We want to help you understand an often misunderstood area of commercial leases.
Have you ever bought a ticket to a concert, a sporting event, rented a car, or bought a plane ticket? If so, you are familiar with all of the add-on fees that are associated with one of these purchases. This happened to me the other week. I saw that one of my favorite bands is coming to my city. So, I went online to one of those ticket purchase websites, checked the price of a ticket, and didn’t think it looked too bad. I called a friend, we agreed to go, and I went back on the website to buy the ticket.
From face value, the price listed on the site for the tickets, I should have paid something like $300. They were expensive tickets to begin with. But, by the end of the purchase, by the time I paid the taxes, shipping fees, handling feels, and some kind of processing fee, I spent like $375.00. Had I known this going into the purchase, I probably still would have bought the tickets, but I would have thought twice about it.
This same kind of hidden fee scenario can happen in the commercial lease you are about to sign. Make sure you know what you are looking for. When you are thumbing through your lease, look for Common Area Maintenance or CAM fees. This is especially true if you are sharing the building with other tenants. This a monthly fee that the landlord will be added onto your regular monthly rent. So, what are they?
When you own a building, there are ancillary costs associated with maintaining that building like replacing the roof, shoveling the parking lot, painting spots in the parking lot, replacing windows, replacing the furnace, etc. It is impossible for a landlord to charge those maintenance costs to one tenant, and you can bet the landlord isn’t going to absorb those costs him/herself. So, you get to pay for them. Typically, the landlord adds up the total maintenance cost, divides it amongst the tenants, and that gets added onto your monthly rent.
So, make sure you don’t get caught off guard. Look through your commercial lease and understand exactly how much you will be paying each month. If you need help understanding those complex legal documents, reach out. That’s why we are here.