Kawhi Leonard's 3 Main Options for His Next Contract

By now you probably know the details about the rift between Kawhi Leonard and the Spurs. If not, Kevin O’Connor sums up the situation well, but basically neither side has a ton of trust right now after Leonard sat out essentially the whole season with a quad injury that San Antonio thought he could play through. With the San Antonio Express-News breaking the news that a trade request was made and Yahoo! and ESPN simultaneously reporting the same, a divorce seems imminent. As a Southern California native, the Lakers are apparently his preferred destination, but with the Clippers, 76ers, and Celtics also in the running, the Spurs have no obligation to send him anywhere than the franchise that provides the best trade package. In any case, any team he plays for this season will have an eye towards his next contract since he is all but guaranteed to decline his undervalued $21,329,752 player option next summer, so let’s take a look at what his options are for a new deal as his 27th birthday approaches this month.

#1: Stay with San Antonio for the most money

This seems like the least likely choice given all of the new developments, but Leonard has reportedly yet to have his expected meeting coach Gregg Popovich. There’s still a chance that relationships could be repaired, and the two-time Defensive Player of the Year is convinced to stay like LaMarcus Aldridge was last year. If everything is smoothed over, the Spurs can offer him the Designated Veteran Extension since he was named All-NBA in both 2016 and 2017. Commonly referred to as the “supermax,” this simply allows Leonard to tack on five years to his contract with a starting salary at 35% of the salary cap as opposed to the 30% he’d normally be eligible for based on his seven years of experience. With a projected salary cap of $108 million next year, he’s looking at a five year, $219,240,000 extension on top of this season’s $20,099,189 for a six year total of $239,339,189.

#2: Wait until next summer and sign a free agent contract

Besides the health concerns, any team trading for Leonard has to be wary since they are only guaranteed one season of his services. The Lakers reportedly can pull the trigger with confidence that he will re-sign next summer, but any other franchise would be risking him entering free agency. Would another team such as the Celtics trade away a promising player on a rookie contract like Jaylen Brown along with draft picks and just bank on their culture and the largest possible contract offer keeping him there? Whoever his incumbent team is can offer a five year pact with 8% raises while he can only receive 4 years and 5% raises with a new team. Thus, he’s looking at $187,920,000 or $139,320,000 deals, and combined with this year’s salary (and 15% trade kicker), totals of $211,034,067 over six years or $162,434,067 over five.

#3: Renegotiate and extend

For all of the talk that’s out there, there is no way for an acquiring team to be absolutely certain that Leonard will re-sign in free agency, especially without knowing how this season will play out. They could try signing an extension now, but those are limited to a 20% raise on the current contract, which isn’t financially feasible (and why Kyrie Irving won’t extend in Boston right now). The solution? Use current cap space to renegotiate his current deal up to his max salary and then add onto it. That means that based on a projected cap of $101 million this year, a team would need to have $7,185,933 in room upon completion of the trade to increase his post-trade kicker salary to $30,300,000 (30% of $101 million). A team like the 76ers could offer some combination of Markelle Fultz, Robert Covington (who was recently renegotiated and extended himself as I suggested), and the #10 and #25 picks, and then use a chunk of their cap space to give to Leonard a bigger contract before re-signing their free agents with the remaining funds.

The negotiations for the two sides to work out would consist of what kind of extension is signed. If they come to an understanding but wait six months to finalize it, then four years can be tacked on with 8% raises, meaning $145,440,000 would be added on top of the $10,200,811 increase for a five year total of $175,740,000. More likely, though, is an immediate extension (well, as soon as July 16th, the third anniversary of signing his current deal) that is only three years with 5% raises and the last season a player option. That way, the deal gets done now instead of getting into the season, and Leonard would be able to hit free agency right after his 30th birthday in 2021 with the ability to sign a 35% max as a 10 year veteran. That would mean he gets $101,732,250 guaranteed plus this year’s increase for a four year total of $132,032,250, and then he’d be in line to replace the last year of that deal with something like a five year, $227,360,000 contract to total $322,805,000 over eight years. That last part comes with assumptions of him performing well enough to be offered the full 35% max and that the cap will keep rising to $112 million in 2021. That was last summer’s projection for 2020, and while it’s difficult to project three years in advance, the point is that this is how he could maximize his potential earnings. I’m not including that theoretical second contract in the table below, but it’s worth noting for his hypothetical future totals.

Contract	2018-19	2019-20	2020-21	2021-22	2022-23	2023-24	Total	Average
Designated Veteran Extension	$20,099,189	$37,800,000	$40,824,000	$43,848,000	$46,872,000	$49,896,000	$239,339,189	$39,889,865
2019 FA, incumbent team	$23,114,067	$32,400,000	$34,992,000	$37,584,000	$40,176,000	$42,768,000	$211,034,067	$35,172,345
2019 FA, new team	$23,114,067	$32,400,000	$34,020,000	$35,640,000	$37,260,000		$162,434,067	$32,486,813
R&E after 6 months	$30,300,000	$32,724,000	$35,148,000	$37,572,000	$39,996,000		$175,740,000	$35,148,000
R&E now	$30,300,000	$31,815,000	$33,330,000	$36,587,250			$132,032,250	$33,008,063

In all scenarios, Leonard is in line to make at least $31 million per year, so it’s just a matter of when and for how long he locks it in. Staying in San Antonio obviously offers the most money since that is the purpose of the Designated Veteran Extension, and if he is set on a specific destination like the Lakers, then he would be sacrificing a lot of guarantees to sign there next summer. His best option may be the renegotiation and extension with a team trading for him that has the requisite cap space, especially if he’s eyeing an even larger deal in 2021. That would provide security for both him and his new club, so if he indicates a willingness for such an arrangement, the leverage in trade negotiations should shift. Again, the Spurs should and will pursue whichever transaction provides the best value for them, but make no mistake: Leonard’s contract options will affect who he plays for next season.

This posts was updated on June 19th to reflect Leonard's 15% trade kicker ($3,014,878) that was previously overlooked.