Commercial Real Estate Investment/Commercial Power meters

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Expert: - 9/15/2010


Question
Is it legal in Maine for a Commercial Landlord Sharing Business property to only have one Electrical meter for both businesses? Can a Landlord just determine your share without having a separate meter? Usually charging my business 2/3rd of monthly bill and themselves 1/3rd ? And not being able to explain why or how they determined said bill? Is the landlord responsible for entire bill if it is solely in their name ? At signing of lease we were promised a seperate meter within 6 months, now on our 3rd year and struggling to pay high electric bills to landlord in excess of $1500.00 per month. Thank you

Answer
Cathy-

If you were promised a separate electric meter by your landlord - in writing - it is far past time for it to be installed.  I would be very concerned if your landlord cannot clearly and simply articulate the detailed process it is using to calculate your share of the electrical bill.  

I am not familiar with the landlord/tenant laws in each state.  A landlord can "just determine" your share of the electrical consumption without having a separate meter only if you agreed to pay for your electrical usage on that basis in your lease.  It could be that your landlord may have discovered that to enable your business to have its own electrical meter, it must have new wiring done to isolate your wiring and electricity consumption from any other electrical consumption at the property.  Often this cost can become quite costly.    

Let me emphasize that the only thing that matters is what in IN WRITING in the lease agreement.   If your landlord TOLD YOU certain things would be done in a certain way verbally, you are out of luck if the landlord has developed selective memory loss.

I am in Bar Harbor often to visit a relative and my visit three weeks ago evidenced the economic difficulties that many business operators are experiencing.  With cold weather approaching, I would confront the landlord immediately about the separate electric meter and why it is not yet installed.

If and when the landlord provides you with your own meter, check to be certain that the landlord has actually isolated your electrical wiring so that you are not paying for the external consumption of some other electrical equipment.  You can do this by very carefully turning off every single piece of electrical equipment serving your business (everything, all lighting, clocks, etc.) and then going to your new meter to see if the new meter is registering any consumption.   If consumption is continuing to register, your wiring has not be isolated completely from all the other equipment at the property.       

Good luck.

-Jim

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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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