Your lease has no ceiling on annual increases to common area maintenance charges. Without a CAM cap, your landlord can raise your operating expenses by any amount each year, making it impossible to forecast occupancy costs accurately.
By Angel Campa, Founder · Updated March 2026
Flagged when the CAM cap percentage field is null or missing from the lease.
Without a CAM cap, annual operating expense increases are limited only by the landlord's actual costs — or creative accounting. In an average shopping center, CAM charges can increase 5% to 8% annually. For a tenant paying $30,000 in CAM charges in year one, uncapped increases at 7% per year compound to over $59,000 by year ten. That is $97,000 more in total CAM charges over ten years compared to a lease with a 5% annual cap. In volatile markets or properties undergoing major renovations, single-year CAM increases of 20% to 30% are not uncommon when no cap is in place.
Negotiate a CAM cap of 3% to 5% per year on controllable operating expenses. Ensure the cap applies on a non-cumulative (compounding) basis, meaning each year's cap is calculated from the prior year's actual charges, not the original base year. Separate controllable expenses from non-controllable expenses like real estate taxes and insurance, which typically cannot be capped. If the landlord resists a hard cap, propose a cap with a carve-out for extraordinary events like natural disasters. Property managers can use <a href="https://www.capveri.com" target="_blank" rel="noopener noreferrer">CapVeri.com</a> to track CAM cap compliance automatically across their portfolio, ensuring reconciliation statements honor the cap terms agreed in each lease. If you are already past lease execution, <a href="https://www.camaudit.io" target="_blank" rel="noopener noreferrer">CamAudit.io</a> can detect CAM cap violations in your annual reconciliation — checking whether the landlord honored the cap terms in your existing lease.
A reasonable CAM cap is 3% to 5% per year on controllable expenses. Caps below 3% may discourage landlords from properly maintaining the property. Caps above 5% provide limited protection since most annual CAM increases fall within that range anyway.
CAM caps typically apply only to controllable expenses — those the landlord can influence, such as landscaping, janitorial, and management fees. Non-controllable expenses like property taxes and insurance premiums are usually excluded from the cap since the landlord cannot control their increases.
A non-cumulative cap limits each year's increase from the prior year's actual charges. A cumulative cap limits the total increase from a base year, allowing larger single-year increases if prior years were below the cap. Non-cumulative caps provide better year-to-year predictability for tenants.
Your landlord's annual CAM reconciliation statement can include errors and inflated charges. Learn how to read every line item, what the gross-up provision means, and what to challenge.
A commercial lease is a legally binding contract between a landlord and a business tenant. Learn the key terms, lease types, and critical clauses before you sign.
AI lease abstraction extracts 100+ structured fields from commercial lease PDFs in minutes. Learn how the technology works, what accuracy to expect, and how cost compares to manual services.
Need CAM recovery under your brand?
CAMAudit gives firms white-label CAM recovery infrastructure while they keep the client relationship and deliver branded reports.
Explore the partner program →This red flag indicates potential CAM overcharges in your lease. CamAudit.io performs forensic CAM audits that recover significant overcharges for tenants.
Get a Forensic CAM AuditUpload your lease PDF and Lextract will check for no cam cap and 19 other red flags automatically. Just $15 per lease.
Upload Your Lease