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When is it time to lock up Starling Marte? …. Yesterday

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SOUTH HILLS COMMAND CENTER – On Monday the Cubs locked up their young, talented first baseman Anthony Rizzo with a seven-year, $41 million deal, a contract that includes a couple club options. While it’s life-changing money for a 23-year-old, it’s probably going to be a mega bargain for the Cubs.

 

In the early 1990s, then Cleveland GM John Hart began the trend of signing  young, core players to long-term contracts, buying out arbitration years and in some cases several years of free agency. It was smart business for the small-market Indians, allowing the Tribe to keep their core together through the mid ’90s.

 

Most recently Tampa Bay has been the most aggressive in locking up young talent, most famously signing Evan Longoria to a six-year $17.5 million deal six days after he was called up in 2008. In total the deal will be worth $44 million over nine years, as it included three club options which were incorporated into his recent 10-year contract extension.

 

It’s widely regarded as the most club-friendly deal in modern history.

mlb_u_longoria11_576

 

Evan why are you smiling, Evan? You left tens of millions on the table? (OK, I’d probably take a deal, too, if I was a young player. $44 million looks pretty good)

 

Consider that one win above replacement is worth approximately $5 million in value to a club.

 

Now consider that through 5.2 seasons, Longoria has produced 31.7 WAR. That’s $158 million in value. The club has paid him $15 million.

 

Advantage: Andrew Friedman.

 

Now the baseball compensation scale is rigged against young players, who often work their first three years for near the game’s minimum wage before becoming arbitration eligible. It’s six years of serfdom. So Longoria was going to be value to Tampa Bay regardless if agree to the deal ed or not. But by buying out Longoria’s arbitration years and three years of free agency the Rays did save tens of millions of dollars in arbitration costs and prevented him from testing the free-agency waters.

 

A number of other young players have signed such extensions in recent years – like the Pirates’ Andrew McCutchen, Atlanta’s Justin Upton, the Reds’  Jay Bruce – but the Longoria was the most aggressive such deal because it came so early in his career.

 

The Rays took on more risk because Longoria had played all of five Major League games, but clubs also have more negotiating leverage the further players are from arbitration and free agency.

 

So that takes us back to the confluence of the Allegheny and Monongahela  …

 

Starling Marte might already be the Pirates’ most valuable asset (this subject will be coming to a blog near you in the near future) when considering present talent, projection and contract/service time.

 

He has already produced $10 million in value this season, having a 2.0 WAR as of May 14. He has the potential t produce tens of millions worth of value over the course of the next five+years.

 

Now most clubs, like the Pirates, prefer to hedge their bets with young players. McCutchen had 2 1/2 years of service time when he signed his 6-year, $51 million extension prior to last season. It was similar to the Justin Upton and Bruce deals. But by hedging bets, the player gains leverage.

 

With Marte I think the risk would be worthwhile to lock him into a long term deal … yesterday.

 

Sometimes these deals do not work because of injury (See: Grady Sizemore) or regression. But often they are great values for clubs, which is so critical for small market clubs. And even if such a deal is a bust, it’s a relatively small risk when considering veteran free agents are singing for $25 million per season.

 

Even if Marte was just a three-win player for the remainder of his pre-free agency club control, which is conservative, he’d still be worth $90 million to the club over his first six years of service, a figure that doesn’t include inflation.  If the Pirates do not buyout his arbitration years they could be looking at 10+ million arbitration prices.

 

Over at BucsDugout.com, Charlie Wilmoth asserted the closest comp to Marte would be Denard Span, who signed a five-year $19 million deal in 2010. Span was a year closer to free agency than Marte. I’d guess the Marte camp would feel his value is closer to that of the Cubs’ Starlin Castro, who signed an eight-year, $60 million deal two full years into his big league career. Still, it bought out four years of free agency and will likely be another mega-bargain for the Cubs.

 

I asked Pirates GM Neal Huntington if the club has reached out to Marte, but Huntington declined to answer.

 

If the Pirates gave Marte an eight-year, $60 million deal tomorrow it would still likely be a bargain for the club. A conservative estimate  would have Marte producing double that value to the club over eight years, $120 million.

