USA – LOUISIANA Law and Practice Contributed by: Jeffrey P. Good, Susan M. Tyler and B. Trevor Wilson, Jones Walker LLP
6.3 Regulation of Rents or Lease Terms Rents and lease terms are not regulated in Loui - siana, except that the maximum term of a lease is 99 years. Commercial leases are generally considered contracts between sophisticated parties, and courts tend to enforce their terms as written. However, certain provisions may be unenforce - able as against public policy, such as waivers of the right to a judicial proceeding for eviction. 6.4 Typical Terms of a Lease Ground leases are usually longer, so that the ten - ant who constructs buildings and improvements on the leased premises may have the oppor - tunity to enjoy the buildings and improvements throughout their useful life. Other commercial leases have shorter terms. In the absence of specific provisions in the lease, the Louisiana Civil Code governs the repair and maintenance obligations of the landlord and ten - ant. Most commercial leases have specific provi - sions governing those responsibilities. Ground leases usually require the tenant to provide all the repairs and maintenance. Other commercial leases usually provide that the landlord will pro - vide repairs and maintenance, and that the ten - ant will pay the landlord its proportionate share of the cost of this work as additional rent. Typical commercial lease terms in Louisiana’s major markets currently range from three to ten years, with larger tenants often securing long - er terms with renewal options. Rent payments are typically due monthly on the first day of the month, with grace periods of 3–5 days common before late fees apply.
Predial servitudes are established in favour of an estate and may not be separated or assigned separately from the estate, while personal ser - vitudes are established in favour of a person or juridical entity and may be freely assigned. Usufruct is a personal servitude that confers the exclusive right to the use of real estate and to occupy and/or collect the fruits, rents and revenues from the real estate. A usufruct may be established by contract or by operation of law and usually terminates on the death of the grantee. The right of habitation may be granted to a person, conferring the right to occupy the real estate. 6.2 Types of Commercial Leases There are two basic types of commercial lease: the ground lease and the commercial lease. A form of ground lease is utilised for the lease of undeveloped land on which a tenant intends to construct buildings and improvements. Ground leases usually have a longer term, which may extend to a maximum of 99 years. A form of commercial lease is utilised for the lease of commercial buildings or for space in commer - cial buildings. Within the commercial lease category, several specialised forms have evolved to address spe - cific property types, including: • office leases – typically structured with base rent plus operating expense pass-throughs; • retail leases – often include percentage rent provisions based on tenant sales; • industrial/warehouse leases – usually net leases with tenant responsibility for most operating expenses; and • medical office leases – specialised provisions for medical waste and healthcare compliance.
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