Knicks' Salary Cap Space Updated in New NBA Rumors amid KAT, Josh Hart Contract Talks

The New York Knicks' financial future has generated plenty of headlines in the early portion of the 2026-27 NBA season, and they are reportedly making a move with an eye on creating more salary cap space down the line.

ESPN's Shams Charania reported Thursday the Knicks are planning to decline the fourth-year option on Pacôme Dadiet's deal.

The option is worth $5.37 million, so the Knicks will have more salary space without it. What's more, Charania noted the two sides "could still discuss a reunion" since the move will make the forward an unrestricted free agent during the upcoming offseason.

Of more note is what this means for some of the headline players.

New York released a statement earlier this month revealing it was pausing contract negotiations.

Karl-Anthony Towns and Josh Hart are among those who are eligible for an extension. Towns even said he was "very disappointed, to say the least" when the Knicks released that statement, per The Athletic's James L. Edwards III.

For his part, Hart said, "Everything is going to work out. I'm not really too stressed over it. I'm not putting too much into it. We have expectations, so it's good we are able to focus on the season."

Even the smallest increase in salary cap space is notable for the Knicks given the uncertain futures of so many players, so it comes as no surprise the team is reportedly declining Dadiet's option.

After all, he is not much of a contributor who has appeared in just one minute of action this season after averaging 4.7 minutes a night in 29 games last season.

While he was a first-round pick in 2024, he is yet to establish himself as an important part of the Knicks' rotation and could be looking for a new team next offseason.