Exploring Heat’s realistic options if Miami uses cap space. Pros, cons and what’s likely

At least the Miami Heat ended its season with clarity.

There should be no pretense, no delusions that this roster is good enough to compete for an Eastern Conference championship, let alone an NBA title.

And that leaves Miami with two clear options this summer:

Option 1: Operate as a room team, using what could be as much as $27.5 million in cap space, to add the best available player or perhaps two players. Miami also would have a $4.9 million room exception in this scenario.

Option 2: Operate as an over-the-cap team, allowing Miami to exceed the cap to keep Victor Oladipo, Goran Dragic and/or Trevor Ariza if it wishes, use a $9.5 million mid-level exception and a $3.6 million bi-annual exception and make a sign-and-trade to upgrade the roster.

We’ll examine both options and other potential avenues to improve in a four-part series, beginning with the using cap space option:

If the cap ends up at the $112 million projection, the Heat is positioned to have between $20.5 million and $27.5 million in cap space this summer. The difference hinges on the cap numbers of impending restricted free agents Duncan Robinson and Kendrick Nunn, which would depend on whether Miami does something outside-the-box to lower their cap numbers.

Should each re-sign with the Heat as restricted free agents this summer, Robinson’s and Nunn’s 2021-22 cap numbers for the Heat, regardless of their salaries next season, would be $4.7 million each.

But Miami can lower those cap hits to $1.7 million for each of them if Miami doesn’t make them a qualifying offer by Aug. 2 and instead agrees to make each an unrestricted free agent, something the Heat likely wouldn’t do without assurances they would re-sign.

So let’s say, for this hypothetical, that Robinson and Nunn carry the lowest cap hits ($1.7 million). The Heat’s cap commitments for 2021-22 would be those two holds/hits (presuming Miami wants to keep those two players), Jimmy Butler ($36 million), Bam Adebayo ($28.1 million), Tyler Herro ($4 million), Precious Achiuwa ($2.7 million) and KZ Okpala ($1.8 million).

There would also be a bit over $5 million in required cap holds for four empty roster spots (Omer Yurtseven, on a non-guaranteed deal, could take one of those spots), plus Ryan Anderson’s $5.2 million waive-and-stretch hit.

That adds up to $86.2 million, if the Heat declines the team options on Dragic ($19 million) and Andre Iguodala ($15 million), which is expected unless Miami needs to use either of their salaries in a sign-and-trade.

So that’s $25.8 million in space if the cap falls at that $112 million.

But if Miami rescinds Nunn’s cap hold and Bird rights, then Miami would have $27.5 million.

But the Heat’s cap space falls to just above $20 million if Robinson and Nunn are kept as restricted free agents with the larger $4.7 million holds.

A case then could be made for using that $20.5 million to $27.5 million in cap space on one marquee 2021 unrestricted free agent, such as Toronto’s Kyle Lowry, who averaged 17.2 points, 7.3 assists, 5.4 rebounds, 1.0 steals and shot 39.6 percent on threes this season.

Butler and Lowry are very close - Lowry is the godfather of Butler’s daughter — and Lowry would have been happy to join the Heat had he been dealt here at the trade deadline.

If there were odds on such things, Lowry would be the betting choice to join the Heat this offseason because of significant mutual interest.

But here’s the problem with the scenario of using cap space and allocating all of it to the 35-year-old Lowry:

1. The Heat — which doesn’t have a pick in July’s draft — would be left with a huge hole at power forward and could fill it only through trades, the $4.9 million room exception or minimum contracts.

2. Lowry suggested last month that he wants a multiyear deal, noting that “money talks, and years talk. … At the end of the day, I want to make sure my family is taken care of for generations.”

The question is whether the Heat is willing to offer a guaranteed second season, further clogging its cap during a 2022 offseason that could feature a loaded free agent class (Bradley Beal, Kevin Durant, Kyrie Irving, James Harden and others).

