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Houston Rockets Salary Cap Update: 2015 Offseason Pre-Draft Edition

After the Houston Rockets’ best season in nearly 20 years, David Weiner breaks down their cap situation to keep their own free agents and improve the team.

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Josh Smith Corey Brewer Houston Rockets

The Houston Rockets just completed their most successful season in 18 years, advancing to the Western Conference Finals despite numerous injuries to key players throughout the season (including injuries to Patrick Beverley and Donatas Motiejunas that kept them out for the entire playoff run).

While many fans still have a bad taste in their mouths from a 4-1 series loss to the Golden State Warriors, the vast majority still seem to have (what I believe to be) the proper perspective on the overall success of this season’s campaign.

With the Rockets’ season now ended, it’s time to once again take a look at the team’s salary cap situation and where the Rockets can go from here.

Player Salary, Exceptions and Available Cap Room

(Salaries and contract information courtesy of ShamSports.com and some good old-fashioned digging.)

The Houston Rockets currently have the following player salary commitments, cap holds and salary cap exceptions available for the 2015-16 season:

Player salary commitments:  Dwight Howard ($22.36 million), James Harden ($15.76 million), Trevor Ariza ($8.19 million), Kostas Papanikolaou ($4.8 million, non-guaranteed), Terrence Jones ($2.49 million), Motiejunas ($2.29 million), Pablo Prigioni ($1.73 million, partially guaranteed for only $440,000), Clint Capela ($1.24 million), Joey Dorsey ($1,015,421) and Nick Johnson ($845,059).

Cap holds:  Jason Terry ($8.76 million – Rockets hold full Bird rights), Corey Brewer ($6.11 million – Rockets hold Early Bird rights), Beverley ($2.725 million – Rockets hold full Bird rights), Josh Smith ($2.49 million – Rockets have only Non-Bird rights), the rookie scale slot for the #18 pick in the 2015 NBA Draft ($1.37 million), and K.J. McDaniels ($1.05 million – Rockets have only Non-Bird rights).

Other Salary Cap Exceptions:  Houston has some small trade exceptions from the Alexey Shved ($1.62 million), Isaiah Canaan ($816,482) and Troy Daniels ($816,482) trades.  However, the key salary cap exception available to the Rockets this summer will be the Mid-Level Exception (MLE), either the Non-Taxpayer variety ($5.464 million, the use of which would impose a hard cap at the “apron” level – currently projected at $85.6 million) or the Taxpayer variety ($3.376 million).  Houston will be unable to avail themselves of the Bi-Annual Exception ($2.139 million) this summer, as they used it this past season on Smith.  (The Rockets could instead have the Room Exception of $2.814 million if they elect to use cap room this summer, but that is unlikely, as described below.)

Given these salary commitments and exceptions, and based on the currently projected 2015-16 salary cap of $67.1 million, the most cap room the Rockets could create (barring trades . . . yeah, I know) is about $10.37 million.  However, this would involve renouncing rights to all free agents, waiving Papanikolaou and Prigioni and renouncing/trading away their first round pick.  Since the Rockets are now at a level (title contention) where roster continuity is more important, do not expect them to opt for cap room . . . unless a star-caliber player shakes loose and opening up additional cap room is the only way to obtain that player.  So the most likely scenario is that the Rockets will operate over the cap this summer.

So… What Happens Next?

As the Rockets prepare for the NBA Draft and the subsequent free agent season, there will be some internal cap-maneuvering for GM Daryl Morey and his staff to do.

The most likely such maneuver will be for the Rockets to pick up the $4.8 million team option on Papanikolaou’s contract.  This option year is fully non-guaranteed, so there is no financial commitment attached to exercising the option.  Also, exercising the option is necessary in order for Papanikolaou to be trade-eligible.  As a sizable non-guaranteed contract, Papanikolaou will probably be a crucial component to almost any trade of significance the Rockets attempt to pull off this summer.  I would be shocked if Kostas’s option were not picked up on or prior to draft day.

Houston will also likely extend qualifying offers to Beverley ($2.725 million, more than he’d otherwise receive based on his prior salary due to meeting the CBA’s “starter criteria”) and to McDaniels ($1.05 million, which is the one-year veteran’s minimum plus $200,000) in order to make them both restricted free agents and to give the Rockets the ability to match any offers from other teams.

