Theis' agents, Michael Tellem and Aaron Mintz of CAA Basketball, told the news to ESPN's Adrian Wojnarowski.
The 29-year-old played for the Boston Celtics and Chicago Bulls during the 2020-21 season. He averaged 9.6 points on 54.1 percent shooting and 5.5 rebounds per game for the C's and Bulls, who acquired the 6'8", 245-pound big man via trade on March 25.
Theis played for the Celtics from 2017 to 2021, starting for the team during the 2019-20 and 2020-21 campaigns. He posted 9.2 points and 6.6 boards for the 2019-20 team, which reached the Eastern Conference Finals.
The C's did not fare as well in 2020-21, going 36-36 and losing in the first round of the playoffs. Amid its midseason struggles, Boston shook up its rotation, and that included dealing the German player in a three-team trade that also included the Washington Wizards.
Theis started 14 of his 23 games with the Bulls, averaging 25 minutes per game. But he'll be moving on to his third NBA home in Houston, which should benefit from the big man's skill set.
General manager Rafael Stone and head coach Stephen Silas are looking to turn around a team that went an NBA-worst 17-55 last year. They have some intriguing young pieces in place thanks to Kevin Porter Jr., Christian Wood and No. 2 overall draft pick Jalen Green, among others.
Theis isn't a young player, but his addition fills a gap in the frontcourt alongside Wood, as Chris Fedor of Cleveland.com noted when he reported on the Rockets' apparent interest on July 27: "Sources say keep an eye on Daniel Theis to Houston this offseason. That signing could help fill a frontcourt void."
Theis should start at center with Wood moving to power forward.