USA – LOUISIANA Law and Practice Contributed by: Jeffrey P. Good, Susan M. Tyler and B. Trevor Wilson, Jones Walker LLP
6.13 Restrictions on the Use of Real Estate Commercial leases usually define the permit - ted 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: ensur - ing tenant mix compatibility in multi-tenant prop - erties, 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 improve - ments to the leased premises without the land - lord’s consent. The tenant is required to sub - mit 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 pro - vide a payment and performance bond. Most leases distinguish between structural and non-structural alterations, with greater flexibil - ity 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.
to maintain control over assessment 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 tenant’s share is typi - cally calculated based on the ratio of their leased space to the total leasable area of the building. Commercial tenants often negotiate the right to contest 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. Commer - cial property insurance covers common casual - ties, and general liability insurance covers claims of damage to property and claims of injury to or death of persons against the landlord. The ten - ant is often also required to carry general liability insurance naming the landlord as an additional insured, and commercial property insurance covering the tenant’s property located in the leased premises. Insurance requirements have evolved in response to climate concerns and increased catastrophic risk in Louisiana, with flood insur - ance becoming a standard requirement particu - larly within designated flood zones. Landlords increasingly require tenants to carry business interruption insurance that covers rent obliga - tions during periods when the premises might be unusable due to casualty damage.
1208 CHAMBERS.COM
Powered by FlippingBook