CAM Review Checklist
Here is our CAM checklist for Medical office tenants to review…
- Lease Language Review
- Are CAM charges clearly defined in the lease?
- Does the lease separate controllable and uncontrollable expenses?
- Are capital expenditures excluded or amortized over their useful life?
- Is there a cap on controllable CAM increases (e.g., 3–5%)?
- Are management or administrative fees limited (e.g., to 10–15%)?
- Does the lease grant you audit rights and define the scope and frequency?
2. Annual Reconciliation
- Have you received the year-end CAM reconciliation statement from the landlord?
- Are backup invoices or ledgers available for inspection?
- Have expenses been allocated proportionately among tenants?
- Do year-over-year increases appear reasonable and within any cap?
- Are new charges or categories showing up that were not previously disclosed?
3. Excluded Expenses (Red Flags to Watch)
- Capital improvements (unless amortized)
- Legal fees not related to property operation
- Landlord marketing or leasing commissions
- Interest, loan payments, or depreciation
- Property management fees exceeding agreed limits
- Repairs due to landlord negligence
- Vacant space costs allocated to tenants
4. Proactive Negotiation Points (Before Lease Signing or Renewal)
- Negotiate a CAM cap on controllable expenses
- Request annual estimated CAM budgets in advance
- Include a clause that any disputes or errors must be corrected with tenant refund rights
- Seek the right to approve major capital improvements or at least be notified in advance
5. Medical Use-Specific Considerations
- Are operating hours or utilities for medical tenants higher and fairly accounted for?
- Are specialized areas (e.g., imaging centers, labs) treated distinctly in allocation?
- Is janitorial or waste removal for medical use excluded from general CAM or separately metered?