Why Khris Middleton’s return to the Wizards turned into a six-team NBA trade

On Tuesday night, reports came in that Khris Middleton will return to the Washington Wizards on a three-year, $17.6 million deal. Good news that doesn’t mean anything. A player and team that have spent a year or more together decide they liked the experience enough to reunite. It seems straightforward enough. Then comes the following: the sign-and-trade will be wrapped up in a six-team deal with 10 players in total and one-fifth of the NBA’s teams.

Wait… what? It feels like we skipped a few steps here. How does the Middleton sign-and-trade turn into a six-way deal? Yes, such maneuvers are actually quite common this time of year. Parties tend to combine several agreed transactions into a single, larger multi-party transaction for procedural purposes only as it relates to the rate of pay.

First things first, who is involved in this besides Middleton? Below are the 10 players involved in the deal, where they started and where they’re going:

If you’ve been following the NBA career cycle, you’ll know that some of these moves have all been independently reported. The Stewart-to-Memphis trade reached the second round of the NBA Draft. The move for Collins and Aldama was initially reported as an individual transaction. But all of these deals took place before or during the July moratorium, when transactions cannot be made official. That leaves parties time to figure out how to structure their transactions in the most beneficial ways possible.

So, why were all these measures restructured into a six-party agreement? Because doing so gives granular cap benefits to everyone involved. That said, let’s go through each group in the agreement and explain why it’s structured this way:

Washington Wizards

The Wizards could have signed Middleton out of their mid-level. However, they entered July 8 with a total trade of $13.4 million that expired on Wednesday. Since the trade option includes a $250,000 buffer, it allowed the Wizards to grab both Deandre Ayton (at $8.1 million) by separate agreement then Middleton ($5.6 million) on top of him and the rest. Therefore, by structuring this agreement as a trademark, they preserve their full mid-level distinction for future use.

Your mid-level variant availability means little if you can’t use it. Had the Wizards not cleared any salary, they would have been looking at only about $5 million in cap space below the luxury tax line without open roster spots. So they went into Memphis to take Russell for a second round pick. Now the Wizards have a cap space open and about $11 million in room under the tax line to add to it.

The Memphis Grizzlies

The Grizzlies have $28 million in trade capital for Jaren Jackson Jr. in Jazz. However, with the Grizzlies operating under the first cap this season, they have access to an additional $9.1 million in cap space coming into the 2023 CBA. That meant they could use Aldama’s $17 million to match Stewart’s $15 million, Russell’s $6 million and Johnson’s $3.2 million, saving Jackson a big deal if they need it. Getting options to take from Russell is just a nice bonus.

Milwaukee Bucks

The Buckeyes are in the same boat as the Grizzlies. They could use Prince and Harris to match up to LeVert, preserving their unique midfield. Like the Grizzlies, they got a pick worth taking on LeVert, but LeVert is a useful NBA player they could move down the line.

The Detroit Pistons

The Pistons are paying Collins above average. They had the cap space to do that. However, because the salary gap between Collins and LeVert is less than $9.1 million, the Pistons can use LeVert to match Collins’ salary. This, in turn, allows them to generate two new trade variants: one for $15 million by sending Stewart to Memphis and another for $5.2 million by sending Sasser to Dallas.

By staying over the cap, the Pistons can keep the Bird Rights to Kevin Huerter, who they previously agreed to re-sign, and keep their own mid-level exception, which they used to acquire Isaiah Joe from the Oklahoma City Thunder. The only catch is that all of this forces them to shut down the starting quarterback, a situation that would be difficult to be in when Jalen Duren is sitting in restricted free agency. However, teams other than the Pistons could offer him about $41 million next season, while the Pistons have about $56 million in cap room to work with. With that in mind, doing all this does not risk losing him. If anything, it makes paying him more fun since they’ve cut the extra salary off their books.

Los Angeles Clippers

For the Clippers, the equation is simple. If possible, teams that lose free agents almost always prefer to structure those losses as sign-and-trade because doing so creates an exception to the new salary of the player in question. The exception for the Clippers was losing Collins for nothing. Instead, they receive not only that exception in the trade, but a second round pick from Detroit.

Dallas Mavericks

By signing and trading Middleton out, the Mavericks could combine him with Johnson to match the cost of Aldama’s acquisition. That allows them to preserve both their mid-range exception and the $20.3 million trade exception they created by dealing Anthony Davis in February. The Sasser’s will go into their own unique twice a year.

Parties want any profit they can get

Is it possible for all of these players to meet with all of their new teams without a six-team trade? The answer is yes. But NBA teams hire cap strategists for this reason. If there is a small profit to be made from turning a two-party trade into a six-party trade, they usually will.

Even if that benefit is as small as saving a different trade or creating another, every little edge counts toward this cap space.

That’s why, every July around this time, you hear about a series of small steps rolling into several big ones.