 

Yes, there’ some risk. But he’s not a pitcher. He’s young, athletic, talented and improving (see: improvement against breaking balls). It’s not my money. Maybe Marte would not be interested, but I think the smart money is with small-market clubs being more aggressive in signing pre-arbitration talents. I’m surprised it’s not done more often.

 

This quote is posted in the Rays’ locker room: “Fortune favors the bold.” It is especially true with locking in prices for small-market clubs.

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Comments

  1. JUCOFan says:

    I love the financial aspect in this article. Thanks for posting. I think with Marte the Pirates want to see a track record of consistency at a minimum and hopefully progression in the majors before commiting long-term….particularly with his patience at the plate. If Marte were a commodity like oil or gas, certainly the price for Marte futures would be increasing at this time, but it may be wise to wait a year to get a bigger sample size. It may end up costing the Pirates a little in the long-run, but probably is a risk worth taking.

  2. Bizrow says:

    The PBC would probably be looking for Tabata like numbers, don’t cha think?

  3. Skip says:

    Travis – I’m surprised you didn’t mention the Tabata signing. Many people at the time thought it was a good deal for the Pirates, but a poor deal for Tabata. Now, it’s looking like Tabata got the better of the deal (since he has under-performed), although its still too early to know yet.

  4. NMR says:

    I believe $/WAR is a poor way of identifying contract value. WAR itself is in its infancy and flawed. Not useless, but flawed.

    Moreso, generating $/WAR data from the entire league does not take into account the vast revenue and payroll disparity between clubs. $/WAR says that Clint Barmes (1 WAR) provided good value last year. I don’t know any real people who think Clint Barmes taking up $5m out of a roughly $60m payroll equates to money well spent.

    This pertains specifically to Starling because he’s still a risky player to bet on, in my opinion.

    Inexplicably, pitchers are throwing him MORE fastballs and MORE pitches in the zone even while he’s swinging at MORE pitches out of the zone. The first two will undoubtedly change after a few times through the league. Teams are not generally that dumb when it comes to scouting reports.

    Yes, he provides value in the field and on the bases, but as long as Andrew McCutchen is a Pirate it won’t be at a premium defensive position and he has yet to prove he can get on base consistantly by means other than hits.

    These extensions really only become great deals in their free agent years. The team risks tens of millions in the arb years in order to save in free agency.

    The other Pittsburgh Pirate early extension player was noteably absent from this article. There should be no better example of why it makes sense to wait until a guy gets through the league a few times before guaranteeing him money than that.

  5. Nate83 says:

    Although I agree almost completely with your post the Tabata contract is so crazy cheap for the type of player a lot of people thought he would be that it had to be done. Even if he is a 4th outfielder on this team at the end of the contract it’s still what contending teams pay for a 4th outfielder. I can’t remember but wasn’t the last two years team options with low buyouts as well.

  6. Chuck H says:

    I too, think the Pirates should wait a while longer for Marte to prove himself as a coming
    super star. As shone in yesterday’s game against Milwaukee, he too was a pushover for the Brewers, as is the rest of the Pirate (hitters). And surely, the Bucs can find a catcher
    who will not be made a fool of like the Brewers did with McHenry. That was an embarrassment to every Pirate fan.

  7. Travis Sawchik says:

    As Nate noted, even if Tabata is nothing more than a 4th OF his contract is modest and hardly a team killer or a reason not to extend another player.

    I agree $/WAR is not a perfect measuring tool, but then again, what is?

    I still believe teams almost always come out ahead, financially, when they extend young players.
    Of course you have to use some discretion in who you choose, and the player had to be on board, but I think it beats playing the arbitration game. Marte is a player worth extending. I think you can argue he is the Pirates’ most valuable asset.

    Cleveland of the 1990s and Tampa Bay of the 2000s have been arguably the best two small-market clubs of the last 30 years and they are/were very aggressive with these types of deals

  8. Travis Sawchik says:

    Skip, perhaps I should have included Tabata, but as I wrote below, even as a 4th OF, he’s not outrageously priced. As the Tabata story is still in the early chapters

  9. Travis Sawchik says:

    JUCO,

    Good post.

    We are dealing with people and not commodities, which increases the element of risk. And increasingly the sample size with Marte could provide more certainty, but if I’m betting on one U25 player in the organization with a long-term deal its Marte. (Though giving Gerrit Cole a Matt Moore-type deal might also be a good idea down the road)

    Still, using your analogy, I think investing in Marte today would be like an airline buying a 10-year supply of fuel at a set price in 2003. The potential for savings are considerable.

