The Athletic: Leroux 2019 Offseason Team Previews: Houston Rockets

By Danny Leroux May 13, 2019
While the NBA playoffs are still going, the 2019 offseason is rapidly approaching for many teams with significant decisions to make for their present and future. CBA expert Danny Leroux breaks down the major options, opportunities and risks for the Rockets in The Athletic’s 2019 Offseason Preview series.

It has been an eventful year in Houston, as the best team in the 2017-18 regular season balanced lofty aspirations with financial constraints. Tilman Fertitta purchased the team from Leslie Alexander for a league-record $2.2 billion shortly after they won 65 games and took the Warriors to the brink in the Western Conference Finals, but the Rockets faced an uncertain summer. Both Trevor Ariza and Luc Richard Mbah a Moute left for one-year deals elsewhere in the Western Conference before having disappointing seasons, while general manager Daryl Morey re-signed Chris Paul to a four-year, $159.7 million pact with a final season player option. He was also able to get center Clint Capela on a team-friendly five-year, $85.7 million pact that solidified the franchise’s exciting core through at least 2020-21.

From there, Morey filled out the roster with minimum players, including Carmelo Anthony, Gerald Green, Michael Carter-Williams and James Ennis. In August, he sent forward Ryan Anderson and 2018 second round pick De’Anthony Melton to Phoenix for Brandon Knight and Marquese Chriss in one of the early signs that the luxury tax was a material concern. During the season, Morey made a series of transactions involving forwards Gary Clark, and Danuel House Jr., one two-way slot and one roster spot that eventually ended up with both on the team.

He also correctly assessed that Anthony and Carter-Williams did not fit the Rockets and unloaded both to clear both luxury tax breathing room and cap space, eventually adding Austin Rivers and Kenneth Faried after they were bought out. Another important development was the final push to get under the tax at the deadline. Morey shipped Ennis to Philadelphia for a second-round pick swap then gave up Houston’s 2019 first rounder to send Knight and Chriss to Cleveland in a three-way trade that brought back Iman Shumpert and likely the ability to avoid the tax in both 2018-19 and 2019-20.

That said, the newcomers helped significantly more than the departed, and James Harden put together another spectacular season as the Rockets eventually finished 53-29. Unfortunately, that record was only good enough for the fourth seed, putting them on the same side of the bracket as the Warriors. After losing to Golden State yet again, Morey and the Rockets have a more stable but still challenging summer ahead of them unless management is willing to sacrifice to make larger changes.

 

Here are three key storylines to watch for Houston this offseason:


The Luxury Tax: Since the tax significantly affected the Rockets’ path this season, it is fair to make it a key consideration for this summer. They only have six players with fully guaranteed contracts, counting Nene’s player option, and would have about $11.5 million to spend filling out the roster. But that evaporates quickly, even with minimum contracts. It seems awfully unlikely that any of their core players will be gone, so the limited wiggle room would be Nene plus partial guarantees for both Isaiah Hartenstein and Clark. There is also an extremely outside shot of moving Eric Gordon or P.J. Tucker, both of whom proved their importance yet again in the playoffs.


It is possible for Morey to repeat the maneuvers he pulled off this season to replace full season minimum contracts with cheaper rest-of-season ones later on, but that would only be wise if the offseason signings disappointed like Anthony and Carter-Williams, which is not something he should or will expect. Maybe ownership is more willing to dip into the tax in 2019-20, but recent precedent does not go in that direction as the Rockets would have been much better served staying a tax team by keeping some of their 2018 free agents than ducking it last season and going over now. Still, changes of heart happen and working within whatever constraints exist will be a huge part of the front office’s challenge throughout the season.


Retentions: It took time and a series of in-season improvements but Morey cultivated a group of contributors on minimum contracts. One of his major challenges this offseason is deciding which of that group are worth bringing back and which should be replaced. Rivers and Faried played big parts but each took a rest of the season minimum contract, so paying them much more than their minimum in 2019-20 requires using the Mid-Level exception, thus making it harder to add new talent. Early Bird rights open up another avenue to keep Houston native Green, while Shumpert’s Bird rights are more than enough if the two sides can figure out a mutually acceptable contract value.


