Commercial Real Estate Blog by Madison
Tag Archives: CAM charges

CAM Negotiations – What You Need to Know before Signing, Part 2

By: Arnon Wiener, Esq., CEO, Real Diligence and LeaseProbe

It is news to no one that CAM charges can be a contentious issue for Landlords and Tenants alike. Generally, Landlords want the CAM clause to be broad and all-encompassing, covering the Landlord’s costs of ownership, management, maintenance, repair, replacement, inspection, improvement, operation, and insurance of the property together with any costs allocated to administration and overhead. The Landlord benefits from a highly expansive CAM definition to avoid the risk that any necessary costs of operation have no corresponding revenue to cover them.

Tenants, on the other hand, generally understand that they need to compensate the Landlord for operating and maintaining the center. But they view the Landlord’s ownership costs as part of the Landlord’s cost of doing business and not a recoverable operation cost. This “maintenance versus ownership” struggle shapes many of the issues relating to inclusion in and exclusion from CAM costs

Here are some questions Landlords should consider. Continue reading

Tags: , , , , , , , , , , , , Comments Off

CAM Negotiations – What You Need to Know before Signing, Part 1

By: Arnon Wiener, Esq., CEO, Real Diligence and LeaseProbe

Common Area Maintenance (CAM) charges can be a contentious issue for Landlords and Tenants alike. CAM charges are one of the net charges billed to Tenants in a commercial lease, and may be charged in addition to base rent. On one hand, Landlords may feel that their expenses are high, and this is the chance to be refunded for the outlay. On the other hand, Tenants may feel squeezed by the rent, and are resentful of any additional charges. CAM becomes the rope in a tug-of-war.

When entering CAM negotiations, there are considerations for both Tenants and Lenders. Continue reading

Tags: , , , , , , , , , , , , , , Comments Off
WordPress Appliance - Powered by TurnKey Linux