Security is one of the most disputed CAM line items. Learn the common benefit test, how landlords inflate security charges, and what to do when security costs are misallocated.
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Find My OverchargesSee a sample report firstSecurity is one of the top five most disputed line items in commercial CAM reconciliations. Landlords routinely bundle tenant-specific security expenses into the pool, charge for enhanced services that were never requested, and bill armed guard contracts without documentation. The result is an overcharge that looks like a routine line item on a 40-row spreadsheet.
The core issue comes down to one test: does the security expense benefit the property as a whole, or does it benefit a specific tenant?
The common benefit test applies to every security line item in a CAM reconciliation. Shared parking lot surveillance, lobby access control, and perimeter lighting pass the test. Dedicated guard stations for a single anchor tenant, interior cameras in private suites, and post-incident upgrades serving only one occupant do not.
40% of CAM reconciliations contain at least one billing error, with security cost bundling one of the most commonly identified overcharge patterns in multi-tenant properties (Tango Analytics, 2023)
Courts and lease arbitrators apply a "common benefit" test to determine whether a security expense is includable in CAM. The expense must serve the general tenant population and protect the shared property. It cannot be a service that primarily or exclusively benefits one occupant.
Standard security expenses that typically pass the test:
Expenses that typically fail the test:
The key language in most leases: "security services for the common areas." If your lease says that and the landlord bills you for a guard stationed at another tenant's dock, that guard is not a common area service.
This is the most common pattern. A large anchor tenant (a bank, a pharmacy, a 24-hour fitness center) negotiates dedicated security patrols as part of their lease. Those costs get folded into the CAM pool and allocated across all tenants. You end up paying for security you never needed or requested.
Security contracts in the $50,000 to $200,000 range are rarely bid competitively. Landlords sometimes use related-party security firms at inflated rates. Your lease may require competitive bidding for major contracts. Many do not.
After a theft or break-in, landlords often upgrade security systems substantially. These upgrades can be legitimate CAM expenses or they can be capital expenditures that should be amortized. The distinction matters. A new surveillance system costing $80,000 may need to be spread over its useful life, not expensed entirely in year one. See Capital Expenditures in CAM Charges for how capital security installations should be treated.
Building has 8 tenants, total CAM pool of $400,000. Security line item: $60,000. Of that $60,000:
Your pro-rata share is 12%. Correct security allocation: $35,000 x 12% = $4,200. Billed amount: $60,000 x 12% = $7,200. Overcharge: $3,000 for this line item alone.
Across a five-year lease, that is $15,000 in overcharges from one line item.
15-20% of annual CAM spending is recoverable through audit, with tenant-specific security allocation disputes among the cleanest findings to document and dispute (Springbord Research, 2023)
If the landlord cannot provide vendor contracts and invoices, that is a documentation failure. Most audit rights clauses entitle you to that information.
For broader context on excluded expense categories beyond security, see Excluded Services in CAM Charges. For how vacant-suite costs create a related overcharge pattern, see Vacant Suite Improvements in CAM.
No. Vague language does not override the implied common benefit requirement. Courts have consistently held that CAM charges must benefit the tenant paying them. If your lease is silent on the scope of "security costs," argue the common benefit test applies. The landlord has the burden of showing the expense benefits the property as a whole.
It depends on whether it is a capital expenditure or a repair. A brand-new surveillance system covering the entire property may be a capital item under your lease. If so, it should be amortized over its useful life, not expensed in the year of installation. Check your lease's capital expenditure exclusion language.
Sometimes. New owners frequently reassess property security and upgrade systems. But a tripling of security costs in year one of new ownership is a red flag. You should request documentation showing what changed, what was bid, and whether any costs are tenant-specific or capital in nature.
A CAM cap limits your total annual CAM increase, so it partially protects you regardless of what is inside the pool. But it does not correct the underlying error. You may still want to dispute the security charges because: (1) reducing the pool lowers your base for future year calculations, and (2) if you sell or assign the lease, the inflated base travels with you. See CAM Cap Violation Guide for how caps interact with pool composition.
Yes. General audit rights cover all CAM line items including security. The audit right lets you inspect the books and records supporting the reconciliation. Security contracts and invoices are part of that record.
CAMAudit's detection engine flags security line items that show year-over-year increases above 15% and cross-references them against CAM pool size to identify tenant-specific allocation patterns.
Related: Pro-Rata Share Calculation Errors | CAM Recovery | How to Audit CAM Charges
Can a landlord charge security costs through CAM?
Yes, when the security expenses benefit all tenants and the property as a whole. Standard CAM-includable security costs include shared parking lot lighting, common area surveillance systems, and uniform guard contracts covering the entire property. Security costs that benefit only a specific tenant, such as dedicated lobby guards or tenant-specific access control, fail the common benefit test and should not be in the pool.
What is the common benefit test for security charges?
The common benefit test asks whether the expense provides a benefit that is proportionally shared by all tenants or primarily serves a specific tenant. A parking lot security camera system that covers all tenant parking passes the test. An armed guard stationed at the entrance of a high-value jewelry tenant does not, because the primary beneficiary is that tenant, not the property as a whole.
How can I tell if a security cost overcharge is in my CAM bill?
Look for security line items that are unusually large relative to property size, that show year-over-year increases above 15%, or that include descriptions suggesting dedicated guard services. Request the underlying security contracts and invoices. If any contract is with an entity related to another tenant, or if the scope of service covers areas outside common areas, those costs may be challengeable.
How do I identify a security cost overcharge in my reconciliation?
Pull the security line item from your reconciliation and request all underlying invoices and contracts. Map each contract to its service scope: which areas are covered and who benefits. Separate common-area services from tenant-specific services. For any large upgrade or new installation, determine whether it was expensed or capitalized. Calculate the amount attributable to non-common-area services and multiply by your pro-rata share to quantify the overcharge.
Do audit rights cover security costs in CAM reconciliations?
Yes. General CAM audit rights cover all line items in the reconciliation including security. The audit right lets you inspect books and records supporting each line item. Security contracts and invoices are part of that record. Request them within your lease's audit window.
