Finding A Three-Year Deal In The New Year

19 free agent contracts guaranteeing three or more years have already been signed this offseason, matching the high from the previous five offseasons.  With Ervin Santana, Matt Garza, Ubaldo Jimenez, Stephen Drew, and Nelson Cruz still on the market, it seems likely we'll ultimately see 20 or more deals of three or more years in this 2013-14 offseason.  However, if recent history is a guide, one or more of these players will be left standing without a chair.

Here's a look at the number of contracts for three or more years signed in each of the past five offseasons:

  • 2012-13: 19
  • 2011-12: 11
  • 2010-11: 17
  • 2009-10: 8
  • 2008-09: 13

Please note that international free agents, typically from Japan or Cuba, have been excluded from this exercise since they often operate on different timelines than traditional free agents.

Of the 68 free agent contracts guaranteeing three or more years from the past five offseasons, 13 were officially signed in January or later (19.1%).  Of those 13, nine were clients of the Boras Corporation, including big money players like Prince Fielder, Adrian Beltre, Matt Holliday, Mark Teixeira, and Derek Lowe.  Agent Scott Boras has a reputation of waiting out the market, and it has served him well in many cases.  While my early November projection of a four-year, $48MM deal for Boras client Stephen Drew seems unlikely at this point, I never viewed Kendrys Morales as likely to get a third guaranteed year.  Though the current market for Drew does not seem robust, I still expect Boras to get at least three years for him.

Since the 2008-09 offseason, only four free agents not represented by Boras have received contracts of three or more years in January or later: Edwin Jackson, Nick Swisher, Jason Bay, and Milton Bradley.  The deals for Jackson and Swisher were actually agreed upon prior to Christmas 2012 and announced officially on January 2nd and 3rd, respectively.  Similarly, the Mets' deal with Bay was reached on December 29th, 2009.  In the last five offseasons, Milton Bradley is the only non-Boras free agent to actually agree to a free agent contract of three or more years in January or later (January 5th, 2009).  Bradley's deal was done by ACES.

If you're a free agent who expected at least three years at the outset of the 2013-14 offseason, and you're not represented by Boras, this trend has to be troubling.  Specifically, the spotlight is on the agents for Ervin Santana (Bean Stringfellow), Matt Garza (Nez Balelo), Ubaldo Jimenez (John Courtright), and Nelson Cruz (Adam Katz).  If any of these four fail to get at least three years, their agent has failed to meet expectations.

As has been widely discussed, Cruz is in a perilous situation.  We don't know what offers the 33-year-old slugger has received to date, but he's tied to draft pick compensation and seems light on current suitors.  Way back in October while working on Cruz's free agent profile for MLBTR, Steve Adams pitched a two-year, $26MM prediction to me and it sounded about right at the time.  Enough information came out in the week following that both of us felt good about Steve's ultimate three-year, $39MM prediction.

In late November, after fellow Biogenesis-connected free agent Jhonny Peralta signed a surprisingly strong four-year, $53MM deal, Jon Heyman of CBS Sports heard from sources that Cruz was "said to seek about $75 million over four years."  While starting negotiations at four years was a plausible tactic in November, an average annual value approaching $19MM never seemed realistic.  Nearly two weeks later, on the first day of the Winter Meetings, ESPN's Buster Olney tweeted that the Rangers were comfortable with a two-year deal for Cruz, while he sought three from them.  Now we're in early January, and I'd bet against Cruz getting a third year from any team.  While a two-year deal may be viewed as underwhelming for Katz, it's worth noting that he doesn't control the ebb and flow of media and fan expectations, and it's possible Cruz never received a reasonable three-year offer.  Katz presumably did have a strong hand in Cruz's decision to turn down the Rangers' qualifying offer in November, which will be questioned if the outfielder falls short of Steve Adams' original guess of two years and $26MM.

There's a good reason why Santana, Garza, and Jimenez remain unsigned, and his name is Masahiro Tanaka.  Tanaka outranked all three in my top 50 free agents rankings published November 4th, and factors related to the revised Japanese posting system delayed the 25-year-old's true entry into free agency until the day after Christmas.  During the 2011-12 offseason, bids were due for Yu Darvish by December 14th, and the situation didn't stop C.J. Wilson and Mark Buehrle from signing strong contracts before then.  It was much more cut and dry with Darvish — the Rangers were revealed as the high bidder on December 19th, and all other interested parties could move on.  With Tanaka, it seems likely more than 20 teams pledged the newly-capped posting fee of $20MM, paid only by the club that signs the pitcher after a standard free agent free-for-all.  The process does have an end in sight, with a January 24th deadline in place.

Back in 2011, the Angels and Marlins had not been connected to Darvish prior to their signings of Wilson and Buehrle.  Conversely, Tanaka seems to be Plan A for many teams, and the would-be contenders that miss out on him probably will turn to Santana, Garza, and Jimenez.  The Diamondbacks, Blue Jays, Yankees, Angels, and Mariners can't all get Tanaka, and it's possible none of them do, so demand could be strong for the Plan B trio even as the calendar turns to February.  Santana and Garza were expected to easily exceed Ricky Nolasco's four-year, $49MM deal (agreed to prior to Thanksgiving), while Jimenez seemed to have a good shot at a similar contract.  I'm sure their agents are unhappy about the way things have unfolded, and there's always a chance the bottom drops out on one of the three pitchers as budgets become settled and we approach time for pitchers and catchers to report in mid-February.  

In the end, there's room for good starting pitching on most teams, plus Tanaka could sign before January 24th.  I still expect Santana, Garza, and Jimenez to receive deals of three or more years, even though there's no precedent from the last five offseasons.

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