Risks and benefits of the Henrik Lundqvist contract

Photo: Willens/AP

Photo: Willens/AP

In case you missed it, and I doubt you did, the Rangers re-signed Henrik Lundqvist to a massive seven-year, $59.5 million ($8.5 million cap hit) contract extension yesterday. It is a long commitment to the best goalie in the world. It’s also a contract that makes him the highest paid goalie in history (not counting Roberto Luongo’s contract, which was for a much longer term). The contract represents a clear message: This team is committed to winning, and is also committed to keeping their franchise players in New York for the foreseeable future. Naturally, there are a lot of pros and cons of the contract, so let’s get into them.

Pros

  1. The contract is only a $1.7 million (approximately 25%) raise on his current deal. With the cap expected to hit $70 million next season (10% increase), the cap hit only represents 12% of next year’s cap, compared to 10% now. The 2% increase is well worth it to keep Hank around. The interesting part is when you start combining goalie salaries. Martin Biron (pre-retirement) was slated to make $1.3 million, for a combined total of $8.175 million this season (12.7% of the $64.3 million cap). Next year with Hank’s contract and Cam Talbot’s $562,500 contract ($9 million total) is only 12.9% of the $70 million cap. The numbers actually remain the same in terms of dollars spent on goaltending.
  2. Hank’s contract does not qualify for the cap recapture penalty. The penalty was in place to penalize back-diving contracts, like that of Brad Richards, in case the player retired before the contract expired. The clause, known as the Roberto Luongo Rule, is in place to penalize teams in ownership of contracts that receive a cap advantage (Brad Richards). Hank’s contract doesn’t back-dive enough to qualify, plus it’s hard to argue that the Rangers received a cap benefit by making Hank the highest paid goalie in the league by 20%.
  3. The contract structure ($11m, $10m, $9.5m, $9m, $7.5m, $7m, $5.5m) means Hank gets most of his money ($39.5m) in those first four seasons. An early retirement (if his game goes the way of the do-do by the time he’s 38) means he doesn’t forfeit much money. That’s smart planning by both sides.
  4. This is a move that shows the Rangers are in win-now mode, which should make a lot of people happy. Given the current roster structure, the assumption is that New York has until –probably– the fourth year of this extension to win a Cup. They may take a hit for it later with the cap, but this is a team that is designed to win now. Locking up Hank just ensures they remain Cup contenders.
  5. He’s Henrik Freaking Lundqvist. Could you imagine him playing anywhere else?

Cons

  1. The King will be 39 years old when this contract hits its final year (40 when it expires). Naturally, the concern here is with performance as the Hank ages. The first four years shouldn’t really be an issue, but once Hank turns 37 or 38, we could see a decline in his play. This is especially true since Hank plays so deep in his net and relies almost entirely on his other-worldly reflexes to stop pucks. As he ages, those reflexes could be slower.
  2. Hank’s $8.5 million cap hit is $1.5 million higher than the next two highest paid goalies (Pekka Rinne, Tuukka Rask). Since the extension came midseason, it’s clear the Rangers were the only ones at the table, but did they overpay a bit? Is Hank work a 20% increase in pay over Rinne or Rask? Where else could he have gone? The Islanders were the only realistic option (big town, no big move required, new arena, cap space). This contract really represents what Hank would get on the open market as a UFA.
  3. The contract does have a no-movement clause. Even if it is Hank, those are always a risky proposition.

There really isn’t much downside to the contract, at least in my humble opinion. The Rangers ensured they treated their star right, giving him the money he deserves, while avoiding that dreaded eighth year. The pros outweigh the cons, and while the sixth and seventh years may be tough to watch, a Cup in those first four years will make it easier to deal with. This is a win-now move, and it’s tough to really be upset with the deal.

13 Responses to “Risks and benefits of the Henrik Lundqvist contract”

  1. Craig says:

    Really risky move with that long a contract. These deals usually turns sour (Devils Broduer exception) because of decline in skill or injury. You mean to tell me,in all those years to comes, the Rangers wouldn’t be able to find a quality goalie? Look at the Devils signing Snyder, a very good goalie.
    Seems to me the money could have gone for other areas needed and Hank would have brought us a good package in a trade

    • Rangers Fan in Boston says:

      *Schneider was a trade…for a top 10 draft pick. Not cheap by any means.

