What Will Felix Cost?
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.