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Offseason Outlook: Baltimore Orioles

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With the Orioles’ first AL East title and first ALCS appearance since 1997, it was a season to remember in Baltimore.  Before following up, however, the O’s will have to take care of quite a bit of in-house business.

Guaranteed Contracts

Arbitration Eligible Players (service time in parentheses; projections via Matt Swartz)

Contract Options

Free Agents

The Orioles answered one of their biggest offseason questions before the ALCS even began, as the club inked J.J. Hardy to a three-year, $40MM extension.  In keeping Hardy in the fold, the Orioles not only ensure their own stability at shortstop, but they also keep a very sought-after player away from potential rivals; the Yankees, for one, were rumored to be interested in Hardy’s services.

With over two-thirds of the roster due for arbitration raises or facing contract options, it’s no surprise that Orioles plan to increase their payroll for 2015.  What remains to be seen is if that spending increase leaves room for new players, or simply reflects the fact that key contributors like Chris Tillman, Miguel Gonzalez and Zach Britton are no longer making minimum salaries.

I’d guess that Tillman will be approached about contract extensions this winter, as Dan Duquette will look to achieve some cost-certainty in future years by locking up a pitcher who looks like a key part of Baltimore’s future.  The O’s had a similarly large arbitration class last winter, and they responded by trading the biggest projected contract (Jim Johnson) to free up payroll space and discussing extensions with the two players (Chris Davis, Matt Wieters) who projected as long-term pieces.  In hindsight, the team benefited by not finalizing those extensions given how Wieters missed most of the season with injury and Davis took a big step back after his mammoth 2013 campaign.  I’d expect one-year deals for both players in their third and final arb-eligible seasons, putting Wieters and Davis on pace for free agency in the 2015-16 offseason.

Now that Evan Meek has been outrighted off the Orioles’ 40-man roster, that leaves Baltimore with 11 players arbitration-eligible players this offseason.  The only possible non-tender candidate could be Alejandro De Aza, and even he may be retained given the unsettled nature of Baltimore’s 2015 outfield.  Matt Swartz projects the O’s will spend $56.9MM on these 11 players; add that to the roughly $43MM owed to six players on multiyear contracts and the $9MM total required for Wei-Yin Chen and Darren O’Day’s options and the Orioles are now in the $109MM range for 19 players.  That’s already more than the $107.46MM the club spent on payroll in 2014, according to Cot’s Baseball Contracts.

The Orioles have already addressed their four outstanding club options.  Chen and O’Day, as expected, saw their options exercised while Nick Hundley’s $5MM option was declined (Caleb Joseph is the cheaper backup catcher option for Wieters next season).  The O’s also declined their half of Nick Markakis’ $17.5MM option, and as MLBTR’s Steve Adams recently noted in his Markakis’ Free Agent Profile, declining the option makes it unlikely that the team will extend Markakis a qualifying offer.

In short, the long-time Oriole will be one of the most sought-after outfield bats on the free agent market.  If Markakis indeed doesn’t have a qualifying offer tied to him, Adams projects him to receive a four-year, $48MM deal.  By contrast, the O’s will make a qualifying offer to Nelson Cruz, which should diminish the slugger’s market a bit, though not to the same level as last winter, when Baltimore was able to sign Cruz to a one-year, $8MM deal that turned into a major bargain.  It wouldn’t be a surprise if Cruz finds at least double that amount on his next contract, netting him in the $16MM average annual value range.

Baltimore seems to have made some solid progress in talks with Markakis and at least touched base with Cruz earlier this season, so the club is fully exploring the possibility of re-signing both players.  If they feel they have a legitimate shot at bringing both back next year, another payroll-cutting move (such as non-tendering De Aza) would likely be forthcoming.

If both outfielders sign elsewhere, then the O’s have at least one ready corner outfield replacement ready in Steve Pearce.  His big 2014 breakout ensures he’ll find an everyday role somewhere on the diamond and he has experience in both LF and RF.  Delmon Young is also hitting free agency and could be brought back at a modest price; he could form a righty-lefty platoon with De Aza or David Lough in left field.  Lough and De Aza would also expect to see playing time in the outfield even if Cruz or Markakis returns, as either veteran (Cruz especially) would see time at the DH spot.

