What Will Felix Cost?

Dave · July 22, 2009 at 8:47 am · Filed Under Mariners 

Happy Felix Day. After losing 1 1/2 games in the standings last night, we badly need a Felix Day. The way he’s been pitching this year, I think we’d all like to see Felix Day made a Seattle holiday for a long, long time. But, as we sit and watch the Blue Jays consider trading Roy Halladay and the Indians listen to offers for Cliff Lee, the reality is that the Mariners are going to be in the same position a year from now.

The M’s control Felix for 2010 and 2011 before he heads for free agency. Since they were never able to sign him to a multiyear contract, he’s got significant leverage as he heads towards his second season of arbitration eligibility. The 4+ years of service time guys usually do pretty well, making ~60% of their free agent value. Felix is easily going to command at least $10 million if the team goes to arbitration with him this winter, so the chance to lock him up long term at bargain rates have gone by the wayside.

What would it take for the M’s to re-sign Felix to a multi-year contract this winter, assuming he would be willing to delay his free agency by a few years? For a baseline, let’s look at some recent 4+ year arb. eligible pitchers who signed long term deals and gave up at least one year of free agency in the process.

Zack Greinke, 2009: Signed a 4 year, $38 million deal.
Dontrelle Willis, 2008: Signed a 3 year, $29 million deal
Scott Kazmir, 2008: Signed a 3 year, $28.5 million deal with a fourth year team option for $13.25 million.

I see a trend. The going rate for talented, young starting pitchers signing contracts as a 4+ year service time guy has been $9.5 million per year. Of course, none of those guys were coming off a season like Felix is having right now, so he’d certainly command a premium above and beyond that kind of deal. Factoring in some salary inflation and Felix’s superiority to recent comparables, you’d think that the M’s would have to start by offering something like $50 million over four years to get in the conversation.

The problem, though, is there’s very little incentive for Felix to sign a deal like that. He’s almost certainly going to get $10+ million for 2010 if he goes through the arbitration process. 4+ year service time guys usually get about 60% of their free agent value, and Felix is a $20-$25 million per year pitcher. Then, in 2011, he’d be looking at a salary around $15 to $18 million.

If Felix doesn’t sign a multi-year deal this winter, he’s in line for about $25 to $30 million for 2010 and 2011, assuming he stays healthy. A 4 year, $50 million offer would be valuing his first two years of free agency at about $12.5 million apiece, which is probably half of what he’d actually get. Yes, there’s a discount involved in getting some financial security up front, but we can’t realistically expect him to leave 50% of his free agent salary on the table when he’s only two years away from cashing in with a massive, long term deal.

Felix would probably want to value those two years at something closer to $15-$18 million apiece. That would require a 4 year, $60 million offer this winter. That would put him in line with what players like A.J. Burnett and Derek Lowe got on annual basis as a free agent. In other words, he’d be accelerating his earnings by taking a deal that is suitable to significantly inferior talents.

4 years, $60 million. It’s a big offer – well above what the Greinke/Kazmir/Willis triumvirate were able to negotiate. But that’s my feeling on what it would take to lock Felix up this winter, so that 12 months from now, we’re not the team trying to figure out if we should listen to offers for our Cy Young contender.


75 Responses to “What Will Felix Cost?”

  1. georgmi on July 22nd, 2009 12:42 pm

    The crazy thing about the A-Rod contract is that he’s outperformed his salary, for ten years now.

    Felix looks like A-Rod-level talent to me–no matter what we end up paying him, as long as he stays healthy, he’s likely to be worth even more.

    It would be great to see him be the second player to go to the Hall of Fame after playing his entire career in Seattle.

  2. Graham on July 22nd, 2009 1:10 pm

    The injury gurus over at BP seem to feel that Felix is a higher-than-average injury risk.

    They also don’t have a clue what they’re talking about.

  3. just a fan on July 22nd, 2009 1:16 pm

    I agree with Marinerz51 that we need to re-sign Felix for up to 8 years. If we can get him for 8 year, $125 million, we should snap that up. Yes, it’s a huge gamble, but all a four-year deal does is put him in free agency after his age 27 season. Do we really want to do that?

    And I’ve always thought that down the line — even if he had some moderate injury trouble — some team would be willing to take on a hefty portion of his remaining salary if it ever became too much for the Mariners. He’s just that talented.

    So, up to 8-year, $140 million is fine with me. The M’s aren’t gamblin’ on Barry Zito, ya know.

