USA – LOUISIANA Law and Practice Contributed by: Jeffrey P. Good, Susan M. Tyler, B. Trevor Wilson and Parker Hufft, Jones Walker LLP
Landlords typically maintain structural elements (foun - dation, roof, exterior walls) in most lease structures
Insurance requirements have evolved in response to climate concerns and increased catastrophic risk in Louisiana, with flood insurance becoming a stand - ard requirement, particularly within designated flood zones. Landlords increasingly require tenants to carry business interruption insurance that covers rent obli - gations during periods when the premises might be unusable due to casualty damage. 6.13 Restrictions on the Use of Real Estate Commercial leases usually define the permitted uses and prohibit the tenant from using the premises for other purposes. In the absence of restrictions on use in the lease, the tenant may use the premises for any purposes permitted under local, state and federal law. Use restrictions serve multiple purposes: ensuring tenant mix compatibility in multi-tenant properties, maintaining property value and reputation, controlling parking and common area impacts and limiting wear and tear on building systems. Beyond contractual restrictions, tenants must comply with applicable zoning ordinances, building codes and environmental regulations. 6.14 Tenant’s Ability to Alter and Improve Real Estate Commercial leases usually prohibit the tenant from making alterations, additions or improvements to the leased premises without the landlord’s consent. The tenant is required to submit plans and specifications to the landlord for approval, and the landlord often has the right of approval of the general contractor. The lease may also require the general contractor to provide a payment and performance bond. Most leases distinguish between structural and non- structural alterations, with greater flexibility typically granted for cosmetic or minor non-structural changes. 6.15 Specific Regulations There are no regulations in Louisiana that apply to leases of particular categories of real estate, except that local ordinances often regulate the short-term rental of residential property.
except absolute NNN arrangements. 6.10 Payment of Utilities and Telecommunications
If public services, utilities and telecommunication ser - vices may be separately metered, tenants are required to pay for their services directly. If not, each tenant typically pays a proportionate share as additional rent. For multi-tenant buildings without separate metering, landlords typically include utility costs in operating expenses and allocate them based on square foot - age or other usage formulae. 6.11 Payment of Property Taxes In commercial leases, property taxes are typically the responsibility of the landlord, but tenants pay their proportionate share as part of additional rent or com - mon area maintenance charges. This arrangement allows the landlord to maintain control over assess - ment challenges and ensure timely payment. In NNN leases, which are common for retail, industrial and single-tenant properties, tenants reimburse the landlord for 100% of the property taxes applicable to their premises. For multi-tenant properties, each ten - ant’s share is typically calculated based on the ratio of their leased space to the total leasable area of the building. Commercial tenants often negotiate the right to con - test property tax assessments, particularly in single- tenant buildings where they bear the full tax burden. 6.12 Insurance Issues Under commercial leases, the landlord usually obtains commercial property and general liability insurance, and the tenant is required to pay a proportionate share of the premiums. Commercial property insurance cov - ers common casualties, and general liability insurance covers claims of damage to property and claims of injury to or death of persons against the landlord. The tenant is often also required to carry general liabil - ity insurance naming the landlord as an additional insured, and commercial property insurance covering the tenant’s property located in the leased premises.
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