The celebrated Nikola Jokić, recipient of three MVP awards, attained the eligibility mark for a contract extension with the Denver Nuggets this past Tuesday. However, sources indicate that Jokić has communicated his intention to defer signing until 2026, reports suggest.
According to reports, the Denver Nuggets’ innovative management structure — spearheaded by executive vice presidents Ben Tenzer and Jonathan Wallace — presented multiple potential agreements to Jokić’s representatives, but were not caught off guard by the ultimate choice. Waiting presents an opportunity for Jokić to obtain a far more financially advantageous deal.
Here’s an examination of the considerations influencing Jokić’s decision to postpone extension talks, along with the subsequent consequences for the Nuggets as they aim for another championship journey in the wake of consecutive second-round playoff eliminations.
Why is Jokić waiting on an extension?
Jokić, now 30 years of age, finalized a lucrative five-year contract with the Nuggets in 2022, amounting to $270 million. This contract remains enforceable through the 2027-28 season. Factoring in his player option for the contract’s concluding year, Jokić’s earliest opportunity to explore free agency arises in 2027. While this remains some time away, evaluating the future with a player of such prominence is always an essential consideration.
Effective Tuesday, Jokić could have signed a three-year extension, valued at $212 million. However, delaying until the next summer allows him the chance to secure a four-year extension, potentially reaching approximately $293 million. This equates to an $81 million surplus, alongside the advantage of an additional year of contractual stability.
While the Nuggets would have eagerly welcomed an immediate extension with Jokić, they reportedly anticipated his inclination to postpone.
“We are absolutely set to present it,” team president Josh Kroenke commented this past June. “However, whether he will accept remains uncertain, because we plan to explain all financial facets pertaining to signing promptly versus waiting. In the spirit of transparency, we will proceed in this manner, as we always do. Ultimately, he will choose the course of action that serves him and his family best, and he will have our full backing.”
What does this mean for the Nuggets?
Regarding the immediate season, the impact is minimal. Jokić is bound by his existing contract, and the Nuggets are optimistic about contending for a title after a summer season characterized by adjustments, including a Michael Porter Jr. trade for Cameron Johnson. This scenario holds true whether or not an extension was signed this year.
In a long-term context, the ramifications hinge on Jokić’s enduring commitment to the Nuggets.
Provided that Jokić intends to sign an extension eventually, the timing is of secondary consequence. An immediate signing would have nullified his player option for 2027-28 and added three years at $212 million. Conversely, waiting until the subsequent year to sign would cancel the 2027-28 player option while adding four years at $293 million.
The latter arrangement entails a more considerable overall financial outlay for the Nuggets, though the cost per year remains relatively consistent. Preserving Jokić’s tenure, irrespective of the associated expense, remains a valuable endeavor.
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If Jokić’s hesitance signals reservations about his long-term commitment to Denver, this raises more complex challenges. However, currently, there appears to be no cause for concern that the decision is rooted in anything other than financial prudence. Jokić has frequently expressed his fondness for the city and has reportedly conveyed satisfaction with the team’s summer acquisitions, according to comments from Brian Windhorst.
Alongside the recruitment of Johnson, the Nuggets re-signed Bruce Brown, an instrumental player on their 2023 championship-winning roster, acquired Tim Hardaway Jr., and orchestrated a trade for Jonas Valanciunas. Although Valanciunas might eventually return to playing in Europe, the Nuggets now possess a more robust and versatile team compared to the previous season. Last season, despite their depth challenges, they managed to secure 50 wins and push the eventual champion Oklahoma City Thunder to a seven-game series in the second round of the playoffs.
What have the Nuggets said about Jokić’s future?
During a press briefing conducted in June, Kroenke acknowledged the intention to present Jokić with an extension immediately. However, his statements were subsequently overshadowed by an unconventional response, wherein he spontaneously addressed a hypothetical scenario involving a possible trade of Jokić.
“Speaking from an organizational perspective, venturing into that second apron is not a daunting prospect for us. However, the attendant rules require careful consideration, particularly concerning our history of injuries,” Kroenke clarified in response to inquiries regarding the impact of the second apron on team composition and financial flexibility. “An ill-timed injury could precipitate a situation that I am unwilling to entertain, namely trading No. 15. Therefore, we are approaching this matter with caution, seeking to provide the resources we can at the appropriate juncture. While I am not entirely sure whether that second apron constitutes a hard cap, it is a critical consideration for all teams going forward.”
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In retrospect, Kroenke’s unexpected mention of a potential trade involving Jokić remains perplexing. While such a scenario is improbable, the reasoning behind raising it remains unclear.
Presently, the Nuggets’ primary goal centers around ensuring Jokić’s long-term presence and securing another NBA championship.
“We must exercise vigilance concerning the margins. Our approach requires deliberate planning. The moment is now,” Wallace emphasized preceding the 2025 NBA Draft. “[Nikola Jokić] is undeniably a generational talent, elevating the play of those around him significantly. Our focus lies on augmenting our shooting capabilities and mitigating defensive vulnerabilities. We anticipate growth from our younger players and will explore external options to maximize our potential.”
This summer, the Nuggets’ management has taken significant steps by acquiring Johnson, Brown, Hardaway, and, assuming the plans materialize, Valančiūnas. It is widely expected that Jokić will contribute effectively once the new season begins. However, the potential of claiming another Larry O’Brien trophy remains uncertain.
