By: Will Van Vactor
Common area maintenance charges (commonly called CAM charges) are, in short, additional rent charged to the tenant for fees incurred by the landlord for the maintaining the common areas of the property. The specifics of the CAM charges are negotiated between each landlord and tenant. Consequently, the amount of CAM charges can vary from lease to lease.
As an initial note, in general, the common areas include the parts of the commercial property that are shared by tenants and their guests, clients, or customers. Using the picture at the top of this post as an example, you might have an office building with a shared courtyard at ground level (with a nice view of the sky above). In such case, the shared courtyard is a common area. Common areas might also include shared hallways and staircases, patios, parking lots, landscaping, and bathrooms.
CAM charges relate to the expenses incurred to maintain those common areas. If you are in an office building, maintenance of the bathroom may require regular cleaning, repairs, and even replacement of fixtures. Charges for landscaping might include mowing, weeding, and maintenance of the irrigation system.
Not surprisingly, a tenant will want to negotiate CAM charges that are specific and narrowly drafted so as to limit the amount charged. On the flip side, a landlord will want the CAM charges to be couched in general, broad terms so as to encompass as many expenses as possible.
To be sure you know what you are agreeing to, talk to your real estate attorney. The last thing you want is to sign a commercial lease where you are paying more than your fair share (if you are a tenant) or receiving less than you should (if you are a landlord).
The information on this blog is for general informational purposes only. This information is not intended to create, and receipt or viewing does not constitute an attorney-client relationship. Nothing on this site should be taken as legal advice for any individual case or situation. This blog should not be used as a substitute for competent legal advice from an attorney licensed to practice law in your state.
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