Pearce’s positional flexibility and the lack of a full-time DH gives the Orioles some options if Cruz and Markakis indeed leave.  This is just my speculation, but Adam LaRoche or Michael Cuddyer would be fits as solid veteran bats who can likely be had on short-term contracts.  Both players would fill everyday roles, which would allow Buck Showalter to employ more platoon depth elsewhere should Pearce come back down to earth.  If the Orioles wanted to go the full-time DH route, they could try to sign Victor Martinez, though his desired four-year contract might be lengthier than the O’s are willing to commit to a 35-year-old.

Around the infield, the O’s seem set with Manny Machado at 3B, Hardy at SS, Jonathan Schoop at 2B and Davis at 1B, though Hardy is the only one who doesn’t have some uncertainty hanging over him headed into next year.  Machado has shown he’s one of the game’s top young stars when healthy, though he has undergone two significant knee surgeries in as many years.  Schoop flashed some nice defense in his first full big league season, though he’ll be expected to show more at the plate than last year’s .598 OPS in 481 plate appearances.

As for Davis, he went from a 53-homer performance in 2013 to a below-average 94 wRC+ in 2014 and also missed the end of the season after being suspended 25 games for Adderall usage.  Davis might be Baltimore’s biggest x-factor for 2015; if he returns to form, the slugger would more than make up for the possible loss of Cruz or Markakis.  Then again, for the Orioles to re-sign those two, Davis could become a trade chip in order to free up payroll space.  They’d be selling low on Davis, though the first baseman’s 2013 campaign is still fresh enough in everyone’s mind that he’ll draw interest.

The Orioles boasted one of the league’s top bullpens last season, and most of the principals are set to return with Britton closing and O’Day and Tommy Hunter as setup men.  The team paid a heavy price (left-handed prospect Eduardo Rodriguez) to obtain Andrew Miller from the Red Sox at the All-Star break, and while Miller pitched very well down the stretch, the high price he’ll command in free agency will likely bring his stint in Baltimore to an end.  It wouldn’t be a surprise to see the O’s pursue a veteran reliever for depth purposes.

Starting pitching could be the biggest area of surplus for Baltimore since the club has six rotation options (Tillman, Gonzalez, Chen, Bud Norris, Ubaldo Jimenez and Kevin Gausman), top prospect Dylan Bundy on his way back from Tommy John surgery and prospects Mike Wright and Tim Berry knocking on the Major League door for depth purposes.  Tillman is the nominal ace, Jimenez is probably unmovable due to his big contract and poor performance last year, and Gausman and Bundy are untouchable as the future of the staff.

This leaves Gonzalez, Chen and Norris as possible trade chips — all solid, unspectacular pitchers with team control (Chen and Norris one year, Gonzalez three years) remaining.  Norris is the most expensive, projected to earn $8.7MM in his final arbitration-eligible year.  While that’s a reasonable salary for an innings-eater, it might also make him the most expendable for a team that’s looking to free up payroll space.

To speculate about a few possible trade partners looking for pitching, the Rockies and Pirates have a number of young outfielders to offer if the O’s were looking for external solutions to replace Cruz or Markakis.  If a bigger-name solution was explored, the Braves could have Justin Upton and Jason Heyward on the market this offseason, though both players are only contracted through 2015 and Atlanta would require more in return than just one of the Gonzalez/Chen/Norris trio.  Such teams as the Cubs, Twins, Diamondbacks, Mariners, Rangers and Angels are among the teams who could also be looking to trade for pitching this winter.

It seems contradictory to predict a surprise, yet given Duquette’s track record in Baltimore, expect him to make one under-the-radar acquisition (a la Chen, Gonzalez, Pearce, Young, Jason Hammel or Nate McLouth) that ends up paying big dividends for the Orioles.  Making the most of unheralded acquisitions and raising the roster’s talent floor have been big reasons why the O’s are 274-212 with a pair of playoff appearances during Duquette’s regime.  Much of the Orioles’ offseason will be shaped by what Cruz and Markakis do, but the club is still in position to contend in 2015.

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