A CAM cap limits how much a tenant’s controllable operating expenses can increase from year to year. The cap is stated as a percentage (typically 3% to 7%) and applies only to expenses the landlord can manage, such as janitorial, landscaping, management fees, and security. Property taxes and insurance are usually excluded.

What is the difference between a cumulative and compounded CAM cap?

A cumulative cap adds the same percentage of the base year amount each year. A compounded cap applies the percentage to the prior year’s cap ceiling, producing faster growth. On a $100,000 base at 5%, the cumulative ceiling in year 10 is $145,000 and the compounded ceiling is $155,133.

How do I calculate my CAM cap ceiling?

For a cumulative cap: Cap Ceiling = Base Year Amount times (1 + Cap Rate times Number of Years). For a compounded cap: Cap Ceiling = Base Year Amount times (1 + Cap Rate) to the power of the number of years of increases. This calculator performs both calculations automatically.

Which expenses are excluded from a CAM cap?

Property taxes, property insurance, and utility costs are typically excluded. These are classified as non-controllable because the landlord cannot significantly influence them. The cap applies only to controllable expenses listed in your lease’s CAM cap provision.

Free Tool: Calculator

CAM Cap Calculator

CAM cap violations are among the highest-dollar overcharges in commercial leases. Enter your base year amount, annual cap rate, and cap type to see the maximum allowed for each year and identify whether your landlord has exceeded it.

How CAM caps work: A CAM cap sets a ceiling on how much controllable expenses can increase each year. The ceiling works differently depending on cap type. Non-cumulative caps set the same fixed dollar ceiling every year (the same amount applies in Year 2 and Year 6). Cumulative caps let unused room carry forward, so the ceiling grows each year. Compounding caps grow like compound interest. If your lease uses one type but your landlord calculates using another, you are being overcharged.

CAM Cap Details

Base Year CAM Amount ($)

Annual Cap Rate (%)

Cap Type

CAM Cap Analysis

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How CAM caps work

A CAM cap limits how much your share of controllable operating expenses can increase each lease year. Caps apply only to expenses the landlord can manage. Property taxes and insurance are excluded.

The most common cap dispute involves compounding versus cumulative math. A cumulative cap adds the same percentage of the base year amount each year (linear growth). A compounded cap applies the percentage to the prior year's ceiling (exponential growth). On a $100,000 base at 5%, the difference reaches $10,133 by year 10, and compounds further every subsequent year.

Enter your base year controllable CAM amount, your lease's cap rate, and the cap type to see the maximum allowed amount for each year and identify any violations.

How CAM caps work

A CAM cap limits how much your share of controllable operating expenses can increase each lease year. Caps apply only to expenses the landlord can manage. Property taxes and insurance are excluded.

Enter your base year controllable CAM amount, your lease's cap rate, and the cap type to see the maximum allowed amount for each year and identify any violations.