ESPN+: Offseason moves for the Houston Rockets, starting with the No. 2 pick in the 2021 NBA draft

Although the Houston Rockets finished with the worst record in the league, GM Rafael Stone is convinced that good things are on the horizon in Houston, starting with July's NBA draft.

"We're going to get a good player in some way, shape or form," he said. "We're going to build something special here over time." Stone is right that the Rockets are likely to add a franchise-type talent with the No. 2 overall pick.

As for the rest of the roster, for the Rockets to get back to being a playoff team, it will take patience and a deliberate approach in how they retool the roster.

"We're trying to compete," Stone said. "We're not going to shortcut the process. We're trying to win a championship, ultimately."

The draft evaluation
There is a process that the Rockets will now undertake when it comes to draft preparation.

While it is unlikely that the No. 2 pick will be moved, Stone made it clear after the lottery that they will exhaust every option when it comes to their three first-round picks.

"It's not necessarily that you're looking to do that [trading out of the No. 2 spot], but you shouldn't foreclose any option," Stone told reporters following the lottery. "You have to do the work. You have to use the allotted time. You have to have the discussions. You have to go through the process."

The process includes the Rockets having dialogue with the other 29 teams, draft workouts, player interviews, conducting thorough checks on background, medical and psychological issues and, most important, relying on their personnel department for game and practice evaluations.

In the next four weeks, a menu of questions will be on their whiteboard, and by the time July 29 arrives, there will be an answer to each question.

Here is what the Rockets will analyze in the next month.

1. Do we explore moving No. 2 for an established All-Star or young veteran?

As ESPN's Adrian Wojnarowski reported, expect the Rockets to explore their options with their lottery pick as it relates to a young veteran or All-Star-level player who can help accelerate their rebuild.

"We have to figure out if drafting is the right thing," said Stone, who noted that he would have had the same approach even if Houston had landed the No. 1 overall pick (and a clear shot at Cade Cunningham). "The easiest way to make a mistake is predetermining what you will do."

Houston will weigh the upside of players such as Jalen Green, Evan Mobley and Jalen Suggs, who will be on a four-year rookie-scale contract, against players who can make an immediate impact. For example, moving No. 2 for a player like Collin Sexton is intriguing, but considering that the Cleveland guard is rookie extension eligible and will cost significant money with his next contract, it likely does not make sense.

"The goal is to find a star player," Stone said. "When you bring in young players, especially, you're really looking for star potential. I wouldn't use the word 'expect.' I don't want to put that pressure on a player. I do think we're likely to get somebody really, really talented if we pick the pick."

2. If we keep the No. 2 pick, do we draft best available?

This is not the NFL, where you might bypass the top QB to select an offensive lineman.

If the Rockets feel that Evan Mobley is the best available player and that there is clear separation from Jalen Green and Jalen Suggs, they should take him, despite having a starting center in Christian Wood.

"We're young and we have interesting young guys in almost every position," Stone said. "We have guys who are multipositional and will play with others. If you're a great basketball player, you can play with other great basketball players. The truly great players enhance one another, play off one another, enjoy one another. I don't worry about position-ability very much." Wood proved at the end of the year that he can play power forward, and he has tremendous value around the league not only with his play on the court but also with his team-friendly contract.

3. Do we take the quantity-over-quality approach?

This scenario would see the Rockets explore moving No. 2 to a team like Orlando (5 and 8) or Golden State (7 and 14).

It sounds appealing to have two picks in the lottery, but ESPN draft analyst Mike Schmitz considers this year's draft to be top-heavy:

"'The draft starts at 6' will likely be a phrase used to exhaustion during the pre-draft process, and for good reason. You could make an argument that four, and potentially even five, of our top-rated prospects would be the No. 1 pick in a normal year when you talk about Cade Cunningham, Jalen Green, Evan Mobley, Jalen Suggs and Jonathan Kuminga. While the top five feels fairly set from talking to NBA executives, there's still a lot of fluidity in this draft starting at 6."

