Can a landlord pass through ADA compliance costs as CAM?

Generally no. ADA compliance upgrades are capital improvements required by law, not routine operating expenses. Most leases, and courts, treat mandatory legal compliance upgrades as landlord obligations, not tenant CAM pass-throughs. If this appears on your reconciliation, request the underlying invoice and legal basis.

How should after-hours HVAC be billed in a medical office building?

After-hours HVAC should be billed to the requesting tenant on a direct, sub-metered or BTU-metered basis. Flat mark-up charges without metering are a red flag. Your lease should specify the hourly rate and the calculation method. CamAudit extracts this rate from the lease and flags charges that deviate from it.

Can a landlord pass through ADA compliance costs as CAM?

Generally no. ADA compliance upgrades are capital improvements required by law, not routine operating expenses. Most leases, and courts, treat mandatory legal compliance upgrades as landlord obligations, not tenant CAM pass-throughs. If this appears on your reconciliation, request the underlying invoice and legal basis.

How should after-hours HVAC be billed in a medical office building?

After-hours HVAC should be billed to the requesting tenant on a direct, sub-metered or BTU-metered basis. Flat mark-up charges without metering are a red flag. Your lease should specify the hourly rate and the calculation method. CamAudit extracts this rate from the lease and flags charges that deviate from it.

CAM Audit for Medical Offices

Outpatient medical practices occupying Class B and Class A office space with specialized HVAC, plumbing, and electrical requirements. Includes primary care, specialty practices, and diagnostic centers. Annual CAM exposure for this tenant type ranges up to $20,000–$60,000. CamAudit runs 12 forensic detection rules specific to your lease structure in under five minutes.

Typical Lease Structure

Modified Gross or Full-Service Gross with Base Year stop

Avg. Locations

1–20

Annual CAM Exposure

$20,000–$60,000

Lease Structure

Modified Gross or Full-Service Gross with Base Year stop, tenant pays operating expense escalations above the base year amount. Some NNN structures exist in medical office buildings (MOBs) with heavy utility and compliance pass-throughs.

CAM Vulnerabilities for Medical Offices

Landlords charge standard tenants for bio-hazard waste disposal and ADA compliance upgrades required by other heavy-use medical tenants. After-hours HVAC costs are marked up without sub-metering. Base year is not grossed up to 95% occupancy, creating inflated escalations.

Most Common Overcharges

1ADA elevator and ramp upgrades amortized into the operating CAM pool
2Bio-waste disposal costs shared across all tenants rather than direct-billed to medical users
3After-hours HVAC billed at a marked-up flat rate without sub-metering verification
4Janitorial costs for specialized medical-grade cleaning billed to non-medical tenants
5Base year operating expenses not grossed up to 95%, inflating Year 2+ escalations

Watch For This Trigger

Landlord amortizes a building-wide ADA elevator upgrade into the CAM pool and the cost appears on the first reconciliation statement after the renovation.

Detect Overcharges in Your Medical Office Lease

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Precedent & Case Context

University of Louisville medical office tenants successfully disputed specialized ADA compliance pass-throughs by demonstrating that the upgrades constituted capital improvements required by law, not operating expenses recoverable under the lease.

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Related Resources

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Frequently asked questions

This 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.