Common Area Maintenance Agreement

In addition, there is less community space in a retail center – no lobbies, public restrooms, etc. – so concierge fees are normally excluded from the CAM. According to the National Association of Realtors, the usual way to calculate cam fees is to determine the proportional share of each tenant in the number of square meters in the property. Each tenant then pays his share of the expenses of the property according to the amount of space he occupies. Negotiating a lease for your business can be a difficult process, and if you haven`t done so yet, you`ll see a lot of potentially confusing new terms. A term that often surprises tenants is the maintenance of common areas, the fees paid by tenants in commercial leases for areas common to all tenants. A good tenant representative is often able to negotiate a cap on the percentage a landlord can increase maintenance costs for the community sector year after year. This should be negotiated in your initial rental terms. Different properties have their own unique needs, and the associated costs are often shared by tenants. This may include local administration, security or any other expense necessary for the management and maintenance of the commercial property. The following descriptions are the usual terms for these types of rentals, but the conditions can vary considerably from one contract to another. Some markets also have slightly different standards, as expenses are split between landlords and tenants.

Among the typical expenses of industrial cam include lighting of real estate and parking lots, landscaping, parking maintenance and water for irrigation. Because all the tenants of the building share the benefits. Do cam fees include “maintenance” and “replacement” and are these costs defined? Some landlords include CAM replacements because they are less expensive than ongoing maintenance, while tenants would argue that replacement comes with additional costs. For some properties, tenants do not share equally in the use of public spaces. Tenants who use less of the common area may object to paying the same cost per square foot as the rest of the tenants. To do this, the landlord must determine each tenant`s expenses and separately calculate the fees for each cost….

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