The city’s plans for a massive new ice skating center and sports entertainment facility in Gilroy are on hold indefinitely, due to continually rising construction costs, according to city officials.
The city has been negotiating with Sharks Sports & Entertainment—the parent company of the San Jose Sharks—since 2019 to bring a 100,000-square-foot ice rink to the Gilroy Sports Park on Monterey Road. The proposal, known as Sharks Ice, included two NHL-sized ice rinks, along with various related amenities, conference rooms, concessions, skate rental area and a 15,000-square-foot gym.
But construction and borrowing costs have risen steadily since 2019, and are now at the point that both the city and the Sharks organization are unwilling to proceed without funding from other sources, city officials said.
“(The) city continues to work closely with Sharks Sports & Entertainment to evaluate the proposed Skating Center Project,” City of Gilroy staff said in a July 3 statement. “While discussions remain active, recent financial analysis indicates that the project, as originally envisioned, faces significant financial hurdles.”
Due to the rising costs, the statement added, “current project revenues are not sufficient to fully support the financing needed to construct the facility, creating a significant funding gap.”
The city and Sharks continue to discuss potential alternatives, partnership opportunities, fundraising and other financing strategies that could improve the proposal’s outlook.
“No final decisions have been made, and the city remains committed to carefully evaluating all available options,” says the city’s statement.
Gilroy City Councilmember Zach Hilton said the council could make a definitive decision on the project at a meeting in August, when a temporary council committee established in 2022 to lead Sharks Ice negotiations on behalf of the city is set to expire. Hilton and Councilmembers Tom Cline and Terence Fugazzi comprise the ad hoc committee.
Hilton expects an agenda item on the Sharks Ice project at a meeting in August, where staff and the committee will present a summary of the yearslong discussion, potentially present alternatives and ask the council what the next steps should be.
“We can’t just keep talking about this or passing it off,” Hilton said. “It’s gotten really, really expensive. I’ve constantly heard from people, we’re not interested in spending or bonding anymore city money to meet this delta.”
Hilton added that the ad hoc committee recently heard a funding proposal from a partner of the Sharks, “but that hasn’t panned out yet.”
Sharks spokesperson Scott Emmert said in a statement, “Sharks Sports & Entertainment remains committed to helping expand recreational ice sports throughout the Bay Area, and believes South County is a strategic, growing market.”
In 2022, when details about the Sharks Ice project began to materialize, the projected cost was about $30 million. In 2024, an architect for the project estimated the total cost had gone up to about $59 million, city staff said at a council meeting in June 2025.
The Sharks Ice Gilroy project was proposed as a partnership between the professional hockey organization and the City of Gilroy. Both city and Sharks officials were hopeful that construction could begin in late 2024, after artistic renderings of the structure were presented to the council; however, that start was delayed by the increasing construction costs.
City officials have hailed the proposal as a lucrative economic development opportunity that could serve as a bustling hub of community recreation as well as a destination for families, athletes and sports fans from throughout the region.
