The madness is upon us. The landscape of the league is about to shift in ways that might cause the Golden State Warriors to look up from their phones and nod briefly in acknowledgement. Let's bounce around the major questions.
Where will LeBron go?
Reporting from ESPN's Adrian Wojnarowski, Ramona Shelburne and Brian Windhorst over the past 48 hours suggests some urgency inside the Los Angeles Lakers to trade for Kawhi Leonard ahead of free agency as a means of cinching LeBron James. The Lakers stared down a similar situation a year ago with Paul George, opted to sit tight and must feel nerves reading chatter -- chatter I'd consider at least fairly credible -- that George is leaning toward staying in Oklahoma City.
Sources at several teams confirmed tidbits in those stories that the Lakers are reaching out across the league in search of an extra first-round pick, indicating they would take on some unwanted future salary to snare it -- a fascinating twist, given L.A.'s need to hoard cap space. That alone indicates the Lakers are at least a little worried and interested in nabbing Leonard now. If the Lakers build a super-ish team, their own future picks over the next three or four seasons lose value; they will presumably fall in the 20s. Thus the search for others.
The subtext of those reports might be that the Lakers view themselves in a race against the clock with LeBron's deadline to opt in on his $35.6 million deal with Cleveland at 11:59 p.m. Friday. If LeBron opts in, his path to the Lakers becomes more complicated, with more varied competition. And as Windhorst has reported, everyone around this situation is under the impression that LeBron wants to make his decision quickly.
To be clear, the opt-in route can still work for the Lakers. They'd just have to trade for LeBron, which would deplete their Leonard trade treasure chest.
The mere perception that the Lakers are anxious about that opt-in deadline is obviously good for the Spurs. They don't want to trade Leonard to the Lakers, but in the end, insiders are betting Gregg Popovich, a franchise-first pragmatist, will bite the bullet and dance with whomever offers the most. (What the Spurs want for Leonard is a point of some contention. They should pivot into full rebuild mode, but they have indicated to at least some teams that they would prefer to remain competitive, sources say. It might depend on what exactly is offered.)
These opt-in deadlines are leverage pivot points. The Clippers dealt Austin Rivers for Marcin Gortat in part to tilt leverage with DeAndre Jordan (and perhaps the Mavericks, among his suitors) back in their favor. If Jordan opts out of his $24 million deal for next season, LA has a starting center. If he opts in, the Clippers with one stroke of the pen regain some control of his destiny. They'd be fine keeping even a disgruntled Jordan and using Gortat as a backup, sources say. If they trade him, they can do so without worrying about acquiring a center.
Back to LeBron: I have never quite bought all-in on the idea that he absolutely needs a superstar partner in the bag to go to the Lakers. It would obviously help L.A.'s case to have one before Friday night's opt-in deadline -- especially since opting in would unlock paths to Houston and almost anywhere else LeBron fancies.
But transactions don't stop in mid-July. A Lakers team with LeBron, enticing young players and cap flexibility would instantly become one of the league's most appealing trade and free-agency destinations over the next 12 months. A second star could come in August or anytime before next season's trade deadline. A third star could come next summer. Sources have denied reports that LeBron texted Kevin Durant about possibly joining him in L.A., but if Durant signs a one-year deal this summer (or a one-plus-one with player option in Year 2), you can bet your life savings that every desirable team will be circling him all season. Durant's motives remain a mystery to everyone in the league.
This game of opt-in chicken could go all the way until 11:59 p.m. ET Friday. Do the Lakers really believe LeBron might opt in with Cleveland and cede at least some control of his free agency back to Dan Gilbert? Does LeBron want to make L.A. believe it? Would he dare opt in without a prearranged trade?
Meanwhile, the Celtics and Sixers have kicked the tires on Leonard, and both have the goods to outbid even the best L.A. offers -- unless the Lakers get crazy and include three first-round picks and two of their best young players. (They likely wouldn't send both Brandon Ingram and Lonzo Ball to San Antonio, though there are persistent questions around the league about whether LeBron would want to play with the Lakers amid the Ball family circus. A logical endpoint and middle ground for negotiations ahead of Friday's deadline might be something like Brandon Ingram, Kyle Kuzma and two unprotected first-round picks.)
Both Boston and Philly have been cautious. They don't know about Leonard's current or long-term health, or if they could trust the word of Leonard and his advisors about his intentions next summer -- if they even gain permission to have such a conversation. Both should have some faith in their culture and rosters and in the extra fifth year they could offer Leonard next summer.
If LeBron opts out and watches the Lakers whiff on George and Leonard, how will things unfold if he goes back to Cleveland without any better option (other than perhaps Philly) and asks for a new contract? Think about that from Gilbert's perspective. He could finally say that he had beaten LeBron in a negotiation. Would he dare squeeze him and ask LeBron to agree to a deal without a no-trade clause? What great theater. The Cavs in that scenario could sign-and-trade LeBron, but that route is thornier than the opt-in-and-trade path.
