Colorado Avalanche star Nathan MacKinnon signed the richest contract for the NHL salary cap era on Tuesday, agreeing to an eight-year contract extension worth $100.8 million. That’s an average annual value of $12.6 million for the 27-year-old center, higher than that of Edmonton Oilers star Connor McDavid or anyone else in the NHL.
It’s a contract that will have an impact on the Avalanche roster and future NHL contracts for superstars like Auston Matthews of the Toronto Maple Leafs.
Here’s a look at the MacKinnon Effect after this blockbuster deal.
How did MacKinnon end up with this deal?
MacKinnon is making up for lost dollars.
The Avalanche star signed a seven-year, $44 million contract extension in July 2016, his second NHL contract following his rookie deal. Nathan MacKinnon wasn’t Nathan MacKinnon yet: He had 52 points in 72 games and had spent two seasons trying to recapture the magic of his Calder Trophy-winning rookie campaign. As a restricted free agent, he didn’t have much leverage and settled on an annual cap hit of $6.3 million.
For the majority of that contract, MacKinnon was perhaps the NHL’s greatest bargain, allowing the Avalanche to build a championship roster while their star player was earning less against the cap than 103 other NHL players.
There was some speculation that MacKinnon might take a cap-friendly deal with the Avalanche, following in the tradition of what his friend and childhood hero Sidney Crosby did with the Pittsburgh Penguins. Three years ago, MacKinnon told Forbes that “on my next deal, I’ll take less again. Because I want to win with this group.”
Maybe he did take less … from a certain point of view?
At the NHL player media tour in Las Vegas, there were rumblings that MacKinnon and his agent, Pat Brisson, would go in the opposite direction: Seeking the richest contract of the cap era. One source believed that MacKinnon would become the first player to hit a $13 million average annual value. The Avalanche weren’t likely to go there, and one could understand their counterargument: Where could MacKinnon get that money as an unrestricted free agent in summer 2023, with a team that could contend and in a place he’d like to live?
Instead, the Avalanche gave MacKinnon a higher cap number than McDavid, and gave Brisson the highest paid player in the NHL. Mission accomplished.
What does this deal mean for the Avalanche?
Under Joe Sakic, who is now Colorado’s president of hockey operations, and general manager Chris MacFarland, the Avalanche had meticulously handed out contract extensions to their key players.
Winger Mikko Rantanen signed a six-year extension off his rookie deal in September 2019, with an average annual value of $9.25 million. It appeared captain Gabriel Landeskog might leave as a free agent last summer; instead, he signed an eight-year extension in July 2021 worth $7 million annually. Then came the key signing: Defenseman Cale Makar, who was inked to a six-year extension in July 2021 worth $9 million annually under the cap. He might already be underpaid just a year into that deal.
According to CapFriendly, the Avalanche will have 13 players under contract and just over $13.98 million in open cap space under a projected $83.5 million cap. Most of those open roster spots are among players found in their bottom-six forwards, as well as veteran defenseman Erik Johnson ($6 million AAV).
Among the contracts that will be impacted by MacKinnon’s deal:
-
Center Alex Newhook, 21, who is a restricted free agent next summer coming off his rookie deal. He’s slated to possibly replace Nazem Kadri as the team’s No. 2 center, which means it could be a breakout season for him.
-
Defenseman Bowen Byram, also a restricted free agent next summer and coming off his rookie deal.
-
Defenseman Devon Toews, 28, who is an unrestricted free agent in summer 2024 and makes $4.1 million annually against the cap — a bargain like MacKinnon has been prior to this extension.
One name to think about on the roster, going forward: Samuel Girard. The 24-year-old defenseman signed a cap-friendly deal in July 2019 worth $5 million annually over seven years. If Byram is as good as advertised — and given that the Avalanche have Makar, Toews and Josh Manson — that likely means Girard is no longer a luxury they can afford.
The Avalanche core is locked up through 2024-25, which is the last year of Rantanen’s contract. The MacKinnon contract doesn’t break that salary structure, but it stretches it. The work done leading up to the contract has allowed MacFarland to ante up large for his star player without knee-capping the Avalanche roster. And that’s how you keep winning Stanley Cups.
Who’s in line for the next megacontract?
This is the structure of MacKinnon’s contract:
The #GoAvsGo signed MacKinnon to 8 year 12.6M Extension:
Yr 1 775K & 15.725M Signing Bonus
Yr 2 775K & 15.725M SB
Yr 3 800K & 15.25M SB
Yr 4 9.15M & 3M SB
Yr 5-8 990K & 9.9M SBFull NMC effective immediately.
Rep’d by Pat Brisson @CAAHockey https://t.co/gzIAsg21w3— PuckPedia (@PuckPedia) September 20, 2022
Like many recent NHL blockbuster contracts, it contains wheelbarrows full of signing bonus money: $89.3 million of the $100.8 million, in fact.
Something that stood out here is in Year 4 of that deal, in 2026-27. That’s when MacKinnon’s signing bonus drops to $3 million, lower than it is in any other year. We’re not trying to freak anyone out here during a time of labor peace … but the current NHL/NHLPA collective bargaining agreement ends after the 2025-26 season.
(There is one caveat: one season will automatically be added to the CBA, through the 2026-27 season and expiring Sept. 16, 2027, if after the 2024-25 season the players’ escrow debt exceeds $125 million but is less than $250 million. But the NHL projects that the players will have paid off their escrow debt within three seasons.)
I think that’s an aspect of this deal that will raise other agents’ eyebrows.
The next megacontract signed in the NHL will be inked by Maple Leafs star Auston Matthews, who becomes an unrestricted free agent in summer 2024. He makes $11,640,250 against the salary cap, or 14.1% of the current cap. His salary was back-diving: He made $15.9 million in base salary in 2019-20 and will make $7.975 million in 2023-24.
Matthews will start his next contract in a different salary cap landscape. The NHL has projected that the cap could see a significant increase after the 2023-24 season.
The rising cap and MacKinnon’s deal all but guarantees that Matthews will be the first player to cross the $13 million AAV threshold. How much higher he can get beyond that will be up to Matthews’ agent Judd Moldaver and the marketplace, as the Maple Leafs attempt to keep their franchise centerpiece while teams like the Los Angeles Kings could be positioned to make their bid on him.
After Matthews comes Maple Leafs teammate Mitch Marner and Edmonton Oilers star Leon Draisaitl in summer 2025. Then in summer 2026, some guy named Connor McDavid gets his chance to make NHL contract history.
And by then, MacKinnon’s deal will look like a bargain.