Sergio Llull celebrates 2015 EuroLeague win

Sergio Llull may finally come over after winning the EuroLeague title in 2015

Expect the Rockets to ramp up their years-long courtship of 2009 second round pick Sergio Llull, a 6-3 combo guard who has developed into one of the top guards in Europe.  After helping lead Real Madrid to a EuroLeague title, there is little else Llull can accomplish overseas.  While being a star on a perennial title contender in his home country (as well as a prohibitive contract buyout) has thus far kept Llull from making the leap to the NBA, he has reportedly always had interest in eventually coming over.  With a title now in hand (and his buyout amount allegedly now low enough), now seems like the ideal time for the 27-year-old guard to join the Rockets.  He will likely command most/all of the MLE, so the Rockets will need to prioritize such a signing with their other offseason moves.  But hearing head coach Kevin McHale (in an interview with 790 AM’s Charlie Pallilo) recently, it sounds like signing Llull will be a high priority for this team.

Draft Day Maneuvering

The Rockets will enter the 2015 NBA Draft armed with the 18th and 32nd picks, about $800,000 in remaining cash to spend, as well as an assortment of young players, draft rights and future picks to trade.  Knowing Morey, expect Houston to diligently seek out a draft night deal.  Whether that is an attempt to trade up in the draft or a shot at acquiring an established point guard (such as Kyle Lowry or Ty Lawson) remains to be seen.

Unlike trades consummated after the July Moratorium, draft day trades (as in, those trades actually consummated before July 1) are made using this current season’s cap figures.  With the Rockets only about $2-3 million below the luxury tax threshold this season, any large draft day trades they make will probably subject them to the “taxpayer matching rules” (in which a team that will be over the tax threshold following a trade may not take back more than 125% of outgoing salary plus $100,000).  Therefore, we may see the Rockets agree to terms on a trade during the draft but not have it consummated until some time in July (when the cap figures reset, certain outgoing players’ salaries increase, and the team can possibly drop far enough below the tax threshold to work under more favorable salary matching rules).

The more likely scenario (as is always the case) is that the Rockets are unable to pull off a significant draft day trade.  We may instead see Rockets owner Leslie Alexander once again allow Morey to spend his remaining $800,000 cash allotment this season on a late second round pick to stash overseas (as the team has done in recent years with Furkan Aldemir and Alessandro Gentile).

Free Agent Decisions

The Rockets have several key decisions to make regarding their own free agents that could greatly impact what they do about any outside additions to the roster.  In his interview with Pallilo, McHale made it quite clear that retaining most/all of their free agents was a high priority for the Rockets.

Patrick Beverley:  While Beverley’s relatively low cap hold could possibly help the Rockets make other maneuvers before re-signing him, don’t expect Beverley to be overly generous in his contract demands.  Despite his injury history, expect his agent to cite (repeatedly) Beverley’s honor as an NBA All-Defense Second Teamer in 2013-14 and to look for a deal in the range of what Boston defensive guard Avery Bradley received last summer (4 years, $32 million).  That might be a tad rich for Houston, especially if they hope to muster any meaningful cap room in the summer of 2016.  However, if Beverley is willing to sign for less in order to retain a starting spot on a contender, there is still a decent chance that he’ll be back next season.

Corey Brewer:  After waiving his player option as a condition to his trade to Houston last December (an option that he undoubtedly would not have exercised anyway based on his late season performance), Brewer will become an unrestricted free agent on July 1.  The Rockets hold Early Bird rights to Brewer, which means that they can offer him a deal starting as high as about $8.23 million.  As it is unlikely that Brewer will do better than that (or even get that high an offer from the Rockets), Houston should be able to exceed the cap in order to retain Brewer if the sides can agree on a deal.  While Brewer’s high motor is a huge plus for this team, the Rockets will need to weigh his strengths against his weaknesses (poor 3-point shooting and a tendency to overplay too much on defense) when deciding how much to offer him.

