Common Area Maintenance (CAM) fees recovery as a result of negotiated or inherited leases can create accounting challenges that cause many commercial property managers significant lost time and resources for annual reconciliation.
The basis of an accurate CAM cost calculation is the collection of all relevant invoices and charges that fall under the umbrella of common area maintenance. It is important that property managers keep track of all relevant maintenance costs that need to be added to CAM calculations.
Legacy Tools are Error Prone
Many managers still use only Excel to track and calculate CAM recoveries manually, with all of the associated labor requirements and human error risk. Every year, millions of dollars are left on the table as property managers accidentally overlook items or fail to recognize existing errors in their manual calculations or spreadsheets.
Using disparate, non-integrated tools such as Excel in combination with dated accounting software multiplies the risk. Compiling CAM budgets and related expenses becomes a time-consuming, tedious, and error-inherent exercise.
After year-end costs have been received and calculated, property managers then work to reconcile CAM costs using these outdated and manual approaches. As a result, many commercial property managers spend a good part – if not all – of January completing reconciliations with little time for other, more profitable work.
Many software tools available are simply too cumbersome to fit the need; on-boarding can take weeks if not months, and the transfer of data alone can be a daunting task.
Your CAM Checklist
- Follow-up to assure all CAM costs and expenses are captured
- Use automation software (like RAAMP) to assure calculations are correct
- Clearly separate CAM from Capital Improvement
- Use automation software to set notifications for deadlines compliance
- Assure follow-up tenant communications notifications are adhered to
- Leverage automation software to easily respond to tenant audit requests
- Reconcile previous payment deficiencies
- Issue proper and timely notices via automation software
- Consider default or waiver concerns
- Communicate estimated CAM for the upcoming year
The RAAMP Solution
Using the CAM Checklist above with power of the RAAMP – Real Estate Accounting and Asset Management Platform — cuts the time to abstract and reconcile by an average of fifty percent for initial migration. This then supports instantaneous, real-time reconciliation throughout the year.
RAAMP’s software solution increases productivity between management teams, reduces the risk of missed revenue, and eliminates the need for multiple software and file management systems within a company.
To learn more about best practices in CAM reconciliation, contact us for a no-fee demonstration of the power of RAAMP.