Fixed CAM gives you predictable payments but no audit recourse. Variable CAM tracks actual costs but requires active monitoring to catch overcharges.
Fixed CAM charges are a flat monthly amount set at lease signing, typically with a predetermined annual increase (often 3-5%). The tenant pays the same CAM amount regardless of actual property expenses, and there is no annual reconciliation.
Variable CAM charges are based on the tenant's proportionate share of actual operating expenses incurred by the landlord. The tenant pays estimated monthly amounts, with an annual reconciliation that adjusts for the difference between estimates and actuals.
| Dimension | Fixed CAM | Variable CAM |
|---|---|---|
| Cost predictability | Fully predictable, set at signing | Variable, adjusted annually via reconciliation |
| Annual reconciliation | None required | Required, compares estimates to actuals |
| CAM audit value | Not applicable | High, every line item auditable |
| Long-term cost trend | Increases at a fixed rate regardless of actuals | Tracks actual building expenses |
| Landlord incentive | Profit from any gap between fixed charges and actual costs | No direct profit from expense pass-throughs |
Fixed CAM eliminates the need for CAM audits because the tenant pays a predetermined amount unrelated to actual expenses. Variable CAM is where audits deliver the most value, since every expense line item must be verified against the lease terms and actual costs. The choice between fixed and variable CAM fundamentally determines whether a tenant needs CAM audit protection.
Variable CAM exposes tenants to more immediate overcharge risk because each reconciliation can contain errors. However, fixed CAM carries long-term compounding risk: a 5% annual escalator on a 10-year lease can push CAM charges far above what actual expenses would have been, with no mechanism to recover the excess.
Upload two PDFs. 14 detection rules. Under 15 minutes. Free.
Upload two PDFs. 14 detection rules. Under 15 minutes. Free.
Next Best Step
Use a pricing and proof pass before you start an audit so the commercial case is clear.
Review the flat-fee audit model before you compare vendors any further.
See what the paid output looks like before you upload documents.
Run the free audit once you have enough proof to move.
Ready to skip the reading and document the overcharge directly?
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.
