A triple-net lease tenant receives a CAM reconciliation statement at year-end showing that actual CAM costs exceeded the estimated monthly payments by $2,400. What typically happens?
Correct Answer
D) The tenant owes the landlord $2,400 as a year-end adjustment to cover the actual CAM costs
In a triple-net lease, CAM charges are typically estimated monthly and reconciled annually. If actual costs exceed estimates, the tenant owes the difference. If estimates exceed actual costs, the tenant receives a credit.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A life estate is a freehold estate that grants ownership rights for the duration of someone's life.
Real property is immovable land and anything permanently attached to it, while personal property (also called chattels) is movable.
Tenancy by the entirety is a form of co-ownership available only to married couples that includes the right of survivorship and protection from individual creditors. Neither spouse can unilaterally sell or encumber the property.
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