Other teams want LeBron to move fast. His choice will ripple across the league. Think about the Raptors. Marc Stein of The New York Times has already reported that anyone on Toronto's roster could be had for the right price, and a couple of teams say the Raptors brain trust at least implied as much during calls on draft night. A rebuild is coming at some point for The North. But how could they feel comfortable igniting that process without first knowing if LeBron will leave the Eastern Conference and clear away one unmovable obstacle to the NBA Finals?
Yes, Philly and Boston will be better next season -- perhaps good enough that Toronto shouldn't care about LeBron's decision if someone offers the Raptors the motherlode for Kyle Lowry or DeMar DeRozan. But it would be painful to detonate a 59-win team and then watch James bolt. (Boston, for what it's worth, is confident it can retain Kyrie Irving next summer, despite persistent rumblings he might consider leaving for one of the New York teams, per league sources.)
The wait will end soon.
What about Paul George?
George re-signing for the max would be one of the great victories of Sam Presti's tenure as Oklahoma City's GM -- validation of the precise, development-focused culture he has built and of the giant risk in dealing for a star on an expiring contract with well-publicized eyes for L.A.
The stakes are enormous. If George re-signs, the Thunder have a two-star path to somewhere for at least another season or two. (There have been reports George might sign a one-plus-one deal to re-enter free agency next summer. But at that point, George would have only nine years of service -- one short of qualifying for the largest possible maximum salary. If George wants to dip back into free agency as soon as he is eligible for that contract, a two-plus-one would make the most sense. The Thunder will and should offer the full five-year max, since that fifth year is the carrot only they can dangle; rival offers top out at four seasons. It's easy to say George would make up that money on his next contract, but this dude shattered his leg four years ago.)
If he leaves, the Thunder have Russell Westbrook, Carmelo Anthony, Steven Adams, a bunch of role players and limited cap flexibility in 2019 and beyond. We saw that movie in 2016-17, and it will get old fast. It leads nowhere interesting. George leaving would at least raise the question of transitioning into a full-on rebuild, a teardown the likes of which Thunder fans have never really witnessed, and sniffing out what Westbrook might fetch on the trade market.
Is that cold? Yes. Westbrook is the one who stayed. Losing all three of James Harden, Durant and Westbrook in the span of six or seven years -- before any of them passed their primes -- would be depressing.
But Westbrook's super-max carries huge risk on the back end, and Presti is no fool. He will not close off any options.
That said, it's possible Presti never finds an offer rich enough to move Westbrook. Even deals that look good -- say, a completely theoretical Knicks offer of Frank Ntilikina, Kevin Knox and two unprotected first-round picks -- could morph into pu-pu-platter of blah within two or three seasons. Westbrook guarantees competitiveness and fun.
If George comes back, the Thunder payroll would rocket toward $240 million including luxury tax. It would normalize in 2019-20, after Anthony's hideous deal expires, and perhaps the Thunder's deeper-pocketed-than-you-think ownership would swallow a one-year bill.
But that isn't a run-of-the-mill tax bill. That is some Warriors- and Cavs-level indulgence. It feels like something would have to give, though it's unclear what. Anthony is going to surrender only so much in a buyout. Waiving him via the stretch provision brings more relief, but the Thunder might feel squeamish embarrassing him like that.
What does the cap crunch mean?
• The legacy of the 2016 cap spike and resulting spending orgy: Only a half-dozen or so teams have pathways to meaningful cap space, and three of them -- Atlanta, Chicago and Sacramento -- are signaling they plan to use it to take on bad salary and extract draft picks as the price, sources say. (That is a particularly interesting, and smart, decision for the Kings, considering they don't own their 2019 pick and as a result have some incentive to compete. But they have zero chance of being good and should look at the lost pick as a sunk cost. If they hunt players instead of dead money, I'd expect them to chase younger free agents -- including restricted guys such as Aaron Gordon, Jabari Parker and perhaps Zach LaVine.)
The lack of space in theory transforms the full midlevel exception, worth almost $9 million per year, into a powerful tool, but only a few teams have access to that. A sad number of blah over-the-cap teams -- Wizards, Pistons, Bucks, Wolves, Heat, Pelicans, Nuggets, Trail Blazers and perhaps even the Hornets -- are so close to the tax that they can't or shouldn't use the full midlevel and will realistically have access to only the baby one for tax teams (worth about $5.5 million). Thanks, summer of 2016 cap spike!
That is going to be the ceiling for a lot of good players who wish to change teams. Those players will be very disappointed. Some will start free agency with hopes of a nice multiyear contract and settle a week or two into it for one-year deals, hoping to cash in on next summer's more player-friendly market. (Several players have already effectively done this by exercising player options.) Teams will find bargains in mid-July.
