Common Area Maintenance (CAM) - Commercial Lease Terminology - Part 2
Last Updated Sept. 7, 2020
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In Commercial Real Estate leases, Common Area Maintenance, or CAM, refers to activities related to areas and items shared between tenants in a multi-tenant building or complex. This will commonly include mechanical systems and areas not under direct control of any given tenant - like parking areas, landscaping, common electrical/lighting, elevators, common restrooms, common break and cafeteria areas, lawns, atriums, etc. These items should be specified somewhere in the lease, and be subject to Expense Caps.
Leasing Overview Information
Our article - Types of Commercial Real Estate Leases - provides an overview of the major lease types used in Commercial Leasing.
Our article - Entering Into a Commercial Lease Agreement - A Guide From a Broker - provides a more comprehensive overview/guide to Commercial Leasing.
A commercial lease is, at least in general, a detailed specification of what property you will gain access to as a tenant, along with the responsibilities of tenant and landlord in terms of the elements of the property and the expenses involved. There are many different types of leases. Each should be analyzed carefully to see that they meet your expectations. Divvying up who will pay for what costs - now and throughout the life of the lease - is a major aspect of any lease. Some (many if not most, I hope) of these costs categories are summarized in the table below:
Expense Category | Responsibility |
| Base Rent | |
| Insurance | |
| Taxes | |
Property Improvements | |
Property Repairs | |
Common Area Maintenance (CAM) | |
| * Landscaping | |
| * Mowing | |
| * Maintenance | |
| * Janitorial | |
| * Security | |
| * Supplies | |
| * Food Service | |
| * Vending | |
| * Etc. | |
| Utilities | |
| * Water | |
| * Electricity | |
| * Sewer | |
| * HVAC | |
| * Sanitation | |
| * Telecomm | |
| * Networking | |
| * Etc. |
A big part of a lease is outlining how these and other expenses are divided between landlord and tenant and how these expenses can vary over time for the tenant - which can, and probably should be limited by caps applied in the lease.
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