With the World Series wrapping up on either Wednesday or Thursday night, the five day window that teams have for exclusive negotiating periods is going to expire at the beginning of next week, and the off-season will officially be underway. As is the case every winter, there are a small handful of players who are going to get paid handsomely – this year, that list includes Albert Pujols, Prince Fielder, Jose Reyes, CC Sabathia, and C.J. Wilson. The big five free agents – and Yu Darvish, if you want to throw him into that mix as well – are all going to be highly coveted and command bidding wars that will land them huge long term contracts.
The drop-off from those five to the next tier, however, is pretty striking. Everyone after that comes with either performance, age, or health concerns, and often a combination of the three. And, unfortunately for the non-premium free agents, they’re hitting the market at a really lousy time.
In any one off-season, teams have an available pool of money on which to acquire or retain talent. The total pool of cash might change slightly based on who is available, but for the most part, it’s driven by overall league revenues and expiration of previous contracts freeing up money that can be re-allocated to other players. At the league level, attendance was fairly flat (up 186 fans per game over 2010), and financial problems plaguing the Dodgers and Mets are threatening to take two traditionally large revenue franchises mostly out of play this winter. However, it’s not just a lack of big spenders that may end up thwarting salary growth for the non-premium tier of free agents – they also have to compete with the huge pool of talent that is headed to arbitration for the final time this winter.
In most years, there aren’t that many top-notch players who make it to arbitration with 5+ years of service. The really great players often get locked up to huge extensions that buy out their final arbitration year and some free agent seasons, and it’s even become common for teams who can’t buy out FA years to at least get some cost certainty by giving out multi-year deals that avoid the arbitration process. Last winter, for instance, the big 5+ service time guys were Prince Fielder, Jose Bautista, Dan Uggla, Rickie Weeks, and Jonathan Papelbon. Fielder and Papelbon were intent on making it to free agency, so that left Bautista, Uggla, and Weeks to sign long term extensions. However, while these are all nice players, each had a pretty huge question mark hanging over their head last winter, and as such, none were able to command massive dollar figures in exchange for giving up the right to hit free agency a year later.
This year, though, the class of guys who could strike it rich is much deeper, and potentially much more expensive. In fact, I can’t remember an off-season in which this kind of talent reached arbitration for the final time together. Among the players who are headed to arbitration this winter with 5+ years of service time:
Matt Kemp, +8.7 WAR, 27 years old
Mike Napoli, +5.9 WAR, 30 years old
Howie Kendrick, +5.8 WAR, 28 years old
Cole Hamels, +4.9 WAR, 28 years old
Brandon McCarthy, +4.7 WAR, 28 years old
Miguel Montero, +4.3 WAR, 28 years old
Melky Cabrera, +4.2 WAR, 27 years old
Michael Bourn, +4.2 WAR, 29 years old
B.J. Upton, +4.1 WAR, 27 years old
Erick Aybar, +4.0 WAR, 28 years old
Anibal Sanchez, +3.8 WAR, 28 years old
John Danks, +3.2 WAR, 27 years old
That list doesn’t even include Shaun Marcum, Carlos Quentin, Delmon Young, Jeremy Guthrie, Francisco Liriano, or Jonathan Sanchez, all of whom are also 5+ year arbitration eligibles, but are probably going to end up just going year to year due to some questions about their performances in 2011.
It also doesn’t include a few other arbitration-eligible guys who could be in line for some serious money this winter; Jacoby Ellsbury (a 4+ service time guy who could hit the jackpot coming off his monster 2011 season), Tim Lincecum (a 4+ service time guy who is likely to break all arbitration records) and Clayton Kershaw (a 3+ service time guy who also could parlay his fantastic year into a big contract if he wants). When you add in potential extension talks for guys whose current contracts expire in time to make them free agents next winter – Zack Greinke, Josh Hamilton, Yadier Molina, and Shane Victorino are all in that boat – you quickly find a very crowded pool of players who would normally be in line for a long term contract.
When teams start looking at the free agents beyond the big five, they’re going to start seeing pretty compelling reasons not to give out deals that stretch too far into the future. Unfortunately for those free agents, these teams have other options this winter. Unlike last year, where it was essentially free agency or do nothing, teams this year will be able to turn to the trade market and find a near-endless supply of quality players who may be pricing themselves out of their current teams plans, and would be available as either one-year rentals or players who teams could acquire and then extend in lieu of signing a mid-tier free agent.
Even players who won’t be going anywhere this winter, such as Cole Hamels, are still going to end up depressing free agent salaries. The big-spending Phillies have to not only worry about giving Hamels a massive extension to keep him in Philadelphia, but they also have to pay Hunter Pence‘s arbitration tab this winter, and those two contracts alone could knock close to $30 million off their annual budget. The same goes for LA, where they’ll likely face the reality that the costs of keeping Matt Kemp and Clayton Kershaw in Dodger blue might end up eating most of their money.
This secondary market for premium players who are starting to get expensive is going to spell trouble for the non-premium free agents who are used to cashing in because there are no alternatives. This year, there are a lot of alternative ways for teams looking to buy talent to spend their money, and I’m guessing that after the big five sign, we’re going to be looking at a lot of free agents who are wondering why the offers aren’t quite what they were hoping for.
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