Percentage Lease tenants face specific billing risks tied to how expenses are allocated and reconciled. The most common error appears in the section below. CAMAudit runs 20 forensic detection rules on your reconciliation statement to identify every recoverable dollar.
Landlords calculating percentage rent using an inflated definition of "gross sales", one that includes employee discounts, sales tax collected, returns, inter-company transfers, or e-commerce sales that were not fulfilled from the demised premises. Each improperly included category inflates the gross sales figure and results in the tenant paying more percentage rent than contractually required.
A lease structure, most common in retail, where the tenant pays a base rent plus additional "percentage rent" equal to a percentage of their gross sales above a defined breakpoint. The percentage rent component is designed to allow landlords to participate in the upside of successful retail operations. The underlying lease structure (the fixed rent component) is typically NNN.
Depends on the underlying lease structure, which is typically NNN (tenant pays taxes, insurance, and CAM in addition to base rent and percentage rent). Percentage rent is layered on top of the base lease expense structure, it is an additional revenue-sharing component, not a substitute for operating expense obligations.
Two components: (1) Standard NNN/CAM expenses billed and reconciled on a pro-rata share basis identical to any NNN lease, and (2) Percentage rent billed separately after the tenant's gross sales exceed the "natural breakpoint" (base rent divided by the percentage rent rate). Percentage rent is typically calculated annually, though some leases require monthly interim payments.
Upload two PDFs. 20 detection rules. Under 15 minutes. Free.
Audit the landlord's definition of "Gross Sales" against the lease's specific definition. Verify that all exclusions in the lease (returns and allowances, sales tax, employee discounts, online sales not delivered from the store) are actually being deducted. Confirm that the breakpoint calculation uses the correct formula, base rent divided by the percentage rate (natural breakpoint), rather than an artificial breakpoint set below the natural one.
Upload two PDFs. 20 detection rules. Under 15 minutes. Free.
Next Best Step
Walk through the full audit steps before you upload your lease and CAM statement.
Review the audit process before you upload your lease and reconciliation.
Preview the proof page before you upload.
Run the free audit when you want documented findings.
Ready to skip the reading and document the overcharge directly?
Run a free CAM scanNeed to extract lease terms before your audit?
A CAM audit is only as accurate as your lease data. lextract.io extracts 126 structured fields from any commercial lease PDF: CAM definitions, pro-rata share, caps, base year, and audit rights. So you have the exact terms your landlord is supposed to follow.
Go to lextract.ioThis 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.
