Your first CAM audit: what to expect, what to prepare, and what happens next
TL;DR: Your first CAM audit requires two documents, takes under 15 minutes with software, and produces a findings report that tells you exactly which charges are wrong and why. If overcharges exist, a dispute letter draft is generated automatically. Most disputes resolve without legal help. This article walks you through every phase from document gathering to landlord response.
CAM audit: A CAM audit is a forensic review of a commercial lease's CAM (Common Area Maintenance) reconciliation statement to identify billing errors. An auditor, or an automated detection system, compares each expense line against the specific provisions in the tenant's lease to verify that charges are calculated correctly, that only eligible expenses are included, and that the tenant's pro-rata share is allocated accurately.
The reconciliation statement arrives in your inbox and you have no idea what to do with it. The numbers mean something, but you are not sure what. The lease is 60 pages. The document your landlord sent references section numbers and formulas you do not remember agreeing to.
This is normal. Reconciliation statements are dense by design, and most tenants have never been shown what a correct one looks like. The gap between what a landlord bills and what they are actually entitled to bill is often significant.
40% of commercial CAM reconciliations contain material billing errors (PredictAP, 2026)
An audit does not require a CPA, a law firm, or a three-month review cycle. It requires your lease, your reconciliation statement, and a systematic process for comparing the two. Here is exactly what that process looks like.
Before you start: what you actually need
You need two documents, and both are already in your possession.
Your lease is the first: the fully executed version, including all amendments, addenda, and exhibits. The CAM provisions are typically in a section titled "Operating Expenses," "Common Area Maintenance," or "Additional Rent." Amendments frequently modify base year calculations, management fee caps, or gross-up provisions, so every amendment matters.
The second document is the reconciliation statement. This is the annual statement your landlord sends, usually in the first quarter of the year, settling the difference between your estimated CAM payments and the actual expenses for the prior year. It should itemize the expense categories and show how your share was calculated.
That is it. You do not need the landlord's general ledger, invoices, or supporting workpapers for a software-based audit. Those are only required if you formally invoke your lease's audit rights clause for a CPA forensic audit, which is a different process for a different situation.
If you have reconciliation statements from prior years, include them. CAMAudit can run a lookback audit across multiple years to identify patterns of systematic overcharging, which compounds the recovery amount significantly.
Phase 1: Uploading your documents
The upload step takes two minutes, and what happens next is where the real work begins.
When you upload to CAMAudit, the platform runs your documents through structured text extraction. Every page of your lease and every line of your reconciliation statement is converted into machine-readable text, preserving the formatting, section numbers, and numeric values that the detection engine needs.
The extraction step runs in parallel on both documents. The platform pulls specific data points from the lease: your base year, your management fee cap, your pro-rata share fraction, your gross-up provision, your CAM cap if applicable, and any exclusion language that restricts what the landlord can bill. At the same time, it parses your reconciliation statement for expense line items, total amounts, and the share calculation the landlord applied.
You do not need to highlight these provisions, categorize the pages, or do any manual extraction. Upload the documents as-is.
Phase 2: The analysis
The 20 detection rules are what separate a CAM audit from a line-by-line manual review.
15–20% of billed CAM charges are recovered on average when tenants conduct a professional audit (Springbord, 2025)
Each rule targets a specific class of billing error. Some rules are mathematical: they verify that the numbers on the reconciliation statement are consistent with the formulas in your lease. The management fee overcharge rule, for example, checks whether the fee was calculated as a percentage of the correct expense base, at the correct rate, and whether it respects any cap your lease imposes.
Other rules are classificatory: they evaluate whether the types of expenses on your reconciliation are actually eligible under your lease. Your lease may exclude landscaping costs for areas outside the common area, capital expenditures, administrative overhead above a threshold, or any of dozens of other expense categories that landlords sometimes include.
