"The Point Forward All-Stars" will have a new theme each week centered on a single shared trait that brings together the team members. This week: highlighting five candidates for rookie extensions next year who are worth keeping an eye on this season. Previously: The All-Redemption Team.
The deadline for rookie contract extensions passed last week, and the volume and size of this year’s deals offered a taste of what’s to come in the NBA’s new financial reality. Come July 2016, the league’s current $63 million salary cap is set to explode – possibly as high as $80 to $90 million – thanks to a new and incredibly rich television dealsigned in October.
Rookie extensions serve as a nice canary in the coal mine when it comes to contract-related trends because they are completed a full season before they go on the books. This offseason’s extension recipients, from Kyrie Irving to Klay Thompson to Ricky Rubio, won’t begin their new contracts until the 2015-16 season as they play out the final year of their rookie contracts this year. Last week, we saw a number of extensions that appeared to “price in” the rising cap because only the first year of those contracts will be on the books before the anticipated salary cap explosion.
Here’s a quick rundown of the rookie contract extensions finalized for players who are beginning their fourth seasons:
- Alec Burks, Jazz: $42 million over four years
- Kenneth Faried: $50 million over four years
- Kyrie Irving, Cavaliers: $90 million over five years
- Marcus Morris, Suns: $20 million over four years
- Markieff Morris, Suns: $32 million over four years
- Ricky Rubio, Timberwolves: $55 million over four years
- Klay Thompson, Warriors: $70 million over four years
- Nikola Vucevic, Magic: $54 million over four years
- Kemba Walker, Hornets: $48 million over four years
Many of those contracts, by our old standards, look inflated. That is irrelevant. Rubio, for example, has all the makings of a $10 million point guard in the current market, as he’s a quality starter (not a star) with clear skills (elite passing, solid defender), some room to grow and some obvious weaknesses (finishing at the rim, shooting range). Remember, a $10 million point guard in 2014 is proportionally equivalent to a $13.5 million point guard in 2016, assuming the salary cap number comes in at $85 million. Rubio’s extension has an average annual value of $13.8 million, meaning it will likely be in the right ballpark rather than outlandish once the NBA’s new economy goes through its cycles.
This look-ahead scaling will be even more important next summer, when the 2012 draft class will be able to sign extensions that will take place entirely under the inflated salary cap setup. Anthony Davis and Damian Lillard are among the players who will be eligible for five-year extensions that begin in 2016-17, the same year the media rights money will be in play.
The 2012 class will face some interesting choices, and excellent earning opportunities, during this transition period. A-listers like Davis and Lillard must decide whether to automatically take the full five-year rookie contract extension, as has previously been done by the likes of Derrick Rose and Russell Westbrook. Would an early termination option on the fifth year of the deal provide sufficient flexibility, or will these rising stars prefer to re-enter free agency more quickly in the new economy? For B-listers, large extensions should be available again, just as they were for Faried and Walker, with teams looking to hedge against what could be a very costly breakout season. The same thing goes for C-listers, like the freshly extended Morris twins, who should feel a trickle-down effect as forward-thinking executives look to keep role players in place so that cores can grow together.
If this summer was any indication, there won’t be much negotiating necessary for the cream of 2012’s crop. Davis, Lillard, Andre Drummond, and Bradley Beal should all be in line for maximum extensions. Davis is an MVP candidate in the making; Lillard already boasts Rookie of the Year, All-Star and All-NBA honors; Drummond is one of the most talented young bigs in the game; and Beal is on the path to becoming an elite shooting guard.
It gets a lot cloudier outside of those sure things. Here’s a look at five other rookie-extension candidates, with an eye toward intrigue and upside. Which third-year players can play themselves into sweet new contracts with strong seasons?
Everything and everyone appears more interesting once they enter LeBron James’ orbit. That’s certainly the case for Waiters, who spent last season as a forgettable chucker (and reported malcontent) on a 33-49 lottery team. Now, the 22-year-old Waiters is starting for the first time and looks like the weakest link in an outrageously talented lineup that includes James, Irving and Kevin Love. Because he’s a young, score-first guard on a roster overflowing with alpha dogs, Waiters is also Cleveland’s most obvious trade asset after Andrew Wiggins and Anthony Bennett were cashed in for Love in August.
