We've already looked at projections for the top players available in this summer's free-agent market and assessed the merits of the various teams contending to sign those elite players. Now, in the third and final installment of Basketball Prospectus' Summer 2010 preview, we consider the alternatives those teams will explore when and if they are unable to lure a marquee free agent.
Option 1 - Piecemeal Free Agency
Instead of signing two max-contract players, why not sign three or four cheaper ones? That's been the subject of much discussion in New York, and the Knicks and Heat are the only teams for whom I really think it makes sense. Because both of them are so thin entering free agency, Miami and New York will want to land more than just two players if they are unable to pair two superstars.
At the same time, buyer beware. As I found in the summer of 2008 while studying the mid-level exception, it tends to take more money to purchase a win as contracts get cheaper in free agency. That is, superstars are better values than their lower-paid peers. Mid-level deals in particular have been disastrous for teams. The player projections gave little indication that will change this summer. David Lee and Tyrus Thomas are the lone apparent bargains among the top tier of players available.
One thing that has become clear over the last month is that Tracy McGrady should not be seen as a major part of the Knicks' future. If McGrady is really willing to play for peanuts in the hopes of being part of a contender, he'd be welcome, but we have seen only intermittent flashes of McGrady's former star self during his 16 games in New York and he seems unlikely to return to anything near that level following microfracture knee surgery.
Option 2 - The Trade Route
Teams may be wise to heed the example of the Memphis Grizzlies last summer. Unlikely to land a top free agent--and with few quality players on the market anyway--the Grizzlies put their cap space to work making an imbalanced trade that sent Quentin Richardson's $8.7 million contract to the L.A. Clippers for Zach Randolph, making $16.3 million (and with an additional year on his contract). With Randolph revitalizing his career and making the All-Star team, the trade has worked out brilliantly for Memphis.
While teams can't expect every imbalanced trade to pay off quite like the Randolph one, there is an advantage to going the trade route. Most of the time, a player acquired in a trade will have no more than two or three years left on his contract as opposed to the five-year deals teams usually hand out in free agency. In Randolph's case, for example, even if he had been a bust the Grizzlies' liability was mitigated because Randolph had just two years remaining on his contract and would have become valuable as an expiring deal in the summer of 2010 anyway.
It's tough to project at this point what players might become available, but New Orleans' Emeka Okafor and Philadelphia's Andre Iguodala are two quality players with long-term contracts (four years left apiece) their teams wouldn't mind shedding. Utah might look to move the last year of Andrei Kirilenko's contract to try to re-sign Carlos Boozer. Devin Harris could come available if New Jersey lands John Wall in the draft and wants to clear additional space under the cap. Then there's Gilbert Arenas, whose very expensive and extremely risky deal might be dangled by the Wizards this summer.
Option 3 - Patience
This might not fly with a Knicks fanbase that has spent the past two years dreaming of LeBron James and Dwyane Wade, but there is no reason cap space has to be spent imminently for most teams. The one notable exception is a team that won't likely be pursuing the big names anyway--Oklahoma City. There is some pressure on the Thunder to use its cap space now because, if the Thunder is able to extend Kevin Durant's contract or re-sign him as a restricted free agent, Oklahoma City will go over the cap starting in the summer of 2011. Extensions usually are responsible for putting time pressure on cap space, and most teams with space won't have to worry about them until at least 2012 (when Derrick Rose, Brook Lopez and Michael Beasley could start extensions) at the very earliest.
One unorthodox strategy a team like the Knicks might consider is signing a number of players to one-year contracts, then trying again in 2011 with even more cap space after the contract of Eddy Curry expires. That would be something of a desperation move, however. We're talking Plan D or E, not Plan B.
The team most likely to roll over its cap space is Washington, which has little to offer prospective free agents at this point and could stand to develop a young core of its own. The Wizards might also benefit down the road from the influx of young stars who hail from nearby Baltimore or the greater D.C. area. The potential jewels of both the 2011 (Carmelo Anthony) and 2012 (Durant) free-agent crops are part of this group, which also includes Beasley, Rudy Gay, Jeff Green, Donté Greene, Roy Hibbert, Ty Lawson and Delonte West, among others.
Between now and whenever they cash in their cap space, the Wizards can make it work for them. Nobody has done this more masterfully than Thunder general manager Sam Presti. In the summer of 2007, Presti used a trade exception created in a sign-and-trade deal to take on the contract of Kurt Thomas and offer Phoenix luxury-tax relief. The Suns paid two first-round picks (one of which turned into promising rookie Serge Ibaka) as part of the deal, and Presti got another one from San Antonio (traded to Chicago for starting shooting guard Thabo Sefolosha) when he dealt Thomas at the trade deadline. In December, Oklahoma City got rookie point guard Eric Maynor to take on the contract of Matt Harpring from Utah.
With the luxury tax likely to hit owners hard next season, Washington has the opportunity to extort tremendous value out of teams looking to shed payroll.
The wild card here is how radically different the NBA's Collective Bargaining Agreement might look in 2011 and beyond. The league has made it clear it would like to overhaul the CBA, with ideas as radical as a hard cap and non-guaranteed contracts on the table. For the most part, it appears these changes would favor a team with cap space, as the consensus is that things will get worse for players. Having as few existing contracts as possible, then, will probably be a positive in the summer of 2011 and waiting until the CBA is resolved to be a player in free agency is almost certainly the Wizards' best bet.
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Kevin Pelton is an author of Basketball Prospectus.
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