|J.D. Martinez||DH||5 yr, $110M||$22M||Player Opt-Out: 2 yr, $50M ($25M AAV); 2nd Opt-Out: 3 yr, $72M ($24M AAV)||Player|
|Yu Darvish||SP||6 yr, $126M||$21M||Player Opt-Out: 2 yr, $45M ($22.5M)||Player|
|Carlos Santana||DH||3 yr, $60M||$20M||2021 Club Option||Team||Eric Hosmer||1B||8 yr, $144M||$18M||Player Opt-Out: 5 yr, $105M ($21M AAV); No Trade||Player|
|Wade Davis||RP||3 yr, $52M||$17.3M||Final year vesting option, trade bonus||Split|
|Yoenis Cespedes||OF||4 yr, $110M||$27.5M||Full No Trade||Split|
|Edwin Encarnacion||DH||3 yr, $60M||$20M||Club Option in 2020||Team|
|Aroldis Chapman||RP||5 yr, $86M||$17.2M||Player Opt-Out: 3 yr, $56M ($18.6M AAV); Full No Trade||Player|
|Dexter Fowler||OF||5 yr, $82.5M||$16.5M||Full No Trade||Split|
|Kenley Jansen||RP||5 yr, $80M||$16M||Player Opt-Out: 3 yr, $42M ($14M AAV)||Team|
|Zack Greinke||SP||6 yr, $206.5M||$34.4M||$62.5M deferred, 15-team trade block, trade bonus||Split|
|David Price||SP||7 yr, $217M||$31M||Player Opt-Out: 3 yr, $90M ($30M AAV)||Player|
|Jason Heyward||OF||8 yr, $184M||$23M||Player Opt-Out: 3 yr, $78M ($26M AAV); Full No Trade||Player|
|Chris Davis||1B||7 yr, $161M||$23M||$42M deferred, partial no-trade||Split|
|Justin Upton||OF||6 yr, $132.75M||$22.125M||Player Opt-Out: 2 yr, $44.25M ($22.125M AAV); 20-team no trade list||Player|
|Max Scherzer||SP||7 yr, $210M||$30M||$105M deferred, present day AAV $27.3M||Team|
|Jon Lester||SP||6 yr, $155M||$25.8M||Full no trade clause. Final year vesting option||Team|
|Hanley Ramirez||DH||4 ye, $88M||$22M||Limited no trade, final year vesting option||Team|
|Pablo Sandoval||3B||5 yr, $95M||$19M||Final year club option; 3-team trade block||Team|
|James Shields||SP||4 yr, $75M||$18.75M||Player Opt-out: 2 yr, $31M ($15.5M AAV)||Team|
|Robinson Cano||2B||10 yr, $240M||$24M||Full No Trade Clause||Player|
|Jacoby Ellsbury||OF||7 yr, $153M||$21.8M||Full No Trade Clause, final year club option||Player|
|Shin-Soo Choo||OF||7 yr, $130M||$18.5M||10-Team No Trade Clause||Player|
|Brian McCann||C||5 yr, $85M||$17M||Full no trade, final year vest||Player|
|Curtis Granderson||OF||4 yr, $60M||$15M||Team|
2014 was really the year the MLB world began to raise eyebrows with free agent spending, as a player like Jacoby Ellsbury not only cashed in, not only guaranteed 7 years, but also held the Yankees hostage with a full no trade clause. That kind of treatment should be designated for elite contracts player contracts only. Team’s had completely lost control.
But clearly this wasn’t a secret, as the top 5 contracts in the 2015 free agent class resulted in MUCH more equal-leveraged fashion. Yes, Pablo Sandoval was a bust on the field, yes James Shields has no business owning a Player Opt-Out, but as a whole, these signings were much more representative of good sense. Even Max Scherzer - an elite free agent - maxed out at 7 years, was awarded no opt-outs, and didn’t wind up TOO far out of bounds for the Nationals.
But 2016 is where the agents/players pushed back - in a big big way. The only somewhat reasonable contract, ridiculously, was Zack Greinke’s 6 year, $206.5M deal in Arizona. Why? Because Arizona gets him for 6 years, not 2 - not 10. A starting pitcher of his caliber on the open market is always going to max out in terms of average salary ($34.4M), and the DBacks threw in limited trade protection to sweeten the deal - but not a full no-trade clause.
