The Toronto Raptors and Pascal Siakam have agreed to a four-year $130 million maximum contract extension. His presence is a stabilizing force for the future of the franchise.
It was always going to be a max. After the season Pascal Siakam had, with a weak upcoming free agent class, and after Jamal Murray agreed to a maximum contract extension, there was no negotiating below that point. Now it’s official, as Adrian Wojnarowski of ESPN is reporting the Toronto Raptors and Pascal Siakam have agreed to a four-year $135 million contract extension.
After the Kyle Lowry extension was completed, the Siakam deal felt more and more likely. The Raptors clearly don’t have free agency plans for the summer of 2020, so locking in the franchise cornerstone as soon as possible became the only priority. Now, they have him locked up for the next five (four plus his one year remaining on the current deal) seasons.
Terms of the contract
It’s interesting the deal is only for four, rather than five, seasons. Whether that was the Raptors choice — he would be slightly past his prime in the fifth year of the deal — or Pascal’s decision — hitting free agency at 30 rather than 31 is a meaningful difference — is unclear. While no fifth year on the contract shouldn’t be the biggest takeaway, it’s not totally insignificant either.
One of the benefits that the Raptors clearly received from getting the deal done a year early was the lack of a player option on the fourth year (there is no team option either). If Siakam had made it to restricted free agency, he would’ve certainly received a three-year deal with a player option for the fourth. By agreeing to terms now, Toronto avoids that scenario. Player options have come back to burn teams in previous years — Gordon Hayward leaving the Utah Jazz a year early is one example.
The deal is currently being reported as $130 million, which indicates he will not receive a raise for making an All-NBA team. Toronto securing Siakam’s number at the 25-percent (rather than the 30-percent) max is a win for management. Note: These figures have been updated to include more relevant cap information/reporting.
Raptors future cap situation
With Lowry and Siakam signed for 2020 (and Pascal obviously longer than that), Toronto has secured a reasonable level of competence for the immediate future. Toronto didn’t appear to have any intention of tanking. This deal only solidifies that position.
The contract also essentially wipes out any cap-space plans for the 2020 offseason. The current roster and Fred VanVleet‘s cap-hold gives the Raptors about 10ish million in space. With the mid-level exception coming in at $9.7 million, Toronto is almost certain to operate as an “above the cap team.”
If Toronto has any future free agency plans, this deal virtually guarantees that it will be in 2021, as we expected. The Raptors have only $46 million committed for 2021, although Fred VanVleet’s deal and OG Anunoby‘s cap-hold will almost certainly be on the books as well.
If you wanted Siakam to get less than a maximum contract, that was never an option. Toronto had two choices, pay the man and lock-in an All-Star, perhaps All-NBA player for the next four years or let him walk, and lose the franchise cornerstone for nothing. By agreeing to the contract a year early, Toronto was able to negotiate a hard four years and keep the maximum at 25-percent of the cap, rather than the 30-percent max.
Siakam finally received his big payday and secured a luxurious lifestyle for him and his family for the rest of their lives. Toronto locked in their franchise cornerstone on what could be considered a below-market value deal. Everyone wins.