Several teams that have the big midlevel -- the Knicks, Spurs, Grizzlies, maybe the Magic and Jazz -- should leverage this environment to sign good players to longer-term deals. We tend to laud short-term deals as wins for teams. Think of Tyreke Evans last season or Atlanta's initial two-year, $19 million deal for Paul Millsap in 2013. But as those deals expire, we all go, "Man, wouldn't it be nice to have that player on that salary for another year or two?"
Some teams will worry that such deals would compromise future cap space. The Knicks, with big free-agency dreams in 2019 and 2020, seem like such a team. But the league will be (relatively) flush with cap space again in 2019 as more deals from the mega-summer of 2016 vanish. It will never be like 2016 again for players, especially as more of them flood next summer's market, but 2019 and 2020 will be loads better than this summer.
For lots of teams, that means their own cap space won't be as much of a competitive advantage. If they can ink good players to longer-term deals now, many of them should.
• Utah and Indiana are especially interesting in this regard. Both want to get better, and Utah rightfully thinks it is a piece or two away from being really good. The Jazz need to renounce both Derrick Favors and Dante Exum -- and ditch their nonguaranteed deals -- to open meaningful room, so they might end up staying above the cap, retaining Favors (and Exum) and using the midlevel.
It's unclear how much of a market Favors has beyond Utah and Dallas, and the Mavs might take themselves out of the big man market before Favors even hits it. Incumbent teams should be able to retain solid veterans on multiyear deals by offering them a little more than the near-$9 million midlevel.
• Another downside of one-year deals from the team perspective: In many cases, they give players a de facto no-trade clause due to quirky rules about Bird rights. The Celtics, for instance, might feel queasy about overspending on Marcus Smart -- and fine with Smart taking his one-year qualifying offer. But they need midsized contracts to match salary in trades, and Smart on a multiyear deal is one of their only methods of acquiring them.
• Most league executives expect a cool market for restricted free agents, which could lead to a few of them -- including Smart -- signing one-year qualifying offers and entering unrestricted free agency next summer. Dallas might have feared this when it withdrew Doug McDermott's qualifying offer mere hours after tendering it.
Smart and Jusuf Nurkic look like the best candidates for this strategy. Nurkic turned down a rich, four-year extension in the fall, league sources say, and might struggle to find any team other than Portland willing to offer more than the midlevel. Portland could try to retain him long-term at a courtesy salary just above that -- say, $11 million or $12 million per year -- and dare Nurkic to do better.
• Teams with starrier restricted free agents -- Orlando with Gordon, Chicago with LaVine, Milwaukee with Parker -- figure to bring heftier offers. None has reason to come out of the gates with a max offer. Remember: Parker and the Bucks cut off extension talks in the fall when it became clear that Milwaukee's parameters centered around the $18 million range over three seasons, sources have told ESPN. Some of these negotiations could take a while. Houston's dance with Clint Capela could get spicy.
• The Pacers might force Orlando's hand with a $20 million-ish offer sheet for Gordon, according to Wojnarowski's reporting, betting that Orlando might decline to match after selecting Jonathan Isaac and Mo Bamba in back-to-back drafts. (Indiana can carve out about $20 million in room even with Thaddeus Young, Darren Collison and Bojan Bogdanovic on the books. Young exercised his player option for next season, per a report by Wojnarowski; Bogdanovic and Collison are on mostly nonguaranteed deals.)
There has been mild discontent for years within the Magic about Gordon's unwillingness to accept a smaller role on offense and his ambitions to be a ball-dominant star. But Gordon could develop into a Swiss Army knife-style secondary star. This would be a worthwhile play for the Pacers. If their offer sheet lands at about $20 million, I'd bet on the Magic to match, but it's not a bet I'd feel super-confident about.
• It will be interesting how market dynamics affect the other subset of extensions: those for first-round picks from the 2015 draft class entering their fourth seasons. A few, including Karl-Anthony Towns and Devin Booker, figure to receive max-level offers early -- if not right at midnight July 1.
A note on Towns: He is not eligible for the super-max, paying him 30 percent of the cap, even though he made an All-NBA team last season. He has to make it again next season. The Wolves can write that contingency into his extension, guaranteeing him the super-max if he qualifies.
If Towns qualifies, Minnesota could be on the hook for about $125 million in 2019-20 salary to only five guys: Towns, Jimmy Butler (presumably on a new max deal), Jeff Teague ($19 million player option for that season), Gorgui Dieng and Andrew Wiggins. That doesn't even include recent draft picks or anyone the Wolves might sign to a two-year deal this summer.
