August 12, 2016

Banjo Hitter

Winter of Their Discontent

by Aaron Gleeman

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If you look back at the biggest multi-year contracts signed by free agents every offseason, the rate of teams at some point wishing they could get out of the deal tends to be high. On the most basic level, there’s simply a lot of room for a nine-figure investment in a baseball player to go wrong, particularly when the player is usually on the wrong side of 30 years old and coming off a stretch of good performance that makes for a natural regression candidate. Beyond that, the notion of a “winner’s curse” is at work, in that any team bidding enough to secure a high-end free agent likely did so by paying a premium. And, of course, players sign deals when they're in their prime. They end them when they're old, but still getting paid like they're not.

None of which is to suggest that handing out $100 million-plus deals to free agents is always a bad idea, but rather that for the contract to be a good idea the team has to get tremendous value in the early years. There’s a tacit understanding that, for instance, a six-year, $150 million signing will not provide the team with as much value in Year 5 and Year 6 as it does in Year 1 and Year 2, but the team lives with the later years of the contract in order to get the early years. Another way of looking at it is that, if things don’t go well in those early years of a big long-term contract, the whole signing may turn very, very ugly.

I bring this up because last offseason’s biggest signings are almost all trending in the “regret” direction. It’s very early, of course, but that's the whole point. If do-overs were allowed, most of the teams that shelled out massive money for free agents nine months ago would gladly wipe the slate clean. In total, there were 13 contracts of at least $60 million handed out to free agents last winter, including seven above $100 million and two above $200 million. One of those 13, the Mets’ three-year, $75 million deal with Yoenis Cespedes, was basically designed to be a one-year, $27.5 million contract if he opts out this offseason, which he will.

Of the other 12 contracts above $60 million, at least half and as many as 10 or 11 could be described as going poorly so far. David Price’s seven-year, $217 million deal with Boston and Zack Greinke’s six-year, $207 million deal with Arizona were the biggest of the winter. Neither has been a disaster thus far by any means, but Price has a 4.34 ERA through 24 starts and Greinke has a 3.67 ERA while spending six weeks on the disabled list (plus, the Diamondbacks’ grand plans for contending vanished quickly). Neither team ought to panic, but Year 1 hasn’t gone as hoped in either case. And those are two of the least-bad examples.

Jason Heyward’s eight-year, $184 million deal with the Cubs was the most polarizing of the winter and the early returns are ugly. Heyward has hit .227/.310/.317 for a 150-point drop in OPS compared to his career mark heading into the season. He’s still great defensively and, at 27 years old, still a good bet to bounce back offensively, but at the very least the Cubs would never have committed $184 million to him had they looked into the future to see Year 1. Similarly, you can be sure the Tigers would gladly take a do-over on giving $133 million over six years to Justin Upton, who’s hitting .234/.290/.386 with a 135/30 K/BB ratio.

Chris Davis hasn’t been quite that bad in Year 1 of his seven-year, $161 million contract with the Orioles, thanks to 23 homers and 63 walks in 109 games, but his .217/.331/.434 line is clearly the low end of what Baltimore hoped for and represents a 160-point decline in OPS compared to 2015. Heyward, Davis, and Upton were the three biggest position player signings of the winter, getting contracts totaling $478 million over 20 years, and all three teams would jump at the chance to take a mulligan in 2016 when the deals run through 2023, 2021, and 2021 respectively.

Johnny Cueto’s six-year, $130 million deal with the Giants stands out as the offseason’s biggest success story early on. It doesn’t mean things won’t go south later in the deal, but Cueto throwing 160 innings with a 2.93 ERA and 146/32 K/BB ratio is exactly what San Francisco hoped for in Year 1; Cueto has an opt-out after next season. On the other hand Jordan Zimmermann, who joined Price, Greinke, and Cueto in the $100 million-plus club with a five-year, $110 million contract with the Tigers, is currently on the disabled list for the second time after posting a 4.44 ERA in 16 starts.

Cueto has worked out well for the Giants in the early going, but their five-year, $90 million investment in Jeff Samardzija has not. Samardzija, who struggled mightily for the White Sox last year, has a 4.23 ERA and 4.83 DRA in 23 starts for the Giants. Mike Leake has been even worse for the Cardinals, kicking off a five-year, $80 million contract with a 4.79 ERA and 4.18 DRA. Wei-Yin Chen’s five-year, $80 million deal with the Marlins is worse yet thanks to a 4.99 ERA and an elbow injury that has him on the disabled list with returning this season uncertain.

Ian Kennedy’s oft-mocked five-year, $70 million with the Royals looks decent by comparison, with a 3.91 ERA/3.92 DRA. Of course, Kansas City gave up a first-round draft pick for the right to sign Kennedy and also shelled out $72 million over four years to retain Alex Gordon, who’s hit .203/.306/.331 for a 150-point dip in OPS compared to his career mark. Greinke, Heyward, Upton, Zimmermann, Samardzija, Chen, and Kennedy all required forfeiting draft picks to sign, and even re-signing Davis and Gordon meant passing up a potential draft pick had they gone elsewhere. In other words, the deals look bad beyond just the money.

Admittedly this is subjective—and teams might all claim they’re just fine with how things have gone—but of the 12 non-Cespedes deals in excess of $60 million only Cueto stands with certainty as a signing the team would do again. There’s some potential for wiggle room on Price and Greinke, but Heyward, Davis, Upton, Zimmermann, Samardzija, Kennedy, Leake, Gordon, and Chen all seem like do-overs for any GM being honest. Every offseason includes regrettable shopping sprees, but this past offseason GMs woke up to find they went on a post-bar-closing chips-and-ice cream run and fell asleep with a pizza in the oven.

Aaron Gleeman is an author of Baseball Prospectus. Follow @aarongleeman
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