On the flip side, Lowry -- if signed to a two-year guaranteed deal -- also could be used to facilitate a sign-and-trade for a star in 2022. For example, if Brooklyn doesn’t win a title and Irving or Harden wants to come here in 2022 and the Heat doesn’t have cap space, Miami could offer Lowry, Robinson (if re-signed) and a first-round pick and more to Brooklyn in a sign-and-trade.

One other point on Lowry: Though he would figure to take a deal in the $25 million range, $21 million might not be enough to lure him.

Whatever $20-(million)-something cap space the Heat carries, it wouldn’t be nearly enough to lure the Clippers’ Kawhi Leonard, whose first year max salary would be $40 million. Leonard is expected to re-sign with the Clippers, according to ESPN and The Athletic. So if he very surprisingly chooses to join the Heat, it would very likely need to come through a sign-and-trade.

Other options with most of that cap space, beyond Lowry, would include San Antonio’s DeMar DeRozan (not particularly likely for Miami because it would leave the Heat with three stars without a consistent three-point game), Utah point guard Mike Conley (averaged 16.2 points and shot 41.2 percent on three pointers), swingman Norman Powell (averaged 17 points and shot 36.1 percent on threes but Portland wants to re-sign him) and Nets point guard Spencer Dinwiddie (on the cusp of being an All Star before his knee injury but not a skilled three-point shooter).

The problem is all four of those are wing players, and the Heat has a glaring need for a stretch four to play alongside Adebayo.

If the Heat operates as a room team, Miami also could split the $20.5 million to $27.5 million between more than one player from an unrestricted free agent group including:

Bobby Portis, Andre Drummond, Kelly Oubre, Torrey Craig, Doug McDermott, Josh Richardson, Tim Hardaway Jr., Evan Fournier, Daniel Theis...

Derrick Rose, Jeff Green, Blake Griffin, Serge Ibaka, Montrezl Harrell, Denis Schroder, Rudy Gay...

JJ Redick, Danny Green, Richaun Holmes, Semi Ojeleye, Kent Bazemore, Enes Kanter...

Reggie Bullock, Otto Porter, Gary Trent Jr., Georges Niang, Nerlens Noel, Kevon Looney..

Reggie Jackson, Nik Batum, Cameron Payne, Patrick Patterson, Paul Millsap, Carmelo Anthony, Trey Lyles ...

Patty Mills, Austin Rivers, Kelly Olynyk (return unlikely), potentially Justise Winslow if his $13 million team option is declined by Memphis (return unlikely)...

Bryn Forbes, Dwight Howard, TJ McConnell, PJ Tucker, Doug McDermott, Alec Burks and Markieff Morris.

Of that group, Portis might be the best among stretch four options if Erik Spoelstra continues to feel strongly about playing a power forward with three-point range alongside Adebayo. (There’s also Atlanta’s excellent power forward John Collins, who’s a restricted free agent; we’ll get to him in a minute.)

The 6-10 Portis, who would have been open to Heat overtures last November if Miami had made an offer, had a career year (11.4 points, 7.1 rebounds, 47.1 percent on threes). He has the range, athleticism and defensive acumen that would be helpful paired with Adebayo.

A case could be made for Otto Porter, 6-8, who has averaged 10.9 points and shot 40.2 percent on threes in his career. But he has battled injuries recently and has averaged only 5.0 rebounds per game in his career.

The 6-8 Jeff Green has some appeal and has an offseason home in Miami. He averaged 11.0 points and shot 41.1 percent on threes this season and can play every frontcourt position but is 34 and has averaged just 4.4 rebounds in his career. He has been sidelined in this Nets-Bucks series with an injury.

Morris — the less productive of the two Morris siblings — saw his three-point shooting sink to 31.1 percent with the Lakers this season, making him less appealing.

Miami could trade a guard (Nunn as part of a sign-and-trade or Herro) for a power forward in this Lowry scenario.

One downside to using cap space: If you operate as a room team — instead of as an over-the-cap team — you cannot use the $3.6 million biannual exception and your mid-level exception is $4.9 million, not $9.5 million.