The rules CAMAudit checks cover the categories where billing errors are most common. Management fee overcharge covers rate miscalculation, wrong expense base, and cap violations. Pro-rata share error catches denominator manipulation and vacant space allocation issues. Excluded service charges flags costs your lease explicitly does not require you to pay. CAM cap violation catches increases above the annual percentage limit your lease may specify. Base year error and gross-up violation check whether normalization provisions are applied correctly. Insurance and tax overallocation catches charges that exceed your proportionate share or include ineligible coverages. Landlord overhead pass-through identifies administrative, legal, or corporate expenses passed through as operating costs.
all 20 rules run simultaneously. The entire analysis completes in under 15 minutes.
Phase 3: Reading your findings report
The findings report is the output of the audit, and it is designed to be readable without a real estate background.
Each detected overcharge appears as a separate finding. For each finding, the report shows:
- The rule that was triggered (e.g., Management Fee Overcharge)
- The relevant lease provision, quoted directly from your uploaded lease
- What the landlord charged versus what the lease permits
- The dollar amount of the discrepancy
- The calculation that supports the finding, shown step by step
The report is organized by finding severity. Material overcharges with clear lease support appear first. Lower-confidence findings, where the lease language is ambiguous or the error is smaller, appear separately so you can decide how to prioritize them.
Read every finding carefully before taking action. The report will sometimes surface findings where the lease language is genuinely open to interpretation. In those cases, the finding is still worth raising with the landlord, but understand that the landlord may dispute the interpretation and you may need to negotiate.
Phase 4: If overcharges are found
A findings report with confirmed overcharges is a starting point, not a final resolution.
15-20% of billed CAM charges are recovered on average when tenants conduct a professional audit (PredictAP, 2022)
The next step is the dispute letter draft. CAMAudit generates this automatically from your findings report. The letter identifies each overcharge by rule category, cites the relevant lease provision, states the dollar amount in dispute, and requests a corrected reconciliation or a credit against future CAM estimates.
The dispute letter draft is not legal correspondence. It is a professional, documented communication from you as the tenant. It does not require an attorney's signature to send, and sending it does not commit you to any particular escalation path.
Before sending, review the letter against your findings report to make sure every number is accurate. One common first-timer mistake: sending the letter with rounding errors or transposed figures. If your landlord challenges your calculations, arithmetic errors give them an easy way to discredit the entire claim. Verify each figure against the report.
When you are ready, send the letter to your property manager or the contact specified in your lease for CAM-related correspondence. Send it by email and confirm receipt. If your lease requires written notice by a specific method (certified mail, for example), follow that method for the formal notice but you can also email for tracking purposes.
Keep a copy of the letter and the date you sent it.
Phase 5: Sending the letter and waiting
Most landlords respond within 30 to 60 days. Here is what to realistically expect.
The most common response: the property manager acknowledges the letter, reviews the calculation, agrees with some or all of the findings, and proposes a credit against future CAM estimates or a direct refund. This is more common than tenants expect, particularly when the dispute letter draft is specific and well-supported.
A substantive dispute means the landlord disagrees with your findings and explains why. They may argue that your lease interpretation is incorrect, that the expense is eligible under a provision you did not flag, or that your share calculation is wrong. This is not a bad outcome. A specific counter-argument is something you can engage with. Respond with the relevant lease language and your calculation methodology.
If the landlord does not respond by your stated deadline, send a follow-up in writing citing the original letter by date. If there is still no response, you move toward formally invoking your audit rights under the lease, which is a separate process that compels the landlord to provide supporting documentation.
One rule for every scenario: keep paying rent and CAM estimates on time throughout this process. A payment dispute does not give you grounds to withhold rent, and attempting to do so typically violates your lease and undermines your position in the dispute.
If no overcharges are found
A clean audit report is not a wasted $79. It is documentation that you reviewed the reconciliation and it is accurate.
