As of Tuesday, Utah Jazz forward Lauri Markkanen becomes eligible for a significant contract renegotiation and extension, marking a key moment in both his career and the Jazz's strategic planning.
A Rising Star
Markkanen has become one of the standout performers in the NBA, and his potential renegotiation places him among an elite group of just 13 players since 2010 to have the chance to restructure their current salary for more favorable terms. Currently in the final year of a four-year, $67.5 million contract originally signed in 2021, Markkanen’s stock has appreciated considerably. His journey has seen him traded to the Cleveland Cavaliers as part of a three-team deal involving Derrick Jones Jr. and multiple draft picks, and then to Utah in 2022.
Once in Utah, Markkanen quickly established himself as a cornerstone of the team, especially following the Donovan Mitchell trade. His $18 million salary this season is widely hailed as the best value in the league for any All-Star not on a first-round rookie scale contract. Averaging 24.5 points over his first two seasons with the Jazz, he earned All-Star honors and took home the Most Improved Player award in 2023. Markkanen is also one of only three 7-footers in NBA history to make 1,000 career 3-pointers, joining the likes of Dirk Nowitzki and Channing Frye.
Renegotiation Opportunities
The Jazz now have the option to renegotiate Markkanen’s $18 million salary up to $42.2 million for this season, followed by an extension for an additional four years, potentially bringing the total value to approximately $232 million over the next five years. Another possibility is to raise his current salary to $33.1 million and extend for four years, totaling $207.8 million over the duration of his contract.
Such financial maneuvering fits within the Jazz's strategy despite operating under the constraints of the collective bargaining agreement's second apron. Although they have $37 million in cap space, they have only signed 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, though these players remain unsigned, preserving Utah’s cap flexibility to renegotiate Markkanen’s contract.
Currently, the Jazz have $103 million in committed salary and need to spend at least $23.7 million more to meet the 2023 CBA rule that 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 the team forfeiting the luxury tax distribution at the end of the season.
Interest from Other Teams
Despite Markkanen’s significant contributions, the Jazz have been open to trade offers. With the 2024 trade deadline approaching, they have set a high asking price, reflecting Markkanen’s value both on and off the court. The Golden State Warriors have shown the most interest thus far. There were also preliminary discussions with the San Antonio Spurs about pairing Markkanen with Victor Wembanyama, though those negotiations did not gain much traction. The Sacramento Kings were interested but ultimately chose to acquire DeMar DeRozan via a sign-and-trade deal. Additionally, the Oklahoma City Thunder and the Houston Rockets, both possessing substantial draft capital, could outbid other teams if they choose to aggressively pursue Markkanen.
Strategic Planning for the Future
Looking ahead to the upcoming season, the Jazz are relying on significant contributions from their recent draft picks, including guard Keyonte George, forward Cody Williams, and center Walker Kessler. The team has been active during past trade deadlines, choosing to retain veteran guard Jordan Clarkson, who has been with the team since the Donovan Mitchell and Rudy Gobert era (2021-22).
With $103 million already committed in salary, the Jazz need to address their financial obligations before the start of the regular season. Ahead of his potential contract renegotiation, Markkanen has expressed his desire to remain with the Jazz, stating, "We'd love to be here. I've said it multiple times. My family likes to be here."
As the Utah Jazz approach critical financial decisions that could reshape their competitive landscape, retaining Markkanen and adequately utilizing their cap space will be essential. The team's ability to navigate these challenges will play a significant role in their long-term success.