Circle October 1 on your calendar, folks. That’s when we will find out just how committed the Miami Heat are to their apparent cap-space plan. It also happens to be the date when Tyler Herro can sign a three-year extension worth as much as $149.7 million
Through the way it has navigated the offseason and structured its books, Miami has made no secret of its intent to bag another superstar. As of now, the team could have over $90 million in cap space during the summer of 2027. That’s more than enough flexibility to make a ruckus on the trade and free-agency markets.
The thing is, this projection is based on Herro’s current contract coming off the books that offseason. Extending him at the full amount adds another $46.2 million to that tally. That more than halves the Heat’s forecasted flexibility.
We are about to find out how much Tyler Herro means to the Heat
Conventional wisdom dictates Miami pass on a Herro extension. This keeps him trade-eligible throughout the season—he cannot be dealt for six months if he signs a deal that increases his eventual salary by more than 20 percent—and allows both parties to revisit the matter next summer.
At the same time, stars are not leaving via free agency anymore. Cap space can facilitate trades, but you don’t see big names shipped out without taking back any money. So it isn’t clear how much the Heat’s cash-rich trajectory matters if they’ll need to deal for their next cornerstone.
Viewed through this lens, a Herro extension could make plenty of sense. The Heat may have to give him a four-year deal if they wait until next summer. Failing that, he could command loads more money if he plays out his contract, and hits the open market in 2027.
Having him locked up for multiple years, on a salary south of his free-agency max, also stands to increase his trade value. If he doesn’t sign an extension, he will be on an expiring contract during the 2027 offseason. Some sellers may appreciate the imminent cap relief. Others will fear losing him for nothing, or having to bankroll a new contract that far exceeds the extension amount he’s eligible to receive this October.
Miami is about to reveal everything about its future
Perhaps there’s a middle ground for the Heat to explore. Offering a three-year, $124.7 million extension keeps Herro trade-eligible this season, and also prevents him from reaching free agency in 2027.
Whether he goes for such a contract is an entirely separate matter. But the outcome of negotiations themselves doesn’t matter nearly as much as Miami’s approach to them.
Maxing out Herro implies that the Heat are committed to keeping him long term. Signing him for less suggests he’ll be part of the next big trade. Punting on an extension offer altogether proves they are all about cap space.
No matter what happens, we’ll know more, if not everything, about this team’s long-term approach because of it.