CAM charges, or common area maintenance charges, are one of the net charges billed to tenants in a commercial triple net lease. They are additional rent charged on top of base rent, and are mainly composed of maintenance fees for work performed on the common area of a property. Each tenant pays their pro rata share of a propertys total CAM charges, which is the percentage of the tenant's rented square footage of the total, rentable square footage of the property. Examples of services often billed to tenants as CAM charges include portering, parking lot striping, parking lot lighting, and landscaping. CAM charges can be broken into two subcategories: controllable and uncontrollable. Uncontrollable CAM charges are taxes, security costs, utilities, and snow removal expenses. All other expenses charged as a CAM charge are considered controllable.
A cap on CAM charges limits the amount by which CAM charges can rise each year and is presented as a percentage. Caps are negotiated between the tenant and landlord and vary from lease to lease. CAM charges allow the landlord to pass along to tenants their proportionate share of the cost to maintain common areas. A tenant rep can help cap the CAM charges to assure they are within the realm of reason, keeping an upper limit on CAM charges and protecting the tenant's budget from excessive charges.