Even moving out of the first round with one of their picks in the early 20s for multiple second-round selections is something that should be taken into consideration, but Houston should pass on that.

4. Would we move up into the teens but at the cost of our two picks in the 20s?

This is more of a question that gets answered the night of the draft and is dictated by the Rockets' draft board that ranks the 60 best prospects.

For example, if Houston has Gonzaga's Corey Kispert ranked No. 10 on its big board and he is still available when it comes to Oklahoma City selecting at No. 16, would the Thunder entertain Nos. 23 and 24 and perhaps a future first to move back in the draft? And if so, is that price tag too rich for Houston?

5. Should we explore trading either No. 23 or 24 for a future first?

We saw this happen in 2019 when Brooklyn traded the No. 27 pick to the LA Clippers for a lottery-protected first (from Philadelphia) in 2021. The first that the Nets would acquire eventually resulted in the No. 19 pick last November.

Stone is convinced that whatever direction the franchise goes in the next month, it will lead to a good player.

The retooling of the roster
Stone is fully aware of the task ahead on reshaping this roster. "I know some teams have done wholesale rebuilds, going extraordinarily young," Stone said. "I think one of the advantages to the various moves we made this year is that we do have a lot of future draft picks that are unprotected that aren't just ours. I think that gives us the luxury of trying to be competitive and grow our young guys and have 30-something guys. The fact they may help us win a game or two extra, or five or six games, is not something that we're worried about."

The playbook on how to build sustainable success started with the Christian Wood sign-and-trade that also netted the Rockets a future first from Detroit and then moved to finding a home for their two disgruntled All-Stars, Russell Westbrook and James Harden.

"We're trying to gather really, really talented basketball players and put them together and grow them ... and that process started for us this year and will continue," Stone said. "We're pretty locked into a strategy and really trying to grow a team that can win a championship."

That strategy starts with the draft in July and then turns to exploring how this roster can achieve sustainable success either in free agency or the trade market. Below is how the Rockets have begun to reshape their roster and the different options this offseason and in the future:

1. The draft

Three picks in the top 25

2. The future All-Star

Christian Wood

3. Identifying second-chance players

Kevin Porter Jr. and Khyri Thomas

4. Under-the-radar prospects

Kenyon Martin Jr. and Jae'Sean Tate

5. The former All-Star

John Wall

6. The veterans

D.J. Augustin, Eric Gordon and Danuel House

7. Own free agents

Kelly Olynyk and Avery Bradley

8. Cap flexibility in the future

The Rockets have a clean slate starting in 2023-24 and could have up to $80 million in room. They can take an aggressive approach this season with their own free agent Kelly Olynyk or explore the sign-and-trade market. Unlike last year, when Houston was pressed against the luxury tax and hard cap, that is not the case this season.

 

9. Trade exceptions

$8.2 million, $5.0 million, $2.2 million and $1.8 million

10. Future draft assets

Unprotected first round: 2022 (from Brooklyn), 2023 (from Milwaukee), 2024 (from Brooklyn) and 2026 (from Brooklyn). Protected Detroit first: 2022 (top 16), 2023 (top 18), 2024 (top 18), 2025 (top 13), 2026 (top 11) and 2027 (top 9). Protected Washington first: 2023 (top 14), 2024 (top 12), 2025 (top 10) and 2026 (top 8). The right to swap firsts with Brooklyn: 2023, 2025 and 2027.

"The easiest way to make a mistake is to predetermine what you're going to do," Stone said. "I think our approach generally to the draft, free agency, is to look at everything that comes up. We will do all the work. We'll research all the players in the draft, and we'll try to figure out the best way to move forward."

