There is a strange clause in the lease.
It appears that the San Jose Sharks hockey team will be playing in its present arena through 2051. Appears is the operative word here. Sharks owners and the city of San Jose have a deal whereby city taxpayers will kick in $325 million to upgrade the 32-year-old city owned venue with the Sharks ownership contributing another $100 million. It seems pretty straight forward but the devil is in the details. Sharks ownership and San Jose officials have pledged to work together to plan a new building by September 2027 and the Sharks ownership has an out if it finds a better arena to house the team. The ownership would have to pay a penalty if it pulls out of San Jose prior to 2051.
The Sharks ownership’s previous 10-year lease deal expired on July 1st but it included an annual renewal option until 2040. A long-term deal has been in the works for months, with San Jose Mayor Matt Mahan revealing in May that a new agreement was close. Time is of the essence as the city of San Jose will be given a $200 million penalty in 2026-27 if it does not meet investment obligations for the arena. This fee will drop to $70 million in 2030-31. If the Sharks ownership terminates the agreement early, the team would be forced to pay $100 million from 2025-26, with the fee rising to $549 million in 2030-31 before dropping to $10 million by 2047-48. Mahan was quick with the platitudes. “Our world-class team deserves a world-class arena and South Bay fans deserve a modern, smooth, and memorable game time experience. That’s what this deal is all about serving this generation of San Joseans and the next.” What he meant to say, Sharks ownership with the upgrades can squeeze more revenue out of the building.
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San Jose Arena
