10,000 Investment
For the period from July 3, 1995 (commencement of operations) to
March 31, 1998

GrandView Realty S&P 500 Dow Jones NAREIT Total
Growth Fund Index Utility Index Return Index

7/3/95 9,550 10,000 10,000 10,000
9/30/95 9,383 10,748 10,722 10,496
12/31/95 9,513 11,395 11,451 10,977
3/31/96 10,095 12,007 10,963 11,257
6/30/96 10,825 12,545 11,503 11,760
9/30/96 11,957 12,933 11,491 12,559
12/31/96 13,358 14,011 12,488 14,902
3/31/97 14,649 14,387 11,890 14,941
6/30/97 15,503 16,899 12,489 15,791
9/30/97 17,533 18,164 13,277 17,528
12/31/97 17,781 18,686 15,374 17,712
3/31/98 18,281 21,293 16,248 17,617

This graph depicts the performance of the GrandView Realty Growth Fund versus
the S&P 500 Index, the Dow Jones Utility Index, and the NAREIT Total Return
Index. It is important to note that the GrandView Realty Growth Fund is a
professionally managed mutual fund while the indexes are not available for
investment and are unmanaged. The comparison is shown for illustrative purposes
only.

Annualized Total Return

- ---------------------------------------------------------------
Since Inception One Year
- ---------------------------------------------------------------
No Sales Load 26.69% 24.80%
- ---------------------------------------------------------------
Maximum 4.5% Sales Load 24.58% 19.18%
- ---------------------------------------------------------------

The graph assumes an initial $10,000 investment at July 3, 1995 ($9,550 after
maximum sales load of 4.5%). All dividends and distributions are reinvested.

At March 31, 1998, the GrandView Realty Growth Fund would have grown to $18,281
- - total investment return of 82.81% since July 3, 1995. Without the deduction of
the 4.5% maximum sales load, the GrandView Realty Growth Fund would have grown
to $19,143 - total investment return of 91.43% since July 3, 1995.

At March 31, 1998, a similar investment in the S&P 500 Index would have grown to
$21,293 - total investment return of 112.93%; the Dow Jones Utility Index would
have grown to $16,248 - total investment return of 62.48%; the NAREIT Total
Return Index would have grown to $17,617 - total investment return of 76.17%
since July 3, 1995.

<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
GRANDVIEW REALTY GROWTH FUND

PORTFOLIO OF INVESTMENTS

March 31, 1998

Agriculture - 1.66%
(a) Cadiz Land Company, Inc. ................................................. 3,300 $ 39,393
----------

Engineering & Construction - 1.90%
Dames & Moore Group ...................................................... 3,400 45,263
----------

Financial - Banks, Savings/Loans/Thrifts - 5.70%
(a) Capital Trust ............................................................ 13,900 135,525
----------

Real Estate - 2.49%
(a) Catellus Development Corporation ......................................... 3,200 59,200
----------

Real Estate Investment Trust - 80.83%
Alexandria Real Estate Equities, Inc. .................................... 800 25,350
(a) American Industrial Properties REIT ...................................... 5,700 79,087
(a) BRT Realty Trust ......................................................... 5,300 40,743
(a) Banyan Hotel Investment Fund ............................................. 25,000 37,500
Bedford Property Investors, Inc. ......................................... 1,000 19,313
Boston Properties, Inc. .................................................. 1,000 35,187
Burnham Pacific Properties, Inc. ......................................... 2,000 29,250
Crescent Real Estate Equities Company .................................... 1,400 50,400
Duke Realty Investments, Inc. ............................................ 800 19,500
Dynex Capital, Inc. ...................................................... 500 6,000
(a) EQK Realty Investors I ................................................... 46,800 55,575
EastGroup Properties, Inc. ............................................... 2,950 60,844
Entertainment Properties Trust ........................................... 900 17,663
Equity Office Properties Trust ........................................... 1,600 49,000
Equity Residential Properties Trust ...................................... 600 30,150
(a) FAC Realty Trust Inc. .................................................... 7,500 73,594
FelCor Suite Hotels, Inc. ................................................ 800 29,650
First Union Real Estate Investments ...................................... 5,700 66,619
Health Care Property Investors, Inc. ..................................... 1,200 44,325
Health and Retirement Property Trust ..................................... 1,000 20,250
Hospitality Properties Trust ............................................. 1,300 46,069
Humphrey Hospitality Trust, Inc. ......................................... 5,400 62,100
JP Realty, Inc. .......................................................... 800 20,300
LTC Properties, Inc. ..................................................... 1,100 21,244
(a) Liberte Investors, Inc. .................................................. 16,800 67,200
Meditrust Companies ...................................................... 2,400 73,800
(a) Meridian Point Realty Trust '83 .......................................... 26,742 40,113

