"We're happy with our roster. We have two guards [Lin and Landry Fields] that are restricted free agents, so we will be able to retain them," Grunwald said Friday night, during his conference call to discuss coach Mike Woodson's contract extension.
"We can keep him if we want him, and we do want to keep him, and I believe that Jeremy had a great experience here. I believe he wants to come back."
Lin missed the last 22 games of the season, including five in the first round of the playoffs, recovering from a small chronic meniscal tear in his left knee. Woodson said the point guard is now feeling "great."
"He's gone through his rehab process, so he's back running and moving, like we expected him to be," said Woodson, who will travel to Las Vegas in early July to watch Lin to participate with the USA Men's Select Team. "Our doctors did a tremendous job on the surgery and our therapy people putting things back in place. So he will be ready to go, at full go [this season]."
Lin, 23, averaged 14.6 points and 6.2 rebounds in 35 games last season. He sparked the Knicks' resurgence in January, when the floundering team reeled off seven straight wins.
Grunwald also addressed the Knicks' two other top free agents, Steve Novak and J.R. Smith. He said he "would love" for Novak, an unrestricted free agent, to return next season and he hopes Smith exercises his player option of $2.443 million.
Losing Smith, Lin or Fields would further deplete a Knicks backcourt that lost Iman Shumpert and Baron Davis to knee injuries in the playoffs.
"The question is: How do we fill out the rest because Baron suffered a pretty bad injury, so he's not going to be able to play next year," Grunwald said. "And Shump's going to be out for a little bit as he recovers from his injury. So we're going to have to see if we can upgrade the rest of the roster while Shump is out and to replace Baron."
Grunwald was asked about Smith's arrest Thursday night in Miami, but he didn't go into any detail about it.