Risks and benefits of the Henrik Lundqvist contract

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.