Analysis: Bradley Beal extends in Washington

News broke early Thursday morning (at 4:54am Pacific!) from ESPN’s Adrian Wojnarowski that Bradley Beal had agreed to a 1+1 extension with the Washington Wizards. The extension agreement comes after months of speculation about Beal’s future, with fans across the league salivating over the chances that their team would trade for him while the DC faithful were petrified that he would look around at what the Wizards have built and flee at the first opportunity.

The end result is a happy medium – the Wizards will have Beal under contract for another year and Beal gets more financial security, can become a free agent after he hits ten years in the league, and gets the positive PR of being one of the rare stars who stays in a non-contending situation. The allure of the supermax extension must have been strong for Beal, but he would have had to make an All-NBA team this year in order to qualify for it. It’s not an impossible task, but given that the Wizards aren’t going to be particularly competitive this year (to say the least) and the risk for injury (he’s played more than 6,000 minutes the last two years), it makes sense that he passed up that opportunity for a less risky approach.

From a salary cap perspective, perhaps the most interesting part of this agreement is that Washington can approach Beal in two years with another extension offer. Since his extension puts a total of four years on his contract (two years remaining and two years on the extension, including the player option year), the Wizards will have to wait until the second anniversary of this extension to sign him to another one, which would start in 22-23 and would net him $41.4 million in the first year. A full four-year extension for the maximum amount allowed under veteran extension rules would pay Beal $185.5 million over four years from 2022-23 to 2025-26. It’s obviously much too early to start speculating on this offer, but it’s a nice bonus for the Wizards that they’ll be able to offer this sort of extension ahead of his free agency in 2022.

If Beal were to become a free agent in 2022, his four-year max with another team is projected to be worth $196.6 million, based on a projected salary cap of $130.625 million. Locking in nearly 95 percent of that nearly a full season ahead of time may be very attractive to Beal and his family, but we’ll have to see how the next two years go for him and the Wizards before he thinks about that possible extension.

Beal could also sign a shorter extension in two years, just like he did this time around, though there wouldn’t be the extra incentive to do so that there is in his current deal. With seven years of service in the league, Beal is certainly eyeing 2022 as the key summer for him to get paid, as he’ll have ten years of service and will be eligible for 35 percent of the salary cap on his next contract, regardless of whether he ever makes an All-NBA team. Opting out in 2022 without an extension would open him up to that $196.6 million with another team, or as much as $265.2 million if he were to re-up with the Wizards at that point.

Beal also reportedly has a 15 percent trade kicker on his extension, but that’s a bit misleading. His salary is already so close to his individual maximum that the 15 percent bonus isn’t worth nearly that much; a trade bonus cannot take a player’s total compensation over his individual maximum for that season. For Beal, his individual maximum is 30 percent of the salary cap for the next three years, so even if 15 percent of his remaining contract amounts to more than $13.5 million, as it does now, he can’t get more than what would put him right at the max. The end result is that his trade kicker is worth about $6.0 million next summer, when he’s eligible to be traded for the first time.

His extension is large enough that he can’t be traded for the next six months, so there will be no Beal chatter around the trade deadline, but as soon as the end of the season rolls around, I’m sure the rumors will pick back up where they left off. That assumes that the Wizards turn in a season that many expect of them and are well out of the playoff picture, no matter how well Beal plays.

At some point during the 2020-21 season, depending on how the schedule breaks and where the cap falls, that trade kicker will drop from $6.0 million to the actual value of 15 percent of his remaining contract (option years don’t count for trade kickers), but the fact of the matter is that the 15 percent trade kicker will not cost the Wizards (in cash) nor a potential trade partner (in salary cap hit) more than about $6.0 million.

For Washington, this is clearly a massive win. Considering most projections have them near the bottom of the league standings this year, nobody would have blamed Beal if he had wanted out. Instead, they were able to extend him for at least one more year and have him under contract through 2022, which gives them a lot more breathing room to build the team around him and convince him that DC is the place he should stay long-term. In particular, this is good news for the Wizards with respect to John Wall; they can now absolutely take their time bringing him back into the fold after his injury and do their best to ensure that he’s healthy long-term, as they now have three years to build their case to Beal that he should stay a Wizard for the rest of his career.