CAM Concept Comparisons

NNN (Triple Net) Lease vs Gross Lease

NNN leases pass every operating cost to the tenant, creating dozens of potential overcharge points. Gross leases bundle costs into rent for simplicity but sacrifice transparency.

NNN (Triple Net) Lease vs Modified Gross Lease

NNN passes everything through, maximizing both transparency and overcharge risk. Modified gross absorbs some costs into rent, reducing audit scope but creating reclassification disputes.

Fixed CAM vs Variable CAM

Fixed CAM gives you predictable payments but no audit recourse. Variable CAM tracks actual costs but requires active monitoring to catch overcharges.

Percentage Rent vs Flat Rent

Percentage rent ties your rent to sales performance while flat rent stays constant. Neither changes your CAM audit needs, which depend on your pass-through structure.

CAM (Common Area Maintenance) vs Operating Expenses

CAM covers shared area maintenance only. Operating expenses include everything from taxes to insurance. Your lease defines which one controls your pass-through charges.

Gross-Up vs Actual Expenses

Gross-ups adjust expenses for vacancy but are frequently miscalculated. Actual expenses are simpler but can unfairly burden tenants in low-occupancy buildings.

Controllable CAM Expenses vs Non-Controllable CAM Expenses

Controllable expenses should be capped in your lease. Non-controllable expenses are uncapped. Watch for reclassification that shifts costs out of your cap protection.

Base Year vs Expense Stop

Base years use actual first-year costs as the benchmark but are vulnerable to manipulation. Expense stops use a fixed negotiated amount that is harder to game.

CAM Cap vs Controllable Expense Cap

A full CAM cap covers all expenses. A controllable cap only covers landlord-managed costs, leaving taxes and insurance uncapped.

Pro-Rata Share Allocation vs Per-Unit Allocation

Pro-rata shares allocate costs by square footage and are the industry standard. Per-unit allocation splits costs equally regardless of size, which disadvantages smaller tenants.

Capital Expenses (CapEx) vs Operating Expenses (OpEx)

Capital expenses are long-term property investments that should not appear on your CAM reconciliation. Operating expenses are recurring costs that landlords can pass through.

Estimated CAM Charges vs Actual CAM Charges

Estimates are monthly prepayments based on projections. Actuals are real expenses verified at year-end. The gap between them is where true-up errors hide.

Desktop CAM Audit vs Full Forensic Audit

Desktop audits review the reconciliation as-is. Forensic audits dig into the landlord's books. Start with a desktop audit and escalate if overcharges are found.

CAM Audit vs Lease Review

CAM audits verify the numbers on your reconciliation. Lease reviews verify the language in your contract. You need both for full protection.

Single-Tenant CAM vs Multi-Tenant CAM

Single-tenant CAM means you pay everything but the math is simple. Multi-tenant CAM shares costs but introduces allocation errors that require auditing.

Annual Reconciliation vs Monthly Estimates

Monthly estimates keep payments smooth. Annual reconciliation settles the real numbers. The reconciliation is where overcharges hide and audits focus.

Occupied Square Footage vs Leasable Square Footage

Occupied SF as a denominator inflates your share when neighbors move out. Leasable SF keeps your share stable regardless of vacancy.

Tenant Improvements (TI) vs CAM Expenses

Tenant improvements customize individual spaces and are never a CAM pass-through. CAM expenses maintain shared areas and are allocated to all tenants.

Direct Expenses vs CAM Pool Allocation

Direct expenses are billed to the tenant who incurs them. CAM pool costs are shared by all tenants. Watch for tenant-specific costs hiding in the shared pool.

Cumulative Cap vs Non-Cumulative Cap

Cumulative caps bank unused increases for future use, allowing large catch-up spikes. Non-cumulative caps expire unused amounts, keeping increases predictable every year.