    The great thing about these deals is even if the club does miss, they still relatively modest contracts and they are not payroll-killers

  10. Travis Sawchik says:

    Chuck,

    My guess is the Pirates probably do want to see a larger sample size. They wanted 2.5 years from McCutchen. Rizzo is also 90 games ahead of where Marte is. Few teams extend players as young as Marte.

    But the Rays do.

    If you believe in the person and the talent, now is the time to really find bargain prices.

  11. Chuck H says:

    Game 2 vs. the Brewers–We’re still not hitting with men in scoring position. Marte left a runner on 2nd. A single would have scored him.

  12. BuccoFaithful says:

    While Tabata was disappointing last year, the guy is performing very well this year as a platoon/bench guy. I believe the average MLB salary is close to $3 million (read this somewhere not citing it as a fact), and I’d consider Tabata to be an above average player and a guy I am sure a lot of teams would love to have in that same role or even as a starter. My personal opinion is he gives you more than Snider does and I’d rather see him in the line up. Snider has no home runs in 30+ games, guy has no power at all as a right fielder.

    Initially, the contract to Tabata then his performance made me think it was a bad deal, but if he can give us what hes given us so far this year 6 yrs $15 million is a good deal.

  13. BuccoFaithful says:

    So? Chuck, hes arguably been the Pirates most consistent hitter this year. How about last night when Cutch came up after the Tabata double with no outs and grounded out to short thus not driving him in or even doing a job and moving the runner to third with one out. So should we not sign any player ever if they are not batting 1.000 with runners in scoring position?

  14. BuccoFaithful says:

    I hate Clint Barmes as much as the next guy NMR, but the guy grades out to be one of the better defensive shortstops in the league and if you take away the first month of this season his numbers are not terrible. Thats the state of the league that guys like Barmes who are not great players are going to make $3-4 million per year and the Pirates being the pirates they have to pay premiums to get guys to come.

    Also, while you are tearing apart Marte NMR, hasn’t Marte progressed more in a short time period then Alvarez has in multiple years? The guy does play a premium position, left field is like center field in most other stadiums at PNC park, not to mention he has the best arm of any of the outfielders. And he has cut down on strike outs and is simply never going to be a guy who takes a 100 bbs a year. Thats not his game he plays aggressive and is probably out of position as the lead off hitter and is more of a 2-3-4 guy with his combination of power and ability to find the gaps. And when you talk about losing money during arbitration years? Are you one of those pirate fans who complain when they don’t spend and complain when they do? I would rather see the pirates lock up Marte then bring some washed up outfielder in on a one year $6 million dollar deal for each of the the next 5 years.

  15. NMR says:

    I humbly disagree with you guys on Tabby’s deal.

    Unless you believe Bob Nutting will begin funding the Pirates commensurate to the big boys, $4m+ is NOT modest for a 4th outfielder. I don’t like it, but its the reality Pirate fans have to play with.

    The $15m Tabby will make over the first six years of his contract would have only been a good deal IF he continued to be a .300 AVG / .350 OBP guy. As is, he almost certainly would make less – likely significantly less – in three standard trips through arbitration.

    Tabby’s deal really becomes team friendly with the three team options in what would be free agent years. If the Pirates do not plan on paying him for those option years – likely considering the emergence of Marte and prospects like Polanco and Bell – then the deal is a bust.

    And a perfect example of why it makes sense to allow a player to get through the league at least a few times before commiting money.

  16. NMR says:

    Easy man, take a deep breath.

    Allow me to disassemble all of your straw men…

    I do not hate Clint Barmes, and I understand his defense is excellent. I did not grade Barmes’ value this year, as it is not over. I graded his value last year as sub-par since all glove, no bat guys like he was could be had for $3-4m less (Brendan Ryan, John McDonald etc).

    I did not “tear apart” Marte. I also never asked him to walk 100 times. I simply stated very concrete reasons that the league may adjust to him, which means his game still has much risk associated with it. That is what this conversation is about. Risk.

