Orlando Magic in position to rent cap space to move up or around Draft

The road to get to the NBA Draft is a long one.

Narratives that seemed set in stone for much of the college season get tired and everyone looks to talk about something different. Teams too are eager to explore everything that is out there and available to them.

There is going to be a lot of talking at this point of the year. And a lot of posturing as teams prepare for the Draft and the transaction period.

It did not take long for the talks to begin about teams moving around the top of the draft either. There are already some reports the Cleveland Cavaliers or Detroit Pistons might be interested in moving off the first and third picks.

There will be plenty of time to break down the potentials for those deals and the various iterations that might get them to work.

For now, it is important to understand the Magic do have the assets to get it done — two top-10 picks, their $17-million trade exception, solid veterans in Terrence Ross and Gary Harris and, perhaps the most useful asset, cap room they would be willing to rent.

The Orlando Magic should enter the transaction market willing to rent their cap space and use this new tool to get the player they want while punting free agency.

It is this last concept that might need a little more explaining to those who are not well steeped in NBA salary cap management. It goes against the sort of common understanding or logic of how teams acquire and use cap space.

One of the goals president of basketball operations Jeff Weltman said the team was chasing with doing the three trade deadline deals was to clear the team’s cap sheet. After years of bumping up against the salary cap, the team wanted to get back under again.

The team clear enough space to have about $7-8 million to spend this summer and then potentially max cap room in 2022.

The usual logic for free agency goes: clear cap room, spend it on free agents and everything is great.

Orlando Magic

The Magic used that strategy to go after Tracy McGrady, Tim Duncan and Grant Hill. But then again, they also used that “strategy” to sign Jeff Green, D.J. Augustin and Bismback Biyombo.

Free agency is not as simple as having cap room and spending it. It is still free agency and teams have to attract the players to sign on the dotted line.

The odds of this team actually attracting an impact free agent while it is rebuilding in that major summer is minimal.

Still, the team has to spend at least 80-percent of the cap to avoid a penalty from the league — and even spending that bare minimum can have a negative effect with agents.

This is where the tool of “renting cap space” comes in. It is something the Brooklyn Nets really made popular during their rebuild when they did not have any of their own picks because of the Kevin Garnett and Paul Pierce trades.

The Nets had loads of cap space but a roster that was not attracting any stars when they sought to take on positive assets by enticing teams with the offer of eating up salaries they no longer wanted.

When the Lakers traded D’Angelo Russell to the Nets, they attached Timofey Mozgov’s contract (the same one that Mozgov ended up finishing in Orlando before the team stretched the final year of his deal) to free themselves from that financial commitment. That move was among the many the Lakers had to make to free up cap room for LeBron James.

The Atlanta Hawks also practiced this before they drafted Trae Young in the aftermath of the teams Mike Budenholzer coached. It is a way to restock the cupboard with future assets and the cost of doing business.

The Magic do not have much cap room to rent this offseason, but they do have mountains of room in the summer of 2022 and a $17-million trade exception that expires at the trade deadline next season. They could easily decide to park someone in that cap room for a few years and wait for their team to develop before attacking free agency or the trade market when they are ready.

They are clearly not ready now. And that is why renting cap space is the tool they likely would use if they were trying to trade up.

Take this kind of a deal for instance — note: this is not reported, but merely an example that has been bandied about:

In this deal, the Magic give up both their picks and an expiring contract in Gary Harris. That would give the Rockets significant cap relief. Eric Gordon is owed roughly $17 million per year in the next two seasons.

Orlando would, in essence, be punting their cap room for a few years to take a chance on Gordon, but more importantly grab the pick they really want. They rent their cap space for the next two seasons to house Gordon and get something done and help another team clear cap room.

The Rockets, while there are reports they want to accelerate their rebuild some, are not a team that likely needs the space to do something in the big summer of 2022.

A team like Cleveland might be a better candidate.

They could end up with something like this:

Similar to the previous deal that has been bandied about, Orlando trades away a pair of expiring contracts for the thing they want — in this case, the third pick — and a long-term contract the Cavaliers no longer want in Kevin Love.

Love would be a pretty onerous contract to take on — more than $31-million for the next two years.

Whether any of these fantasy-booked trades are frameworks for a deal will be something to debate and ponder in the next month. But the strategy to pull them off is something the Magic will weight and likely execute. They have the tools to do so.

Each of these deals involves the Magic acquiring the asset they want, sending out perhaps some salary to make it work and then taking on some onerous long-term salary as the cost of doing business.

That is how renting cap space works.

The Magic probably are hoping to get into the top four and improve their draft position. They put a lot into this draft and it was palpably disappointing. This could be a tool to get the team the draft position they want.

It is also probable the Magic could get more assets or better use this tool — including the trade exception — by waiting for the trade deadline. By then, teams will have some idea of what free agency will look like in 2022 and who the major players are and who needs to free up the money to go after those major players.

The Magic could be a team that helps facilitate a trade that helps those teams free up cap space for the offseason. That paired with Gary Harris’ expiring contract and the trade exception could give the team a few bites at that apple.

What the Magic decide to do is not something we want to predict here. But this merely a way to explain one of the tools at the team’s disposal.

Orlando right now is a rebuilding team. Cap room does the team very little good. Flexibility does though. And the Magic are in a position to get valuable assets if they are willing to take on bad salaries with the cap space they are not using anyway.