  4. Dave on July 22nd, 2009 1:25 pm

    The list of 6+ year contracts for pitchers that have ever worked out is basically nil. There’s a reason the actuaries who work for the companies that insure these contracts won’t cover anything over 3 years.

    You go four years, maybe five, but nothing longer.

  5. TranquilPsychosis on July 22nd, 2009 1:32 pm

    Felix looks like A-Rod-level talent to me–

    So he’ll choke in the post season on an annual basis?

    Seriously though, I would think his agent would steer clear of any contract going to deep into his free agent years unless Felix said flat out that he wants to play here for his career. The team might be able to sign him, say, through 2014, but probably not much longer at this point.

  6. rick m on July 22nd, 2009 1:49 pm

    Where were those insurance bean counters when Bavasi was offering Silva 4 years?!

  7. just a fan on July 22nd, 2009 1:49 pm

    OK, so the insurance is the big issue with a longer deal?

    But wouldn’t one issue with longer term deals be that they tend to be signed when players are older (Santana signed his long deal for his age 29 season, which seems to be OK to this point) and already have passed their prime, whereas a 7- or 8-year deal with Felix would take him from 24 to 30 or 31, and THEN somebody would sign him to a contract that wouldn’t work out?

  8. Dave on July 22nd, 2009 1:51 pm

    Pitchers are risks to blow out their arms at any age. Committing to a pitcher seven or eight years from now, when he could very well shred his arm tomorrow, is a bad idea.

    Also, pitchers don’t age like hitters. There’s no age 27 peak with a standard decline.

  9. joser on July 22nd, 2009 1:54 pm

    Have there been any pitchers in the last 10 years that have made the big pay day and been worth the money?

    Roy Halladay.
    One point, however, does not make a general trend.

    This year: Beckett, Javier Vazquez, and even Sabathia (yes, really — he’s been worth almost exactly the $14M the Yankees are paying him; whether that continues over his contract remains to be seen — but since he gets $23M each of those remaining years, I’d say it’s unlikely).

    Also, depending on how you define “big payday”: Joel Pineiro is in there (the $7.5M he’s making this year is more than I ever expected him to see when he left Seattle, and he’s crazily out-performing it).

    I can’t be bothered to go through past years summing contract values and WAR equivalents, but it’s fair to say there are pitchers now and in the past 10 years “who made the big pay day and been worth the money.” And most of them were over 25 when they signed the deals.

  10. Snake Hippo on July 22nd, 2009 1:55 pm

    I would trade my soul for Felix. Give him 20 years and $400 million, whatever, just keep him in Seattle!

  11. joser on July 22nd, 2009 1:56 pm

    OK, so the insurance is the big issue with a longer deal?

    No, the insurance tells you longer deals are a bad idea. If an insurance company isn’t willing to sell you insurance on a risk you’re thinking of taking, that should be a hint that you don’t properly understand the risk.

  12. just a fan on July 22nd, 2009 2:01 pm

    No, the insurance tells you longer deals are a bad idea. If an insurance company isn’t willing to sell you insurance on a risk you’re thinking of taking, that should be a hint that you don’t properly understand the risk.

    But does the insurance company consider the reward? I understand it’s a huge risk to sign Felix to a 7-year deal (which ultimately would be my personal preference), but I’m also looking at the huge reward of potentially have an Ace for 7 seasons.

    Given the revenue streams of the M’s, I’m hoping they’d have three seasons that they’d put together a team good enough for Felix to drive them through the playoffs to the World Series one time.

    Yes, there’s Hope involved, but darnit, I’d risk an albatross for 3 or 4 years, or even 7, to give this team a chance to have a great shot to win a World Series for a couple of seasons with Felix anchoring the pitching staff! High-risk, high-reward.

  13. Dave on July 22nd, 2009 2:02 pm

    The risk too high. 5 years max for a pitcher, period.

  14. Mike Snow on July 22nd, 2009 2:05 pm

    If an insurance company isn’t willing to sell you insurance on a risk you’re thinking of taking, that should be a hint that you don’t properly understand the risk.

    Well, sometimes it’s just a lack of market information (a sufficient group of people seeking that type of insurance that you can pool together, actuarial data to evaluate their risk). But I wouldn’t say that’s the case with baseball contracts.

