Heat’s Tyler Herro on trade rumors, extension talk: ‘This is what comes with the business’

As Miami Heat guard Tyler Herro prepares for his fourth NBA season, he spent time Tuesday afternoon helping children prepare for another school year.

All the while, Herro continues to work through an offseason filled with uncertainty surrounding his future in Miami. There have been endless trade rumors involving his name and also a looming deadline to sign a contract extension with the Heat.

“I mean, every summer, that’s just what it is,” Herro said Tuesday as his foundation, the T. Herro Foundation, teamed up with the Heat to award nine Heat Academy students each with a $500 gift card to use on a back-to-school shopping spree at Target located at Dadeland Station in Miami. “I mean ever since I’ve been here, my name has been in rumors. So rumors, they don’t bother me. Whether I’m on the Heat or somewhere else, I’m getting ready for the season.”

As a young player with All-Star potential, Herro is at the center of nearly every hypothetical Heat trade offer for a star. This offseason those rumors involving Herro have been connected to the Heat’s pursuit of Brooklyn Nets forward Kevin Durant and Utah Jazz guard Donovan Mitchell.

Then there’s the fact that Herro, who will earn $5.7 million this upcoming season in the final year of his rookie deal, is eligible this offseason to sign a contract extension worth as much as $188 million over five seasons with a first-year salary (2023-24) of $32.5 million. He can sign for five years — instead of four — only if he gets a max contract.

It seems like a clear-cut decision for the Heat to strike a deal with Herro, a 22-year-old rising star, on an extension prior to the mid-October deadline (the final day before the start of the regular season) to reach an agreement. If an extension isn’t agreed to, he will become a restricted free agent in the summer of 2023.

The issue is that if Herro signs an extension with the Heat, he would essentially be untradeable until the 2023 offseason.

“I mean, I know as much as you know,” Herro said when asked where negotiations stand surrounding a potential extension with the Heat. “I’m just waiting on my turn and we’ll see what happens. There’s a deadline, but I’m going to let my agent take care of that and see what happens.”

First-round picks (Herro was a first-round pick in 2019) who receive extensions before their fourth NBA seasons are subject to the “Poison Pill Provision,” which would make it difficult for the Heat to include Herro in a trade until July 1, 2023.

This provision means when that player is traded between the date the extension is signed and the date it takes effect, the player’s trade value for the receiving team is the average of the salaries in the last year of their rookie scale contract and each year of their extension. But the outgoing salary in the trade for the sending team is the players’ actual salary for that season in the last year of their rookie scale deal.

Recent history with players of or close to Herro’s caliber entering their extension window indicates his extension could fall in the range a four-year contract worth around $25 million per season. Jaylen Brown signed a four-year, $107 million extension with the Boston Celtics in the 2019 offseason and Mikal Bridges signed a four-year, $90 million extension with the Phoenix Suns last offseason.

So if Herro hypothetically signs a four-year extension worth $104 million, the acquiring team would take him in at about $22 million for salary-matching purposes in a trade while the Heat would send him out at his $5.7 million salary for this upcoming season because of the “Poison Pill Provision.”

The discrepancy between his incoming salary and outgoing salary for salary-matching purposes would be so wide that both teams would need to add a large amount of additional salary to the transaction or a third team would need to be brought in to absorb some of the excess salary to have any chance of completing the deal.

The bottom line is it would be very hard for the Heat to trade Herro for the entirety of this upcoming season if he signed an extension.

On top of all that, Herro has made it known that he wants to be a full-time starter this upcoming season. He started in just 33 of the 175 regular-season games he appeared in during his first three NBA seasons.

Herro closed last regular season as the Heat’s second-leading scorer with a career-high 20.7 points per game in a bench role to become the first player in franchise history to win the NBA’s Sixth Man of the Year award. Herro did it while shooting a career-best 44.7 percent from the field and 39.9 percent from three-point range, while averaging a career-high four assists in his third NBA season.

“Just trying to add more weight again,” Herro said of his focus in offseason workouts this summer. “Get stronger, get better on defense and continue to do what I do on offense.”

Because signing Herro to an extension would clearly limit Miami’s trade options, the expectation is the Heat will wait until closer to the deadline before making that type of commitment to keep its options open as long as possible, especially with the Durant and Mitchell situations still unresolved.

Or the Heat could pass on signing Herro to an extension altogether this offseason to keep him available as one of its top trade chips in case another star becomes available in the next 11 months.

“As you get older and more years in the league, you realize this is what comes with the business,” Herro said. “You could be in one city one day, the next city the next day. But at the end of the day, it’s about me and getting better every single day in the summer. Like I said, whatever team I’m on, I’m ready to play.”

But Tuesday wasn’t about Herro. It was about helping others ahead of a new school year.

“It’s truly amazing just to see all these kids, these families have smiles on their faces,” Herro said. “We do this event ever year. Back to school, just want to be able to give back and make sure these kids are set for the entire school year.”