Their most interesting negotiation is with House, who turned down longer contracts to become a restricted free agent at 26. He fell out of the playoff rotation but made a difference during the regular season and capable forwards are hard to find, especially if they can hit jump shots. Morey will likely challenge House to secure an offer sheet, but there could be a market for him at more than the minimum but less than the full Mid-Level exception. It is also possible that a general manager sees a modest but not meager offer as an opportunity to make the Rockets sweat, particularly if Houston spends close to its limit before the end of the July Moratorium.


Mid-Level Exception: It remains to be seen if Morey will have the spending power to use the MLE in any significant way this offseason, but it represents their best tool for adding talent. He could use some of it to give minimum and near-minimum players slightly more money, longer contracts or both, as he did with Hartenstein last summer. Theoretically, the Rockets will have a $5.7 million Taxpayer MLE and there will be players willing to take that salary to be a part of one of the league’s best teams. The key question will be whether Morey can offer it and, if so, whether he chooses the best recipient.


Potential Free Agents: Gerald Green (unrestricted), Austin Rivers (unrestricted), Kenneth Faried (unrestricted), Nene ($3.8m player option), Gary Clark (partial guarantee), Isaiah Hartenstein (partial guarantee), Michael Frazier (non-guaranteed) and Chris Chiozza (non-guaranteed)


Likely Summer of 2019 Cap Space: None


Realistic Maximum Summer of 2019 Cap Space (using $109M estimate): None


2019 Draft Assets: No picks. Own first owed to the Cavs and own second owed to the Knicks.


Potential Targets: With so many pieces already in place, Morey will continue his search for perimeter players capable of hitting open shots and defending multiple positions. They will continue to be hard to find, particularly at a low price point, but he has done well over the past few years. Morey can try to sell more talented free agents on playing time with one of the league’s best teams, but expect both the offseason free agency and in-season buyout markets to be less friendly this time around because so many players are hitting free agency this summer. There could be significantly more teams offering playing time on the minimum market, depending on how the Knicks, Clippers and others fare this summer.


That could lead Morey down the retention route or a volume play where the Rockets bring in a series of potential fits for training camp with little to no guaranteed money and see who looks like he can stick. Additionally, his experience using cash to unload the signings that wash out is important as well since it takes some of the risk out of the equation. The Rockets will likely have to wait out the market to see who becomes willing to take a minimum contract, but there should be some intriguing options given their track record.


Pressure Scale: 8. The Rockets’ mix of limited flexibility and high stakes makes Morey’s challenge a distinctly different one than most of the league, especially this offseason, when so many franchises are dealing with massive uncertainty. If Fertitta again makes the tax a significant consideration, the front office’s primary focus will be finding value on minimum contracts as they do not have any more Anderson or Knight contracts to trade in salary dumps. Normally a summer with severe constraints would not be pressure-packed, but the Rockets have an MVP-caliber megastar in his prime and second-best player who just turned 34. It is reasonable to expect that the passage of time will weaken Houston’s core, though they are starting from an incredibly strong position. Still, that understanding makes maximizing the present an unambiguous imperative.


State of the Franchise: Fine-Tuning. Having Harden, Paul, Capela, Gordon and Tucker on the roster for 2019-20 means Morey’s primary objective would have been exactly the same even if ownership gave him more spending power: make the most of this window. He did a great job within those constraints last year in no small part because he identified his mistakes and mitigated them before taking advantage of a strong buyout market to add Rivers and Faried in-season.


It looks to be more of the same in 2019-20 but repeating his successes will likely be even harder. Sacrificing another first-round pick to dump salary appears unnecessary but also impractical, and the front office already traded their 2020 and 2022 second-round picks in the Shumpert/Knight deal. As such, the most likely scenario is an identical foundation with exceedingly important depth decisions that will mostly be minimum contracts.


Morey could absolutely pull another rabbit out of his hat on that front, but a weaker buyout group and presumably a significantly stronger group of elite teams offering playing time for minimum contract players at any point during the year, ramps up the difficulty level on what are already remarkably high stakes. For one of the league’s best teams propelled by one of the league’s brightest stars, every roster spot counts and it looks like every dollar does too.
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