That looks untenable. I would expect the Wolves to explore the trade market for Wiggins soon, if they haven't started already. To shed his salary, they might have to wait until next summer, when a team with unused cap room could be willing to take Wiggins into space -- and send out something nice in return.
The Wolves have explored the possibility of getting far enough under the cap -- about $10 million -- to extend Butler up to his max salary this summer, sources say, but that would require dumping both Wiggins and Dieng. Unlikely.
• The rest of the interesting extension-eligible guys from that draft class might find a leaner initial market: Terry Rozier, Justise Winslow, Trey Lyles, Myles Turner, Stanley Johnson, Frank Kaminsky, Willie Cauley-Stein, Kelly Oubre, Delon Wright and perhaps a couple others. Teams are going to squeeze early, hoping these guys watch good veterans sign for cheap and come back to the table in late July with lower expectations. At the same time, agents know there will be more money in the system next summer, when these players could enter restricted free agency. Finding common ground might prove difficult.
Other notes on teams in tax hell
• Once again, there are few veterans for whom an extension -- which can start at 120 percent of their current salary or 120 of the league-average salary -- makes any sense. Two such guys are in Milwaukee: Eric Bledsoe and Khris Middleton. I'd expect the Bucks to engage Middelton, earning $13 million in the final guaranteed year of his contract, and for Middleton to shut them down. If the Bucks are willing, Bledsoe -- earning $15 million -- should think very hard about it.
• If they miss out on the big stars, the Rockets might approach Eric Gordon for extension talks once they are allowed to do so in July, sources say. I would still bet on Houston offering Chris Paul something less than his full five-year max, especially given the tax advantage of Texas living.
• An extension for Tobias Harris at 120 percent of his $14.8 million salary makes sense in theory but somehow feels unlikely. The Clippers might be hesitant to commit that much to him.
• Denver, with Nikola Jokic on a new deal, is set to be more than $10 million above the tax before accounting for Will Barton, whom the Nuggets would like to re-sign. Dumping both Kenneth Faried and Darrell Arthur would probably not crack open enough space to ink Barton and safely duck the tax. Denver could also explore sloughing away Mason Plumlee or Wilson Chandler.
They have to be prepared to attach their 2019 first-rounder, which they feverishly tried to trade during the draft to acquire another pick in the teens after selecting Michael Porter Jr., sources say. (They wanted Zhaire Smith.)
• Denver's five-year deal for Jokic carries no player option in Jokic's fifth year, sources say. It is a straight five-year contract -- something Denver justifiably wanted as a concession for declining Jokic's cheapo 2018-19 option and giving him an immediate raise.
• Keep an eye on Greg Monroe in New Orleans if the Pelicans hold firm on plans to offer DeMarcus Cousins a shorter, non-max deal -- and somehow lose him. The much-dreamed-of sign-and-trade sending Cousins to Washington is very tricky given both teams' tax situations and might require a third team -- if Washington and Cousins are even interested.
• Another sneaky veteran extension candidate: Al-Farouq Aminu. But a 120 percent raise would leave him below the midlevel, and so he probably rejects it. Portland should still offer, though.
• Several teams called the Heat about Josh Richardson during the draft, but Miami showed no interest in trading him despite their tax bill, sources say. Something has to give with Miami's cap sheet, too.
• There is some mutual interest between the Warriors and Jamal Crawford in a potential minimum deal, sources say. He might want more than the minimum. It's unclear if the Warriors will use their mini-midlevel exception, but if they do, it likely will not be on Crawford.
Other notes on teams with flexibility
• T.J. McConnell is an interesting extension candidate. There has been little noise so far about a potential deal.
• The easiest call on the board: Phoenix acquiring a point guard, either in free agency (Fred VanVleet is a name to watch) or via trade. The problem for Phoenix is that its best assets -- Booker, Deandre Ayton, Mikal Bridges -- are untouchable and its young big men (Dragan Bender, Marquese Chriss) have limited trade value. Chriss was available on draft night, per league sources.
They can take small swings on guys such as Jeremy Lin, Darren Collison, Cory Joseph and Patrick Beverley -- a perfect fit next to Booker, though he is recovering from microfracture surgery -- packaging Bender and some salary filler (Jared Dudley). That is probably not enough for Rozier, another nice fit. Milos Teodosic is another name to watch -- a playmaker who would make Ayton's life much easier. But in the long run, the Suns need a plus defender next to Booker.
Bigger fish would require Phoenix sliding Josh Jackson into a trade. He is the swing piece, whether the Suns like it or not. He puts Kemba Walker in play. Would a rebuilding Raptors team say no to Dudley, Tyson Chandler and Jackson for Kyle Lowry? (I doubt Phoenix does that, but it makes you pause.) What about Mike Conley if the Grizz pull the plug (and Conley proves healthy)?
Phoenix has shown no interest so far in Dennis Schroder, sources say.
Enjoy the fun!
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