Looking Ahead To Next Offseason’s Opt-Out Clauses
In recent memory, we’ve seen more and more players receive opt-out clauses in their contracts. Last winter, Jason Heyward and David Price, the biggest position player and pitcher on the market, respectively, each signed massive deals with the right to opt out after three seasons. Zack Greinke, the second-most sought after pitcher on the market that year, was only available because he had opted out three years into a six-year pact with the Dodgers.
There’s occasionally debate as to whether there are cases when opt-outs benefit the team, but generally, opt-outs are considered to be a player-benefit. Giving a player the option to leave after a certain number of seasons gives him the chance to re-up for even more cash should the initial years of his contract go well, and the ability to simply stand pat if things don’t go as smoothly.
Next offseason, there will be several high profile players with the ability to opt out of their current contracts. Let’s take a look at the most prominent ones, and try to figure out what it would take for the player to opt out, or sit tight.
Justin Upton, OF, Detroit Tigers
Contract terms after 2017: 4 years, $88 million.
When Upton signed his six-year, $132 million deal after 2015 with an opt-out after two years baked in, it seemed like a logical move. Upton was only 27 at the time, and figured that should he opt out after his age-29 season, he would put himself in position to cash in big once more. His poor 2016 has thrown that plan into doubt.
Upton batted just .246/.310/.465 in 2016, his worst line since he was 20 years old. He did hit 31 bombs, but saw his strikeout rate balloon to a career-high 28.6%, and did nothing to change his reputation as a now mediocre fielder in right.
The Tigers can pin some hope on Upton’s second half, though. FanGraphs’ Corrine Landrey profiled Upton’s second-half resurgence last year, and it was readily apparent in his surface numbers: he posted a 77 wRC+ in the first half, but a stellar 142 wRC+ in the second.
Whether Upton can prolong that resurgence will go a long way towards determining his opt-out decision. In order to feel safe opting out, Upton must feel that he can exceed the $88 million he’s guaranteed across his age-30 to age-33 seasons. Looking back at this past winter, free agent outfielder Yoenis Cespedes was guaranteed about $110 for his age-31 to 34 seasons, while Dexter Fowler got $82.5 million for his age-31 to 35 seasons.
If Upton continues to perform at an All-Star level as he did in the second half of 2016, earning something in the vicinity of what Cespedes got seems plausible. Upton would be a year younger than Cespedes or Fowler were when they hit the market, and would have a year and a half of excellent play to convince teams he was his old self again. But it will all come down to whether Upton can continue to put his miserable start to 2016 in the rear-view mirror.
Johnny Cueto, SP, San Francisco Giants
Contract terms after 2017: 4 years, $84 million.
Cueto signed a contract very similar to Upton’s. Both signed deals prior to 2016 with opt-outs after just two years, and both have over $80 coming their way if they do not exercise their opt-outs. But coming off another great season, Cueto’s tenure in San Francisco could already be coming to a close.
Cueto proved to be perhaps the best free agent signing of last winter. He logged 219.2 innings for the Giants, maintaining a 2.79 ERA and totaling nearly 6 rWAR. He’s 31, so some regression is to be expected in 2017, but FanGraphs still projects him for 4.3 WAR next year. Should Cueto hit or exceed his projections for this season, he will almost certainly opt out. He might not get another six-year deal entering his age-32 season in 2018, but a five-year deal worth well over $100 million would seem highly attainable.
This puts the Giants in a strange position: should they hope Cueto opts out? The only realistic scenario in which Cueto doesn’t opt out involves him sustaining an injury or severely under-performing. If Cueto plays as well as the Giants expect, he’s gone. In that case, the Giants might be happy to thank Cueto for his service, and allow another team to pay handsomely for the decline years of Cueto’s career.
Either way, Cueto has given himself a nice opportunity to break the bank again. He is a pitcher, so any number of awful unforeseen things could occur to deter Cueto from hitting the market after this year, such is the nature of throwing baseballs for a living. Regardless, the smart money is on Cueto earning more money next winter.
Ian Kennedy, SP, Kansas City Royals
Contract terms after 2017: 3 years, $49 million.
Most people would have scoffed at you if you told them Ian Kennedy would be among the players who realistically could opt out of their deals after the 2017 season. When the Royals gave Kennedy a five-year deal worth $70 million with an opt-out after two, the expectation was that Kennedy would simply laugh his way to the bank, with no thought of opting out.
That’s because Kennedy was coming off a pretty dreadful season for the Padres, one in which he rated as replacement level by rWAR. $70 million seemed like such a reach for bad starter, the idea that Kennedy would want to opt out to earn more money seemed ludicrous. But after giving the Royals 195.2 innings with a 3.68 ERA, totaling over 4 rWAR, Kennedy just might do the unthinkable.
The main issue, of course, is whether Kennedy’s 2016 is sustainable. Kennedy’s peripherals did not improve much in 2016 over his previous 2013-2015 period in which he was not a good pitcher. His strikeout rate actually decreased from where it was with the Padres, and he generated ground balls on just 33.2% of his batted balls, a career-low.
Rather, a .268 BABIP could have been one of the main drivers of Kennedy’s big 2016. However, playing in front of the Royals’ perennially strong defense probably helped produce that low BABIP. That Royals defense will still largely be intact for 2017, so it’s very possible that Kennedy could continue to post mediocre underlying numbers but shiny run prevention results.
If those run prevention figures stay low, Kennedy might feel compelled to hit the market again. What will be interesting to see, in that case, is how the market values him. MLB teams will be fully aware of his declining peripherals and the Royals tight defense, but would that be enough to overcome the allure of a dependable starter with a low ERA? We will have to wait and see.