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GTA5 needs twice its space to decrypt the pre-loaded files. That's why so many people at launch had issues unpacking it on i.e. SSDs.
While I could be wrong, I'd imagine its process near end is somewhere similar to having the encrypted file at 100% file size; then extracted at 99.9%. (Thus virtually double its size.) Then when the extracted filesize hits 100%, the encrypted file gets removed.
You've apparently even played the game before, just move the installed files?
http://steamcommunity.com/sharedfiles/filedetails/?id=428340230
This leaves the drive with 40gb left
I go to install the game, it says there is only 40gig left out of 120gb, even though 70gb is the game if it would take 2 seconds to look it wont and says there is not enough space to install it
this is not a GTAV problem its a steam one
That way you don't have to go through the discovery process.
The problem is because Steam assumes it's uninstalled (because you didn't copy the file that bridges the client and the folder), and it refuses to do the discovery process without ensuring it has enough disk space.
my freind only has the non-steam version, the files work when the cache does its check and fixes a few small things
appmanifest_271590.acf
Exit Steam, place it under the steamapps -folder in the same Steam library location where your Grand Theft Auto V is installed.