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Report: Grizzlies owner Robert Pera signaling intent to spend big

Grizzlies owner Robert Pera

MEMPHIS, TN - AUGUST 1: Robert J. Pera of the Memphis Grizzlies addresses the media during a press conference introducing front office additions on August 1, 2014 at FedEx Forum in Memphis, Tennessee. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, user is consenting to the terms and conditions of the Getty Images License Agreement. Mandatory Copyright Notice: Copyright 2014 NBAE (Photo by Joe Murphy/NBAE via Getty Images)

NBAE via Getty Images

The Grizzlies exist in a blissful state.

They’re one of the NBA’s best teams with the league’s second-lowest payroll (ahead of only the tanking Thunder). Memphis has drafted well and ascended quickly with several key contributors still on their relatively cheap rookie-scale contracts.

The future could be blindingly bright. NBA salary-cap rules won’t break up this core. Teams can generally exceed the salary cap to keep their own players. If that player spent his last three seasons with the team (or moved only via trade), the team can typically pay any amount up to the max salary.

But there’s a catch: The team must still pay those contracts and, potentially, the resulting luxury tax.

If re-signing everyone, the Grizzlies could get quite expensive. Jaren Jackson Jr. already signed a four-year, $105 million contract extension that kicks in next season. Ja Morant is headed toward his own max, potentially super-max, extension. A solid supporting piece, Brandon Clarke will also be extension-eligible this offseason. Desmond Bane, who deserved All-Star consideration this year, will be up for an extension next year. If Ziaire Williams nears Memphis’ expectations, he’ll be due a large raise after that.

The Grizzlies could even open cap space this summer to sign a veteran before those young players’ raises kick in. Again, once players are on the team, there’s more latitude for keeping them than adding new players.

Brian Windhorst of ESPN:
The team has been sending signals it intends to be aggressive in retaining and acquiring talent, league sources say.

In conversations internally and with executives on other teams, the Grizzlies have been consistent with their message: When the time is right, Pera will spend what it takes.

Along the way, he paid to upgrade the Grizzlies’ facilities, spending millions renovating the locker room and expanding the training and weight rooms, and he deepened the team’s front office, scouting and medical departments. He almost never involves himself directly in league business, league and team sources say.

“He watches from a distance, but he’s very involved day-to-day and knows everything that’s going on,” says [Elliott] Perry, who is the Grizzlies’ alternate governor on the NBA board of governors. “He has trust in the people he’s put in place, and he stays out of their way.”

What an about-face in reputation for Pera, who’d previously been seen as both too distant and overbearing. Money goes a long way. Pera’s net worth, as estimated by Forbes, now ranks third among NBA owners:

  • Clippers’ Steve Ballmer ($69 billion)
  • Cavaliers’ Dan Gilbert ($52 billion)
  • Grizzlies’ Robert Pera ($18 billion)

We’ll see how much Pera actually spends. Just because he has the means doesn’t mean he’ll use them on his NBA team, especially if it’d cut into his profits. Signaling intent to pay to keep everyone increases players’ trade values – even if the actual plan is to deal some to mitigate costs. It can be an effective time to bluff. The salary cap could skyrocket in coming years, leaving even max contracts signed prior to the spike as bargains.

The most infamous case of a small-market team heading toward this situation: The Oklahoma City Thunder, who kept Kevin Durant, Russell Westbrook and Serge Ibaka but traded James Harden and, relatedly, never fulfilled their championship promise.

Less noticed: The Thunder spent into the stratosphere in Westbrook’s later years in Oklahoma City (with Paul George and, later, Carmelo Anthony). Those teams never advanced past the first round. Big spending doesn’t assure winning.

But it certainly helps. Especially when it means retaining a group that’s already succeeding.

With this report, Memphis has even more reason to believe in its future.