CAM reconciliation and pro-rata share calculator

The calculator above runs a CAM reconciliation in the order the work happens: the operating expenses on the books, less what the leases exclude, with the variable part grossed up to the stated occupancy; then each tenant’s pro-rata share of that pool; then one tenant’s statement, less its base-year share and the estimates it already paid; then a cap on controllable expenses under each of the three mechanics a lease can describe. It opens with the Harbor Point Plaza figures used throughout this site, so the first thing it shows is a $1,075,000 grossed-up pool, an 8.00% share, a $1,200 true-up, and a 2026 cap ceiling of $57,500 — the same numbers as the worked example in what a CAM reconciliation actually involves. Replace them with your own and every figure recomputes as you type. Nothing is sent anywhere.

What follows is the arithmetic behind each step, so that the output can be checked by hand and so that the places where the calculator simplifies are clear. It applies one gross-up factor to one variable total, computes shares on one denominator, and runs one cap mechanic at a time without carry-forward. A reconciliation with recovery groups, per-expense gross-ups or cumulative caps uses the same arithmetic several times over, and the posts linked from each step cover those cases.

Step 1: the pool

Pool after exclusions = operating expenses posted − exclusions.

Grossed-up variable expenses = variable expenses × (stated occupancy ÷ actual occupancy), applied only when actual occupancy is below the stated level.

Grossed-up pool = fixed expenses + grossed-up variable expenses.

The exclusions are the leases’ list — capital improvements, leasing commissions, the owner’s own legal and financing costs, and anything named — and recoverable vs. non-recoverable expenses is the full version of that list. The gross-up applies to the expenses that would have been higher in a fuller building and to nothing else; the calculator’s note under step 1 shows what grossing up the whole pool would have produced, because that is the most common error on a statement and it is worth seeing the size of it. Gross-up clauses, explained covers which expenses are variable and why the base year has to be grossed up the same way.

Step 2: pro-rata shares

Share = tenant rentable square feet ÷ denominator rentable square feet.

Allocated = grossed-up pool × share.

The denominator is whatever the lease says it is. Most leases use the building’s total rentable area, in which case the shares of the occupied tenants add up to the occupancy percentage and the remainder is the landlord’s — at Harbor Point, 80,000 of 100,000 RSF is occupied, so 80% of the pool is allocated and 20% is absorbed, which is the vacancy cost the gross-up exists to correct for. Some leases use occupied area, or a stated percentage, or a different denominator for a different recovery group; the calculator takes one denominator, and a lease that uses another needs the share computed on its own terms.

Shares are the figure most often wrong after a lease event. A suite remeasured, a tenant expanding into the next unit, a building added to the campus — each changes a numerator or the denominator, and every statement computed on the old figure is wrong by the difference. The denominator used should appear on every tenant’s statement, and it should be the same number on all of them for the same group.

Step 3: one tenant’s true-up

Gross share = grossed-up pool × share.

Recoverable = gross share − base-year share, where the lease has a base year. Under an expense-stop lease the deduction is the stop amount instead, usually stated per square foot and multiplied by the tenant’s area; base year and expense stop covers the difference. Under a straight triple-net lease there is no deduction and recoverable equals the gross share.

True-up = recoverable − estimates billed for the year. A positive result is owed by the tenant; a negative one is a credit.

The base-year share has to have been built the same way as the current year: same exclusions, same variable list, same gross-up to the same stated occupancy. Brightleaf’s $74,000 is the 2023 pool grossed up to 95% from that year’s 76% occupancy, times 8.00%. If the base year had been left at actual occupancy it would be $67,840, the recoverable would be $18,160, and the tenant would pay $6,160 a year for the rest of the term for a difference in method rather than a difference in cost.

Step 4: the cap

A cap on controllable expenses limits how much the tenant’s controllable share can grow from the base year. The calculator takes the base-year controllable share, the percentage, and the actual controllable share for each year since, and computes the ceiling under the mechanic selected; the billed amount each year is the lower of the actual and the ceiling.

Simple from the base year: ceiling in year n = base × (1 + rate × n).

Compounded from the base year: ceiling in year n = base × (1 + rate) to the power n.

On the prior year’s actual: ceiling in year n = prior year’s actual × (1 + rate).

Same costs, same 5%, and a $3,925 spread in year three that grows to $6,800 by year five. The percentage on the term sheet does not tell you which column applies; the lease language does, and CAM caps: cumulative, non-cumulative and compounding goes through the clause forms, the carry-forward case the calculator does not model, and the ordering of the cap against the base year and the gross-up. The cap is tested against the controllable share only — taxes, insurance and utilities are usually outside it — so the figure entered for each year is the tenant’s share of the controllable accounts, not its whole share of the pool.

What the calculator does not do

It is a check on the arithmetic, not a reconciliation system. It does not split the pool into recovery groups, so a property where retail tenants share the parking lot and office tenants do not needs a run per group. It applies one gross-up factor to one variable total rather than grossing up account by account. It computes one tenant’s statement at a time. It runs the cap without carry-forward or recapture and does not hold last year’s ceiling for next year. And it keeps nothing: close the page and the figures are gone, which is the right behaviour for a calculator and the wrong one for a reconciliation, because the question in eighteen months will be how a number was reached, and the answer has to have been kept at the time.

The “Copy the derivation” button produces the chain as plain text — pool, exclusions, gross-up, shares, the tenant’s statement, the cap table — in the order a tenant’s auditor would ask for it. Pasted into a working file it is a reasonable first draft of the schedule that should accompany every statement, and the sample statement shows what the finished version looks like.

What makes the next one easier

Everything the calculator asks for is either on the books or on the lease, and only the first kind changes each year. The exclusions, the variable list, the stated occupancy, the denominator, each tenant’s area, the base-year share and the cap mechanic are stable; the year’s expenses and occupancy are new. Recorded once against the lease, the reconciliation is a re-run of this page with one new pool, which is what Ledgerstone does: the recovery rules live on the lease, the expenses are read from QuickBooks Online rather than re-keyed, and the reconciliation shows the derivation behind every figure and keeps it when the period is sealed.

Related reading

• What a CAM reconciliation actually involves — the five steps and the worked example the calculator reproduces.
• The CAM reconciliation checklist — the dated steps around the arithmetic.
• CAM reconciliation spreadsheet template: where it breaks — the workbook version of the same chain, and its limits.
• Gross-up clauses, explained with the arithmetic — step 1 in full.