Tyler Herro explains significance of extension: ‘I had a dream of getting paid by the Heat’

For the last few years, Tyler Herro has seemingly been at the center of endless trade rumors. After signing a lucrative extension on Sunday, Herro looks to now be at the center of the Miami Heat’s long-term plan.

Herro’s extension keeps him under contract with the Heat through the 2026-27 season. The four-year deal, which takes effect beginning in 2023-24 as he plays out the final year of his rookie deal this season, includes $120 million guaranteed and another $10 million in incentives with no player or team options.

“It’s a really good feeling,” Herro, 22, said following Monday night’s Red, White & Pink intrasquad scrimmage and ahead of Tuesday night’s preseason opener against the Minnesota Timberwolves at FTX Arena. “When I came here, I had a dream of getting paid by the Heat and being here for a while and bringing a championship here. We’ve come close, but we haven’t gotten there yet. To be locked in for the next five years means a lot to me because the goal is still to win a championship and we feel like we can do that.”

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The Heat had until Oct. 17 — the final day before the start of the regular season — to sign Herro to an extension. The two sides struck a deal two weeks ahead of that deadline instead of letting the date pass without an extension and having Herro become a restricted free agent next summer.

Herro, who became the first player in Heat history to win the NBA’s Sixth Man of the Year award last season, received a bigger extension than another talented member of the 2019 draft class. Wing RJ Barrett, who was drafted with the third overall pick, signed a four-year, $107 million extension that could be worth as much as much as $120 million with the New York Knicks this offseason and Herro, who was drafted with the 13th overall pick, signed a four-year, $120 million extension that could be worth as much as $130 million with the Heat.

“It was a number I couldn’t pass up,” Herro said. “It wasn’t worth going into restricted free agency. And at the end of the day, this is where I want to be. So like I said, it was a number I couldn’t pass up and this is where I want to be. So it made sense.”

The trade speculation involving Herro will likely end for now, as he’s essentially untradeable until the 2023 offseason after signing his extension with the Heat.

First-round picks who receive extensions before their fourth NBA seasons are subject to the “Poison Pill Provision,” which makes it difficult for the Heat to include Herro in a trade until July 1, 2023.

This provision means when that player is traded between the date the extension is signed and the date it takes effect, the player’s trade value for the receiving team is the average of the salaries in the last year of their rookie scale contract and each year of their extension. But the outgoing salary in the trade for the sending team is the players’ actual salary for that season in the last year of their rookie scale deal.

In this case with Herro’s four-year extension worth $120 million, the acquiring team would take him in at about $25 million for salary-matching purposes in a trade while the Heat would send him out at his $5.7 million salary for this upcoming season because of the “Poison Pill Provision.”

It would be very hard for the Heat to trade Herro for the entirety of this upcoming season if he signed an extension because the discrepancy between his incoming salary and outgoing salary for trade purposes would be so wide.

“It is gratifying for everybody involved. Everybody in our organization, for Tyler, his family, his representation,” Heat coach Erik Spoelstra said of Herro’s extension. “He has improved every single year and this is what we’re about, developing players and then hopefully trying to keep them in our program and to be able to take care of them and compensate them. His ceiling, we don’t know where it will be with the way he just continues to improve.

“I feel very similar about Tyler as to when we were able to extend Bam [Adebayo]. The really cool thing about is: Yes, they are the future, but they also are the present.”

Adebayo added: “It’s dope because I feel like [Herro] deserved it. He got his bread now. So it’s good to have him around for five more years. The future is bright for us.”

Herro hopes the pay raise is a sign the Heat views him as a starter. Since last season ended, he has made it very clear that he hopes to be moved into the starting lineup this season alongside the trio of Adebayo, Jimmy Butler and Kyle Lowry.

“I’m comfortable with that group. Obviously, it’s not going to look like midseason form right now if that is the unit that I’m in,” Herro said. “It’s going to take some adjusting. For me, playing off the ball will be a little different to start games if that is what happens. It’s an adjustment. We got a lot of good players on the team that can make each other better. At the end of the day, we’ll get better as the season goes on.”

When asked for his favorite reaction from a teammate to the extension, Herro pointed to a text message from Heat wing Caleb Martin.

“Caleb said I have to buy the whole team Rolexes now,” Herro said with a smile. “I shut that down quick, though. That was funny when he texted me that.”

Herro, who is entering his fourth NBA season, closed last regular season as the Heat’s second-leading scorer with a career-high 20.7 points per game in a bench role. He did it while shooting a career-best 44.7 percent from the field and 39.9 percent from three-point range, while averaging a career-high four assists in his third NBA season.

Herro’s production dipped this past postseason, as he averaged just 12.6 points while shooting 40.9 percent from the field and 22.9 percent from three-point range and 2.8 assists in the playoffs. A groin injury also forced Herro to miss part of the Eastern Conference finals.

That playoff disappointment motivated Herro this offseason.

“Tyler has really come a long way. It’s really a credit to his drive, his ambition,” Spoelstra said. “But his work ethic matches that and that’s what’s important. That’s what you’re excited about because he’ll continue to improve. As he gains more experience, he’ll continue to improve his skill set with the mindset of really using those skills to contribute to winning. That’s the exciting part.”

▪ Butler, Victor Oladipo and Gabe Vincent did not play in Tuesday’s preseason opener against the Timberwolves because of rest purposes.