Gilroy drops its Sharks ice rink after the cost doubled

Gilroy will not get its two-rink Sharks ice center. On Oct. 5 the City Council accepted a committee finding that "no economically feasible path currently exists" to build it at the Gilroy Sports Park, then voted to stop working on it. The base design was estimated at $64 million. The city could borrow about $49 million.

That $15 million hole is the smaller of two. A larger version of the building came in at $84 million, a $35 million gap, according to San Jose Spotlight's account of the committee's findings. In local terms, the base building would have cost as much as 59 typical Gilroy homes, using Houseberry's October 2026 figure of about $1.08 million for the city.

So nothing changes on anyone's street, and nothing rises on the south end of town any time soon. What carries forward is an empty corner of the sports park, about $4 million in traffic fees already set aside for the rink's site work, and an annexation the council still wants.

How a $30 million rink became $64 million

Gilroy opened talks with Sharks Sports & Entertainment in May 2019, according to the city's project page. The council certified the environmental review in June 2020 and approved a term sheet in June 2022. The deal was simple: Gilroy supplies the land and the site work, the Sharks run two sheets of ice. At that point the building was pegged at about $30 million, the Gilroy Dispatch reported in February.

Then construction prices moved. An architect's estimate of about $59 million reached the council in June 2025. That August the council formed a three-member ad hoc committee, Zach Hilton, Terence Fugazzi and Tom Cline, to find the difference. Fourteen months later it came back empty.

The building never got bigger. The state environmental record describes a two-story, 100,000-square-foot indoor facility about 30 feet tall, built mainly for youth hockey. It would have replaced a 41,000-square-foot tent structure and a ball field that the park's master plan had drawn but never built.

The borrowing is where it broke. Projected net operating revenue from the rink could not cover the debt needed to build it, Spotlight reported, so the $49 million ceiling was the most the project could carry on its own. Everything above that line would have come from somewhere else in the city budget.

We think the council made the right call

Hilton told Spotlight that residents do not want the city spending or borrowing to close the gap. They are right. Last month we covered Gilroy's $230 million civic center plan, which has no money attached and is aimed at a bond measure. A city that cannot yet pay for a new City Hall and pool should not write a $15 million check for a hockey rink.

That earlier post described the rink as paused. The Oct. 5 action is firmer. It discontinues "active pursuit" of the project and sunsets the committee, per the city's staff report. City spokesperson Rachelle Bedell said both sides stay interested if finances change or a new partner appears. No date is attached.

The trade-off is drive time. Sharks Ice already runs rinks in San Jose, Fremont and Oakland, and Gilroy would have been the fourth. South County skaters will keep driving north. Sharks spokesperson Ben Guerrero called South County a strategic, growing market, which is a reason to come back with private money.

Our one criticism is the calendar. Costs had roughly doubled by June 2025. The committee then took 14 months to confirm that a $15 million hole was a $15 million hole.

The land, the fees and the annexation

The Sports Park is 79 acres at Monterey Road and Luchessa Avenue, on Gilroy's south edge near Highway 101. It is still unincorporated county land, designated Regional Park-Agriculture on the county map, per the state record. On Oct. 5 the council made annexing it a "standing Council priority" and told staff to keep the request moving at LAFCO, the county board that sets city limits.

The money question is smaller and more specific. The annual development impact fee report in the same Oct. 5 packet lists project 800900, "Gilroy Skating Center Site Improvements," as in progress with $3,983,300 in traffic impact fees committed. Those fees come from builders of new homes and businesses in Gilroy. The report's resolution lists the project among those whose costs exceed the money on hand.

With the rink gone, that $4 million needs a new job. The city has not said what it will be. That is the thing to ask when the council reviews its next five-year capital plan.

What the nearest neighborhoods cost now

None of the 11 neighborhoods on Houseberry's Gilroy ranking touches the park. The closest is Downtown Gilroy, whose Caltrain station sits about a mile north of the site. The table uses straight-line distance from the park's state-filed coordinates, with prices from each page's price history. Las Animas, Lions Creek and Sunrise Park are all on the west and north sides of town.

Downtown is the cheapest place near the site and the one that has swung most this year. Houseberry's price history shows the typical Downtown Gilroy home at about $1.02 million in March 2026 and about $925,000 in September, roughly 14 percent below the city. A rink a mile south was never going to set that price.

Citywide, prices have barely moved. Gilroy's typical home was about $1.08 million in November 2025 and the same in October 2026. Its 2.7 overall score ranks 18th of 18 Santa Clara County cities on Houseberry, and the drag is shopping and services nearby, at 1.9 out of 5. Las Animas already has a public skate facility at Las Animas Veterans Park. Ice was a bonus, not the gap.

Three questions we keep hearing

Is the rink dead for good? It came off the city's work list on Oct. 5, with no restart date. Both the city and the Sharks say they would return if costs fall or a new investor covers the gap.

Did Gilroy lose money? More than $1 million went to predevelopment, design and studies, per Spotlight. The $3.98 million in committed traffic fees is still in the fund.

Do the existing fields change? No. The Oct. 5 action covers the rink and the annexation only.

Until someone finds $15 million, the nine-acre rink site at Monterey Road and Luchessa Avenue stays a field. If you are choosing a Gilroy neighborhood, the scores on Houseberry's Gilroy ranking will tell you more than a rink that is not coming.

Sources

• City of Gilroy, Gilroy Sports Park Improvements project page
• City of Gilroy, Oct. 5, 2026 staff report, Sports Park ice skating facility
• CEQAnet, Gilroy Sports Park Master Plan Phase III Amendments, SCH 1998102079
• San Jose Spotlight, Nov. 2, 2026
• Gilroy Dispatch, Feb. 26, 2026