Plans for the arena stalled in recent years but it will now open alongside a new health research centre.
Council officer Neil Jones told a meeting: “This is essentially bringing back something that was originally in the vision for the Olympic Legacy Park in the first place, which was a basketball arena to be the home of Sheffield Sharks
“That proved to be a bit difficult with funding over the past few years so a different proposal emerged whereby it will be funded by Canon Medical Systems.
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“The Sharks, through their company Park Community Arena, will operate the basketball arena.
“It will be the home of the Sharks but will also be a leisure centre and there will be other sports, business and community events, exhibitions and potentially weddings and Bollywood events.
“So it’s a general leisure facility, with the very clear intention that whatever goes on there doesn’t compete with facilities that the council’s already running at the Arena or City Hall.”
The building will be funded, constructed, and held on a long lease by Canon Medical Systems with under leases going to Park Community Arena.
Mr Jones said as well as the basketball arena, there would also be a sports diagnostic imaging centre.
“This will help provide care and research into individuals’ health. It’s mainly aimed at sports people but it will be open to all.
“The research centre will be run by an organisation called Living Care who work closely with the NHS so it’s not a purely private health care system.
“It’s an off market deal, so it hasn’t been marketed. It’s something which we think is strategically important. It’s been negotiated at a price which is open market value despite the fact the lease has restrictions in it, so we think it’s a very good deal financially.
“They should be on site over the next couple of months and open for next summer.”