Victor Oladipo exercises player option, now on Heat books for $9.5 million next season

As expected, guard Victor Oladipo has decided to bypass free agency this summer.

Oladipo on Tuesday exercised the player option in the final season of his two-year contract with the Miami Heat, according to a league source. He opted into a salary of $9.5 million for next season.

Oladipo had until Thursday to decide on the player option. With Oladipo informing the Heat he’ll opt-in, he immediately becomes trade eligible.

This news was expected, as Oladipo is not in position to enter free agency after tearing the patellar tendon in his left knee in the first round of this year’s playoffs.

Oladipo, 31, won’t be ready for the start of the season, but the hope is he’ll return to game action as soon as early in 2024. He’s recovering from his third major knee surgery in just over four years.

Just before the unfortunate series of significant knee problems, Oladipo was voted to the NBA All-Star Game, NBA All-Defensive First Team and All-NBA Third Team in 2017-18 as a member of the Indiana Pacers. His first serious knee injury during this four-year stretch came when he ruptured the quadriceps tendon in his right knee in January 2019 with the Pacers.

This past regular season, Oladipo averaged 10.7 points and 3.5 assists per game while shooting 39.7 percent from the field and 33 percent on threes in 42 games (two starts).

Oladipo wasn’t in the Heat’s rotation at the end of the regular season, but he was pushed into a bigger role in the playoffs after starting guard Tyler Herro broke his right hand in the opening game of Miami’s playoff run. Oladipo scored 15 points in 26 minutes in Game 2 of that series and had eight points and two steals in 19 minutes in Game 3 before sustaining the knee injury late in that contest.

The Heat faces a salary cap crunch this summer and Oladipo’s opt-in only adds to the team’s expensive pay roll.

The Heat’s current salary-cap breakdown for next season now includes Jimmy Butler ($45.2 million), Bam Adebayo ($32.6 million), Kyle Lowry ($29.7 million), Herro ($27 million), Duncan Robinson ($18.2 million), Oladipo ($9.5 million), Caleb Martin ($6.8 million), Jaime Jaquez Jr. ($3.5 million), Nikola Jovic ($2.4 million), Haywood Highsmith ($1.9 million non-guaranteed salary).

The Heat has about $179.3 million committed to salaries for those 10 players, including “unlikely to be earned incentives” that raise Herro’s cap number for this upcoming season to $29.5 million. Highsmith’s full $1.9 million salary for next season becomes guaranteed if the Heat does not waive him before July 15.

With the 2023-24 salary cap projected to be set at $136 million, the projected luxury tax at $165 million, the projected first tax apron at $172 million and the projected second tax apron at $182.5 million, the Heat is already a luxury tax team and very close to crossing the newly-instituted and ultra-punitive second apron with roster spots still to fill for next season.

If the Heat crosses the second apron, as expected, it won’t be permitted to use the $5 million taxpayer midlevel exception that it would otherwise have at its disposal in previous years before the new salary-cap rules were established.

The Heat could create more flexibility under the second apron, and more flexibility to re-sign free agent guard Gabe Vincent, by using the waive-and-stretch provision on Oladipo and/or Lowry. Doing so on Oladipo would give the Heat $3.1 million cap hits each of the next three seasons instead of $9.5 million next season. Using that provision on Lowry would give the Heat $9.9 million cap hits each of the next three seasons instead of $29.7 million next season.

The deadline to use the waive and stretch provision is Aug. 31.

Since the Heat has no cap space and likely won’t have a midlevel exception because it’s expected to be above the second apron, the only realistic way for Miami to add outside talent this offseason is through a trade and/or with minimum contracts unless a move is made to change the salary-cap math.

Another option for the Heat this offseason is to leverage the Bird rights it holds for some of its own free agents to bring back most of last season’s roster that finished just three wins short of an NBA championship.

Miami’s own impending free agents include Vincent, Max Strus, Kevin Love, Omer Yurtseven and Cody Zeller.

The only remaining bookkeeping decision the Heat must make before the start of free agency has to do with Yurtseven. Miami has until Thursday to extend a $2.3 million qualifying offer to Yurtseven to make him a restricted free agent and retain the right to match outside offers to re-sign him.

Free agent negotiations across the NBA can begin on Friday at 6 p.m, with free-agent signings permitted to start on July 6 at noon.