What is Anchor Exclusion?
A lease provision removing a large anchor tenant from the pro-rata share denominator, preventing their space from diluting other tenants' CAM obligations.
Definition
An anchor exclusion removes a large tenant (the anchor) from the pro-rata share denominator used to calculate other tenants' CAM obligations. Without the exclusion, the anchor's space would be included in the total leasable area, reducing every other tenant's share and potentially leaving the landlord under-recovered on CAM. Anchor exclusions are common in retail properties where a department store or grocery tenant occupies a significant portion of the building and has separately negotiated CAM terms. Implementing anchor exclusions correctly requires maintaining separate denominators for different tenant groups and ensuring the billing system applies the right denominator to each lease.
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