Monthly Archives: January 2017

Are CAM Fees Costing You?

CAM Fees

How much are Common Area Maintenance (CAM) fees costing your business? While standard in most leases, consider the annual cost and impact on the bottom line during lease negotiations to avoid unexpected costs.

CAM fees are paid in addition to rent. CAM fees represent a portion of the total maintenance fees for a building’s common areas and are allocated to each tenant based on the amount of space they occupy. The most common costs built into a commercial lease pertain to the repair and maintenance of hallways, parking lots, sidewalks, light fixtures, and elevators among others. Unless a business can reasonably show that it does not utilize these areas, CAM fees are a cost of doing business. However, in an effort to make sure CAM fees are fair, request an itemized list of fees for verification purposes. Consider requesting the landlord’s allocation calculations to avoid over or unfair fees, and have the documentation included in any lease documentation.

While CAM fees are a cost of leasing commercial space, tenants should be wary of fees noted as CAM charges that don’t directly or indirectly benefit them. Examples of such expenses are professional service fees for accounting and legal services, advertising and promotion, liability insurance costs, and building management salaries. Tenants should also be aware of any capital expenditures including extravagant additions or renovations to the property. Before signing a lease agreement, pay attention. If the agreement does not plainly state and explain CAM charges, administrative fees, or anything that is not purely base rent, make sure the details are mutually agreed upon and in writing.

For more information, please contact Jimmy Miller at JMiller@aronsonllc.com or Aronson’s Construction & Real Estate team at 301.231.6276.

 

Related reading

http://www.retailrealestatelaw.com/archives/352

http://svn-ricore.com/base-rent-common-area-maintenance-expenses-in-commercial-leases/

http://nreionline.com/mag/battle-over-cam-charges

https://www.thebalance.com/tips-on-how-to-negotiate-cam-fees-in-commercial-leases-3515425

GSA Opportunities for Construction Companies

The Federal government is one of the largest consumers in the world, so why not take advantage of the numerous business opportunities they offer? The Federal government has hundreds of open contracts across the United States available for construction and facility service companies to repair, build, and lease space for Federal employees and Federal programs. However, many companies in construction and facility services miss these opportunities because they don’t know about them. The General Service Administration (GSA) along with the Public Buildings Service (PBS) has established an online source to help companies identify available contracts and streamline the process for bidding on the projects.

One of the essential missions of the GSA is to provide workplaces to government employees and government programs through the construction of new government facilities, through the preservation of existing facilities, and by leasing commercial real estate from private sector owners. This mission provides many opportunities for construction and facility service companies to bid on government contracts that range in size and location. The GSA and PBS created a company friendly search engine that combines all available contracts in one place.

FedBizOpps.gov allows companies to search through available contracts the government is looking to fund. The opportunities listed on the site include infrastructure repairs such as road repairs, water main repairs, and installing new fencing, with contract awards from a few thousand dollars to the design and construction of new buildings with contract awards in the millions of dollars. The site allows individuals to search through open opportunities by geographical location, NAICS Code, Classification Code (such as “Construction of structures and facilities” and “Maintenance, repair, and alteration of real property”), and more. The search page also allows individuals to filter their searches by “Set-Aside Codes” if they qualify as a veteran-owned small business, competitive 8(a) business, woman-owned small business, etc. Updated daily, the site is an excellent resource to help companies identify greater opportunities for business.

To learn more about GSA opportunities in the construction sector, please contact Aronson’s Construction & Real Estate Group at 301.231.6276.

Minimum Wage for SCLS Contractors Increased to $10.20

In accordance with Executive Order 13658, the minimum wage for certain Federal contractors increased to $10.20 an hour effective January 1, 2017. Generally, the increased wage rate must be paid to workers performing on or in connection with covered Federal contracts whose wages are governed by the Fair Labor Standards Act (FLSA), the Service Contract Labor Standards (SCLS), or the Davis-Bacon Act (DBA).

Covered contracts include:

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