  15. just a fan on July 22nd, 2009 2:13 pm

    Well, I’d like to see the full analysis before I’d put a period on it. Maybe you’re right. Maybe it’s just a philosophical difference on risk versus reward.

    I’m still gonna favor a 7-year deal worth $100 million, if it could be done. Fortunately, Jack Z is far smarter than I am and he’s the one in charge, and I trust him to make a better, much more well-informed decision as a GM than I can possibly make as fan.

  16. TranquilPsychosis on July 22nd, 2009 2:23 pm

    Yes, there’s Hope involved, but darnit, I’d risk an albatross for 3 or 4 years,

    Don’t we already have one for 2 more years in Silva?

  17. Soonerman22 on July 22nd, 2009 2:26 pm


    I don’t want to have Randy, Griffey and A-Rod all over again. There are guys I am fine with letting go, but there are also guys you have to build a team around. Felix is defiantly developing into one of those guys and TRUE Aces are hard to come by as Baker loves to point out. Plus this would be the perfect year to do it with all the cash (Bavasi’s junk) falling off.

    (I would love it if he would like a deferred contract with the money over 20 years like Griffey did with the Reds, but I strongly doubt it. I know if I was 23 what I would want!)

  18. dw on July 22nd, 2009 2:30 pm

    If the M’s let free agency play out, Felix will be a free agent at 26. If they buy those years out for a 4-5 year contract, that will push the Big Payday back to when he’s 28-29.

    And here’s where the calculus comes in. Longer he pitches, the greater the chance he’ll have a career threatening injury. But the longer he pitches, the better counting stats he has. But because, at worst, we’re looking at him turning free agent at 29 with a 5 year deal, he’ll still be young enough to command the Big Payday.

    Taking a 4/60 or a 5/75 right now doesn’t hurt his chances at getting a Santana-sized deal later. The only thing that can keep him from that is his body.

    If my opinion mattered, I’d be all for either deal. The money is there. And at the end of it, he can go break down Pedro-style for the Mets and collect $150M while doing it. 🙂

  19. fiftyone on July 22nd, 2009 2:40 pm

    6 years, 108 million. If he’s healthy for five, he’ll earn every dollar.
    Don W – Convince him that Safeco Field is slightly better place to pitch than Yankee Softball Half-Stadium.
    Jack Z – Convince him that his outfielders will be more along the lines of DTFT than Alfonso Sorry-ano.
    The rest of us can make sure we know he is loved and appreciated.

  20. fiftyone on July 22nd, 2009 2:41 pm

    *make sure HE KNOWS he is loved and appreciated.

  21. John S. on July 22nd, 2009 2:45 pm

    If the M’s aren’t going to commit to signing Felix long-term, they at least need to take advantage of the opportunity and put a team around him next season and in 2011 that is capable of winning the World Series.
    With so much money coming off the books for 2010, if they don’t bring in the talent immediately to compete with the Angels they’re just wasting their time.
    What’s the point of building slowly if you’re going to lose one of the best arms in baseball by 2011? And I’m all for building up the farm system, just not at the expense of the ML club.

  22. rick m on July 22nd, 2009 2:47 pm

    6-7 years for a pitcher is not smart, as Dave says. But if you are going to make an exception, a roll of the dice, I would say that Felix is the guy you would make it with.

    The combination of his age, his stuff, and his demonstrated durability to date, suggest to me that he would be the one to gamble on.

  23. rick m on July 22nd, 2009 3:42 pm

    I don’t understand this whole “put a team around” someone. We always want to put a team around the players who least need it.

    Why don’t we ever want to put a team around a Willie Bloomquist? Or a Ronny Cedeno. If ever anyone needed a team around him, it’s Willie Bloomquist.

    If the M’s could put a team around Felix that was capable of winning the World Series, the wouldn’t need Felix.

  24. bookbook on July 22nd, 2009 5:21 pm

    The list of 6+ year contracts for pitchers that have ever worked out is basically nil.

    Mussina was also worth his mega-contract (though the Yankees never realized it). Greg Maddux outearned any contract he ever received. Didn’t Randy Johnson receive a 4-year 50 million dollar contract and earn 2 cy youngs (plus 2 other great years)?

    Long contracts are risks, but not certain busts by any means.

  25. DAMellen on July 22nd, 2009 10:27 pm

    So you say we shouldn’t go more than four or five. Can we at least tack on a couple option years? Maybe go 4/$60 plus an option at $17 and an option at $20? Something like that? Would that be feasible?

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