Build vs buy for CAM reconciliation: spreadsheets, auditors or software

What is CAM reconciliation?#

CAM reconciliation is the annual process of comparing what a tenant paid in estimated common area maintenance charges against the landlord's actual recoverable costs, then settling the difference. The calculation depends on each lease: which costs are recoverable, which are excluded, whether controllable expenses are capped, how the tenant's pro rata share is calculated, whether costs are grossed up for vacancy, and what management or administrative fee applies. For landlords, reconciliation means producing a correct statement for every tenant. For tenants, it means checking that statement against the lease before the audit or objection window closes. Our explainer on what CAM reconciliation is covers the mechanics. The National Retail Tenants Association is the main professional body for lease administrators who do this work.

Option 1: spreadsheets and in-house review#

In-house spreadsheet review means a lease administrator or analyst rebuilds each landlord's calculation in a template and compares it with the lease. It is the most common starting point and, done well, it is thorough. The person in the seat knows the leases, the landlords and the history. The limits are capacity and continuity. Each reconciliation takes hours, so teams prioritize the largest locations and let smaller statements through. The knowledge lives in one or two people and their files, and audit windows close whether or not anyone had time. The EY and LeaseAccelerator 2022 Global Lease Accounting Survey found 38% of companies still rely on spreadsheets for lease accounting (Compliance Week, April 2022). CAM work is often even more manual than that.

Option 2: contingency CAM auditors#

Contingency CAM auditors review landlord records on your behalf and take a percentage of what they recover. The model is attractive because there is no upfront cost, and good auditors know where landlords tend to get it wrong: capital repairs passed through as operating costs, caps applied to the wrong base, denominators that ignore vacant space. The trade-off is selection. Auditors focus on statements large enough to justify their fee, so smaller locations are rarely examined. The contingency fee comes out of every dollar recovered, including the obvious errors software would have caught. Findings arrive as a report, not as a running record, so next year starts from zero. Many large occupiers use auditors well: targeted at the biggest leases, with in-house or software review covering the rest.

Option 3: CAM reconciliation software#

CAM reconciliation software reads the lease terms and the landlord statement and checks one against the other, line by line. For tenants, this means every statement is reviewed for exclusions, caps, management fee rates, pro rata share and gross-up, and each finding cites the clause it breaks. For landlords, it means calculating pools, exclusions, caps, base years and each tenant's share from the lease and ledger, then producing statements from the same data. The case for software is coverage and memory. Every reconciliation gets reviewed, findings carry forward, and year-over-year increases stand out. The case against is that software is only as good as the lease data behind it, so check how the product handles amendments and how it shows its work before you buy.

What would you have to build to automate CAM review yourself?#

This is a real software project. Teams that try it usually get the calculation engine working and stall on intake and amendments.

When does building in-house make sense?#

Building or staying in-house makes sense when the portfolio is small, the leases are standard, and you have an experienced reviewer with time. It also makes sense for a specific, recurring check that no product handles the way you need, such as a negotiated cap structure unique to one landlord relationship. A tenant with 40 locations and a seasoned lease administrator does not need software to do CAM well. A tenant with 400 locations and the same administrator is sampling, whether anyone calls it that or not.

What is the third path?#

The third path is to buy CAM software with a shared lease record, then build the checks that reflect your own negotiated terms and reporting. The vendor maintains intake, extraction, the calculation logic and the audit trail. Your team adds rules for the clauses you negotiated hard for, routes findings to the right approver, and decides which claims go to a contingency auditor for deeper work. REAL supports this through custom workflows on your own lease data. It also lets you use auditors where they add the most value instead of as your only coverage.

Decision scorecard#

Questions to ask before you decide#

1. 01What share of landlord statements did someone actually check last year?
2. 02How many audit or objection windows closed unreviewed?
3. 03Who knows the CAM terms for each lease, and what happens if they leave?
4. 04Can each finding be traced to a clause and a ledger line?
5. 05Do expected recoveries reach lease accounting as accruals?

What REAL does here#

For tenants, REAL's CAM recovery audit agent checks every landlord reconciliation against the lease, flags year-over-year increases and drafts recovery claims that cite the clause and ledger line, for a person to approve. For landlords, the CAM reconciliation agent computes pools, exclusions, gross-up, caps and each tenant's share from the lease and ledger, and holds output until inputs are complete. Existing REAL clients see a 10.3% average CAM savings. For more, see the CAM reconciliation playbook, the build vs buy AI agents framework for corporate real estate, and build vs buy lease accounting software. Or book a walkthrough.