Tyson Chandler near deal with Knicks

In the latest twist of his expected departure from the Dallas Mavericks, Tyson Chandler is closing in on a deal with the New York Knicks, according to sources close to the process.

"New York is Tyson's first choice," one source told ESPN.com, confirming a Thursday report from CBSSports.com that the Knicks have jumped ahead of the Golden State Warriors in the race to sign Chandler.

"It's 98 percent sure that Tyson is going to wind up with the Knicks."

To create sufficient salary-cap space to sign Chandler, New York is expected to shed the contracts of Chauncey Billups and Ronny Turiaf, through either trades or the forthcoming amnesty clause.

Signing Chandler, sources said, could free up the Knicks to offer star forward Amare Stoudemire to the New Orleans Hornets in a trade scenario for Chris Paul, who badly wants to reunite with Chandler after their time together with the Hornets. Sources say that's one option New York is considering.

CSNBayArea.com reported that the Warriors are trying to sweeten a four-year offer to Chandler valued at $60 million to outbid the Knicks.

The Warriors, sources said, have made Chandler their No. 1 roster target, no matter what happens with their recent trade talks with the Hornets about Paul.

The Mavericks, meanwhile, are fully operating under the premise that Chandler is gone.

Another telling sign that Chandler's time in Dallas has come to an end emerged Thursday, when sources close to the situation told ESPN.com that the Mavericks offered Chandler to the Orlando Magic as part of a proposed sign-and-trade deal for All-Star center Dwight Howard.

No one connected to the Mavericks has said outright that Chandler's time in Dallas is over. But it's now the working assumption in Dallas that Chandler will definitely be leaving the Mavericks -- despite being credited with changing the defensive culture of a team that lost in the first round of the playoffs three times in the previous four years before its 2010-11 championship breakthrough.

Negotiations between the Mavericks and Chandler are essentially frozen, sources said. And any hope of a U-turn has all but evaporated because Dallas is determined to take as much salary-cap space as possible into the summer of 2012, even if that means parting with such an important piece of the first championship in franchise history.

Two sources briefed on the matter used the same words to describe the situation when asked about Chandler by ESPN.com: "He's not coming back."

The Mavericks have taken such a firm negotiating stance with Chandler because they fear that matching the offers for the 29-year-old will not only take them out of the race for 2012 free-agent stars Howard, Deron Williams and Chris Paul, but also prevent them from having the down-the-road financial flexibility to find a younger cornerstone player to team with Dirk Nowitzki as the 33-year-old face of the franchise gets older.

Dallas strongly believes that it will be a finalist for all three of those top stars next summer, since none of them -- no matter where they are this season -- are expected to sign contract extensions, sources close to the situation said. That's because the new labor deal expected to be ratified Thursday by NBA players and owners makes it more advantageous for Howard, Williams and Paul to opt out of their current contracts in July and then proceed to free agency.

The Warriors and Rockets have already met face-to-face with Chandler this week, with sources telling ESPN.com that the 7-footer is likely to sign a four-year deal worth more than $50 million with one of his suitors.

NBA front-office sources say the Mavericks have already begun courting bargain-priced big men, most notably former lottery pick Brandan Wright. Incumbents Brendan Haywood and Ian Mahinmi will obviously get the first crack at Chandler's minutes.

The challenge for the Mavericks in adding depth to their center rotation is getting quality players to take short-term deals to preserve maximum cap space for their summer of 2012 recruiting plans. The Mavericks did try to convince Chandler to accept a one-year deal worth a whopping $20 million, but there was never real hope of that happening, sources said.

As far back as last week, as negotiations with the Mavericks quickly stalled, Chandler told ESPN.com in a phone interview: "I really think I'm going to be on a new team come training camp."

Chandler maintains that staying in Dallas has always been his first choice, but he expressed disappointment last week that communication between the sides was minimal from the end of the NBA Finals in mid-June and the June 30 deadline for a contract extension.

The Mavericks maintain that they were reluctant to talk about an extension before July 1 because no one knew how drastic changes to the NBA's collective bargaining agreement would be at that time.

The best estimates in circulation suggest that the Mavericks would only have roughly $5 million in cap space for the summer of 2012 if they match an offer for Chandler, even if Dallas' other free agents, such as Caron Butler and J.J. Barea, are let go as expected.

To have the needed cap space to bid for a player of Paul's or Williams' caliber if Chandler is retained, Dallas would likely need to set free either backup center Haywood or forward Shawn Marion through the amnesty clause, bid farewell to 2012 free agent-to-be Jason Terry and perhaps even be forced to send away younger prospects like Corey Brewer or Rodrigue Beaubois in trades that bring back no salary.

Chandler, 29, was acquired by the Mavericks in July 2010 in a deal sending Erick Dampier to the Charlotte Bobcats. But Chandler was widely billed at the time as a consolation prize, after Dampier's cap-friendly contract failed to get Dallas in the bidding for the league's marquee free agents -- LeBron James, Dwyane Wade and Chris Bosh among them -- through various sign-and-trade offers.

Yet, Chandler wound up meshing with Nowitzki better than anyone anticipated, supplying a blend of length, athleticism, rim protection and vocal leadership that no big man who previously lined up alongside the eventual NBA Finals MVP had ever provided in Dallas.

After missing nearly 70 games over the previous two seasons through injury, Chandler wound up playing in 74 regular season games and finished third in the league's Defensive Player of the Year voting.

In the Western Conference finals, Chandler helped Dallas to a 4-1 series win over the same Oklahoma City Thunder team that traded for him in February 2009 and then rescinded the trade one day later because of concerns about a toe injury.

Marc Stein covers the NBA for ESPN.com.