A CAM cap expressed as a maximum dollar amount per square foot, such as "CAM shall not exceed $8.50 per SF." Dollar caps provide absolute cost certainty because the maximum charge is a fixed number regardless of actual expenses.
A dollar cap sets an absolute ceiling on the tenant's CAM obligation, typically expressed per rentable square foot per year. Unlike percentage caps, dollar caps do not reference a base year or prior year amount. They can be static (same cap every year) or escalating (increasing by a fixed dollar amount annually, e.g., $0.25/SF/year). Static dollar caps become more valuable to tenants over time as actual expenses rise, while escalating dollar caps provide a predictable expense trajectory.
A landlord charges $9.25/SF against a lease with an $8.50/SF dollar cap, burying the excess in a "special assessment" line item that the landlord claims is outside the cap. The tenant does not realize the special assessment is actually routine maintenance that belongs under the capped category.
A dollar cap is only as good as the definition of what it covers. Verify that your lease does not allow the landlord to create uncapped categories for expenses that should fall under the dollar cap. Review every line item to confirm proper categorization.
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Find My OverchargesThis page provides general educational information. It is not legal advice and may not reflect the most current law in your state. Consult a licensed attorney for advice specific to your situation.
