Monthly Archives: February 2017

Reconciling Common Area Maintenance (CAM) in Commercial Property

Common Area Maintenance (CAM) charges are a standard component of most commercial retail leases. Typical expenses – including landscaping, snow removal, utilities, sanitation, maintenance, repairs, etc.  – are added to the base rent as additional rent (much the same as taxes and insurance). These costs are negotiated at the beginning of a lease but can often become a point of contention if both the tenant and landlord don’t communicate openly.

Here are a few things to keep in mind when it’s time to reconcile CAM charges:

  • Make sure all charges that could be considered CAM costs are presented to the landlord or owner by the submission deadline for review.
  • Determine the amounts per tenant based on their Gross Leasable Area.
  • Determine if the charges benefited one tenant or all tenants.
  • Have tenants been credited or refunded for over paying CAM estimates?
  • Were notices of deadlines for reconciliation clearly provided to tenants?
  • Make sure to follow the terms of each lease as they may vary (i.e. Base Year CAM or Cap on CAM rates).
  • Landlords should also provide CAM estimates for the current year and give adequate notice to the tenant.

Agreeing to terms and understanding charges as they arise is an easy way to avoid frustration at the end of the year. CAM reconciliation shouldn’t add aggravation to the already tedious budget process as long as the landlord and tenant keep accurate records and an open line of communication.

 

 

Winter Storm Preparedness for Property Managers

Groundhog General Beauregard Lee did not see his shadow which predicts an early spring; however, we know all too well that a final Arctic blast can wreak havoc on homes and businesses if not properly prepared. Our property management team suggests the following tips to ensure your commercial property is protected should a severe cold storm strike.

Extreme Cold

  • Set thermostats to 55 degrees or warmer
  • Water heaters and HVAC systems have to work harder during extreme temperatures. Ensure these systems are cleaned and serviced regularly.
  • Cover exposed pipes with insulation sleeves or heat tape
  • Leave faucets dripping to relieve pressure that could develop in pipes
  • Ensure hoses are removed from exterior faucets and leave water dripping

Snow and Ice

  • Identify pavement deficiencies that may become covered by snow and difficult for pedestrians to see.
  • Ensure roof water runoff is directed away from the building structure and clear of walkways where it could freeze.
  • Clear areas around vents and exhaust pipes.
  • When snow melts, make sure it does not drain onto pedestrian areas where it can freeze later.
  • Clear snow from roofs to prevent excess drainage and weight.
  • Instruct maintenance staff to clear sidewalks using salt, chemical pellets, and sand as appropriate.

Once the cold has gone for good, take time to assess how well your property weathered the cold and make note of any items or tasks that could be done better next winter.