Julius Randle is entering the third year of his four-year $117 million deal; the 2026-27 season is a player option. He became eligible to sign a contract extension with New York on Saturday. Since joining the Knicks in 2019, Randle has earned All-Star honors in three of his five seasons, proving himself to be one of the franchise’s most important players.

Nevertheless, if Randle wishes to re-sign with the Knicks, he may need to be flexible about guaranteed money. As The Athletic’s Fred Katz reported on Aug. 1, the All-Star forward may need to take a “substantial discount” to make the money work in New York’s favor.

“Unless Randle, 29, is willing to take a substantial discount, it is difficult to find an agreement that makes sense for both sides,” Katz wrote. “… The Knicks can’t throw away the gift Brunson gave them. They cannot go above the second apron this upcoming season…It means Randle may have to take far less than $40.5 million in starting salary to entice the Knicks into handing him a new contract this summer.”

Randle has been a core part of Tom Thibodeau’s rebuild in New York. He’s established himself as a second star on the roster behind Jalen Brunson. His three-level scoring, high-level rebounding and physical defense will fit perfectly next to OG Anunoby and Mikal Bridges next season. That’s why former Knicks GM Scott Perry believes the Knicks must extend Randle if they want to be contenders.

“The Knicks should definitely sign Julius Randle to an extension, and here’s why,” Perry said during Monday’s episode of ESPN’s NBA Today. “The Knicks are in desperate need of having that reliable second scorer. We saw that they missed that in the playoffs. [Jalen Brunson] needs somebody to be able to take the load off of him when other teams try to go after him, and double-team him, and scheme him. Julius has a personal connection with this organization. He’s played for Thibs for the last four years. He has a connection with his teammates and the front office. He knows what it’s like to play in New York. He has unfinished business playing in New York.”

Given his status as one of the best forwards in the NBA, Randle could generate significant trade interest for the Knicks should they decide not to offer him an extension. However, his value to the team has been clear for multiple years. He has been a cornerstone of its journey toward the top of the Eastern Conference.

As such, it’s only logical to expect the Knicks front office to work with Randle on a solution that works for him and the team. However, if a deal can’t be reached, he will certainly fetch a healthy return on the trade market.