Commercial Lease Type CAM Reconciliation Guides

Everything landlords need to know about CAM pass-throughs, gross-up applicability, and annual reconciliation requirements under a triple net lease.

Most gross leases don't require CAM reconciliation — but expense escalation riders and partial pass-throughs create hidden obligations that many landlords miss.

Modified gross leases split operating expenses between landlord and tenant. The specific split determines which expenses need annual reconciliation — and which the landlord absorbs.

Full service gross leases bundle all operating expenses into base rent — no separate CAM billing. But expense stops and escalation riders create hidden reconciliation obligations landlords overlook.

In a double net lease, tenants pay property taxes and insurance — landlords retain maintenance and operating expenses. Annual reconciliation applies to the tax and insurance pass-throughs.

Retail percentage leases combine base rent with a percentage of tenant gross sales. CAM is billed separately — reconciliation follows standard NNN procedures but with unique anchor exclusion and sales-reporting considerations.

In a ground lease, the tenant constructs and owns the building while the landlord owns the land. Operating expense obligations and CAM requirements depend on the lease structure — net ground leases vs. participating ground leases.

Industrial gross leases bundle most expenses into base rent but commonly pass through exterior maintenance, landscaping, and taxes. Understanding which expenses require reconciliation prevents billing disputes.