The big question since the Orlando Magic made the controversial Tobias Harris trade was how much space they cleared. It is significant and enough for a max.
The obsession for the Orlando Magic since mid-February has been free agency.
With the team finishing with 35 wins and missing the Playoffs for the fourth straight year, there is a sense that 2017 is going to end up being Playoffs or bust and the team is determined to end the Playoff drought and take a big step forward. Despite all the improvement the Magic had made, they needed a bit more.
The reclamation project began in February with the oft-talked about trade of Tobias Harris. When the deal was made it had two main goals — to bring some rotation stability and get the team into the Playoff race and to clear cap space.
“I think we see Brandon and Ersan as really good fits both short term and long term for us,” Orlando Magic general manager Rob Hennigan said the day of the trade. “We were able to open some flexibility this summer in the cap space realm if we decide to go that route. I think it sort of sets up a few different ways we can play this. A lot of that is going to depend on how we evaluate the team the rest of the year and what options we feel are worth pursuing this summer. I think it does give us a good short-term bump in areas that we needed, but also to commit long term but also pivot depending on the circumstances.”
That first goal obviously failed. The Magic rotation did stabilize, but the results did not quite work out. Orlando never made any serious run at the Playoffs in the second half of the season. Neither Ersan Ilyasova nor Brandon Jennings stood out in any significant way.
That left the one goal left to salvage much from this trade. One that would not come to fruition until this point of the season — and not even, there are still two months before free agency hits.
By trading Tobias Harris’ $17.2 million in 2017 for only $400,000 in guaranteed salary, the Magic freed up more than $16 million in cap room they did not otherwise have. Add in the $20 million from the cap increase from $70 million this past year to projected $92 million next year, and the Magic have created $36 million in cap room just from this deal alone.
That $36 million is enough for a max contract. More than enough. According to Eric Pincus of Basketball Insiders, the max salaries for next season look to come in at about $21.6 million per season for players with up to six years of experience, $25.9 million for those with 7-10 years of experience and $30.2 million per year for those with more than 10 years of experience.
There is obviously a lot of money to throw around and many teams are going to have max cap room as it is. So there is going to be a lot of competition.
But the Magic were looking at a decent amount of cap space anyway. As things stand now at the end of the season, Pincus projects the Magic could have as much as $52.1 million in cap space this summer depending on what they do with their free agents — Evan Fournier, Brandon Jennings, Jason Smith and Andrew Nicholson. That is potentially the fourth most cap space in the league.
Orlando is very much a player in this.
But how much money do the Magic REALLY have to spend? Exactly what can they do with this space?
The first place to start is what money the Magic have committed right now. They currently have $35,927,840 committed for next year. That leaves $56,072,160 in cap space remaining. If the Magic draft with the 11th pick, that is a cap hold for $2,033,500. We then add in the cap hold for (yes) Fran Vazquez worth $2,033,500.
Assuming the Magic keep that draft pick, the Magic enter July with $52,005,160. This is the number Pincus came up with as best as I can tell (my math may be slightly off, but we are close enough in my opinion that we can proceed . . . I would trust Pincus’ numbers and calculations over mine, I am doing my best to copy his work essentially).
So to come up with a final cap number for the Magic, we have to begin considering their current free agents. This is where the team really begins having to make some decisions.
The cap hold comes in at 110 percent of the final year salary. In order to retain Bird Rights, the Magic have to keep this cap hold in place. Those Bird Rights are important, of course, because they enable the Magic to go over the cap to re-sign that player.
The Magic will almost certainly extend an offer sheet to Evan Fournier (cap hold of $5,720,513) and will probably extend an offer sheet to Dewayne Dedmon ($1,215,696) and Andrew Nicholson ($5,951,483).
I would imagine the Magic would also be interested in maintaining any rights they have to Jason Smith too. The Magic do not have Smith’s Bird Rights, but still face a $5,160,000 cap hold.
So in total, the Magic have $12,887,692 in cap holds. That brings their grand total up to $39,117,468.
This is the number I would focus mostly on when it comes to the Magic’s cap room for the summer. While they certainly could surprise everyone and renounce all their free agents and have enough cap room to go after two max players, more realistically it seems they will have $40 million to play with in cap space.
That would mean they could use about half of it to sign a max free agent and still have a little less than $20 million to fill out the roster. And this is all before deciding whether to re-sign Evan Fournier, which the Magic do not have to do until last because of his Bird Rights unless he signs an offer sheet (and that is a whole different rabbit hole).
With Tobias Harris, the Magic would have to add $16 million to their cap number. That would still leave enough room to sign a max player, but not a veteran max player. It would only allow them to go after a player just coming off his rookie contract. And those are very tough to get because of restricted free agency.
The important thing to remember too with cap room is that it creates flexibility. The Magic can also engage in trades and take on more salary than they send out, using the cap room to absorb the extra salary. This is why the scenarios involving trading Nikola Vucevic ($11.75 million in 2017), Victor Oladipo ($6.6 million in 2017) and Ersan Ilyasova ($8.4 million in 2017, but only $400,000 guaranteed before July 1) have some currency. The Draft will be the first big day for Orlando and deciphering the team’s summer plans.
Trading Tobias Harris did free up a significant amount of cap room. Without trading him, the Magic would not have the ability to trade for a max-caliber player and sign another one. That seems to be the most likely route the team goes if it is looking for two such players.
Otherwise, the Magic have positioned themselves to go after several different kinds of free agents — both a max player and to fill out the rest of the roster.
Next: Decision to sign Dwight Howard belongs wholly to Orlando Magic
Whether the Magic effectively use this newfound flexibility will determine whether the Magic can salvage anything from the Tobias Harris deal.