(Continued)
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>

GRANDVIEW REALTY GROWTH FUND

PORTFOLIO OF INVESTMENTS

March 31, 1998

Real Estate Investment Trust - (Continued)

National Income Realty Trust ............................................. 3,760 $ 66,270
Patriot American Hospitality, Inc. ....................................... 2,500 67,500
RFS Hotel Investors, Inc. ................................................ 1,700 31,131
Realty Refund Trust ...................................................... 25,200 108,675
Redwood Trust, Inc. ...................................................... 4,000 94,000
(a) Resort Income Investors, Inc. ............................................ 70,000 15,400
Security Capital Pacific Trust ........................................... 1,200 28,875
Security Capital Industrial Trust ........................................ 900 23,062
Semele Group, Inc. ....................................................... 4,651 4,070
Simon DeBartolo Group, Inc. .............................................. 600 20,588
Sovran Self Storage, Inc. ................................................ 800 23,750
Spieker Properties, Inc. ................................................. 1,300 53,625
(a) Starwood Financial Trust ................................................. 27,800 128,575
Starwood Hotels & Resorts ................................................ 600 32,062
(a) TIS Mortgage Investment Company .......................................... 8,400 17,325
Tarragon Realty Investors Inc. ........................................... 8,600 84,925
----------
1,920,659
----------
Utilities - Water - 3.45%
(a) Western Water Company .................................................... 7,800 81,900
----------

Total Common Stocks (Cost $2,165,623) .................................... 2,281,940
----------

INVESTMENT COMPANY - 4.46%

Evergreen Money Market Institutional Money
Market Fund Institutional Service Shares (Cost $105,868) ................. 105,868 105,868
----------

Total Value of Investments (Cost $2,271,491 (b)) ..................................... 100.49 % $2,387,808
Liabilities In Excess of Other Assets ................................................ (0.49)% (11,587)
------ ----------
Net Assets .................................................................... 100.00 % $2,376,221
====== ==========

(Continued)
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>

GRANDVIEW REALTY GROWTH FUND

PORTFOLIO OF INVESTMENTS

March 31, 1998

(a) Non-income producing investment.

(b) Aggregate cost for federal income tax purposes is the $2,300,599. Unrealized appreciation (depreciation) of investments
for federal income tax purposes is as follows:

Unrealized appreciation $146,797
Unrealized depreciation (59,588)
--------
Net unrealized appreciation $ 87,209
========

See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
GRANDVIEW REALTY GROWTH FUND

STATEMENT OF ASSETS AND LIABILITIES

March 31, 1998

ASSETS
Investments, at value (cost $2,271,491) .......................................................... $2,387,808
Cash ............................................................................................. 28,795
Income receivable ................................................................................ 5,032
Receivable for investments sold .................................................................. 23,929
Receivable for fund shares sold .................................................................. 2,500
Prepaid expenses ................................................................................. 2,547
Deferred organization expenses, net (note 4) ..................................................... 12,253
Due from advisor (note 2) ........................................................................ 5,849
----------

Total assets ................................................................................ 2,468,713
----------

LIABILITIES
Accrued expenses ................................................................................. 8,537
Payable for investment purchases ................................................................. 79,550
Payable for fund shares redeemed ................................................................. 4,405
----------

Total liabilities ........................................................................... 92,492
----------

NET ASSETS
(applicable to 163,820 shares outstanding; unlimited
shares of no par value beneficial interest authorized) .......................................... $2,376,221
==========

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE
($2,376,221 / 163,820 shares) .................................................................... $ 14.51
==========

OFFERING PRICE PER SHARE
(100 / 95.5 of $14.51) ........................................................................... $ 15.19
==========

NET ASSETS CONSIST OF
Paid-in capital .................................................................................. $2,090,161
Undistributed net realized gain on investments ................................................... 169,743
Net unrealized appreciation on investments ....................................................... 116,317
----------
$2,376,221
==========

