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A landlord needs to handle CAMs carefully

On Behalf of | Mar 26, 2019 | Landlord / Tenant |

Renting space in shopping centers can be a lucrative business. Part of the rental process is passing on common area maintenance costs. An Orange County entrepreneur looking to become a landlord to retail establishments and restaurants needs to understand what CAMs entail and know how to handle them so as not to make things overly complicated.

CAMs are one thing that commercial tenants tend to pay attention to when negotiating a lease. As a landlord, an Orange County property owner should make sure that each tenant understands his or her obligations in this area. It could also help to keep track of what each tenant owes, along with the expenses. Documentation helps provide a paper trail for tenants and makes sure that no expenses to be included are missed.

When estimating expenses, a landlord should leave some cushion. Tenants would appreciate a refund more than an additional charge. When tenants are asked to pay more too often, they may decide that an audit of the CAMs is needed. These actions often disrupt good relationships with tenants that a landlord needs in order to keep spaces rented.

Even a seasoned landlord may need some assistance in handling CAMs appropriately. This is often a point of contention between landlords and commercial tenants, so the better prepared a property owner is, the smoother the process may be. Creating goodwill with tenants is just as important as having a property that people want to rent. Tenants understand that they will have to pay a certain amount in order to get the space they need, but when they feel they are not treated fairly, the turnover could potentially doom an otherwise good business venture.