The basic questions that need answering this season are: 1) Can Waiters succeed and find fulfillment as a fourth or fifth scoring option? And 2) How highly does Cleveland value his skill set relative to other roster issues? Waiters seems overqualified as a scorer for his current role and under-qualified or unqualified for the other things that contenders often look for from their complementary guards, whether that’s defending multiple positions or exercising judicious shot selection and hitting open shots. His first trip to the postseason could prove to be a double-edged sword: Waiters will be able to show off his attacking mentality and playmaking ability to a larger audience, while his decision-making and fit within the team framework are being subjected to heightened scrutiny.
The biggest variable in Waiters’ extension status is whether he gets traded (and when). His best chance for a maximum, early payday will likely come from a change of scenery, given that Cleveland has committed to paying huge dollars to the Big Three and Anderson Varejao (who signed a two-year, $20 million extension with a third-year team option last week). If Waiters sticks in Cleveland, he might be best served by playing out his rookie deal and entering restricted free agency in 2016, when an outside suitor flush with new cap space might decide that he is poachable and capable of being a No. 1 or No. 2 option.
In recent years, Golden State has done its extension work early with Thompson, Stephen Curry and Andrew Bogut. If everything goes according to plan this season, Barnes has a decent shot of adding his name to that list. Selected to SI.com’s All-Redemption team in October, a strong bounce-back season would help the 22-year-old small forward move past a disappointing sophomore season and into position to land an extension worthy of his lottery status.
So far, the stars are aligning. New coach Steve Kerr has opened the season with Barnes in the starting lineup, giving him a chance to play off Curry and Thompson and prove his two-way worth. Although Barnes will be hard-pressed to post big scoring numbers because of his spot on the Warriors’ scoring pecking order, that shouldn’t prevent him from making his case for an extension. Golden State’s deep-pocketed owners will surely make full use of an enlarged cap, and Barnes matches up better with the Splash Brothers, age-wise, than Bogut, Andre Iguodala and David Lee. When the Warriors’ brass looks ahead to its long-term planning, Barnes might just be the third-most-desirable commodity on the roster.
There isn’t an overwhelming number of recent positional comparison points for Barnes. Superior players such as Utah's Gordon Hayward and San Antonio's Kawhi Leonard have failed to reach early extensions, with Hayward cashing in for max dollars in July and Leonard on track to do the same next summer. Chicago's Jimmy Butler also made it through the early period without reaching agreement; his price is only going up. Denver succeeded in signing Danilo Gallinari early; its approach was sound and the final terms (four years, $42 million) were reasonable, even if a knee injury has sidetracked Gallinari’s career.
Barnes has shown less than Gallinari at the same point in their respective careers, and there is greater uncertainty around Barnes’ future than with any of the names listed in the previous paragraph. Golden State should consider seizing on this uncertainty by aggressively courting Barnes in hopes of locking him up at a discount. The worst-case scenario is that he develops into a serviceable, dependable starter like Marvin Willams; his best-case scenario, given his prototypical size/strength combination, is significantly higher. Before the Warriors weigh that decision, though, they must decide what to do with 2012 second-round pick Draymond Green, who will be an unrestricted free agent next summer.
This might be the trickiest case in the 2012 class. Barely 21, Kidd-Gilchrist is incredibly young for a third-year player and his game remains fairly raw. The former No. 2 pick is a quality all-around athlete who projected to be an elite perimeter defender coming out of Kentucky. The problem, then as now, is that his severely limited range requires some massaging. Yes, Kidd-Gilchrist has worked diligently to improve his broken shooting stroke, but he’s still a work in progress who must be deployed with the right combination of players and in the right game situations. Although he’s started since his rookie season, he hasn’t yet handled a full starter’s workload, and he’s unlikely to do so this season.