Josh Smith:  I wrote in my last cap update about the details surrounding Smith’s free agency and how much the Rockets could offer him.  Essentially, Houston must either hope that Smith accepts its Non-Bird free agent tender ($2.49 million) or use the MLE (or cap room) to re-sign Smith.  While Smith would still clear over $7 million in total salary next season between a Non-Bird tender from Houston and his stretch payment from the Detroit Pistons, he can always make more with a larger new contract.  It seems the Rockets are hoping they can leverage Smith’s happiness in Houston to convince him to stay for the Non-Bird amount.  Only time will tell if that strategy will work.

K.J. McDaniels Houston Rockets free agent

It could be tough to keep K.J. McDaniels, who should get a lot of league interest

Jason Terry:  Coming off an MLE-sized contract he signed with the Boston Celtics in 2012, do not expect Terry to re-sign for anything close to that much this summer.  But the Rockets apparently love what Terry brings to the table, both on and off the court.  As has been mentioned on this site, look for the Rockets to offer Terry a deal similar to what they gave Francisco Garcia a couple of years back: either a two-year veteran’s minimum deal (with a player option on Year 2) or a one-year vet minimum deal (perhaps with a tacit understanding about an ongoing role with the team).

K.J. McDaniels:  The decision with McDaniels will likely be one of the hardest decisions of the offseason for Houston.  A young player with high upside, there will certainly be several teams that come calling for McDaniels’s services.  But the Rockets are limited to either their qualifying offer ($1.05 million) or tapping into the MLE (or cap room) to re-sign K.J.  (As an “Arenas Rule” free agent, no team can offer McDaniels a starting salary in excess of the full Non-Taxpayer MLE; but teams could still create the sort of “poison pill” offer sheets Houston utilized to sign Jeremy Lin and Omer Asik.)  The Rockets traded for McDaniels in February largely to reserve another palatable alternative for themselves this summer should Brewer leave or should Ariza be traded.  But if Ariza and Brewer are both Rockets next season — and especially if Llull comes over as an MLE signing — it is likely that McDaniels moves on to another team.  If the Rockets can somehow convince McDaniels to accept the qualifying offer (with the hopes of signing a larger contract next summer), it would be quite the coup for Morey and his staff.

Conclusion

After a terrific playoff run to the Western Conference Finals, the Rockets must now turn their attention to both retaining the talent that got them there as well as adding to that talent via trades and free agency.  Morey and company have enough assets to at least make legitimate trade offers this summer for a “third best player” or other key piece.  Even if no outside talent is added, bringing back this season’s entire (healthy) rotation, with the additions of Llull and a mid-first rounder, could possibly be enough to get Houston over the hump next season.  But if we’ve learned anything from the last several years, it’s that the Houston Rockets will explore every possible avenue to get better.

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Podcast: Houston Rockets options with the #3 pick of the 2024 NBA Draft

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Houston Rockets 2024 NBA Draft prospects Zaccharie Risacher Stephon Castle Reed Sheppard Donovan Clingan

The offseason is now underway.

The forecast looks good for the Houston Rockets, but… there’s pressure as well this offseason because there are a handful of other West teams that might have rosier futures. Ime Udoka wants to win and win big. As we are about five weeks away from the NBA Draft, what are the Rockets looking to do this summer?

David Weiner joined Dave Hardisty on the ClutchFans podcast to discuss the Rockets shockingly landing the #3 pick and their options in this draft, including Reed Sheppard, Donovan Clingan, Zaccharie Risacher, Stephon Castle, Matas Buzelis and others. They also discuss the possibility of some big game hunting in Houston.


CLUTCHFANS PODCAST: SPOTIFY | APPLE

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Podcast: Steven Adams, Mikal Bridges and Trade Possibilities for the Rockets

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Houston Rockets Trade Deadline 2024

The Houston Rockets already made one deal, acquiring center Steven Adams from Memphis for a handful of second-round picks, but we still have several days left before this Thursday’s NBA Trade Deadline.

Are more deals on the way?

Rumors of interest in Mikal Bridges have swirled, with the Rockets holding precious (and unprotected) first-round picks from Brooklyn. They also could use some help inside this season, which Adams can not provide. Shooting is always in demand.

David Weiner joined Dave Hardisty on the ClutchFans podcast to discuss the Adams trade, its impact on the Rockets in 2024-25 and beyond, the Mikal Bridges rumors, the Brooklyn picks, other trade possibilities and options for Rafael Stone moving forward. Also discussed is the play of Houston’s core 6 prospects: Amen Thompson, Cam Whitmore, Alperen Sengun, Jabari Smith Jr., Tari Eason and Jalen Green.