The remainder of the top free agent contracts in 2016 were a mess though in terms of structure and team leverage. David Price, the 2nd best pitcher on the open market, pulled in a 7 year deal at $31M per year, with a 3 year $90M player opt-out in his front-pocket, meaning the final 4 years of the deal (at his choice) are worth nearly $32M a year. Then comes arguably the single worst contract in MLB free agency history: Jason Heyward’s 8 year deal, at $23M per year, with a 3 year $78M opt-out available, and full no trade protection. Take that Jacoby Ellsbury.
Numbers aside, 2016 was the year the player opt-out really became prevalent, to a fault really. For years a shorter termed guaranteed contract followed by one or two club options was the “go-to” structure for a top but not elite free agent. But in 2016, MLB contracts started to look a little more like NFL contracts in that the full reported value of the contract really didn’t tell the story.
Fast forward to 2017 and we see two very different use cases of the player opt-out - at the same position. Aroldis Chapman cashed in on his World Series performance with the Cubs by fleecing the Yankees for a 5 year deal that reset the market for relief pitchers at $17.2M per year. However it also came with an opt-out after 3 seasons, through which he’ll have made $56M - a whopping $18.6M AAV. Toss in a full no-trade-clause and a red bow on top, and Chapman walks away with a 100% player-friendly contract. Flip the switch to the Dodgers , who re-signed their closer Kenley Jansen just 5 days after the Chapman deal became official. Jansen’s deal also runs 5 years ($16M per), with a player opt-out after 3 years. However his deal includes $42M through the first three seasons, or $14M per year. In other words, should he NOT opt-out, Jansen will have the ability to make $19M per year over the final two seasons of his contract - an incentive for him to stay, which is good for the team. It should also be noted that the deal does include a trade bonus ($1M), it does not include any trade blocking abilities.
Much has been made of how nearly all notable MLB free agents in 2018 went unsigned through December, January, and much of February - some even calling for legal grievances to be put into place as owners held firm.
Now that signings are slowly starting to come down (Hosmer, Martinez, Darvish), we can begin to assess the structures of this year’s class. It appears thus far that while overall AAVs are down across the board, that player’s still did well in garnering strength in structure.
Hosmer’s 8 year $144M contract has a 5 year, $105M player-opt out, making it solid $22M per year deal before dropping down to $13M per year for the final 3 seasons. Hosmer held a $21M market value in our system.
JD Martinez and the Red Sox finally made the marriage work, locking in a 5 year $110M contract, that could be a 2 year $50M, or 3 year, $72M. In other words, this is a front-loaded deal, putting a much deserved $25M AAV on his first two seasons, then a less risky $22M salary on year three. If Martinez continues to bat .300 while nearing 40 HR a season, he’ll be back on the open market come 2020. Martinez held a near $26M calculated market value with us.
Yu Darvish was the first big SP to lock in, when the Cubs gave him a 6 year $126M contract, but with $45M over 2 years after which Darvish can bail out. If he’s still on top of his game come 2020, a 4 year, $80M deal likely won’t be enough to keep him in the fold. Darvish held a $21.9M calculated market value with us.
Related: Track all 2018 MLB Free Agent Signings
The early signs in 2018 are positive for the sport going forward. While a lack of 10 year, $400M contracts isn't sexy, the deals for these notable players thus far have been good business - for both sides.
JD Martinez put up numbers last year that warrant $25M a year. But he hasn't always performed near that kind of production, a common trait for players set to hit the open market (peak in a contract year). Team's appear to be using the player option as a way to "tease" contracts into looking like great deals for the player: Take a lot of money up front, give yourself a chance to leave if you can't tolerate a little less money through the remainder of the contract, and if you're still worth elite money, we'll talk a bigger better deal before you ever leave (see Justin Upton).
In other words, an 8 year $144M contract for Eric Hosmer sounds like a mega blockbuster signing for San Diego. But a 5 year, $105M deal is not only a fair AAV for a player who can fill up the stat sheet, but it's a sensible length for any team who needs to remain fluid and flexible as they continue their building process.
However, the real trend we've seen in this analysis is that the market tends to react every other year. A "team-friendly" signing class is generally followed up by a player-grab smash the next season. Which leads us to 2019, a free agency period that has the potential to include Bryce Harper, Manny Machado, Josh Donaldson, Daniel Murphy, Charlie Blackmon, Andrew McCutchen, Brian Dozier, Clayton Kershaw, & David Price. In most cases here "elite" contract structure will not only be required - but likely rewritten.