Yahoo Sports reports that the Houston Rockets have elected to decline the option on Chandler Parsons' 2014-2015 season, making him a restricted free agent. The move means the Rockets will have the right to match any offer made for Parsons. Had they picked up the option for next season, Parsons would have become an unrestricted free agent, making retaining him more difficult.
For the Rockets, there are two distinct advantages to letting Parsons into restricted free agency now. First, Houston is determined to clear the necessary salary cap space this summer to chase a third maximum contract free agent to join Dwight Howard and James Harden, league sources tell Yahoo Sports.
Houston plans to pursue the major stars who could be available upon opting out of deals, including Miami's LeBron James and Chris Bosh, and New York's Carmelo Anthony, league sources said. Dallas' Dirk Nowitzki is expected to be a target too.
The Rockets are pursuing Minnesota's Kevin Love in trade talks too, and Parsons could hold sign-and-trade possibilities.
In one scenario, Houston could secure three max-out players – including Howard, Harden and a potential star free agent – and then re-sign Parsons to an extension below the max-level range. Parsons could command in the $12 million to $13 million annual range, league executives tell Yahoo Sports.
The Rockets have $53 million tied up in just Dwight Howard, James Harden, Omer Asik, and Jeremy Lin next season. So if they're going to make a serious run at a free agent this season, they're going to need to trade Asik and Lin, or some combination of other players.
The big key here is that if the Rockets are going to sign a big-name free agent, it needs to be this summer. You see, they can go over the cap to re-sign or match the offer for Parsons. So theoretically, if they were to trade Lin and Asik, freeing up $17 million in cap space, they could then sign a max free agent... and then re-sign Parsons, keeping all involved.
If they want to do a sign-and-trade with Parsons for someone like Kevin Love, that option exists as well.
But if they don't sign one this summer, even if they decline all options, their cap room for 2015-2016 would be a little over $40 million. Even if Parsons takes a huge discount at say, $9 million, that only provides roughly $14 million to sign a free agent based on cap estimates. If Parsons pulls an offer at $13 million a year, that only makes it tougher.
This move protects the Rockets from losing Parsons and opens up the possibility of making a big splash in the offseason should a free agent of that caliber come available. But it also speeds up their timetable to a degree. To put it another way: In 2015, if Parsons gets a $12 million per year offer, they'd have Howard, Harden, and Parsons locked in at $50 million, just for the three alone.
Either way, Daryl Morey and the Rockets are apparently not done with big moves.