CLUTCHFANS PODCAST: SPOTIFY | APPLE

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Rockets trade for center Steven Adams

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Steven Adams Houston Rockets

The Rockets made a surprise trade on Thursday, sending the contract of Victor Oladipo and three second-round picks to Memphis for center Steven Adams.

The deal came together quickly and the Rockets had a small window to get it done, hence why this trade was made with a week to go until the trade deadline.

The Price

When you consider that Memphis did this for cost savings primarily and that Adams would not play for any team in the league this season, the price seemed a little high to me. The Rockets gave up the OKC second-round pick this year, which is no big loss, but they also give up the better of Brooklyn’s or Golden State’s second-round pick this season. That’s a pretty good pick (likely in the late 30’s). They also give up the better of Houston’s or OKC’s second-round pick in 2025. If things go as planned for the Rockets, that pick should be in the 45-55 range.

But they didn’t sacrifice a first-round pick, which would have been brutal, and they were not going to use all those seconds this season. So it’s just a matter of opportunity cost — who else could they have gotten for this package?

My understanding is they (particularly Ime Udoka) are very high on Adams.

The Rockets also did this move for cap purposes as well. By moving out the Oladipo contract, which was expiring, and bringing in Adams’ deal, which is signed for $12.4M next season, the window for the Rockets to put together a trade package for a star player is extended out until the 2025 trade deadline. They continue to wait to see which players, if any, shake loose here and become available. They want flexible (see: expiring) contracts that they can combine with assets and this gives them another year to be in that position.

The Trade

It’s not often that the Rockets acquire a player I had not considered beforehand but that’s the case with Steven Adams. The Rockets sorely need a big with size that provides more traditional center strengths, making Clint Capela, Robert Williams, Nick Richards or Daniel Gafford potential candidates, but Adams was overlooked for a few reasons.

First, the 30-year old big man is out for the season after knee surgery cost him the entire 2023-24 campaign, so the Rockets won’t get any benefit from this trade this season. Secondly, Adams is not your traditional center either when it comes to rim protection.

But what Adams does do, he’s really good at and he has some of the same strengths of Brook Lopez, who the Rockets tried to sign in the offseason. Adams is quite possibly the strongest guy in the league and a legitimate 6-foot-11 with a 7-foot-5 wingspan. He’s an outstanding screen-setter, something that could really benefit the likes of Fred VanVleet, Amen Thompson and Jalen Green. He was also an elite rebounder last season, finishing 6th in the league in caroms at 11.5 a game despite playing just 27.0 minutes a contest.

After watching Jonas Valanciunas absolutely bully the Rockets inside on Wednesday, it should be apparent by now to everyone that this was a pretty big need.

In 2021-22, the Memphis Grizzlies finished #2 in the West at 56-26. Their top two players in Net Rating that season were Dillon Brooks (+11.0) and Adams (+8.3), key cogs in a defense that held opponents to 108.6 points per 100 possessions. They’re both now Houston Rockets.

So this adds another trusted vet to Ime Udoka’s rotation.

The question is will the 30-year old Adams return to form after the knee injury? Adams sprained the posterior cruciate ligament in his right knee a year ago, which cost him the end of that season and the playoffs. He tried rehabbing it and it never got better, so surgery became the option just as this season was kicking off.

I like to think the Rockets did their due diligence on that, despite the short time it took for this deal to come together, but that’s unclear.

If he does bounce back, then Udoka has a big man he can turn to reliably in situational matchups or on nights when the younger bigs struggle. He wouldn’t be Boban or even Jock Landale in that scenario — he’s going to play, so the frontcourt depth in 2024-25 should be better. In the end, they got a starting-caliber center who will have no problems coming off the bench, and that’s what they were looking for.

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On the KPJ trade and future of the Rockets

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The Houston Rockets are back to being a professional NBA team once again.

The Rockets finally ended the Kevin Porter Jr. era on Tuesday, coughing up two second-round picks in order to unload his contract to the Oklahoma City Thunder, getting back the contract of Victor Oladipo and third-year forward Jeremiah Robinson-Earl. The move puts an end to a long investment and very rocky tenure with KPJ.