Offseason cap breakdown
John Wall $44,310,840

2. Eric Gordon $18,218,818
3. Christian Wood $13,666,667
4. D.J. Augustin $7,000,000
5. Danuel House Jr. $3,894,000
6. Kevin Porter Jr. $1,782,621
7. Avery Bradley $5,916,750 (team option)
8. Khyri Thomas $1,762,796 (non-guaranteed)
9. Jae'Sean Tate $1,701,593 (non-guaranteed)
10. Kenyon Martin Jr. $1,517,981 (non-guaranteed)
11. Kelly Olynyk1 $19,797,365 (free agent hold)
12. Dante Exum1 $18,240,000 (free agent hold)
13. David Nwaba2 $1,669,178 (free agent hold)
14. Sterling Brown3 $1,669,178 (free agent hold)
15. D.J. Wilson4 $13,644,840 (free agent hold)
16. Anthony Lamb5 $1,489,065 (free agent hold)
17. Armoni Brooks5 $1,489,065 (free agent hold)
18. First-rounder (own) $8,992,200 (draft hold)
19. First-rounder (via POR) $2,553,120 (draft hold)
20. First-rounder (via MIL) $2,259,240 (draft hold)
-- Troy Williams $122,741 (dead cap space)
Guaranteed contracts $89.5M
Partial/non-guaranteed $10.2M
Free agent/draft holds $72.9M
Dead cap space $123K
Total $172.8M
SALARY CAP $112.8M
LUXURY TAX $136.6M
1. Bird
2. Early Bird
3. Non-Bird
4. Restricted Bird
5. Restricted Non-Bird

The Rockets are right at the salary cap when taking into account their three first-round picks and the $5.9 million team option on Avery Bradley. If the team option on Bradley is declined, Houston is still over the cap when factoring in the $9.5 million midlevel exception, $3.8 million biannual exception and their trade exceptions. They are $23 million below the luxury tax.

Team needs

• Depth at every position
  

Resources to build the roster

• The draft: three first-round picks (own, Portland and Milwaukee)
  
  
• Future draft assets (Brooklyn, Milwaukee, Detroit and Washington)
  
  
• Exceptions: $9.5 million midlevel, $3.7 million biannual and trade ($8.2 million and $5.0 million)
  

Dates to watch
• The Rockets have until Aug. 1 to tender D.J. Wilson a $6.4 million qualifying offer. Acquired from Milwaukee as part of the P.J. Tucker trade, Wilson played in 23 games, averaging 6.1 points and 3.8 rebounds. If the Rockets extend the offer, they will have until mid-August to rescind without the approval of the player.

• Expect Kenyon Martin Jr. to be on the roster past his Aug. 1 guarantee date. Selected in the second round last November, Martin averaged 9.3 points and 5.3 rebounds in 45 games. Among players selected in the second round, Martin ranked in the top five in points (second), rebounds (first) and field goal percentage (fourth). His contract for next season is $1.5 million.

• There are no offseason guarantee dates for Jae'Sean Tate ($1.5 million) and Khyri Thomas ($1.8 million). The undrafted Tate is coming off a season in which he earned All-Rookie honors. Thomas averaged 16.4 points in five games with Houston.

• The Rockets have until Aug. 1 to exercise the $5.9 million team option on Avery Bradley. The veteran guard played in 23 games, averaging 5.1 points after the trade deadline. Because the Rockets are already over the cap, they would not gain flexibility if the option is declined. If the option is exercised, Bradley now becomes a valuable trade option because of his ability to defend and the fact that he is on an expiring contract.

Restrictions
• Avery Bradley cannot be traded until his team option is exercised.

• The three players with non-guaranteed contracts -- Kenyon Martin Jr., Khyri Thomas and Jae'Sean Tate -- count as zero in outgoing salary.

Extension eligible
• John Wall and Danuel House are both extension eligible. It is unlikely either player will receive additional years to his current contract.

The draft

The Rockets are flush with draft assets now and in the future but do owe Oklahoma City two future firsts as part of the Russell Westbrook trade. Houston will send the Thunder a top-four-protected first-round pick in 2024 and 2026. If neither is conveyed, the Rockets will then send 2024, 2025 and 2026 second-round picks to Oklahoma City. Oklahoma City also has the right to swap firsts in 2025 if the pick is outside the top 10. If the swap is made, Houston would then have the option to swap the Thunder first for the Brooklyn first.