USA - LOUISIANA Trends and Developments Contributed by: Jeffrey P Good and Susan M Tyler, Jones Walker LLP
Jones Walker LLP 201 St Charles Avenue New Orleans LA 70170-5100 USA
Tel: +1 504 582 8000 Fax: +1 504 582 8583
Email: styler@joneswalker.com Web: www.joneswalker.com
The COVID-19 pandemic leaves what will be long lasting social and economic changes. Louisiana real estate markets are no exception, although it should be noted that the impacts of the global health crisis were mixed. Where one industry, sector, or region faced significant chal - lenges, another found opportunities. Meanwhile, the real estate industry is watch - ing a mixture of economic and political factors, particularly a new republican governor and gov - erning coalition in Baton Rouge and a federal government that is rapidly spending money on clean energy. With this in mind, this overview of Louisiana real estate trends and developments will begin by looking at some of the most pronounced effects of the pandemic, particularly in the hospitality, retail and tourism sectors. Other geopolitical, climate change, and sociocultural forces – including the impact of the Russian invasion of Ukraine on global energy markets – have also had an influence on real estate activity in the state, particularly given Louisiana’s sizeable oil and gas, chemicals, manufacturing and related industries. A number of developments “closer to home”, including emerging legislation and new infrastructure projects, will also be discussed in order to provide a more complete picture of Lou -
isiana’s commercial, industrial, and multi-family residential real estate markets. COVID-19: One Person’s Challenge Was Another’s Opportunity For a number of companies, including brick and mortar retailers, restaurants, entertainment ven- ues and nightclubs, hotels, and other tourism- related businesses, the pandemic had a devas - tating effect on revenues. In many cases, these businesses were unable to weather the storm. In turn, some landlords lost revenue as their ten- ants’ businesses folded, others agreed to rent abatements or deferrals. This situation was not, however, universal. In Baton Rouge, for example, after retail occu - pancy rates hit an eight-year low in 2020, the market rebounded strongly. As of April 2022, 91.2% of leasable retail space in shopping cen - tres of 15,000 square feet or larger was occu - pied, the highest level since 2018. Among sur - vey respondents, 67% reported vacancy rates of 10% or less, and only 4% of centres indicated that they were more than half vacant. Recent reports indicate that retail vacancy rates have further dropped in Baton Rouge. For a variety of reasons, including federal and state stimulus programmes, eviction moratori -
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