David Weiner joined Dave Hardisty on the ClutchFans podcast to discuss the Porter Jr. Experiment, the price paid to move him, Houston’s potential trade options moving forward, the new culture and the current state of the Rockets young core.

ClutchFans Podcast: On Apple | Spotify

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Heavy investment in Kevin Porter Jr raises serious questions about Rockets front office

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Kevin Porter Jr. Rafael Stone

Soon-to-be-ex Rockets guard Kevin Porter Jr was arrested last week for allegedly assaulting his girlfriend, resulting in a fractured neck vertebra and a deep gash above her right eye after an attack at a hotel in New York. He allegedly woke her up by punching her repeatedly, strangled her and did not stop hitting her until she ran out of the hotel room screaming for help and covered in blood.

“This is a serious domestic violence case,” said assistant Manhattan district attorney Mirah Curzer.

First and foremost, I wish the victim healing. I don’t know what to say about the nightmare she went through. She and her family will forever be impacted. As for KPJ, if this is true, he doesn’t belong on the Rockets or in the NBA at all. He belongs in jail.

Secondly, this can’t be overlooked and just swept under the rug: Why did the Houston Rockets bank on and invest so heavily in this guy?

Kevin Porter Jr. being accused of crimes of this severity should not be shocking – at all. Before he even came to the Rockets, he had a long list of serious problems. He was suspended multiple times in high school. In 2019, he had a “conduct issue” significant enough that USC suspended the 5-star recruit indefinitely. He fell to the end of the first round of the 2019 NBA Draft because of his behavior liability. He was accused of punching a woman in the face in Cleveland. He also had a gun and marijuana charge later dismissed after getting into a car crash. He went into a tirade and got into a nasty confrontation with both the Cleveland coach and GM, resulting in the Cavs severing ties immediately and dumping him to the Rockets for nothing.

You could make the argument that initially giving Porter Jr. a second chance in Houston was praiseworthy, but the Rockets experienced KPJ’s anger management and immaturity issues firsthand on several occasions.

Former Rocket Austin Rivers said this week that this isn’t the first, second or even seventh issue with Porter Jr. and that Rockets “higher-ups” confided in him that they had no idea how to handle him.

“I remember talking to guys in the Houston Rockets organization, higher-ups, [and] they were having issues then,” said Rivers. “They were like, ‘We don’t know what to do with him.’ And that’s when he just got there from Cleveland!”

Porter Jr. was routinely a nightmare for Rockets coaches to deal with. On several occasions, he confronted and cussed out members of the coaching staff, saying they didn’t have the “credentials”, per source, a reference to the fact that him playing heavy minutes at point guard was a decision they did not control.

Once at a night out, Porter Jr. had a disagreement with a DJ over music choice and he snapped, smashing the DJ’s laptop to the floor. He needed to be restrained and removed. Rockets personnel and several of Porter’s teammates witnessed the incident.

Curzer also dropped a bombshell at the arraignment in saying that Porter Jr. has a history of abusing his girlfriend, who he had only been dating since early last year, his second season with the Rockets. Curzer specifically cited an incident in which KPJ allegedly rammed his car into hers.

There were dozens of maturity issues visible on the court to anyone paying attention. He refused to check out of games. He got into an argument on the bench with assistant Lionel Hollins. On numerous occasions, he would visibly shut down when he wasn’t passed the ball. I invite you to watch this video from a game against Memphis on March 20, 2022. Just listen to the Grizzlies broadcasters, particularly starting at the 1:40 mark, talk about what they are witnessing here:



Privately, people around the league would say they were baffled by the Rockets continued fascination with Porter Jr. Nobody could understand it.

That fascination starts with Rockets general manager Rafael Stone, who by every account over the last two years was the driving force behind the investment in Porter Jr. It has been no secret. Trading for him in January 2021 was seen by some with the team as his “Harden acquisition”, code for a signature move that makes an executive’s career, much in the way landing James Harden did for Daryl Morey in 2012.

For example, former Rockets head coach Stephen Silas never considered Porter Jr. to be a point guard, per sources — playing him there was a Stone mandate because the GM believed that is where his future lied.