See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
GRANDVIEW REALTY GROWTH FUND

STATEMENT OF OPERATIONS

Year ended March 31, 1998

INVESTMENT INCOME

Income
Dividends ..................................................................................... $ 43,596
--------

Expenses
Investment advisory fees (note 2) ............................................................. 16,842
Fund administration fees (note 2) ............................................................. 5,053
Distribution fees (note 3) .................................................................... 4,211
Custody fees .................................................................................. 8,883
Registration and filing administration fees (note 2) .......................................... 3,099
Fund accounting fees (note 2) ................................................................. 16,200
Audit fees .................................................................................... 7,500
Legal fees .................................................................................... 5,095
Securities pricing fees ....................................................................... 2,878
Shareholder recordkeeping fees ................................................................ 1,475
Shareholder servicing expenses ................................................................ 4,473
Registration and filing expenses .............................................................. 9,190
Printing expenses ............................................................................. 1,846
Amortization of deferred organization expenses (note 4) ....................................... 5,442
Trustee fees and meeting expenses ............................................................. 410
Other operating expenses ...................................................................... 3,103
--------

Total expenses ........................................................................... 95,700
--------

Less:
Expense reimbursements (note 2) .................................................... (42,126)
Investment advisory fees waived (note 2) ........................................... (16,842)
Distribution fees waived (note 3) .................................................. (3,054)
--------

Net expenses ............................................................................. 33,678
--------

Net investment income .............................................................. 9,918
--------

REALIZED AND UNREALIZED GAIN ON INVESTMENTS

Net realized gain from investment transactions ..................................................... 327,769
Increase in unrealized appreciation on investments ................................................. 25,711
--------

Net realized and unrealized gain on investments ............................................... 353,480
--------

Net increase in net assets resulting from operations ..................................... $363,398
========

See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>

GRANDVIEW REALTY GROWTH FUND

STATEMENTS OF CHANGES IN NET ASSETS

Operations
Net investment income ............................................................. $ 9,918 $ 17,274
Net realized gain from investment transactions .................................... 327,769 125,083
Increase in unrealized appreciation on investments ................................ 25,711 86,406
---------- ----------

Net increase in net assets resulting from operations ......................... 363,398 228,763
---------- ----------

Distributions to shareholders from
Net investment income ............................................................. (9,918) (17,274)
Tax return of capital ............................................................. 0 (948)
Net realized gain from investment transactions .................................... (158,026) (125,083)
---------- ----------

Decrease in net assets resulting from distributions .......................... (167,944) (143,305)
---------- ----------

Capital share transactions
Increase in net assets resulting from capital share transactions (a) .............. 1,022,744 890,543
---------- ----------

Total increase in net assets ............................................ 1,218,198 976,001

NET ASSETS

Beginning of year ..................................................................... 1,158,023 182,022
---------- ----------

End of year ........................................................................... $2,376,221 $1,158,023
========== ==========

(a) A summary of capital share activity follows:
-------------------------------------------------------------------------------
Year ended Year ended
March 31, 1998 March 31, 1997

Shares Value Shares Value
-------------------------------------------------------------------------------

Shares sold .................................... 105,845 $1,463,197 120,300 $1,552,510
Shares issued for reinvestment
of distributions .......................... 10,869 153,559 9,716 123,136
---------- ---------- ---------- ----------

116,714 1,616,756 130,016 1,675,646

Shares redeemed ................................ (44,171) (594,012) (56,779) (785,103)
---------- ---------- ---------- ----------

Net increase .............................. 72,543 $1,022,744 73,237 $ 890,543
========== ========== ========== ==========

See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
GRANDVIEW REALTY GROWTH FUND

FINANCIAL HIGHLIGHTS

(For a Share Outstanding Throughout the Period)

Net asset value, beginning of period .................................. $12.69 $10.09 $10.00

Income from investment operations
Net investment income ...................................... 0.11 0.33 0.20
Net realized and unrealized gain on investments ............ 3.00 4.14 0.36
---------- ---------- ----------

Total from investment operations ....................... 3.11 4.47 0.56
---------- ---------- ----------

Distributions to shareholders from
Net investment income ...................................... (0.11) (0.33) (0.20)
Tax return of capital ...................................... 0.00 (0.01) (0.05)
Net realized gain from investment transactions ............. (1.18) (1.53) (0.22)
---------- ---------- ----------

