Rockets: Is Tilman Fertitta financially prepared for a John Wall buyout?

Houston Rockets GM Rafael Stone will be in store for a busy offseason, as the Rockets must decide whether to bring back soon-to-be free agents such as David Nwaba, Sterling Brown, and Armoni Brooks (to a lesser extent). The Rockets will also have to assess the trade market for Eric Gordon, which could be tricky to navigate, as he played well this season, averaging 17.8 points (his highest since 2017-18) on 57.7 percent true shooting, which is the third-best mark of his career.

However Gordon has battled health issues, which limited him to just 27 games and has kept him out of action since March 11th. But although those decisions will be important, they all pale in comparison to the Rockets’ situation with John Wall, the five-time All-Star and former All-NBA guard.

Wall will turn 31-years-old before the 2021-22 season kicks off, which would make him the elder statesman on a young Rockets team. At Wall’s age and at this stage of his career, he doesn’t exactly align with the Rockets’ timeline, and he’d certainly be tempted by the opportunity to join a contending team.

Trading Wall seems unlikely, as the Rockets would be forced to part with some of the draft capital they scrambled for this season just to offload Wall’s remaining $91.7 million. Including draft picks in a Wall trade could prevent the Rockets from packaging said draft picks to acquire a proven star, which the front office may be seeking to do.

Tad Brown talking to @RocketsPxP about the possibility of using that #Rockets stockpile of draft assets to go out and get a star player via trade.

— Ben DuBose (@BenDuBose) May 15, 2021

Granted, none of this is any knock against Wall, as he averaged 20.6 points (3rd-best of his career) and 6.9 assists, showing glimpses of the Wizards version of himself.

Furthermore, Wall has played better than anyone would have imagined, especially for someone that missed two years of action on the hardwood. In spite of that, $91.7 million is alot for a team to take on in salary.

For that reason, the Rockets’ best chance of getting rid of Wall this summer is via buyout. In fact, Tim MacMahon, who is ESPN’s beat writer for the Rockets, stated that the Rockets will eventually do just that, at some point in the future, during the most recent episode of The Hoop Collective.

“I think we all understand that it’s a matter of when, not if, the buyout talks heat up again.”

For Fertitta, such a move would do wonders for his reputation, in the eyes of many.

Next: How a buyout would help Fertitta

How a buyout would help Houston Rockets owner Tilman Fertitta

Buying out Wall’s contract will surely put an end to any narratives regarding Rockets owner Tilman Fertitta being cheap, which is the predominant school of thought regarding Fertitta. This was heightened after Chris Paul stated that the Rockets’ decision to let Trevor Ariza bolt in 2018 was the downfall of the Rockets, as many believe Fertitta could have prevented that by paying Ariza and going into the luxury tax (granted, Paul could have also made it possible by taking less than the 4-year deal worth $160 million that he took).

A quick scope of recent buy-outs shows why a Wall buyout would reverse Fertitta’s reputation, as it’s rare for players to give back much when they agree to buyouts. For example, Andre Drummond, who agreed to a buyout with the Cleveland Cavaliers this season, was in the final year of a $28.5 million deal and gave back just $794,536 to become an unrestricted free agent (roughly 3%).

Another recent buyout involves the recently-retired LaMarcus Aldridge, who was owed $24 million by the San Antonio Spurs this season, and agreed to give back $5.8 million (24%). These varying percentages provide proof of how buyouts are truly case-by-case.

Based on those percentages, Wall would be giving back just $2.75 million, if he were to go the route of Drummond, and $22.1 million if he were to be generous, like Aldridge. Both of those examples involve players in the final year of their deals, which is the common scenario for buyouts.

For a more accurate gauge of Wall’s situation, in which he’d be leaving multiple years on the table, we’d have to look at other examples.

Next: More relevant examples for Wall's situation

More relevant examples to Houston Rockets guard John Wall’s contract

Earlier this season, Blake Griffin agreed to a buyout with the Detroit Pistons, despite being owed $75 million through next season. Griffin gave back $13.3 million to the Pistons (18%) to become an unrestricted free agent, and later sign with the Brooklyn Nets.

Another recent example of a player taking a buyout with multiple years left on his deal is DeMarre Carroll, who was in the first year of his 3-year deal at the time of the buyout last season. Carroll gave back just $811, 447 of the $21 million he was signed to (roughly 4%).

As we can see, players don’t typically give back much in buyouts, and players also don’t generally agree to buyouts with multiple years left. And in the case of Wall, he’d practically have to agree to essentially deduct his scheduled $47 million player option to even make such a move possible this summer (which would be 52% of his remaining salary).

Why exactly would he do that when he likely won’t reach those annual figures again in his career? He’d have to desperately want out of Houston in order to give that up, and even that would be asking for alot.

Wall is represented by Rich Paul of Klutch Sports, who also represents LeBron James and Anthony Davis of the Los Angeles Lakers. Could a scenario emerge where Wall does give back $47 million to join the Lakers this summer?

He could possibly make a good portion of that money back in off-the-court endorsements in the Los Angeles market, so maybe that would tempt him, but even that is a reach. With that being said, a buyout this summer would likely mean the Rockets would have to pay Wall somewhere in the neighborhood of $70-85 million (based on the percentages of the aforementioned players).

In other words, Houston Rockets owner Tilman Fertitta needs to be prepared to pony up, if the Rockets do intend to go the route of buying out Wall this offseason.