In previous seasons, the Marlins were wary about handing extensions because they were constantly concerned about their financial status. The team simply wasn’t willing to commit years to players it was not sure were going to be worth the money. Now that the Fish have committed three extensions to important Marlins Hanley Ramirez, Josh Johnson, and Ricky Nolasco, it seems the time for hesitance on extensions is past. In 2008, the Fish extended Ramirez with an excellent deal that will be paying him below market value through 2014. Johnson and Nolasco received similar extensions that will take them through 2013.
But I am not concerned with discussing the players the Fish have already extended. Rather, I am interested in considering the next two players the Fish will consider paying, the combination of Patience and Power, Logan Morrison and Mike Stanton. You might think it is too early to commit to either of these guys, especially since they will remain under cheap team control for the next two seasons and arbitration for three years after that, but it turns out that working early extensions like these is a great way to do business if you are a small market team.
A cue from the Reds
The Cincinnati Reds have tried to use the approach of extending players early this offseason, getting outfielder Jay Bruce to sign away six years of his career to Cincinnati for a cool $51M. The team is also attempting to get Johnny Cueto and reigning NL MVP Joey Votto under extensions as well. The key for all of these extensions is that each of these players has either reached their first arbitration year or is still in their pre-arbitration seasons.
Take a look at the advantage the Bruce signing provides the Reds. Last season, Bruce put up a .281/.353/.493 slash line (.363 wOBA) and was worth 5.3 fWAR / 4.3 rWAR thanks to some healthy defensive contributions. Even if you don’t buy how good his defense was, Bruce was at least a 3 – 4 win player and could be projeced to be around that range for the foreseeable future. His extension takes him through four arbitration seasons and two free agent years, paying him $25.25M during arbitration and $22M for his two free agent years, with a 2017 club option worth $13M. If you think the 24-year old (in 2011) Bruce is a 3-4 win player now with some possible improvement down the line, then you have to figure that three of his free agent seasons are going to be worth more than $35M in the future open market. By extending him now and guaranteeing him money, the Reds likely saved a good deal for those three free agent seasons. As we all know, saving money, especially on All-Star caliber players like Bruce, is a small market team’s best friend.
A Marlins example
The Marlins took this cue with Ramirez, signing him early to his six-year, $70M extension in 2008. Ramirez is at a level above Bruce, and so he will be earning $46.5M through his three free agent seasons. However, according to FanGraphs’ valuations and fWAR, Ramirez has only had one season in which he has been worth around the $15.5M annually that this contract would pay him for his free agent years. This means the Marlins are likely getting a huge discount on Ramirez’ services by guaranteeing that money as well. This allows the team to hold its superstar for a long period without investing market value.
Patience and Power
Morrison and Stanton look to be the next two players in line for an extension, but what are the criteria they will have to meet for the Marlins to consider a deal? Obviously the 2011 season is going to be a big determinant on whether they get deals done. According to my calculations, ZiPS along with my defensive projections have Stanton putting up a 3.2 WAR season and Morrison putting up a 2.5 WAR year. While I do not think this puts Morrison quite in line for an extension (meaning the team can afford to wait for an improvement in 2012), it does put Stanton in line for a nice deal.
Let’s say the Marlins offer Stanton a six-year extension taking him through his last pre-arbitration season, three arbitration years, and two free agent seasons. Such an extension for a budding star like Stanton would essentially cut him off before he developed into a superstar, instead paying him similar to how they paid Bruce and how the Arizona Diamondbacks paid Justin Upton. Consider this following payout:
2012: $1M (pre-arbitration)
2013: $4M (arbitration)
Coming off a 3-win season, that seems like a perfectly fair extension, worth $49M over those seasons and buying out two free agent years at the cost of $26M. By starting the extension this early, it guarantees Stanton dollars earlier in his career, making it more likely for him to accept. At the same time, the Marlins are clear beneficiaries at the back end of the deal if Stanton remains a 3 – 4 win player, and they reap huge benefits if he develops into the star some of us dreaming of, a 5 – 6 win palyer through the 2014-2017 seasons.
For Stanton, he is set for the foreseeable future regardless of his performance, and for the Marlins they get a favorable deal that becomes an absolute windfall if he develops as they expect. Now that the Marlins seem willing to use this small market weapon to improve their team, they should seriously consider this move.