Lauri Markkanen's Contract Situation: A Closer Look
As of Tuesday, Utah Jazz forward Lauri Markkanen has entered a pivotal phase in his career, becoming eligible for a significant contract renegotiation and extension. This eligibility positions Markkanen among a rare group of just 13 NBA players since 2010 who could restructure their current salary for more favorable terms.
Markkanen is currently in the final year of a four-year, $67.5 million deal initially signed in 2021. His stock has risen dramatically, making him a key figure in the Jazz’s lineup following his journey through multiple trades and impressive on-court performances. After a notable trade to the Cleveland Cavaliers in a three-team deal involving Derrick Jones Jr. and multiple draft picks, Markkanen found his way to Utah in 2022. The forward became a linchpin in the Jazz's lineup following the Donovan Mitchell trade.
Markkanen's $18 million salary this season is widely considered the best value in the league for any All-Star player not on a first-round rookie scale contract. His consistent performances, averaging 24.5 points over his first two seasons in Utah, have earned him All-Star honors and the Most Improved Player award in 2023. Adding to his accolades, he is one of only three 7-footers in NBA history to make 1,000 career 3-pointers, joining the esteemed ranks of Dirk Nowitzki and Channing Frye.
Despite Markkanen's considerable contributions, Utah has been open to trade offers leading up to the 2024 trade deadline in February. The team’s high asking price reflects Markkanen’s value both on and off the court. As of August 6, the Jazz have the opportunity to renegotiate Markkanen's $18 million salary up to $42.2 million for this season, followed by an extension of an additional four years, potentially bringing 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 years at a total value of $207.8 million.
The Jazz have implemented these strategies while navigating the financial constraints of the collective bargaining agreement's second apron, despite having $37 million in cap space. They have been particularly strategic this offseason, only signing their 2024 first-round picks Cody Williams and Isaiah Collier since July. Additionally, they drafted Kyle Filipowski in the second round and reportedly agreed to contracts with free agents Drew Eubanks and Johnny Juzang. However, Eubanks, Juzang, and Filipowski remain unsigned, preserving Utah’s cap flexibility to renegotiate Markkanen’s contract.
With $103 million in committed salary, the Jazz need to spend at least $23.7 million more to meet the added rule of the 2023 CBA, which requires teams to spend 90% of the salary cap by the first day of the regular season on October 22. Failing to meet this criterion would result in forfeiting the luxury tax distribution the team would receive at the end of the season.
The 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. Utah has 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).
So far, the Golden State Warriors have been the most aggressive suitors for Markkanen. While there were preliminary discussions with the San Antonio Spurs to pair Markkanen with Victor Wembanyama, those talks did not progress significantly. 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 possessing substantial draft capital, could outbid other teams if they choose to pursue Markkanen aggressively.
As the Jazz navigate these complex financial decisions, the words of Lauri Markkanen resonate strongly: "We'd love to be here. I've said it multiple times. My family likes to be here." With a clear path to renegotiate and extend Markkanen's contract, the Utah Jazz are poised to make strategic moves that could shape the team's future and competitive landscape for seasons to come.