The City of Gilroy and Sharks Sports & Entertainment (SSE) have indefinitely paused their multi-year effort to develop a professional-caliber ice skating rink. The Gilroy City Council voted unanimously on October 5 to discontinue active pursuit of the project, known as Sharks Ice. This decision comes as increasing costs for both construction and money borrowing have outpaced the financial capabilities of both the city and SSE, which owns the San Jose Sharks professional hockey team. A city staff finding upheld that "no economically feasible path currently exists" to construct the Gilroy Sports Park Ice Skating Facility.
Assistant City Administrator Harjot Sangha informed the council that SSE remains interested in the project should economic conditions improve. Sangha stated that both parties are looking to pause the project at this point but remain committed if economic feasibility changes.
Negotiations between Gilroy and the Sharks to develop an ice skating and sports entertainment center at the Gilroy Sports Park began in 2019. By 2023, the city and SSE had started the initial architectural design process. The original concept for the facility envisioned a 100,000-square-foot building featuring two NHL-sized ice rinks, along with various amenities such as conference rooms, concessions, a skate rental area, and a 15,000-square-foot gym.
The project’s initial cost estimate was $30 million. However, this estimate escalated drastically in recent years due to rising inflation, which has driven up the costs of construction and borrowing. The city had planned to fund the majority of its share by borrowing money through bonds. Sangha explained that even after considering smaller, stripped-down project options as cost estimates rose, a basic design is now estimated to cost approximately $57 million.
Efforts were also made by the city and SSE to secure participation and revenue from outside parties, including potential co-tenants, to help close the funding gap. However, according to a city staff report, none of these efforts produced a commitment of a scale capable of closing the gap.
The city has incurred about $1 million in "pre-construction" costs related to the project, which include architectural services and technical studies. This figure does not account for city staff time. Furthermore, the estimated cost for the city’s share of off-site infrastructure improvements necessary for the project has also seen a significant increase, jumping from $4 million in 2019 to about $10 million today. The city has not yet identified local funding sources to cover this increased infrastructure cost.
Despite the pause on the ice rink project, the city council voted unanimously on October 5 to continue with the process of annexing the Gilroy Sports Park into the city limits. City officials have planned to annex this site since at least 1999, and much of the residential property in the surrounding area has already been annexed. The 79-acre Gilroy Sports Park, located at 5925 Monterey Frontage Road, currently offers amenities such as baseball fields, outdoor grills, jogging paths, a playground, a soccer field, picnic tables, and parking.
In August 2025, the council had formed a temporary ad hoc committee, comprising Councilmembers Zach Hilton, Terence Fugazzi, and Tom Cline, to lead negotiations on behalf of the city. Councilmember Cline noted at the October 5 meeting that the annexation of the sports park remains an important part of the city’s economic development goals. Cline expressed support for pausing rather than ending the Sharks Ice project, stating, "I like the idea of pausing it and not ending," and adding that the Sharks still desire the project.