Total distributions .................................... (1.29) (1.87) (0.47)
---------- ---------- ----------

Net asset value, end of period ........................................ $14.51 $12.69 $10.09
========== ========== ==========

Total return (a) ...................................................... 24.80 % 45.12 % 5.70 %
========== ========== ==========

Ratios/supplemental data

Net assets, end of period ....................................... $2,376,221 $1,158,023 $ 182,022
========== ========== ==========

Ratio of expenses to average net assets
Before expense reimbursements and waived fees .............. 5.68 % 9.59 % 31.34 % (c)
After expense reimbursements and waived fees ............... 2.00 % 1.89 % 2.00 % (c)

Ratio of net investment income (loss) to average net assets
Before expense reimbursements and waived fees .............. (3.09)% (4.58)% (25.55)% (c)
After expense reimbursements and waived fees ............... 0.59 % 3.12 % 3.62 % (c)

Portfolio turnover rate ......................................... 170.19 % 197.90 % 44.44 %

Average broker commissions per share (b) ........................ $0.0429 $0.0367 -

(a) Total return does not reflect payment of a sales charge.
(b) Represents total commissions paid on portfolio securities divided by total portfolio shares purchased or sold on which
commissions were charged.
(c) Annualized.

See accompanying notes to financial statements
</TABLE>
<PAGE>
GRANDVIEW REALTY GROWTH FUND

NOTES TO FINANCIAL STATEMENTS

March 31, 1998

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND OTHER INFORMATION

The GrandView Realty Growth Fund (the "Fund") is a diversified series
of shares of beneficial interest of the GrandView Investment Trust (the
"Trust"). The Trust, an open-ended investment company, was organized on
February 6, 1995 as a Massachusetts Business Trust and is registered
under the Investment Company Act of 1940, as amended. The primary
objective of the Fund is long-term growth of capital by selecting
investments which are equity securities of real estate industry
companies which are undervalued or have significant "turnaround"
potential. The Fund began operations on July 3, 1995. Shares of the
Fund purchased are subject to a maximum sales charge of 4.50%. The
following is a summary of significant accounting policies followed by
the Fund.

A. Security Valuation - The Fund's investments in securities are
carried at value. Securities listed on an exchange or quoted
on a national market system are valued at the last sales price
as of 4:00 p.m., New York time on the day of valuation. Other
securities traded in the over-the-counter market and listed
securities for which no sale was reported on that date are
valued at the most recent bid price. Securities for which
market quotations are not readily available, if any, are
valued by using an independent pricing service or by following
procedures approved by the Board of Trustees. Short-term
investments are valued at cost which approximates value.

B. Federal Income Taxes - No provision has been made for federal
income taxes since it is the policy of the Fund to comply with
the provisions of the Internal Revenue Code applicable to
regulated investment companies and to make sufficient
distributions of taxable income to relieve it from all federal
income taxes.

The character of distributions made during the year from net
investment income or net realized gains from investment
transactions may differ from their ultimate characterization
for federal income tax purposes. Also, due to the timing of
dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or
realized gains are recorded by the Fund.

C. Investment Transactions - Investment transactions are recorded
on the trade date. Realized gains and losses are determined
using the specific identification cost method. Interest income
is recorded daily on an accrual basis. Dividend income is
recorded on the ex-dividend date.

The Fund records distributions received from its investments
in real estate investment trusts that represent a tax return
of capital as a reduction of the cost basis of investments.

D. Distributions to Shareholders - The Fund generally declares
dividends quarterly, payable on a date selected by the Trust's
Trustees. In addition, distributions may be made annually in
December out of net realized gains through October 31 of that
year. Distributions to shareholders are recorded on the
ex-dividend date. The Fund may make a supplemental
distribution subsequent to the end of its fiscal year ending
March 31.

E. Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles
requires management to make estimates and assumptions that
affect the assets, liabilities, expenses and revenues reported
in the financial statements. Actual results could
differ from those estimated.

