The Knicks' breakout star is going to have a $95 million decision to make, and it could shape the team's future
- Knicks star Julius Randle will have to decide whether to sign a contract extension this offseason.
- The extension would give him $106 million, but All-Stars can get more than that on the open market.
- If he keeps it up and hits free agency in 2022, he could sign a $201 million contract with New York.
New York Knicks forward Julius Randle will have a major contract decision to make this summer.
Randle is coming off a breakout season - he made his first All-Star team, may make his first All-NBA team and is the favorite to win Most Improved Player. He led the Knicks to the fourth seed in the Eastern Conference while becoming just the second player in NBA history to average over 20 points, 10 rebounds, and 5 assists per game on 40% three-point shooting.
Randle signed a three-year, $62 million deal with the Knicks in the summer of 2019. He has one year left on that deal, worth $19.8 million, but only $4 million of it is guaranteed. He and the Knicks could hammer out an extension this summer, worth a maximum of $106 million over four years on top of his $19.8 million.
However, coming off an impressive season, Randle could also forgo an extension and hold off on a big payday for one more year. If he hits free agency in 2022, he'll be eligible to sign a five-year, $201 million contract with the Knicks, according to ESPN's Brian Windhorst.
Windhorst also noted that Randle and the Knicks plan to discuss contract extension options this offseason. Randle has said he wants to stay with the Knicks.
Now he'll have to decide whether to cash in on his monster season or bet on himself, banking on a repeat performance.
The safe route: a $106 million extension
Signing the four-year, $106 million extension is Randle's safest option. While his play has been fantastic this season, there's no guarantee he can keep up this production.
Two factors might be working against Randle. His breakout season came at age 26, a rarity in the NBA - most players generally don't make huge leaps so late into their careers.
Statistically, this season is an outlier.
The leap also happened during a highly abnormal season. The pandemic meant that arenas were mostly fanless, and the schedule was compressed. Questions remain as to whether this Randle is here to stay.
An extension could be a pleasant middle ground for the two parties. Randle would get a considerable payday while helping the Knicks remain flexible going forward. He'd be a centerpiece of the team, but the Knicks would have cap space to add talent around him.
Randle could make nearly $100 million more by forgoing an extension
The group of people who think Randle might regress next season, however, likely excludes Randle himself. NBA players are a confident bunch.
If Randle believes he can stay at his current production level and lead the Knicks to a second consecutive playoff berth, he may choose to play out the final year on his contract.
Such a gamble could pay off big time. Randle would be eligible to sign a five-year contract worth 30% of the salary cap, with 8% annual raises, totaling about $201 million.
The Knicks would be the only team capable of offering such a deal, but it would be complicated for them.
If Randle keeps up his play for another season, he'd surely be worth a max contract. But the Knicks would have to decide whether he is capable of being the centerpiece of a championship-contending team because his contract would take up such a large portion of their payroll.
On the one hand, Randle's leap to stardom was a key factor in the Knicks' surprising success, especially since the supporting cast around him doesn't jump off the page. Upgrading the roster around Randle might be enough to help the Knicks build from a middle-of-the-pack playoff squad to a true contender.
On the other hand, signing Randle to a max contract would make it harder for the Knicks to build around him. Teams can fit two max contracts on their rosters, but it makes building out the rest more difficult since there is less financial flexibility.
The Knicks will also have future contract decisions to make on key players from this year's roster like Mitchell Robinson, R.J. Barrett, and Derrick Rose. They'll be eligible for extensions or new deals over the next two seasons.
A middle ground could help both parties
Randle and the Knicks could pursue a third option this summer: a short extension that would give Randle a payday while leaving open the possibility of a bigger contract in the future. The Knicks could guarantee all of Randle's $19.8 million salary for next season, then give him a two-year extension that would be worth about $48 million through 2024.
Such an extension would be an underpay if Randle keeps up his production, but it could also be beneficial for three reasons.
- Randle would get a modest pay raise after making $36 million over the past two seasons.
- He'd get to see how the Knicks build around him without making a long-term commitment.
- He would enter free agency after 10 years of experience, when he'd eligible for a bigger max contract - worth 35% of the salary cap, with 8% annual raises.
Signing a shorter extension comes with risk, too: Randle could get injured and struggle to return to form over the next three seasons, in which case he'd likely wish he'd taken the $100 million extension or hit free agency in 2022.
Randle is in a great position to cash in on a great season. It'll be up to him to decide just how much he thinks it was worth.