Commercial leases tend to be longer and more complex than residential leases. It is relatively common for commercial property owners to require more financial contributions from their tenants than residential landlords do.
For example, some commercial leases make tenants partially responsible for facility maintenance. Other times, commercial tenants have to pay for the repairs and maintenance performed by their landlords. One of the ways that landlords may pass those costs onto their tenants is through the collection of common area maintenance (CAM) fees in addition to monthly rent.
What is a CAM fee?
As the name implies, a CAM fee is a fee assessed by a landlord related to the maintenance of shared facilities. For example, if a tenant occupies one office in a large building, CAM fees may cover costs related to parking lot maintenance, the shared bathrooms in the building and any security services that the landlord provides.
In some cases, landlords impose a set CAM fee every month. The tenant must pay that base amount in addition to their rent. Other times, the fee may fluctuate from month to month.
The commercial lease may make the business tenant responsible for a specific portion of the total maintenance costs for the facility based on the size of their unit and other factors. In many cases, tenants may have the option of negotiating their CAM fees to better reflect their use of the space.
Business leaders negotiating terms for commercial leases may need help reviewing the documents and obtaining the best terms possible, and that’s okay. CAM fees and other maintenance fees are often a top consideration when preparing to sign or renew a commercial lease.