Common Area Maintenance, or CAM, is the part of a commercial lease that should spell out what a tenant’s pro rata share of the operating expenses incurred by the landlord is in the operation of the building or shopping center. In other words, it represents the cost to maintain the common areas of an office or retail building in which all tenants benefit. CAM costs typically include:
However, it’s not always so crystal clear. For example, does the landlord know the current value of the property? Is the tenant aware of the going market rate for costs that are being passed from landlord to tenant? What happens when an unexpected event triggers a cost increase?
As a landlord, your goal is to maximize your return on investment. That includes optimizing cost-sharing with your tenants. You should have a formal CAM audit of your expenses that will stand up to tenant challenges that may occur. For example, real estate tax pass-throughs should not include real estate transfer taxes, which are those taxes arising from the landlord’s property conveyance.
Skoda Minotti’s team of real estate experts conducts cost-saving audits and business valuations. Our CAM experts will help you avoid tenant disputes by working with you to include only those costs that are appropriate, accurate and timely.
You depend on your landlord for garbage collection, landscaping and snow removal costs. But how do you know your landlord is getting the best pricing? As a tenant, you have the right to audit your landlord’s CAM calculations to help confirm you are being charged accurately and fairly.
A third party can help in examining all of your expenses to ensure you are getting fair pricing. Skoda Minotti’s CAM experts will apply best practices to review your lease and determine whether the expenses you are being charged are appropriate or need to be challenged. We’ll review your invoices and, when necessary, compare them with the actual contracts your landlord has in place to ensure accuracy. Over the years, we’ve been able to save tenants thousands of dollars.
Beyond our CPA financial credentials, our experts also hold some of the most highly-regarded designations in the field including:
That means we’re well-prepared to assist you with your CAM matters as we find ways to help you achieve your greatest value through fixed-fee arrangements.