Only having $5 million of exception money available would limit Miami’s ability to find a starting power forward if it uses all of its cap space on Lowry.

Perhaps you could get well-past-their-prime Griffin or Millsap or Gay or Tucker at $4.9 million in this scenario; all will be unrestricted free agents. All would be the type of stretch fours that the Heat likes to play with Adebayo, but all are stopgaps.

In this scenario of spending all your cap space on Lowry and finding a power forward with exception money, Lyles (35 percent on threes for Spurs); Mike Muscala (9.0 points, 37 percent on threes for OKC) and Niang would be other options. Niang shot 42.5 percent on threes for Utah this season, averaging 6.9 points and 2.4 rebounds and 16.0 minutes in 72 games and 10 starts.

The Heat also could offer a $2.4 million minimum deal to Dewayne Dedmon to return as a backup center - paired occasionally with Adebayo - but that might not be enough.

So in this scenario, with the Heat operating as a room team, Miami could have Butler, Adebayo, Robinson, Herro, Achiuwa, Okpala, Lowry and potentially Ariza and Dedmon if they take minimum deals, plus a power rotation player at the $4.9 million room exception.

Miami instead could offer that $4.9 million room exception to Victor Oladipo (likely not enough to keep him) or Goran Dragic, but both assuredly will want more. Oladipo, off major quad surgery, hopes to be ready for court work by November and to play in a game in December or January, but that’s far from certain.

And keep in mind the Heat cannot exceed the cap to keep Oladipo and Dragic if it operates as a room team.

So unless the Heat uses some of its cap space on Oladipo or Dragic, that $4.9 million would be the most the Heat can offer either if it chooses to operate as a room team. And that makes a Dragic or Oladipo return much less likely in this use-all-your-cap-space-on-Lowry scenario.

Clearing out the $27.5 million in space and using that space on several players (say Portis, Porter, Oladipo, Dragic) would be another option, but signing any to guaranteed money beyond one season comes at the cost of less flexibility in the summer of 2022.

One final option if Miami operates as a room team: The Heat could use all of its space to sign a restricted free agent to an offer sheet, with Atlanta’s Collins the most viable of those options after a season in which he averaged 17.6 points, 7.4 rebounds and shot 39.9 percent on threes.

The Heat could carve out room for a max contract for Collins if it chooses and sign him to an offer sheet, hoping the Hawks would not match. But that strategy seems senseless because it’s expected the Hawks would match any offer sheet instead of losing Collins for nothing.

The Collins scenario for Miami can’t be ruled out but doesn’t seem especially likely. Beyond the question of whether he warrants a max contract, a sign-and-trade likely would be needed because the Hawks - if they don’t keep Collins - aren’t going to lose an asset for nothing in return.

Bulls restricted free agent Lauri Markkanen (13.6 points, 5.3 rebounds, 40.2 percent on threes) would be another option, though his deficient defense might not make him a good fit for the Heat organization. Pelicans point guard Lonzo Ball would be the third restricted free agent who could warrant Heat interest, but that too realistically would require a sign-and-trade.

NEWS NOTE

On the agenda for a Miami-Dade County commission meeting next Tuesday: A resolution to co-designate a portion of Northeast 7th St. from Biscayne Blvd to Northeast 2nd Ave. as “Dwyane Wade Boulevard.”

Wade, who lives in Southern California, recently agreed to sell his Miami Beach mansion for $22 million, according to the Wall Street Journal. The home includes a boat dock and a Heat-themed basketball court.

Wade, now a part-owner of the Utah Jazz, would join Dan Marino and Don Shula as sports icons with names on streets in South Florida. Jose Canseco’s name previously was removed from a Miami street.

Coming Thursday: Examining the Heat’s options if it bypasses using cap space. This is part 1 of a 4-part series on how the Heat can improve.

Here’s my Wednesday piece on the NBA fining Heat president Pat Riley.

Here’s my Wednesday Miami Marlins 6-pack.

Here’s my Wednesday Miami Dolphins piece.