This matters for two reasons. First, it establishes that you are an engaged tenant who monitors CAM billing, which historically correlates with fewer overcharges in subsequent years. Second, if the landlord ever claims you accepted charges you did not dispute, you have dated evidence showing you performed a review.
Clean audits also sometimes surface near-misses: charges that are borderline but within lease terms, or calculation methodologies that are technically correct but aggressive. Knowing where the edges are before the next reconciliation arrives puts you in a better negotiating position.
Common first-timer mistakes
Waiting to audit is the most costly. Most commercial leases contain an audit window, typically 12 to 24 months from receipt of the reconciliation statement. Miss it and you lose the right to dispute that year's charges permanently. Check your lease's audit rights provision before anything else.
Auditing the wrong document is another common error. The reconciliation statement and the CAM estimate invoice are two different things. The reconciliation is the annual settlement and the document you audit. The monthly estimate is just an advance payment against that annual settlement. Sending a dispute letter about the monthly invoice achieves nothing.
Do not assume the landlord's methodology is correct because it looks official. Reconciliation statements are formatted to look authoritative. That does not mean the underlying calculations are correct. After testing reconciliation samples from published audit cases through CAMAudit, the 40% error rate is not an anomaly. It reflects systematic, repeatable mistakes in how management fees, pro-rata shares, and expense exclusions are applied.
Sending the dispute letter without reviewing the findings is a fourth mistake. The auto-generated dispute letter draft is accurate to the findings the software flagged. But you know things about your lease and your property that the software does not: side agreements, verbal understandings, expense categories that were negotiated outside the standard lease form. Review the findings against your own knowledge of the situation before sending.
Finally, do not expect immediate resolution. CAM disputes take time. The landlord needs to pull records, run their own calculations, and involve their property management accounting team. A 30-day response is reasonable. A 60-day negotiation is normal. Patience is part of the process.
"I built CAMAudit because first-time tenants were either ignoring reconciliation statements entirely or assuming they needed an attorney just to ask a basic question. The process is genuinely straightforward once you have a report that shows you exactly what is wrong and why. Most disputes close in a single exchange of letters." — Angel Campa, Founder of CAMAudit
Frequently Asked Questions
What documents do I need for my first CAM audit?
You need two documents: your commercial lease (including any amendments) and the CAM reconciliation statement your landlord sent. If you have prior years' reconciliations, include them for a lookback audit. You do not need the landlord's general ledger for a software-based audit, only for a CPA forensic audit that invokes your lease's audit rights clause.
How long does a first CAM audit take with software?
With AI-powered software like CAMAudit, the process takes under 15 minutes from upload to findings report. You upload your lease and reconciliation, the platform extracts relevant provisions, runs 20 detection rules, and delivers a findings report. If overcharges are confirmed, a dispute letter draft is generated automatically.
What does a CAM audit findings report look like?
A CAM audit findings report lists each detected overcharge by rule category, shows the lease provision that was violated, calculates the dollar amount of the discrepancy, and explains what the correct charge should have been. CAMAudit's report also includes a dispute letter draft with the findings formatted for landlord correspondence.
What if my first audit finds no overcharges?
If no overcharges are found, the audit produces a clean report confirming the reconciliation is consistent with your lease terms. This is still valuable: it documents that you reviewed the statement and found it accurate, which protects you if the landlord later claims you accepted charges you did not dispute.
What happens after I send the dispute letter draft to my landlord?
After sending the dispute letter draft, landlords typically respond in one of three ways: they agree to the overcharge and issue a credit or refund, they dispute the finding and ask for supporting calculations, or they do not respond. If a landlord disputes or ignores the letter, you have documented evidence to escalate to an attorney or pursue mediation.
Do I need a lawyer for my first CAM audit?
No. The vast majority of CAM disputes resolve without legal representation. You send the dispute letter draft, the landlord corrects the overcharge, and the matter closes. Lawyers become relevant when the landlord refuses to respond, the disputed amount is large enough to justify litigation costs, or the landlord's actions suggest bad faith.