SAN JOSE — Sharks Sports and Entertainment and the City of San Jose formally announced a lease extension for SAP Center on Friday that will keep the NHL team at the downtown arena for at least the next decade and potentially through 2040.
The lease agreement, which, beginning in 2026, will renew on an annual basis through the year 2040, still needs to gain approval by the San Jose City Council at its May 19 meeting.
“I’m thrilled to be able to say that the San Jose Sharks will be staying right here in their home of San Jose,” San Jose Mayor Sam Liccardo said.
The new agreement will see the team and the city split costs of upgrades to the arena’s infrastructure, which includes completion of a new roof and improvements to the facility’s heating, ventilation and air conditioning units.
The cost of upgrading the roof will likely exceed $3 million, according to the Sharks, and Chief Operating Officer John Tortora said the team would like to begin those upgrades as soon as the council approves the deal.
The Sharks had sought for their lease payments to the city to be invested back into the building for capital repair, replacement and, over time, modernization.
“That way the building can compete with what’s coming in San Francisco, and we can continue to bring marquee events here,” Tortora said, referring to the Warriors’ new arena in the Mission Bay neighborhood that is supposed to open in 2018.
Liccardo said the city will help pay for the arena’s upgrades that have the highest priority. After some variability in the next couple years, the Sharks and the city will each invest $2.6 million annually to maintain the building’s infrastructure.
“We know there’s some long-deferred capital replacement that needs to get fixed right away,” Liccardo said. “And since this is the city’s building and our responsibility, we know that we have to step up and do that. But for the most part, we’ll be sharing this burden going forward for the next decade.”
There had been speculation that the Sharks, with a lease set to expire in 2018, might move to another building in the area, such as the Warriors’ San Francisco arena or another new building in Santa Clara close to Levi’s Stadium.
Liccardo thanked Sharks owner Hasso Plattner for being “so committed to staying here in San Jose and making this a great franchise. I know that he’s had many, many suitors. I hear that smaller cities to our north have been approaching, among others, to lure him elsewhere.”
Plattner, in his first meeting with local media in over two years, was asked about the mayor’s comments that he had other suitors for the Sharks. “I’m not commenting (on) those because I get the rumors actually from your writing,” Plattner said.
Plattner didn’t foresee any major changes being made to the inside of the building, such as an increase in seating capacity or additional luxury suites.
Plattner also was asked when the Sharks might need a new facility.
“I think this is an American thing, that you think buildings from a certain age are kaput,” Plattner said. “I saw probably 20 or 19 other arenas. This is, from an architectural point of view, internal point of view, material point of view, one of the best arenas. It has a fresh atmosphere inside.
“Yes we need some touches. That’s all, and then it will stay for at least the next 10 years in good shape. I can’t see that the concrete is falling apart.”
Follow Curtis Pashelka on Twitter at twitter.com/CurtisPashelka.
