Commercial Real Estate Investment/cam fees

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Question
Hi Phil.This is my situation. My lease is over dec 31 2015. I gave the landlord six months notice in writing and now he is coming up with fees that he says I now owe him.First of all in Jan 2015 i gave him 12 post dated cheques for the rent in the assumed amount he has been cashing them and never mentioned anything about a rent increase until now so he's saying I owe him the difference.Second now he is telling me that I owe him cam fees something new that was never mentioned in the last 5 years or dicussed when we negotiated the 5 year contract lease.I have been paying TMI with my rent for the last 5 years can he all of the sudden start charging me CAM fees or does it just sound like hes trying to get money from me hoping I wouldn't question it? I am not in an enclosed mall its just a small 7 unit strip mall with no common elements shared with any other tenants.

Answer
hi Manny

depends on lots of things;

In your lease there should be wording to explain tmi / cam charges. I would assume that the lease it written in a format "NET" to the landlord. In other words, you are responsible for your proportional costs to the premise eg taxes, maintenance, insurance, common area costs.

These charges are of course contestable. You likely (depends on wording of the lease) but you likely have the right to see the increase in costs, (audit the mall).

As a last resort, you could also attempt to legally defend your position in court but then it comes down to a business decision. Is it worth paying the lawyer, courts, time etc vs. what do you have to gain?

Talk to the landlord, explain your position with these points. Maybe he will cave and let you go because he doesn't want to chase you in court.

Im only speculating because I have not read your lease. DId it call for increases in rent over time? if so, this is your obligation. The cam/tmi clauses are usually open ended.

Thisi s probably not what you want to hear but if your lease called for increases and you did not pay them, then they are still outstanding.

You're saving grace, is depending on the amount outstanding, its not usually financially feasible for a landlord to chase you in court. Would cost him many more 1000's to get a judgement - and that judgement then has to be collected, which is another story.

Ive had perfectly good contracts tossed out of court because the judge was having a bad day. My only recourse was to appeal, at which point, I decided not to because of costs.

Law is CERTAINLY NOT black and white, it's GRAY at best.

Commercial Real Estate Investment

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Phil Nicols

Expertise

Legal issues which are specific from state to state.

Experience

Licensed Realtor since 1987, Broker Since 1991. Ontario Canada real estate -- Commercial, investment, leasing, business brokerage

Organizations
Stockwell Realty Corporation

Publications
www.StockwellRealty.com

Education/Credentials
Real Estate Council of Ontario, Registered under the real estate and business brokers act 2002

Awards and Honors
A few from past organizations I belong to. Now with my own company, it's hard for me to give myself awards.

Past/Present Clients
Dealt with both small as well as regional tenants, individual investors to syndications.

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