Islanders: Breaking down Mathew Barzal three extension

The deal is done. The New York Islanders have re-signed Mathew Barzal to a three-year extension. Here’s how that deal is structured and what the means.

The New York Islanders did what most of us thought would happen. They re-signed RFA center Mathew Barzal to a three-year extension that carries a $7 million AAV.

While the negotiations dragged on a little longer than Islanders fans would have liked, it was never in doubt that they would re-sign Barzal before the start of the 2021 season. With Barzal under contract, he can participate in the remainder of the Isles training camp.

Aside from the team-friendly average annual value, here’s what else can we take away from what we know about Barzal’s three-year extension.

So Close

When I tried to predict what Mathew Barzal would sign a month ago I based myself on what Mikhail Sergachev had just signed with the Tampa Bay Lightning. Sergachev, just like Barzal, was a premier RFA and top player at his position on a cap-strapped team.

Here’s what I thought Barzal would get based on the structure of Sergachev’s deal:

• Year 1: $4.5 million ($3 million signing bonus, $1.5 million salary)
• Year 2: $7 million ($3 million signing bonus, $4.5 million salary)
• Year 3: $9 million  (all salary)
• Total: $21 million and $7 million AAV

The structure of this deal would allow the Islanders to keep the AAV low ($7 million) but also allow Barzal to get that $9 to $10 million salary he wants in just three years’ time. It also allows the Islanders to keep Barzal as an RFA at the end of this three-year contract.

Now, we don’t know the full breakdown of signing bonus and salary for Barzal’s deal just yet, but we do know the breakdown year-over-year total salary for his deal.

Based on TSN’s Darren Dreger, Barzal’s extension is broken-down like so:

• Year 1: $4 million ($1 million signing bonus, $3 million salary)
• Year 2: $7 million
• Year 3: $10 million
• Total: $21 million ($7 million AAV)

Looks familiar, eh?

So what does that mean for the Islanders now?

Room to Breathe

Well, first it gives them a bit of room to breathe. According to CapFriendly, the Isles have an $84.594 million cap hit after Barzal’s $7 million deal. That doesn’t count any cap freeing measures Lou Lamoriello can use.

Like using some (or all) of Johnny Boychuk‘s $6 million AAV as LTIR space or gaining $1.075 million from placing guys like Leo Komarov, Andrew Ladd, and Thomas Hickey in the AHL or on the taxi squad.

Just by placing all three of those players in the AHL, the Islanders can free up $3.225 million. That would lower the Isles from $3.094 million over the cap to $131,000 below the $81.5 million salary cap. And, again, that isn’t considering any of Johnny Boychuk’s contract as LTIR space.

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Once the contract is over, Barzal will be in line for a $10 million deal based on the structure of this extension. Will the Islanders be able to afford that? With only $28.5 million committed to the cap in 2023-24 it sure seems like it. And that’s assuming the cap stays flat at $81.5 million by then.

What happens with the NHL’s economics in three years is anyone guess. But what the pandemic has forced the NHL to do is diversify its revenue-making apparatus. The league is far too dependent on gate receipts and TV deals to make money and has taken steps this year to remedy that. So in three years’ time, they should have been able to recover from the pandemic, and we won’t have to worry about the Isles meeting Barzal at $10 million (or more).