The City of Gilroy and Sharks Sports & Entertainment will indefinitely “pause” their years-long effort to jointly develop a professional caliber ice skating rink at the city’s sports park south of town.
The city council on Oct. 5 voted unanimously to discontinue its active pursuit of the project—known as Sharks Ice—due to increasing costs for both construction and money borrowing that have outpaced both the city’s and the Sharks’ ability to spend.
The council upheld a city staff finding that “no economically feasible path currently exists to construct the Gilroy Sports Park Ice Skating Facility.”
Assistant City Administrator Harjot Sangha said that SSE, which owns the San Jose Sharks professional hockey team, is still interested in pursuing the project if conditions improve.
“Both parties (the city and Sharks) are looking to pause the project at this point, but remain committed should the economic feasibility change,” Sangha told the council.
Gilroy and the Sharks began negotiating to develop an ice skating center and sports entertainment center in 2019. The facility was proposed at the Gilroy Sports Park.
In 2023, the city and SSE began the initial architectural design process.
An initial concept was a 100,000-square-foot facility featuring two NHL-sized ice rinks, along with various related amenities, conference rooms, concessions, skate rental area and a 15,000-square-foot gym.
The project cost estimate started at $30 million, but escalated drastically in recent years as rising inflation has resulted in increasing costs of construction and borrowing. The city had planned to fund most of the cost by borrowing money through bonds.
Sangha explained that as cost estimates rose, the city and SSE considered smaller project options. However, even a stripped-down, basic project design is now estimated to cost about $57 million.
The city and SSE even tried to seek participation and revenue from outside parties, such as potential co-tenants, to bridge the funding gap, but “none of these efforts produced a commitment of a scale capable of closing the gap,” says a city staff report.
The city has spent about $1 million in “pre-construction” costs, Sangha said, including architectural services and technical studies. That cost does not include city staff time.
Even the estimate of the city’s share of off-site infrastructure improvement costs related to the project has jumped from $4 million in 2019 to about $10 million today. The city has not been able to find local funding for that cost, Sangha added.
But the council still intends to annex the Gilroy Sports Park into the city limits, and unanimously voted Oct. 5 to continue with that process. City officials have planned to annex the site since at least 1999, and much of the residential property in the area has been annexed since then.
The 79-acre park is located at 5925 Monterey Frontage Road, and features baseball fields, outdoor grills, jogging paths, a playground, soccer field, picnic tables and parking.
In August 2025, the council had formed a temporary committee to lead negotiations on behalf of the city. Councilmembers Zach Hilton, Terence Fugazzi and Tom Cline formed the ad hoc committee.
Cline said at the Oct. 5 meeting that annexation of the sports park remains a key component of the city’s economic development goals.
“I like the idea of pausing it and not ending” the Sharks Ice project, Cline said. “The Sharks want this but it’s just a matter of getting there. Annexation is part of that puzzle.”
