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Commercial Real Estate Investment/Paying CAM's
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Question
In my lease my cams include all of the buildings shared utilities. Power, Water, Gas, septic, snow removal ETC. During the summer months my land lord will shut off the hot water, and the heat to the whole building to save a buck. and as it turns out the water we get is from a well that is unfit to drink.
So for 6 months a year I'm paying cams for something i don't get, and for water i can only flush with Do I have any recourse?
Martin-
If the water is not appropriate for the uses it was provided for, I believe that the health department would be the correct organization to call to eliminate any possible health danger. I would do that right away but be certain that you have all the necessary evidence etc. as I am certain they will ask you for all the details at the time you make your report.
It is obviously wrong to use contaminated water for the building requirements, and it may be considered a fraudulent act under the local legal code, you will need to check with a local attorney in this regard.
If you pay your landlord for your ratable share of the CAM costs, and you can prove the violation you report regarding the water, you are due a reimbursement for the water expense subsumed in the aggregate CAM charges that you have reimbursed this year. Note however that if your landlord didn't include a charge for his well water in his CAM calculation, (verify this by checking his supporting expense records of the component expense charges), you may not have paid excessively and it saved you a few dollars.
You should definitely determine if the landlord has been using an illegal water source and report it if you are certain.
You might consider drinking bottled water for awhile until this matter blows over.
Happy Holidays.
-Jim
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Answers by Expert:
Jim Avancena, CPM
Expertise
Best qualified to answer questions that involve commercial leases, that is, basic issues as well as the often unexpected effects of the complexities and inter-relationships of the provisions a lease may contain, explain how seemingly innocuous text in your lease can have a major impact on a Tenant or Landlord and their business operations, and the common practices utilized in the industry. I can untangle most matters that may come up from the time a tenant begins searching for a office or store space and the lease acquisition process, concerns related to remodeling/improving the leased premises, moving-in, subletting or assigning the leased space, and a long list of problems that may come up during the lease term and even after a tenant moves out. I have practical experience with most property management issues and resolving landlord and tenant disputes - especially those involving what may appear to be overcharges assessed for additional lease charges like CAM costs, operating expense reimbursement, real estate taxes, utilities, construction improvements etc. Note that I am not an attorney and cannot provide legal advice.
Experience
Thirty years active experience in the commercial real estate industry as a licensed real estate broker in the Washington DC Metro area (DC, Northern Virginia & Maryland). I have been admitted (approved) by the Maryland and DC courts to testify as an expert witness on the subjects of Commercial Leasing and Property Management in the area of standard industry practices. I have had a business for the last 14 years advising virtually every form of business entity from large national corporations to the smallest ma & pa new businesses regarding a wide range of commercial real estate matters in addition to property management and commercial leasing.
Organizations
Currently my three children keep me so busy that it is difficult to participate in organizations with continuing and specific time requirements.
Publications
I publish a local commercial real estate newsletter titled: "Tenants First". My firm was the subject of a high profile Washington Post business section cover page (2.25 full pages) feature story on January 13, 1993; titled "Overcharging Overhead".
Education/Credentials
BA in Political Science from Memphis University, and five years of study in the real estate development summer program at MIT. I was certified as a commercial property manager (CPM-IREM), and currently hold a brokers license in Maryland and the District of Columbia.
Awards and Honors
The same plaques and honors that most others in my industry have earned. I have none that I consider especially meaningful.
Past/Present Clients
Past clients include: The World Bank, George Washington University, National Association of Criminal Defense Attorneys, US Department of Commerce, The American Benefits Council, K-Mart Development, many law firms, a national union, other major organizations, and many, many small business firms and retail operators that I am most honored to serve. I estimate more than 1,500 firms/organizations.
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