    I am not one of those Pirate fans who “complain when they don’t spend and complain when they do”. I just expect them to be smart with HOW and WHERE they spend.

    Again, this conversation is about risk.

    What do the Pirates have to lose by waiting a year? Somebody? Anybody?

    If Marte is willing to sign some ridiculously low extension, then great. Do it now.

    But if he’s not an idiot and expects something close to the $60m that Travis has suggested above, the Bucs have just assumed all the risk without even 500 MLB at-bats. Not a good way to run a low revenue franchise.

  17. Cleveland Travis,

    It seems in every one of your daily posts, you refer to the Pirates as a “small market franchise.” I wish to heck that you would quit calling Pittsburgh that!!!

    Cincinnati is a similar sized market and they have no problem spending money and having winners. St. Louis is almost exactly the same size as the Pittsburgh market, and read MLB Rumors today, where they call the Cards the best franchise in baseball. The Cards have no trouble spending and producing winners. Milwaukee is SMALLER than Pittsburgh, and they have spent money and gone to the playoffs.

    What do Milwaukee, Cincinnati, and St. Louis have in common? All are the same size or smaller than Pittsburgh, all spend significantly more cash than the Pirates for players, all have been recent winners, and ALL RESIDE IN THE NATIONAL LEAGUE CENTRAL!

    “Small market” is an excuse that should excised from your language (unless your job here is to make excuses for the last 20 years!) Is it?

  18. Travis Sawchik says:

    Cincinnati, Pittsburgh and Milwaukee are three of baseball’s smallest 10 markets.

    St. Louis is a small market in population, but it is the rare baseball-first town.

    Being in a small-market doesn’t doom a franchise to failure. But it is a considerable disadvantage as we all know from a payroll standpoint.

    It is what it is. If you’re going to rank MLB markets in three classes – Large, Mid, Small, Pittsburgh is in the bottom tier.

  19. Travis Sawchik says:

    Unfortunately, small- and mid-sized markets often have to deal with the player prices set by large-market clubs. And $4 million for a veteran 4th OF is about market price, I think.

    Now, that’s for a veteran OF.

    If Tabata never becomes more than a 4th OF/platoon guy, his deal will be a relative loss to the club compared to the cost of other similarly-aged and skilled players. But, again, it’s not a deal that kills a payroll.

  20. NMR says:

    Lets take your own advice, Travis.

    Do as the Rays do.

    The Rays do not deal with players coveted and paid by mid to large markets.

    They find value in the castoffs.

    If the Pirates cannot even get decent value out of a bench player, they simply have no chance of fielding a competitive lineup at their current payroll.

  21. Cleveland Travis,

    If St. Louis, Milwaukee, Cincinnati, and Pittsburgh are similar in market size, compete against one another primarily in schedule, and all reside in same division, then it is incumbent to cease using “Market size” as an excuse for losing.
    .
    “Give me an incentive to succeed, I will succeed!
    Give me an excuse to fail, I will fail!”
    .
    Los Angeles, Texas, Anaheim, Boston, and the Yankees do not compete in the National League Central. Do not compare Pirate spending & winning to those five——compare them only to rest of team of similar market size in their own division: Pirates spend less and win less.
    .
    To make Playoffs Pirates only have to beat Brewers, Cards, Reds, and woeful Cubs. Are they spending similar to those teams? No!
    .
    Market size is just an excuse!!

  22. Cleveland Travis,
    .
    Or, let’s take you other “own advice” and look at Cleveland:
    .
    1/ They traded for big salary Ubaldo Jiminez
    2/ They traded for young stud pitcher Trevor Bauer (Gerrit Cole’s college teammate and draftmate) and started his clock on big league club
    3/ They signed big money free agent Nick Swisher (who has a larger club salary outlay than any Pirate player)
    4/ They signed large salary free agent Mark Reynolds, who leads American League in homeruns
    .
    Pirates do not match up well to either of the so-called “small marked” teams you cited.

  23. Chuck H says:

    BuccoFaithful:

    I didn’t mean just Marte or any particular Pirate player. They are all guilty of not moving
    runners to the next base. You will have to admit, over the last few losing seasons, that’s
    what made them losers time after time. I have been a Pirate fan since the 1940s and
    suffered through many losing seasons, and also reveled through some wonderful ones.
    Just to let you know.

 
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