As of Tuesday, Utah Jazz forward Lauri Markkanen becomes eligible for a significant contract renegotiation and extension, positioning him among a mere 13 NBA players since 2010 to potentially restructure their current salary for improved terms. This eligibility is a testament to Markkanen's remarkable on-court performance and dramatic rise in value.
Currently in the final year of a four-year, $67.5 million contract signed in 2021, Markkanen's journey to this point has been fascinating. Initially traded to the Cleveland Cavaliers as part of a three-team deal involving Derrick Jones Jr. and multiple draft picks, he subsequently found himself with the Utah Jazz in a trade in 2022. Markkanen quickly established himself as a key player in the Jazz's lineup following the Donovan Mitchell trade.
This season, Markkanen's $18 million salary is seen as the best value in the league for any All-Star player not on a first-round rookie scale contract. His stellar performance has been instrumental to the Jazz, as he averaged 24.5 points over his first two seasons in Utah. These exceptional stats earned him All-Star honors and the Most Improved Player award in 2023. Additionally, Markkanen has carved out his place in history by becoming one of only three 7-footers in NBA history to make 1,000 career 3-pointers, joining the ranks of legends such as Dirk Nowitzki and Channing Frye.
However, despite Markkanen’s tremendous contributions, the Jazz have remained open to trade offers since the transaction activity leading up to the 2024 trade deadline in February. The team’s high asking price reflects Markkanen’s considerable value both on and off the court.
As the Jazz look ahead, they now have the opportunity to renegotiate Markkanen's $18 million salary up to $42.2 million for this season, followed by an extension of four additional years. This renegotiation could push the total value to approximately $232 million over the next five years. Another option allows the Jazz to raise his current salary to $33.1 million and extend for four more years at a total value of $207.8 million.
These strategic financial decisions come as the Jazz operate within the constraints of the collective bargaining agreement's second apron, despite having $37 million in cap space. Utah has been strategic this offseason, only signing their 2024 first-round picks Cody Williams and Isaiah Collier since July. They also drafted Kyle Filipowski in the second round and reportedly agreed to contracts with free agents Drew Eubanks and Johnny Juzang. Eubanks, Juzang, and Filipowski remain unsigned, preserving Utah’s cap flexibility to renegotiate Markkanen’s contract.
With $103 million in committed salary, the Jazz are required to spend at least $23.7 million more to meet the 2023 CBA rule, which mandates teams spend 90% of the salary cap by the first day of the regular season on October 22. Failure to meet this criterion would result in the forfeiture of the luxury tax distribution the team would receive at the end of the season. This upcoming season will also feature significant contributions from seven picks from the past three drafts, including guard Keyonte George, forward Cody Williams, and center Walker Kessler.
The Jazz have remained active during trade deadlines, retaining veterans like guard Jordan Clarkson, who has been with the team since the Donovan Mitchell and Rudy Gobert era (2021-22). The Golden State Warriors have been the most aggressive suitors for Markkanen thus far. Preliminary discussions were held with the San Antonio Spurs to pair Markkanen with Victor Wembanyama, but those talks did not gain much traction. The Sacramento Kings showed interest as well but eventually opted to acquire DeMar DeRozan via a sign-and-trade deal.
The Oklahoma City Thunder and the Houston Rockets, both in possession of substantial draft capital, could also outbid other teams if they pursue Markkanen aggressively. Regardless of these trade rumors, Markkanen's intentions seem clear. "We'd love to be here. I've said it multiple times. My family likes to be here," said Markkanen, signaling his preference to stay with Utah.
With a clear path to renegotiate and extend Markkanen's contract, the Utah Jazz are on the brink of making pivotal financial decisions that could not only define the team's future but also secure their competitive edge for the coming seasons.