Commercial leases can come with Common Area Maintenance (CAM) fees, which help the landlord pay for upkeep on the property’s common areas. While CAM fees are common in leases, they can vary from space to space and year to year. When signing a lease for a commercial space, be sure you understand all parts of the Common Area Maintenance fees.
What do CAM Fees Cover?
As the term suggests, CAM fees help to pay for the cost and upkeep of common areas in the building and grounds of a commercial property. Common areas can include hallways, shared bathrooms, lobbies, elevators, as well as the parking lot and landscaping. CAM fees in a lease typically include regular maintenance to the property and building, but can also consist of emergency repairs, security systems, signage, insurance, and in some instances salaries of administrative staff.
Variable CAM Fees
If you have a lease with variable CAM fees, this means the fees you are charged can increase based on factors outlined in the contract. If the factors are not explicitly stated, find out what they are from your landlord and get them in writing. You should also find out if there is a cap to how high the fees will go.
Flat CAM Fees
Flat CAM fees in an agreement mean the fees are fixed, and will not adjust up or down. Depending on the lease, these fees can be paid monthly, quarterly, or annually. Sometimes, the costs of major renovations are separate from flat CAM fees. If this is the case, determine if there are scheduled renovations happening in the future.
With commercial leases, there is not a standard on what can and cannot be included in CAM fees. While most landlords will not take advantage of their tenants, it is important to always carefully read your lease and get clarification on any items that are not explicitly stated.