City of Gilroy staff and San Jose Sharks officials will meet soon to talk about how to proceed with the 100,000-square-foot Sharks Ice Gilroy project in the face of rapidly increasing construction costs.
Representatives from the two parties will meet March 6 as negotiations continue over the ice skating rink project, according to city officials. After that meeting, city staff will present the results of the discussion and a recommendation to a city council committee formed to oversee the project, for which negotiations began in 2019.
“Everyone has recognized that construction costs are much higher than anticipated, and now the Sharks are seeing if they can come up with a plan to figure out if there’s a way to bridge the gap,” Mayor Greg Bozzo said.
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.
Gilroy City Council member Zach Hilton said the negotiations are “going to get settled pretty quick.” Hilton is a member of the temporary Sharks Ice council committee, known as an “ad hoc” committee, along with Council members Tom Cline and Terence Fugazzi.
“We’re going to give (the Sharks) that space to find additional investors to fill the gap because the construction costs have escalated beyond” previous estimates, Hilton said. “We’re trying to come to a mutually beneficial solution.”
The project is proposed as part of the Gilroy Sports park on Monterey Road south of town. Construction of the ice rink will occupy about 100,000 square feet of land. Details include two NHL-sized ice rinks; a 65,000-square-foot “event level” on the first floor featuring a lobby, elevator, amenities, conference rooms, skate rental area and concessions; and a 15,000-square-foot gym on the second floor.
An architectural rendering from 2024 offered a 3,800-square-foot upper deck bar and lounge that would provide views of both rinks.
The Sharks Ice Gilroy project is a partnership between the professional hockey organization and the City of Gilroy. As of June, the Sharks agreed to pay for the project’s construction costs—possibly with the assistance of a taxable municipal revenue bond—and operate the facility when it opens.
Construction is expected to last 12-18 months, but there is not currently an estimated start date. 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.
Through a spokesperson, the Sharks declined to comment before March 6.
Hilton added that while the Sharks have indicated they are still committed to the Sharks Ice Gilroy project, the continually rising construction costs present an air of uncertainty.
“We’ve got to figure out how we’re going to fund the difference, or we’re not going to fund the difference at all,” Hilton said. “An encouraging sign is (the Sharks) have finished their negotiations for the SAP Center and they still want to develop this project in the City of Gilroy.”