John Wall also told us as much publicly when he explained the phone call he got from Silas about coming off the bench. He said Silas told him “This is what the GM wants,” adding again that Silas said, “Man, you don’t deserve that. You should be the starter. This is just what they want to do.” Wall was upset because he believed KPJ should have to earn the spot.

“I have a hard time finding anybody outside of the Rockets front office that believes that Kevin Porter Jr. is a starting point guard in the NBA,” said ESPN reporter Tim MacMahon in December.

There were plenty of warning signs about KPJ to the public too.

After Porter Jr. got into a heated argument in which KPJ “physically shoved” Rockets assistant coach John Lucas and quit on the team in the middle of a game against Denver in January of 2022, leaving the arena at halftime, Sports Illustrated’s Chris Mannix famously wrote that the Rockets should “Cut Porter Jr. Waive him. Release him. Whatever. Eat what’s left of the $1.8 million he’s owed this season and the $3.2 million he’s got next and move on.” It became a source of mockery for Porter Jr’s fans, a line they would bring up after each game he hit a few threes or handed out some assists.

In February of this year, ESPN’s Jonathan Givony, one of the most connected reporters in the league, flat out warned us that he was hearing awful things about the Rockets culture and locker room. He was blunt in what the Rockets needed to do — waive Kevin Porter Jr. outright and bring in a new coach and GM.

“Just cut him. That’s it,” said Givony of Porter Jr. “And you’re sending a signal to the league that we’re going to do things differently from here on out.”

“When you talk to people around the NBA about Houston, you just don’t hear good things about their culture, about that locker room. You talk to people that are on that team, and they are like, ‘We are a mess’,” said Givony. “Do people want to work with this organization? But you can change that fairly quickly if you come in, get rid of the bad apples and you change the coaching staff, and all of a sudden, you’re Houston. It’s the third-biggest city in America. There’s a history here of you actually being good.”

Porter came to the Rockets for “free” (in exchange for a top-55 protected second-round pick, which was designed not to convey), but he proved far from it as the Rockets continued to pour investment into him. Over the last 2-3 seasons, no Rockets player got more developmental capital than Porter Jr. – not Jalen Green, not Alperen Sengun, not Jabari Smith Jr. The Fertittas paid John Wall $85+ million over two years to sit at home so the team could groom Porter Jr. to be their future point guard.

Then they doubled down. With restricted free agency on the horizon and a seemingly non-existent market for KPJ’s services, the Rockets gave Porter Jr. an extension a year sooner – a contract that was presented as a four-year, $82.5 million deal. The deal was more team-friendly than that, putting team options in it after years 1 and 3. Going from the potential disaster that was initially reported to a deal they could escape after one season felt like a “win”, but the biggest question was why they wanted him long-term at all. The unprecedented nature of a contract that size with that kind of club control clearly showed the Rockets knew there was unique and significant risk here.

After KPJ signed the extension, The Athletic’s Kelly Iko summarized the Rockets view of Porter Jr. – “As has been [their] stance for months, the Rockets have maintained the notion that Porter is a priority and is considered a huge part of their core, along with Green and Jabari Smith Jr.”

The Rockets actions to kick off the 2022-23 season showed exactly that – that he was a priority. They benched Sengun to start the season, in large part to give KPJ a “lob threat” and defender in the starting lineup. They gave him the superstar “Harden Locker”. They introduced him last in the starting lineups. They treated him as the star and empowered him to be the self-proclaimed “Head Honcho” of Clutch City.

But the extension proved unwise and foolish. Porter Jr. never even made it to the first year of it. With over $80 million on the line, he snapped again. The Rockets signed him to one of the team-friendliest deals ever and still managed to both overcommit and overpay as Stone now scrambles to attach real assets to it to get another team to take it off his books.

Is it fair to question the judgment of the Rockets front office? Absolutely and without question. Whether you look at their ability to value character, evaluate risk, scout basketball, build culture, manage assets or allocate development resources, they failed at every level here. Why didn’t they act sooner? Why did they double down? Why didn’t they hold him accountable? Why did everybody in the league see it but them?

“We value the player and the person that [Kevin Porter Jr.] is becoming and are eager to invest in him and his journey,” said Stone after rewarding him with the extension less than a year ago.

The question you have to ask yourself now is, with all they knew and witnessed about Porter Jr. both on and off the court — why were they eager at all?

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