      The Rangers could have risked letting Henrik walk, but unless Talbot is/was the answer, there’s no guarantee they could have found a suitable replacement.

    • Dave says:

      Elite goalies are almost impossible to come by. Most have a few hot years. Hank is in the Brodeur mold of consistently elite for years upon years.

  2. Walt says:

    The contract was needed if we are indeed going to compete for the next few years. Hank’s abilities will decline some with time, but in the short term, we should be solid. Also, I believe that if Hank’s skills do decline, he would walk away before he embarresses himelf, that is the reason the contract was structured the way it was.

    All indications are that the cap increases next season, and there should be enough money to sign the key players that are UFA, Callie, Brass, not sure I’d put much more into Girardi. There should be enough left over to pay the kids like Kreider, coming off of an ELC, with a nice raise, and need be, bring in a sniper from the UFA market.

    The move was a good one, Slats has a way of doing these things, and he should look good at the end of the day!!

  3. Bloomer says:

    Hank will become the highest paid goalie in the history of the NHL and has never won a Stanley Cup. His new contract is over the top and as Craig said- the money is needed to go in other areas to improve the team. They already have Rick Nash’s monster contract on the books and now they have vastly overpaid for their goalie.

    The team has structured their payroll into win now mode, but those wins are not coming often enough. Hockey is not baseball. Big names on the back of hockey jerseys of past legend’s don’t mean dilly squat. To win a championship you need depth. Although not surprised, I find it disappointing that this franchise still doesn’t get the team concept. Now and for years to come, the Rangers will be nothing more then a average team playing in a below average Metropolitan division.

  4. George says:

    He could of gotten more if he hit UFA. There’s was a chance the islanders could of signed him, so I’ve heard. It’s best for both sides and with a higher cap next season, I feel Cally and Girardi can still be resigned as well as all the RFA’s.

  5. SalMerc says:

    With the contracts we have with Nash, Richards and now Hank, the team has no choice but to seek valuable minutes from low priced (read rookies/young)players. Team management wants to win now, but I fear this is a similar strategy that the Yankees took a few years back. They did win, but now have many overpaid, older stars. If 30% (or more) of our team salary comes from 3 players, we need to get them to produce more AND groom our younger players to become more valuable. To me, this makes the “nice-to-have” players (Boyle, Pyatt, Polion, Moore) more expendable.

    • Walt says:

      Sal

      Don’t forget that Richards will be a buy out at the end of the season. He started out like a gang buster, but now is showing he is a flash in the pan, and should not be kept, based on his ice performance!!

      • SalMerc says:

        Anything is possible. Until it happens, he is still a high percentage of the salary budget. 2014-15 may be around the corner, but many said he would be bought out this year as well.

      • Scully says:

        Lol I always agree with almost everything you say Walt except our differences with Brad Richards. He’ll be gone next year no matter what I agree, which would have happened even if he scored 50 goals this year.

        I also agree with your earlier comment about Hank’s contract. Is it a slight overpay? Ehh maybe, but I think it’s actually a really team friendly deal and a necessary one. He was going to get that from SOMEONE, it had to be us. If we let him walk all these naysayers would turn into complainers about how we now don’t have a star goalie to help cover up other issues on ice. Talbot looks good, but let’s not forget the last 9 years as we convince ourselves that Hank’s 2.5 GAA and .917 Save percentage are him falling off a cliff. Also, Talbot is 27, so while he’s a rookie… he’s no rookie, hence his good play making even more sense. At worst he could be an awesome trade chip to get us depth to win a cup.

        Good contract, we’ll have more cap room than people realize… and we got the King. Lest we all forget Henrik is our king, not the Red Wings’, the Avalanche’s, The Islanders’ or any other damn team out there.

        LGR! Let’s fatten up in the win department at home this month boys!

        • Walt says:

          Scully

          My man, you are not alone with your thoughts about BR, and so be it. I do believe that BR is going to be gone, and some will miss him, while others will be glad, but his cap hit, and decline are going against him. It’s not anything personnal against BR, he has been a good team mate, worked well with Step, and some of the other young guys, but the cap hit is the main reason he will be history.

  6. Ray says:

    If Talbot surpasses, equals, or nearly equals Lundqvist, this is a mistake. Otherwise, it’s probably a shrewd move. And I think most of us would bet on the otherwise.