An estimated 50-60% of rent abatement clauses exclude CAM charges, meaning you may pay full operating expenses even when you cannot use the space.
A rent abatement clause provides for reduction or elimination of rent (and sometimes CAM payments) during specific circumstances, such as the initial lease-up period, property damage, landlord default, or significant disruption to the tenant's use of the premises. The abatement may be automatic upon a triggering event or require formal notice.
Rent abatement provisions that include CAM can provide meaningful financial relief when circumstances prevent the tenant from fully using the premises. However, many abatement clauses apply only to base rent, leaving CAM obligations in full force even when the tenant cannot occupy the space. This creates a situation where you pay for maintenance of areas you cannot use.
“If, as a result of a casualty, condemnation, or Landlord's failure to maintain the Building in a manner that substantially impairs Tenant's use of the Premises for more than five (5) consecutive business days, Tenant's Rent (including Tenant's share of Operating Expenses) shall abate in proportion to the square footage rendered unusable until the condition is remedied. For the avoidance of doubt, "Rent" as used in this Section includes Minimum Rent, Additional Rent, and Tenant's share of Operating Expenses. Abatement shall commence automatically upon the qualifying event without the need for notice.”
This is illustrative language only. Your actual lease language controls your rights.
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50-60%
An estimated 50-60% of rent abatement clauses in standard commercial leases do not extend to CAM or operating expense payments [industry estimate]
Source: Commercial Lease Negotiation Data (2024)
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Go to lextract.ioThis 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.
