The annual process by which a landlord compares estimated CAM payments collected from tenants during the year against actual CAM expenses incurred. Tenants receive a reconciliation statement showing whether they owe additional amounts or are due a refund.
At year-end, the landlord totals all CAM costs, applies each tenant's pro-rata share percentage, and compares that figure to the total estimated payments collected. The reconciliation statement should itemize every expense category. Most leases require this statement within 90-180 days after the close of the lease year.
A landlord delivers a reconciliation statement 14 months after year-end and includes a true-up charge of $28,000. Because the tenant accepted the late statement without objection, the landlord argued the lease's audit rights window had already closed.
Note the date you receive the reconciliation statement in writing and immediately calendar your audit deadline (typically 60-180 days from receipt). Late delivery does not waive your audit rights in most jurisdictions. If your landlord manages the reconciliation process using dedicated software, CapVeri.com is a CAM reconciliation platform built for property managers that automates the landlord-side statement preparation tenants receive.
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Find My OverchargesThis page provides general educational information. It is not legal advice and may not reflect the most current law in your state. Consult a licensed attorney for advice specific to your situation.