In a more stable market, the incumbent team’s preference would probably be to slow-play the decision by letting Kidd-Gilchrist mature at his own speed and then strike the right deal after Year 4. If the Hornets opt for this approach, they will be taking a risk that Kidd-Gilchrist’s defensive tools and upside draw attention from a suitor looking to make a splash, just as Charlotte snatched Lance Stephenson from Indiana in July. At the same time, some agents might advise Kidd-Gilchrist to use the extra developmental year to address his offensive question marks as best he can and boost his value. Butler is taking that approach this season, and it might make even more sense for Kidd-Gilchrist, who hasn’t enjoyed Butler’s postseason success or major minutes load.
Kidd-Gilchrist is worth keeping an eye on mostly to see whether the salary cap increase changes the negotiating equation for less-proven youngsters. Will Charlotte be more likely to put faith in its top draft pick if it has more money to play with? Will fear of a late-blooming breakout -- which will be much more costly in 2016 than in '14 -- change a team’s thinking? Will the influx of money lead to greater compensation for defense-first players who have historically been overlooked for big paydays in favor of offensive threats? Kidd-Gilchrist might not answer all of these questions, but his case should be instructive no matter how it plays out.
Houston’s versatile power forward is a strong candidate to become the “He Got Paid How Much?!” player of his class. Jones might be undersized compared with many of the league’s star power forwards, but he makes up for it with length, mobility and productive rebounding. A solid finisher around the basket with developing range, the 22-year-old Jones is entering his second season as a full-time starter for a team with strong playoff aspirations.
Markieff Morris’ contract should serve as a basement comparison point for Jones, who was roughly as productive during his age-22 season (12.1 PPG, 6.9 RPG, 19.1 Player Efficiency Rating) as Morris was at 24 (13.8 PPG, 6 RPG, 18.4 PER). Just how high Jones can go past that will be determined by the progress he shows this season. There are untapped areas for exploration: Jones can handle the ball and he is comfortable in the open court, but his ceiling would increase if he becomes a perimeter threat.
Houston seems to enjoy a permanent flexibility with its roster, which sees plenty of year-to-year turnover. The anticipated cap increase should put GM Daryl Morey in position to make Jones an early offer, knowing that he will have real room to build around his three current building blocks: Dwight Howard, James Harden and Trevor Ariza. Achieving cost certainty with Jones next fall, rather than letting him enjoy another season of development that could boost his restricted free agency value, makes a lot of sense. The biggest unknown here: whether Morey will be able to wiggle his way into a third superstar, a move that could turn Jones into prohibitively expensive trade bait.
Just as Vucevic’s rookie extension was fairly easy to forecast thanks to a strong comparison point set by Derrick Favors, Valanciunas should slide in line pretty cleanly behind Vucevic. (The No. 5 pick in the 2011 draft will be extension-eligible next offseason because he delayed his NBA debut for a year.) Valanciunas is tall (6-11), young (22) and skilled, with the added bonus that he’s an established full-time starter on a team that went to the playoffs last year. Vucevic’s contract, therefore, is only going to serve as a starting point: Look for Valanciunas to command a premium based on his All-Star upside and year-to-year inflation.
Toronto general manager Masai Ujiri should be highly motivated to take care of Valanciunas early. It’s easy to envision a rival coming after Valanciunas with a max offer in July 2016, a la the Blazers with Roy Hibbert in 2012, as young bigs who have already worked through some of their growing pains are incredibly difficult to acquire. The rest of the Raptors roster also leaves Ujiri with little leverage. Kyle Lowry is the only core piece locked up for the long haul. All-Star guard DeMar DeRozan is guaranteed to opt out in July 2016, so that he can take advantage of the swelling cap, and Patrick Patterson is the only other frontcourt player under contract past 2015-16.
While re-signing the dirty-working Amir Johnson will also be a high priority next summer, sealing up Valanciunas should be priority No. 1. Ujiri’s track record has been pretty clear: He does what it takes to keep his players, especially centers. If Nene and JaVale McGee were able to cash in thanks to Ujiri's work as Denver's GM, paying up for Valanciunas should be a formality. Also on Toronto’s agenda: making a rookie-extension decision on 2012 lottery pick Terrence Ross, who will be tracking toward a Burks-type offer (or better) if he continues to blossom this season.