Your pro-rata share decides how much of the building's operating expenses lands on you. A small error in that percentage is repeated on every line of the CAM reconciliation statement and every year, which is why it is one of the first things worth checking.
The basic formula
In most leases the share is your premises area divided by the building (or project) area, shown as a percentage:
Pro-rata share = your square footage ÷ the building's square footage
Your lease decides which areas count and how they are measured. Some leases name a fixed percentage; others say the share changes if the premises or the building changes. Always start from the lease wording, not from the number on the statement.
A worked example (fictional numbers)
This example uses invented figures to show the arithmetic. They are not from any real lease.
- Your premises: 4,000 square feet
- The building: 50,000 square feet
- 4,000 ÷ 50,000 = 0.08, so the share is 8.00%
- Total building operating expenses on the statement: $500,000
- Your share at 8.00%: $500,000 × 8.00% = $40,000.00
- If the statement uses 8.08% instead: $500,000 × 8.08% = $40,400.00
- Difference to ask about: $40,400.00 − $40,000.00 = $400.00
A $400 difference may have an ordinary explanation, such as a different building area in the lease than in the landlord's records. The point of the check is to find out, not to assume.
What to compare
- The percentage in the lease (or the two square-footage figures it is built from).
- The percentage on the statement. If it differs, note both numbers and the page they appear on.
- The building area the landlord used. Landlords sometimes use rentable, leasable or gross area. Your lease says which one applies.
- Whether the share can change. Leases often say what happens when space is added, removed or vacant. Occupancy adjustments ("gross-up" clauses) are a separate calculation, covered in our reconciliation guide.
- Whether the same share is applied to every line. Some expenses, such as a cost that serves only part of the property, may be allocated differently under the lease.
Questions to ask if the share differs
- Which square footage did you use for my premises and for the building, and where does the lease say so?
- Has the measured area changed since the lease was signed, and is there an amendment that says so?
- Can you send the calculation behind the percentage on the statement?
- Is the same percentage applied to every expense line? If not, which lines use a different allocation?
You can turn these into a written request with our dispute letter template. A request for an explanation is a reasonable first step and does not assume the landlord made a mistake.
Check it with your own numbers
The free CAM calculator runs this arithmetic for you. If you would like your lease and statement compared in full, including the share, the LeaseGuard audit flags a share that differs from the lease as a potential discrepancy and shows where in your documents it found each figure.
This guide is general information for commercial tenants, not legal or accounting advice. Your lease and applicable law decide your rights.