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Commercial Real Estate Investment/Cam Fees
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Question
Hello,
I have had a breach in my lease that seems to now focus on the Cam fees and not the breach. The main question, The cam charges are set at $4 per square foot and I am suppose to receive an itemized billing monthly and never have, we questioned this and were told that the cam fees were set and it did not matter what they charged for the billing as our fees are set. is this true and we are in washington state the new managemnet if you can call it that is the son-in-law who does the management along with maintenance and cannot prove such costs associated with the Cam costs. I am confused and our attorney seems to be as well.
Jeanne:
I am not an attorney and cannot give you legal advice, so check with your attorney about what action to take in this regard. However, if the text of your lease specifically articulates that the landlord is to send you an itemized billing each month indicating that the CAM fees meet or exceed the four dollars per square foot ($4.00/sf) you are reimbursing, then you should send certified mail notice to your landlord and advise that it must provide you with the itemized monthly billing or you will begin putting the payment for those monthly CAM fees into an escrow account on a consecutive monthly basis.
Again, you should have your attorney advise you further before sending such a notice. Since I do not have a copy of your entire lease document, I cannot tell if there is other language in your lease that would suggest sending notice is not the most effective action to take.
For example there may be some legal ambiguity if your lease does not stipulate precisely what happens to the landlord if it does not send you the monthly itemized billing. Additionally, consider the next possible step in your situation; what happens if the itemized billing reflects monthly CAM expenses of only three dollars per square foot ($3.00/sf) on an annualized basis? Are you still LEGALLY required to pay the landlord at the annual rate of four dollars per square foot ($4.00/sf)? Vague lease terms may create some legal ambiguity regarding your chances of being successful.
I can assure you that you will get a quick response from your landlord if you send the notice I suggest, however, ask your attorney to advise you of the risk(s) involved.
Good luck.
- 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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