The Rockets are still in talks with restricted free agent K.J. McDaniels regarding the player re-signing and returning to Houston, Calvin Watkins of ESPN.com reports (Twitter link). The franchise wishes to use the mid-level exception, worth $5,464,000 to ink the swingman, Watkins adds. It’s not clear what contract length and annual salary the player is seeking.

McDaniels has received what Watkins refers to as a “strong offer” from another team, though the ESPN scribe doesn’t mention which franchise that may be. No offer sheet has been signed by the swingman as of yet, notes Watkins. Houston would have three days to match any signed offer sheet it received for the player, which the team reportedly intends to do, as a result of tendering McDaniels a qualifying offer worth slightly more than $1.045MM. The Knicks were one franchise that was reported to be interested in the second-year guard out of Clemson, though it’s unknown if they are the team that has made McDaniels a contract offer.

In 62 appearances split between the Sixers and Rockets last season, including 15 as a starter while with Philly, McDaniels averaged 7.9 points, 3.2 rebounds, and 1.2 assists in 21.8 minutes per contest. His slash line was .396/.287/.752. McDaniels is a solid perimeter defender, and his skillset and upside are a tantalizing combination, which makes it a bit surprising that he hasn’t garnered more interest this offseason. That’s likely due to the fear that Houston would match any reasonable offer, but that’s merely my speculation.