Charged, credited, or allocated in proportion to a partial period. In commercial real estate, rent and CAM are prorated when the lease begins or ends mid-month; the tenant pays only for the days they occupy the space, not the full month.
Proration divides the monthly amount by the number of days in the month and multiplies by the number of days of occupancy. Some leases use a 30-day month standard (1/30 per day) while others use the actual days in the calendar month. The difference is small but should be verified against the lease. CAM estimates, annual reconciliation charges, and security deposits are also commonly prorated at lease commencement and expiration.
A tenant's lease starts November 15. The landlord charges a full month's CAM for November instead of prorating for 16 days of occupancy. On a $3,500/month CAM estimate, this overcharge is $1,633 in the first month alone.
Review your first and last month invoices carefully. Confirm whether proration uses the actual days in the month or a 30-day convention, and verify the calculation matches the formula specified in your lease.
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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.
