Legal Advice During Challenging Times

What you need to know about CAM fees before signing a lease

On Behalf of | Jun 24, 2022 | Real Estate Law |

Although they are similar documents, there are many significant differences between a commercial lease and a residential lease. No matter how many apartments you have previously rented, you may not be familiar with the terms used in a commercial rental agreement. 

For example, your monthly commercial lease amount won’t be the full amount you pay. Often, landlords assess not only rent but also secondary maintenance costs on a monthly basis. If you share common areas, like a lobby, bathrooms or a parking lot with other tenants, you may have to pay common area maintenance (CAM) fees. 

How do CAM fees work? 

Landlords have numerous ways in which they can pass on maintenance costs to individual tenants. They might include a clause in your lease that makes you responsible for a specific percentage of the monthly CAM fees for the property. 

You may pay a specific percentage based on the square footage that you occupy or the anticipated traffic to and from your business. On the other hand, they may have set a flat-rate fee on a monthly basis and then will send out separate bills for one-time expenses, like resurfacing the parking lot. 

You may have the necessary leverage to negotiate how much you pay in CAM fees based on what you intend to do with the property. The smaller the unit, the few accommodations you require and the less foot traffic your business will have – and the less demand you will place on the shared amenities, like the parking lot. 

Learning more about the unique requirements in commercial leases will help you reach the most beneficial terms for your rental agreement.