The Deal
Rockets get: Guard Ty Lawson, 2017 Denver second-round pick
Nuggets get: Guards Nick Johnson and Pablo Prigioni, forward Kostas Papanikolaou, center Joey Dorsey, 2016 Houston first-round pick (lottery protected)
Houston Rockets: A
I've long believed that the Rockets were a logical destination for Lawson, and I think last week's DUI arrest -- Lawson's second of 2015 -- made them the obvious choice. His evident struggles with alcohol abuse, for which Lawson is currently in rehab in Los Angeles, make him a basketball risk. And few GMs have a greater appetite for risk than Houston's Daryl Morey.
With greater risk comes the potential for greater reward, and that's what the Rockets have here. If Lawson is able to avoid further off-court missteps, this is a bargain price for a quality starter at a position of need. Houston is giving up four reserves, none of whom figured to play an important role in 2015-16, along with what will likely be a late first-round pick. In the event of a doomsday scenario in which the Rockets miss the playoffs, lottery protection means they won't surrender a valuable pick next season.
Lawson isn't a perfect fit next to James Harden. He's most valuable with the ball in his hands pushing in transition and running pick-and-rolls. According to SportVU player tracking available on NBA.com/Stats, Lawson held the ball for 7.3 minutes per game last season, the league's ninth-highest total. That's more than Houston's primary point guards, Patrick Beverley (3.9) and Jason Terry (2.0), averaged combined. Harden was the Rockets' leader in time of possession at 6.0 minutes per game, second only to LeBron James (6.1) among non-point guards.
As compared with his time in Denver, Lawson will be spending a lot more time spotting up on the perimeter. He's an OK spot-up shooter, having made about 35 percent of his catch-and-shoot 3-point attempts each of the past two seasons, according to NBA.com/Stats. That's not quite as good as Beverley, who has made around 38 percent, but is decent enough to keep defenders honest.
Lawson also gives Houston a badly needed secondary playmaker. Expect to see Rockets coach Kevin McHale manage his rotation to put Lawson on the floor with the second unit, whether or not he starts games at point guard. His ability to run the break fits perfectly with the up-tempo style Houston's reserves played last season, and Lawson gives the team more creative ability when Harden is on the bench -- or getting overplayed by an aggressive defense.
Even though the Rockets aren't giving up much in terms of talent, they're still taking a risk in terms of alternative cost -- what else they could have acquired for this package of cap relief and a first-round pick. If Lawson is unable to stay on the court because of his legal troubles, Houston could regret this move. However, by this point in the summer the Rockets were unable to get anyone else nearly this talented, and Papanikolaou's guarantee date meant they couldn't necessarily wait until midseason to make a move.
Houston mitigated its long-term financial risk by getting Lawson to agree to make his 2016-17 salary non-guaranteed, as reported by Grantland's Zach Lowe. If Lawson can stay on the court, his $13.2 million salary is likely to be a good value for the Rockets. (I project his production as worth approximately $19 million that season.) If things go wrong, Houston can clear max-level cap space if Dwight Howard next summer opts to become a free agent, and the Rockets have protected that cherished flexibility in the event of a worst-case scenario with Lawson.
Adding additional salary is relevant for Houston because the team is likely to be hard-capped next season at the luxury-tax apron $4 million above the tax line. The Rockets will be hard-capped if they use part of their non-taxpayer midlevel exception to sign second-round pick Montrezl Harrell to a contract longer than the two years permitted by the minimum-salary exception. They already committed to give most of their midlevel exception to re-sign restricted free agent K.J. McDaniels earlier Sunday, so using part of it on Harrell's contract would prevent Houston from using the smaller non-taxpayer midlevel exception and avoiding the hard cap.
With this trade, the Rockets edge slightly over the tax line, giving them about $3.5 million under the apron to fill out the remaining three spots on the roster. If Harrell gets the minimum salary as a rookie and Houston signs a 14th player for the veterans minimum, that would limit the team to offering a starting salary of about $2 million to re-sign Terry, an unrestricted free agent.
If Lawson performs as expected, the Rockets have upgraded their roster. In a loaded Western Conference, that doesn't guarantee a return trip to the conference finals. It doesn't even necessarily make Houston a favorite to win a playoff series. But Lawson's addition could make the top of the West that much more crowded.
Denver Nuggets: B+
I'm guessing there's a sense of relief in the Nuggets' front office today. If Denver had it to do over again, the organization surely would have moved Lawson before last season's trade deadline, when his value was likely higher. But it would have been difficult for anyone to predict just how badly things would go for Lawson's relationship with the Nuggets over the last five months, and at this point a first-round pick of any kind in return is a solid save.
I don't think drafting Emmanuel Mudiay seventh meant Denver had to trade Lawson. Given that Lawson is going to be playing off the ball much of the time in Houston and Mudiay has the size to defend 2-guards, it's possible they could have played together at times. It's also possible Mudiay won't be ready to start this season. As exciting as his performance during the NBA summer league in Las Vegas was, Mudiay flashed more long-term potential than immediate production. He ended up shooting 2-of-14 from 3-point range and averaging five turnovers a game this summer.
Still, Mudiay's arrival meant a couple of things. First, it meant some conflict between the twin goals of rehabilitating Lawson's trade value and facilitating Mudiay's long-term development. Second, it gave the Nuggets an alternative if they were tired of worrying about Lawson off the court, an understandable position.
It's still not clear that Denver understands exactly where it's headed as an organization. The front office has sent mixed messages, stockpiling future first-round picks and young talent while maintaining a veteran core. The Nuggets extended the contract of 28-year-old forward Wilson Chandler last week and have reportedly been talking extension with Danilo Gallinari, who will turn 27 next month. Although neither player is past his prime yet, the two also aren't on the same timetable as Mudiay (19) and second-year players Gary Harris and Jusuf Nurkic, who will both turn 21 later this month.
What was clear was that Denver's future did not include Lawson. In addition to the pick, the Nuggets also got immediate and long-term cap relief. Prigioni's contract was only partially guaranteed for $290,000 through Monday, and ESPN's Marc Stein reported he was waived as soon as the trade was completed. Denver can save another $4.8 million by waiving Papanikolaou, whose contract is non-guaranteed through October 4. The Nuggets have the option of trading him to another team looking for cap relief between now and then.
If Denver waives Papanikolaou, the team will have about $8.3 million in cap space and be slightly below the league's salary floor (90 percent of the salary cap). The Nuggets might use some of that space to renegotiate Gallinari's contract at the same time they extend it, as they did with Chandler. That's a logical solution since even without Papanikolaou and Prigioni, Denver would have 14 guaranteed contracts along with guard Erick Green, whose contract is non-guaranteed through Aug. 1. So the Nuggets might not be doing any more shopping in free agency.
Pending a Gallinari extension, Denver is looking at $40 million in cap space next summer, when only Johnson will remain on the books from this trade. At this point, the Nuggets can't provide a compelling sales pitch to free agents. But if their young core shows promise this season, they might be able to successfully reinvest Lawson's salary in 2016.