Whether you are well seasoned in renting commercial property or you are new to the process, you probably know that signing a lease without reading it carefully is asking for trouble. However, what happens if you read through your lease and still don’t understand every stipulation included in it? It is true that some commercial leases contain far more information than simply how much rent you will pay, and many of the terms are open for negotiation.
Among those items you can possibly negotiate are charges for common area maintenance, which is also called CAM. Your landlord might include certain CAM charges to help defray the cost of maintaining areas in the building or complex that everyone uses but no one pays rent for, such as lobbies and parking lots. Unfortunately, some landlords may take advantage of business owner tenants by charging unfair CAM fees.
What’s hidden in your lease?
Commercial leases are not uniform, and your landlord may include CAM fees that are higher or lower than other property owners. There is no consensus about what that amount should be, but an ethical landlord will include a fair price for each tenant. CAM fees may improve the chances that your building will not fall into disrepair, so before you sign the lease, you might want to investigate the landlord’s history with upkeep on the property. Your CAM fees can include any of the following or other items:
- Making sure hallways and stairwells are clean, maintained and well lit
- Maintaining and repairing elevators or escalators
- Keeping lobby bathrooms clean, stocked and in good repair
- Providing and servicing plumbing, air conditioning, heat and other utilities in common areas
- Clearing and maintaining paths and sidewalks
- Keeping parking lots clean, paved and well lit
- Paying for landscaping services, such as mowing, weeding, trimming shrubs, planting flowers and irrigating
Your landlord might ask you to pay a percentage of property taxes, permits, building repairs, management fees and even insurance, and you can question whether these fees are excessive or unfair. CAM fees in your commercial lease may be couched in vague, confusing language, so you can feel free to ask for an explanation for any charge you do not understand. You also have the right to negotiate for lower amounts or even ask to have certain CAM fees removed, especially if they seem suspicious, too high or duplicative.