There are three general types of fixed-term land lease available.

1) A general fixed-term land lease available for either residential purposes or business purposes

The fixed term is 50 years or more for this type. The important thing is that under this agreement, at the end of the lease period, the lessee must evacuate the land after demolishing any buildings on it. This could be a major burden for the lessee.

2) A land lease by which the lessee assigns any buildings on the land to the lessor

Under this type of lease, the lessor obtains any buildings on the land from the lessee at a reasonable price when the lease is terminated, if the lease has lasted for 30 or more years. This type gives the lessor some negotiation rights in finishing a lease, allowing the lessor to buy back any buildings, and at the same time, giving the lessee the right to force the lessor to pay a reasonable price for the buildings before the termination of the lease.

3) A fixed-term land lease for business purposes

This type of lease involves a term of 10 years or more, but cannot exceed 50 years. Such leases are frequently used for land for big shopping malls with spacious parking lots and restaurants that are near main roads. The drafting of this type of lease typically must be reviewed by a Japanese real-estate lawyer, because there are some additional rules that apply.