The financial implications of the Redick-Harris deal


It has been two weeks since the Magic acquired Tobias Harris, Beno Udrih and Doron Lamb from Milwaukee for J.J. Redick, Ish Smith and Gustavo Ayon. Some of the initial shock has certainly worn off and the Magic have gotten some impressive play from Tobias Harris and Beno Udrih through three games in a Magic uniform.

The move was clearly a move that had the future in mind. Orlando was looking to cash in on Redick for a player that could contribute and develop in the future and also for some form of cap relief. The going thought really was that the Magic would not be able to or would not be willing to match whatever offer Redick would get this summer.

Even if they thought Redick was worth whatever amount he would get paid, it did not fall in with the Magic's long-term plans to tie up somewhere in the neighborhood of $8-10 million per year. Redick may be beloved, but it is questionable to spend $15-17 million per year on two shooting guards. Only one can start after all, and the jury is still out on Arron Afflalo and J.J. Redick as full-time starters on Playoff-caliber teams.

The Magic were not willing to make that investment in any case.

There is good reason. The Magic are trying to get their ducks in a row and give themselves flexilbility to go after free agents very soon in the future. Rob Hennigan inherited a roster with one of the largest payrolls in the league and he has had to find a way to rebuild the assets on the roster to make potential moves in the future.

That was very much something that the Magic had in mind when they made the Redick deal.

This move was made to help clear cap room for the summer of 2014 and put the Magic in position to build quickly if the time was right.

The Magic did not save a whole ton of money in the short term. What the Magic did though was support themselves for that 2014 free agency plan in the long run and give Orlando more assets it can use for future trades to take advantage of that extra cap space coming down the pipe.

First a review of where the Magic were this summer when Hennigan took over. Orlando's payroll was a bit out of control. The Magic had $67.4 million committed to 2013 and $32.2 million committed to 2014 according to ShamSports. It seemed it would take another two years at least for the Magic to get out of the cap hell they were in. Dwight Howard obviously did not have that patience.

Hennigan inherited a roster too with some bad contracts.

At the beginning of this season, Hennigan had a roster with a $64.4 million payroll this season and $53.9 million for next year. To get rid of Dwight Howard, Hennigan was able to cut a little bit of salary this year but had to take on more salary in the future.

Orlando entered the year having to find a way to deal with the contracts of veterans Hedo Turkoglu, Glen Davis, Arron Afflalo, Jameer Nelson and Al Harrington. All were in volved in trade rumors at some point before the trade deadline. Hennigan was not able to trade any of them before the deadline.

However, he was able to cut some of that long-term salary and get some major assets.

According to HoopsHype, the Magic's current payroll is $66.6 million this year (excluding Gilbert Arenas' amnestied contract). Next year, Orlando has $53 million committed in salary including Hedo Turkoglu and Kyle O'Quinn's player option. However, the Magic begin to gain some flexibility beginning with the 2015 season.

According to HoopsHype, the Magic have only $22.8 million committed to 2015. However, $18.7 million of that total is non-guaranteed through several team options. That unguaranteed portion includes the final year of Jameer Nelson's contract the team option year for Nikola Vucevic, Tobias Harris and Maurice Harkless.

In 2014, the Magic have only about $4.1 million committed as of now, potentially raising up to $11.4 million if the Magic pick up the options on those young players.

Considering the Magic are likely to have two first round picks from this year and next year added into that, it still gives the Magic a ton of cap room to play around with in 2014.

This was the true purpose of the Redick deal. The hope might still be to shed Glen Davis' contract (his deal will be expiring in 2015) and Al Harrington before then, but the Magic did not want to get tied up in a four-year, $32 million deal that Redick seems likely to receive.

Adrian Wojnarowski of Yahoo! Sports seems to believe Redick will receive starter's money from the Bucks this season. If Redick is looking for the most money this summer, no one can offer him more now than Milwaukee.

Without the Redick deal, the Magic would have had a hole to fill in its lineup that might have been difficult to fill with the kind of young players the Magic want. Namely, a player like Harris — someone with a ton of talent that could play his way into the Magic's future plans like Harris seems to have done and Redick seemed to have done at one point.

For the Magic it is clear though that the team got a quality player in Tobias Harris who can help the team in the short term and the long term and saved a ton of cash to position itself to beginning building around at least one high draft pick and potentially another in two years.

It may not be light at the end of the tunnel, but Rob Hennigan has stuck to his plan so far.