(Continued)
<PAGE>

GRANDVIEW REALTY GROWTH FUND

NOTES TO FINANCIAL STATEMENTS

March 31, 1998

F. Repurchase Agreements - The Fund may acquire U. S. Government
Securities or corporate debt securities subject to repurchase
agreements. A repurchase agreement transaction occurs when the
Fund acquires a security and simultaneously resells it to the
vendor (normally a member bank of the Federal Reserve or a
registered Government Securities dealer) for delivery on an
agreed upon future date. The repurchase price exceeds the
purchase price by an amount which reflects an agreed upon
market interest rate earned by the Fund effective for the
period of time during which the repurchase agreement is in
effect. Delivery pursuant to the resale typically will occur
within one to five days of the purchase. The Fund will not
enter into a repurchase agreement which will cause more than
10% of its net assets to be invested in repurchase agreements
which extend beyond seven days. In the event of the bankruptcy
of the other party to a repurchase agreement, the Fund could
experience delays in recovering its cash or the securities
loaned. To the extent that in the interim the value of the
securities purchased may have declined, the Fund could
experience a loss. In all cases, the creditworthiness of the
other party to a transaction is reviewed and found
satisfactory by the Advisor. Repurchase agreements are, in
effect, loans of Fund assets. The Fund will not engage in
reverse repurchase transactions, which are considered to be
borrowings under the Investment Company Act of 1940, as
amended.

NOTE 2 - INVESTMENT ADVISORY FEE AND OTHER RELATED PARTY TRANSACTIONS

The Advisor currently intends to voluntarily waive all or a portion of
its fee and reimburse expenses of the Fund to limit total Fund
operating expenses to 2.00% of the average daily net assets of the
Fund. There can be no assurance that the foregoing voluntary fee
waivers or reimbursements will continue. The Advisor has voluntarily
waived its fee amounting to $16,842 ($0.14 per share) and has
voluntarily reimbursed $42,126 of the Fund's operating expenses for the
year ended March 31, 1998.

The Fund's administrator, The Nottingham Company (the "Administrator"),
provides administrative services to and is generally responsible for
the overall management and day-to-day operations of the Fund pursuant
to an accounting and administrative agreement with the Trust. As
compensation for its services, the Administrator receives a fee at the
annual rate of 0.30% of the Fund's first $25 million of average daily
net assets, 0.275% of the next $25 million of average daily net assets,
and 0.225% of average daily net assets over $50 million. The
Administrator also receives a monthly fee of $1,500 for accounting and
recordkeeping services. Additionally, the Administrator charges the
Fund for servicing of shareholder accounts and registration of the
Fund's shares. The Administrator also charges the Fund for certain
expenses involved with the daily valuation of portfolio securities.

(Continued)
<PAGE>

GRANDVIEW REALTY GROWTH FUND

NOTES TO FINANCIAL STATEMENTS

March 31, 1998

Certain Trustees and officers of the Trust are also officers of the
Advisor, the Distributor or the Administrator.

NOTE 3 - DISTRIBUTION AND SERVICE FEES

The Plan provides that the Fund may incur certain expenses, which may
not exceed 0.25% per annum of the Fund's average daily net assets for
each year elapsed subsequent to adoption of the Plan, for payment to
the Distributor and others for items such as advertising expenses,
selling expenses, commissions, travel or other expenses reasonably
intended to result in sales of shares of the Fund or support servicing
of shareholder accounts. Expenditures incurred as service fees may not
exceed 0.25% per annum of the Fund's average daily net assets. The Fund
waived $3,054 of such expenses under the Plan for the year ended March
31, 1998.

NOTE 4 - DEFERRED ORGANIZATION EXPENSES

NOTE 5 - PURCHASES AND SALES OF INVESTMENTS

Purchases and sales of investments, other than short-term investments,
aggregated $3,605,994 and $2,791,534, respectively, for the year ended
March 31, 1998.

<PAGE>
INDEPENDENT AUDITORS' REPORT

To the Board of Trustees of GrandView Investment Trust and Shareholders of
GrandView Realty Growth Fund:

We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of GrandView Realty Growth Fund (a portfolio of
GrandView Investment Trust) as of March 31, 1998, and the related statements of
operations and changes in net assets, and financial highlights for the year then
ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audit. The statement of changes in net assets for the year ended March 31, 1997
and the financial highlights for the two years in the period ended March 31,
1997 were audited by other auditors, whose reports thereon dated April 25, 1997,
expressed an unqualified opinion.

In our opinion, the 1998 financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
GrandView Realty Growth Fund as of March 31, 1998, the results of its
operations, the changes in its net assets and its financial highlights for the
year then ended in conformity with generally accepted accounting principles.

Deloitte & Touche LLP

Pittsburgh, Pennsylvania
April 24, 1998