How do you audit and verify CAM charges and allocations from landlords?

1 Review your lease agreement

The first step is to review your lease agreement and understand how your CAM charges are calculated and allocated. Some leases may have a fixed CAM fee, while others may have a variable or pro rata CAM fee based on the actual costs incurred by the landlord. Some leases may also have a base year or a cap on the CAM charges, which means you only pay for the increases over a certain amount or percentage. You should also check if your lease specifies what types of costs are included or excluded from the CAM charges, and if there are any audit rights or dispute resolution procedures.

2 Request a CAM reconciliation statement

The second step is to request a CAM reconciliation statement from your landlord at least once a year. This is a document that shows the total CAM costs for the property, the allocation method, and your CAM share. You should compare this statement with your lease agreement and your monthly or quarterly CAM invoices, and look for any discrepancies or errors. For example, you should check if the landlord has charged you for any costs that are not allowed by your lease, or if the landlord has used the correct square footage or occupancy rate to allocate the CAM costs.

3 Compare with market benchmarks

The third step is to compare your CAM charges with market benchmarks and industry standards. This can help you determine if your landlord is charging you reasonably and competitively for the CAM services. You can use various sources of information to benchmark your CAM charges, such as online databases, industry reports, trade associations, or other tenants in your market or property. You should also consider the quality and level of the CAM services, and the age and condition of the property, when comparing your CAM charges.

4 Negotiate with your landlord

The fourth step is to negotiate with your landlord if you find any issues or concerns with your CAM charges. You should communicate with your landlord in a professional and respectful manner, and provide evidence and documentation to support your claims. You should also be realistic and flexible, and try to find a mutually acceptable solution. Depending on the situation, you may be able to negotiate a lower CAM fee, a refund or credit for overcharges, a change in the allocation method, or a modification of the lease terms.

5 Hire a professional auditor

The fifth step is to hire a professional auditor if you are unable to resolve your CAM disputes with your landlord, or if you want a more thorough and independent review of your CAM charges. A professional auditor can help you verify the accuracy and validity of the CAM costs and allocations, and identify any errors or discrepancies. A professional auditor can also help you negotiate with your landlord, or represent you in a legal action if necessary. However, hiring a professional auditor can be costly and time-consuming, so you should weigh the benefits and risks carefully.

6 Monitor and track your CAM charges

The final step is to monitor and track your CAM charges regularly and proactively. You should keep records of your lease agreement, your CAM invoices, your CAM reconciliation statements, and your communications with your landlord. You should also review your CAM charges periodically and look for any changes or anomalies. By monitoring and tracking your CAM charges, you can avoid any surprises or disputes, and ensure that you are paying your fair share of the CAM costs.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?