Can a landlord bill odor control costs to a pet care tenant through CAM?

It depends on whether the odor control work is for common areas of the property or for your leased space. Exterior drainage and common-area odor mitigation can be legitimate CAM items if they serve the shared property. Odor treatment specific to your unit or your outdoor run area is an operating cost of your space, not a shared CAM pool expense.

How are water and sewer costs typically allocated in a strip center NNN lease?

Some leases pass through water and sewer as part of the common area utility pool. Others sub-meter each tenant and bill usage separately. Pet care facilities often use above-average water volumes, which is why sub-metering is favorable for neighbors but can be expensive for the pet care tenant. If you are on shared meters, verify that the allocation is pro-rata by square footage, not by usage estimates.

Is an outdoor dog run part of the common area or my leased premises?

This depends on your lease exhibit showing the demised premises. If the outdoor dog run area is drawn as part of your leased space, it is exclusive use and its maintenance is your responsibility, not a CAM pool cost. If it is designated as a licensed exclusive area outside the demised premises, the classification may be more ambiguous. Read the lease exhibit carefully.

What CAM items are most commonly disputed by pet care tenants?

The most common dispute items for service-intensive tenants in retail strip centers include management fee overcharges (fee applied to wrong base), exterior maintenance items billed specifically to one tenant rather than shared across the pool, and water or sewer utility allocations that do not follow the lease formula.

What is my audit window for a pet care franchise CAM reconciliation?

Your audit rights clause sets the window, typically one to three years from the date the reconciliation statement is delivered. After that window closes, you lose the right to dispute even if errors exist. Review each year's reconciliation within the window.

Pet Care Franchise CAM Costs: What Strip Center Leases Pass Through

Pet care franchise locations — Camp Bow Wow, Dogtopia, PetSuites, and similar daycare and boarding concepts — occupy a specific and somewhat unusual position in strip center leasing. The use generates more infrastructure demand than standard retail: water, drainage, exterior areas, and odor management all become real operational concerns.

Landlords and property managers notice those demands. Some try to recover related costs through CAM in ways that exceed what the lease actually allows. This guide covers the main NNN cost issues for pet care franchise operators and what to verify before paying annual reconciliations.

Odor Control and Exterior Drainage

Pet care facilities generate odors and drainage demands that other strip center tenants do not. Exterior hose-downs, drainage maintenance, and odor control treatments may be necessary for the center's overall appeal. The question for your store-level P&L is which of those costs are legitimately yours and which belong in the shared CAM pool.

Costs you should expect to pay as your space's operating expenses:

Interior cleaning, drain maintenance, and odor treatment within your unit
Any work specific to your outdoor run or kennel area if it is part of your leased premises

Costs that should be scrutinized before paying through CAM:

Exterior drainage work adjacent to your unit that the landlord bills as a center-wide maintenance item but that serves primarily your operation
Odor mitigation treatments applied to common walkways near your unit that are direct-billed to you rather than allocated across the pool

The distinction matters because costs specific to your tenancy should not appear in the shared CAM pool that all tenants pay into. And costs the landlord is trying to direct-bill to you specifically need lease authorization.

If your reconciliation includes a line item for drainage repair or odor treatment that does not appear in prior years and seems specific to your unit area, request the underlying invoice. If the work was done on a common drain line, pro-rata allocation through CAM is appropriate. If the work was done on a drain serving only your suite, it should not be in the pool.

Water and Sewer: Sub-Metered vs. Shared Allocation

Water and sewer are a significant cost for pet care operations. Some strip centers sub-meter each tenant, meaning you pay for your actual usage. Others run the property on shared meters and allocate costs through the CAM pool.

If you are on a shared meter, the allocation method matters. Standard NNN lease language allocates shared utility costs by pro-rata share: your square footage divided by total building square footage. If a pet care location at 4,000 square feet is in a 22,000-square-foot center, the pro-rata share is roughly 18.2%, and that percentage of the shared water and sewer bill is your allocation.

The issue arises when landlords attempt to allocate water and sewer by estimated usage rather than by the lease-defined formula. A property manager who calculates that the pet care tenant uses 40% of the building's water and applies a 40% allocation to the utility bill is overriding the pro-rata formula in the lease. Unless your lease specifically authorizes usage-based utility allocation, the formula controls.

If you suspect your water and sewer allocation is above your pro-rata share, request the underlying utility bills and the allocation methodology from the landlord. Compare the methodology to your lease.

Outdoor Dog Run: Exclusive Use vs. Common Area Classification

The outdoor dog run or play yard attached to a pet care franchise location is one of the most straightforward lease questions that somehow becomes contentious.

Pull your lease exhibit. The demised premises are defined by the boundary shown in the attached floor plan and site plan. If the outdoor area is enclosed within the boundary of your demised premises, it is part of your leased space. Maintenance is your responsibility, not a CAM pool item.

Where it gets complicated: some leases use a licensed exclusive use structure for outdoor areas, meaning the area is not formally part of the demised premises but is licensed to you for exclusive use. This creates ambiguity. The landlord may argue that maintenance of the area falls under CAM because it is technically outside the demised premises. Depending on the lease language, the landlord's position may have some support.

Regardless of how the outdoor area is classified, exterior fencing that encloses your run area exclusively is not common area maintenance. Fencing that benefits only your operation should not be billed to the common area pool at all. If the landlord bills fence repair or replacement as a CAM item and the fence serves only your dog run, that is a misclassification.

Exterior Fencing Billed as CAM

Fencing is one of the more creative billing items that appears in reconciliations for pet care tenants. A property manager may include fence maintenance or replacement in the CAM pool under an exterior maintenance or site improvement line item.

The question is what the fence serves. If there is perimeter fencing around the property's parking lot or a decorative fence along the street frontage that defines the center's exterior, that is a legitimate common area maintenance item. If the fence in question is the enclosure around your outdoor dog run that has no function for any other tenant or visitor, it is not.

Request backup documentation for any fence-related line items in your reconciliation. The invoice will show the scope of work and the location. If the location is your dog run enclosure, the cost should not be in the pool.

Management Fee Structure for Service Properties

Management fee overcharges follow the same pattern across all commercial property types: the fee is calculated against a base that is broader than what the lease specifies.

For pet care locations in strip centers, an additional issue can arise when the property management firm argues that service-intensive tenants create additional management burden that justifies a higher fee. That argument does not override your lease cap.

Verify the management fee calculation:

What fee is billed in the reconciliation?
What percentage does your lease cap the fee at?
What base does your lease specify for the calculation?

If the lease caps the fee at 4% of controllable CAM expenses and the billed fee equals 4% of gross building revenues, the overcharge is the difference between those two bases multiplied by the cap rate, allocated at your pro-rata share.

What to Check Before Paying the True-Up

For a pet care franchise location, the annual reconciliation review should focus on:

Drainage and odor items: Are they pro-rata CAM pool expenses or direct bills? Request invoices to confirm scope and location.
Water and sewer: Is the allocation method pro-rata by square footage as the lease specifies, or is it usage-based without lease authorization?
Outdoor area maintenance: Does any line item cover your exclusive-use outdoor space? If so, it does not belong in CAM.
Fencing: Any fence repair or replacement — request the invoice to confirm it covers common perimeter, not your run enclosure.
Management fee: Verify the cap percentage and the base. Calculate the allowable maximum and compare.

Upload your lease and reconciliation to CAMAudit. The tool checks each of these items automatically against your lease provisions, so you know which line items to question before you decide to dispute.

Pet Care Franchise CAM Costs: What Strip Center Leases Pass Through