SAN JOSE – An agreement that extends Sharks Sports & Entertainment’s lease at SAP Center to 2051 and commits hundreds of millions of public dollars towards modernizing the 32-year-old arena was unanimously approved by the San Jose City Council on Tuesday.
The deal binds the city to a $325 million investment into the municipally owned facility, with the Sharks, who are owned by billionaire Hasso Plattner, contributing $100 million. The agreement also penalizes the Sharks should they leave San Jose before the lease expires on June 30, 2051.
San Jose Mayor Matt Mahan and all 10 council members voted to approve the deal, which also commits the city and the NHL franchise to begin planning a new arena by September 2027.
San Jose Sharks President Jonathan Becher and Sharks mascot S.J. Sharkie celebrate after the San Jose City Council agreed to the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
“It was a true sense of partnership, a knowledge from the beginning that we wanted to get to yes, that we would find a path together,” Mahan said at a news conference, “because the Sharks belong in San Jose.”
After a lengthy negotiation, the Sharks and the city announced on August 15 that they had reached a deal that keeps the team at the arena for another quarter century. The Sharks had sought a long-term agreement but wanted the city to make a larger financial contribution toward deferred infrastructure maintenance, with team executives stating that Plattner had already spent over $100 million on upgrades to the facility.
“We don’t know exactly every renovation we’re going to do, but knowing that we’ve got at least 25 more years in this building, knowing we have a chance to make it a world-class facility again, as it was when it first opened,” Sharks president Jonathan Becher said. “It just feels like home.”
The city is facing a $35.6 million budget deficit this year and a projected shortfall of $52.9 million next year. Lee Wilcox, San Jose’s assistant city manager, emphasized that, considering the deficits, no payments will be required by the city in 2026, with the Sharks covering those costs in the short term. The Sharks would also be responsible for any cost overruns.
Becher said once the Sharks learned of the city’s sizable budget deficits, they worked quickly to resolve the issue.
“We’re like, ‘we can solve that problem for you,’” Becher said. “We have a very generous owner. So if that’s your fundamental issue, let’s make that go away. And once that went away, a lot of other things became easier.”
As of last week, the South Bay Labor Council had requested more details about how the city will fund the agreement with Jean Cohen, executive officer of the organization, writing to council that, “by waiting to develop such a plan, at a time when the City projects deficits, we fear the City may be unnecessarily leaving the General Fund and essential services vulnerable.”
Mahan said he anticipates San Jose to experience economic growth in the coming years to boost the city’s coffers. Still, financing options, if need be, include a short-term commercial paper, increased hotel taxes, or a general obligation bond.
Along with fans and business leaders, several labor leaders spoke in favor of the agreement during public comment on Tuesday. In a statement to this news organization on Tuesday, Cohen wrote, “When corporate sports teams receive public subsidies, there is an expectation that the community benefits. The Sharks are a good labor partner, and we expect that the City will include impacted workers, local neighborhoods, and San Jose taxpayers in the next phase of planning for this partnership.”
San Jose Sharks mascot S.J. Sharkie stands next to a rendering of the interior of the SAP Center during a press conference about the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
Renovations to the arena are expected to take place over seven years. They include widening the concourse areas, introducing new premium seating, and upgrading the back-of-house facilities. Both the team and the city will contribute $32 million toward capital maintenance. The city’s financial commitment is weighted toward the back end of the deal.
In the deal, the city is also required to address parking around the arena, including maintaining at least 3,175 spaces available on the streets and in lots within a third of a mile, as well as an additional 6,350 spaces within a half mile.
Should the city fail to meet its investment obligations, the agreement imposes a $200 million penalty in 2026-2027, with the fee decreasing to $70 million in 2030-2031.
The Sharks face potentially harsher penalties if San José is no longer their home base. Early termination of the agreement would result in a payment of $100 million in 2025-2026, increasing to $549 million in 2030-2031. The fee would then decrease by $10 million up until 2047-2048.
Other financial terms include the Sharks’ commitment to contribute $12.35 million over the lease’s life for community benefits. The Sharks will also fund traffic and management costs up to $517,000, and contribute $120,000 to the arena authority.
Staff writer Devan Patel contributed to this story.
San Jose Sharks President Jonathan Becher speaks to the San Jose City Council about the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
San Jose Sharks President Jonathan Becher sits with Sharks mascot S.J. Sharkie during the San Jose City Council meeting talking about the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
San Jose Assistant City Manager Lee Wilcox stands during a press conference about the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
San Jose Sharks mascot S.J. Sharkie listens during the San Jose City Council meeting talking about the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
From left to right, San Jose Assistant City Manager Lee Wilcox, San Jose City Councilmember Michael Mulcahy, San Jose Mayor Matt Mahan, San Jose Sharks President Jonathan Becher and Sharks mascot S.J. Sharkie participate in a press conference about the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
San Jose Sharks President Jonathan Becher gets a hug from Sharks mascot S.J. Sharkie after he spoke to the San Jose City Council about the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
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San Jose Sharks President Jonathan Becher speaks to the San Jose City Council about the San Jose Sharks’ lease extension at SAP Center until 2051 at San Jose City Hall in downtown in San Jose, Calif., on Tuesday, Aug. 26, 2025. (Nhat V. Meyer/Bay Area News Group)
Originally Published: August 26, 2025 at 7:06 PM PDT