What’s your favorite season of the year? I’d bet not many of us would say “CAM season is it!”. Undoubtedly you’ll get a few questions from both clients and tenants after you deliver the news. Here are 3 sure-fire tactics you can use NOW to save time on the back end.
Connect CAM to BUDGET: This may sound obvious, but all too often real estate managers—especially new ones—don’t take this aspect seriously enough. Look at it this way: what goes into the budget will definitely come out in the CAM.
I’m often asked by managers, for example, if it’s possible to charge tenants back for a management fee and an administrative fee, plus salaries. My first response is always “it depends”, because it does depend on the lease language for each tenant. My second answer is “does it make sense?”, because although it may be possible to charge back everything allowable, it may or not make sense to do so. Once you’ve finished your spreadsheets and prepared your invoices, be sure to take some time for an overview: look at your property’s expenses and see if they do make sense; you’ll save valuable time later.
Review your leases: If you haven’t done it already, there’s no better time than now to review and re-visit your leases. A colleague of mine noted that whenever his company takes on a new third-party management account they come out looking like heroes to the owner. The reason? He’s steadfast in his belief that having his managers re-read and review every lease turns up dollars—he almost always finds something that was billed incorrectly.
Look at past mistakes: When I worked for an anchor grocery tenant, we discovered that almost 95% of the CAM bills we received from real estate management companies were incorrect. Most often, the errors were easily rectified, but the bills took longer to evaluate and pay, simply because the process of getting them corrected took longer. Reviewing the prior years’ CAM reconciliation with an eye toward correcting past mistakes can be a great time-saver!
Here’s the secret: Year-end and first quarter are a busy time for everyone, but if you keep your eye on these tactics, you’ll sail through CAM season without a hitch.
What’ are your tips? I’d love to hear from you.