How Pascal Siakam’s extension impacts the Raptors’ payroll and their pursuit of Giannis Antetokounmpo

No matter what happens this season, the Toronto Raptors will have one eye on the future. With a number of high-profile players set to hit the market in 2021, maintaining cap flexibility will be key.

The Toronto Raptors are ready to hand the reins over to Pascal Siakam. Just before the start of the regular season, the two sides agreed to terms on a four-year, $129.9 million contract extension. The deal came fresh off the heels of signing Kyle Lowry to a one-year, $31 million extension. The question on the mind of most fans is how do these signings impact the Raptors’ payroll moving forward?

The Toronto Raptors appear to have their sights set on the summer of 2021. At that time, a number of All-Star and All-NBA players can hit the open market. The crown jewel of that group could be Giannis Antetokounmpo.

A report surfaced a few days ago in which Giannis reportedly said that if the Bucks under-perform this season it would make it “a lot more difficult” for him to commit to the team long-term. Giannis quickly released a statement indicating that he was misquoted. Regardless, the vultures are circling and a number of teams will be keeping tabs on Giannis and the Bucks over the next two seasons. It’s also not the first time something of this nature has been reported.

Marc Spears of ESPN reported that the Toronto Raptors could be on the shortlist of teams that Giannis would consider if he were to leave Milwaukee.

For the Bucks, their intention is perfectly clear. They want Giannis around as long as possible. Jon Horst, the team’s general manager, was fined $50,000 in September after he stated publicly that the Bucks intend to offer Giannis a supermax extension next summer.

If the Bucks win a championship or even make the NBA Finals, it is hard to see Giannis leaving Brewtown. But if the team falls short, the reigning MVP might start looking for a better situation.

From the Raptors’ perspective, it is too early to tell whether they fit the criteria. All Masai Ujiri and Bobby Webster can do is continue to establish a winning culture and make sure their cap sheet is clean when the time comes.

Raptors’ payroll beyond this season

The Raptors have nine players under contract for next season. Three key members of the teams’ rotation will be free agents, Fred VanVleet, Serge Ibaka and Marc Gasol. The Raptors are expected to retain VanVleet. However, rumors continue to circulate as to whether the Raptors may look to move one or both of their veteran big men.

Entering the weekend, Toronto currently sits at 4-1 with a matchup against Giannis and the Bucks set for Saturday night. If Toronto continues to win games it’s hard to imagine Ujiri would blow the team up.

As a result of the new contracts given to Siakam and Lowry, the Raptors have essentially taken themselves out of the free agent market next summer.

Locking both up now makes sense for the franchise. The 2020 free agent class is underwhelming, especially after a number of restricted free agents agreed to terms on new deals. There is also uncertainty as to how the NBA’s recent tension with China will affect the salary cap moving forward.

The salary cap is currently projected to increase to $116 million, with a luxury tax threshold of $141 million next season. Once cap holds for VanVleet ($17.8 million) and a mid-first round pick are taken into account the Raptors would have just under $107 million on the books.

That would leave Toronto with about $9 million in cap space. As a team operating under the salary cap, the Raptors would also have access to the room exception, which is projected to be just over $5 million for the 2020-21 season. It’s difficult to add one or more impact players with these figures. As such, re-signing Ibaka and/or Gasol could make more sense for the franchise.

By re-signing one or both of Ibaka and Gasol, the Raptors would continue to operate as a team over-the-cap and have access to the mid-level exception.

There are two different mid-level exceptions available to NBA teams. Teams that don’t go over the tax apron have access to the non-taxpayer mid-level exception, projected to be $9.7 million in 2020-21. Teams over the apron can access the taxpayer mid-level exception, which is expected to increase to $6 million.

For those unfamiliar with the tax apron, it is essentially a threshold $6 million higher than the luxury tax. For 2020-21, the tax apron would be around $147 million. As such, the Raptors would be able to use the non-taxpayer mid-level as long as their payroll never exceeds $147 million.

Based on these projections, the Raptors would be able to pay up to $30 million to re-sign Gasol and Ibaka. The team would also have $9.7 million available to add one or more free agents. This makes way more sense than dipping below the cap because Ibaka and Gasol are better than anyone the Raptors could add with the room exception. Plus the non-taxpayer mid-level is basically the same as the Raptors’ maximum cap space (without other cap-clearing moves, which seem unlikely).

The Raptors don’t need to be worried about spending next summer. They have the ability to retain their entire core. However, what the team does need to focus on is the length of any contracts handed out next summer.

Maintaining future flexibility

Retaining Ibaka or Gasol on one-year deals, similar to the contract given to Lowry makes sense. By re-signing either for anything longer would restrict the Raptors’ future flexibility.

The Raptors currently have four players under contract beyond next season, Siakam, Norman Powell, Matt Thomas and Dewan Hernandez. And in all likelihood, VanVleet will sign a new contract in the summer.

Through five games, VanVleet  is averaging 17 points and 7.2 assists per game. He’ll be looking for a raise. However, as things currently stand there are only seven teams that project to have significant cap space. Outside of the Knicks, none of them need a point guard. As such, the Raptors might be able to get a slight bargain. Ideally, VanVleet would sign a three or four-year deal with an average annual salary around $15 million.

Beyond those mentioned, OG Anunoby and Terence Davis will be restricted free agents in 2021. The Raptors can use their cap holds, $11.6 million and $2 million, respectively, in order to maintain cap flexibility. The total salary for those seven players is just over $75 million. That leaves the Raptors with max level cap space in order to chase Giannis or any other high-profile free agent.

Entering the summer of 2021, Giannis will have eight years of service. That means teams are able to offer him a contract starting at 30 percent of the salary cap or $37.5 million. It is unlikely the Raptors will do anything between now and then that would impact their ability to add a player as talented at Giannis, provided Antetokounmpo doesn’t sign an extension over that same period.

Historically, Toronto has not been viewed as a free agent destination. However, if Giannis were to hit the open market it could be slightly different. Giannis is from Greece, not the United States. His parents are from Nigeria. Giannis may not view Toronto in the same light as his American counterparts.

Ujiri also has a connection to this particular superstar. Ujiri tried to trade into the 2015 NBA Draft in order to select Giannis. He also helped Giannis’s family emigrate from Nigeria to Greece, long before Giannis became the league’s MVP.

Next: Time to worry about the Raptors forward depth?

All of this is not to say that Giannis is destined to become a Toronto Raptors. But this may be the first time that Toronto is viewed as a legitimate contender to sign one of the league’s best and brightest.