MLB free agents: J.D. Martinez's reported contract demands are well above his worth

Though J.D. Martinez generated exemplary walk-year production in 2017, his mega deal eludes him — even with spring training less than five weeks away.

Martinez has the right man behind him in Scott Boras, but even the super-agent seems to be having a difficult time persuading clubs that it’s wise to heavily invest in a player destined to be — or at least should be — a full-time designated hitter. Boras does not sweat securing significant deals when facing a dwindling timeframe because he has experienced immense success in similar circumstances with numerous high-level free agents.

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The delay is not about the slog of the current free-agent market. Rather, teams are having a difficult time reconciling the 30-year-old Martinez’s financial value when all his production comes in the batter’s box. Martinez hit free agency older than some, and while he’s considered one of the best hitters in the game, his fielding ability is extremely limited, adding another risky component to the equation. Even if a club wants a strict DH, guaranteeing a salary approaching Martinez’s reported seven-year, $210 million asking price or a shorter term deal that maintains a $30 million average annual value is ludicrous.

The Red Sox, who could use Martinez’s thump (45 home runs and 166 OPS+ in 2017), are reportedly the lone suitor. Boston’s proposal is said to be for five years, so it becomes Boras’ responsibility to drag a competitor into the mix. Boston will not bid against itself, therefore if the value or length of their proposal is to increase, another club will have to enter the fray. Unfortunately, this is not a pool in which many teams want to swim, despite Martinez offensive prowess (career 130 OPS+).

We created a basic model to demonstrate the cavern between Martinez’s asking price and the analytical market for his services. To determine a starting point, we averaged Martinez’s WAR measures per FanGraphs across the past three seasons, arriving at 3.5 WAR for 2018. Second, we assume 5 percent inflation year over year to determine the worth of 1.0 WAR following the initial $9.0 million value. Lastly, the age-curve begins to decrease a player’s speculated WAR by 0.5 on an annual basis beginning at the age-31 season.

Season Age Value of 1.0 WAR in millions Estimated WAR Performance Value in Millions
2018 30 $9.00 3.5 $31.50
2019 31 $9.45 3 $28.35
2020 32 $9.92 2.5 $24.81
2021 33 $10.42 2 $20.84
2022 34 $10.94 1.5 $16.41
2023 35 $11.49 1 $11.49
2024 36 $12.06 0.5 $6.03
Total     14.0 $139.42

The model shows Martinez would fall well short of producing enough on-field value to match a seven-year, $210 million deal. Even Boston’s five-year proposal should not go beyond $121.91 million if the club expects to stick to a theoretical breakeven point. This disparity is also a critical problem for Martinez if he hopes to minimally obtain a $30 million average annual value over a five-year contract. In fact, we see that a one-year deal is the only one that would cover such an average annual value, though his two-year performance value comes close.

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Our first model grants Martinez the benefit of the doubt by using the WAR average of his past three seasons versus statistical projection models such as FanGraphs’ “Depth Charts” (derived from Steamer’s and ZiPS’ 2018 projections). Depth Charts has Martinez manufacturing 2.7 fWAR in 2018. If we use that value as a starting point, it severely lowers Martinez’s overall performance value as shown in our second model below.

Season Age Value of 1.0 WAR in millions Estimated WAR Performance Value in Millions
2018 30 $9.00 2.7 $24.30
2019 31 $9.45 2.2 $20.79
2020 32 $9.92 1.7 $16.87
2021 33 $10.42 1.2 $12.50
2022 34 $10.94 0.7 $7.66
2023 35 $11.49 0.2 $2.30
2024 36 $12.06 -0.3 -$3.62
Total     8.4 $80.80

This pessimistic scenario has Martinez contributing negative WAR in his final season, and thus a lower overall value than a five-year deal would generate.

While neither of these projections reflects Martinez in a great light compared with his initial asking price, there is a solid agreement to be made. Knowing that there is a five-year deal on the table and that the length will not decrease, Boston, or whichever club inks Martinez, must determine their upper limit in terms of average annual value.

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By selecting a dollar amount at the approximate midpoint of performance value between the two models’ five-year mark, the wisest five-year offer will be in the $100 million range. From the club’s perspective, if it believes in the higher performance value in Model 1, the team stands to gain a financial advantage by signing Martinez at $100 million. Further, the club would have room to increase its proposal until Martinez is satisfied.

However, if the club suspects the less desirable outcomes in Model 2 are more realistic and still wants to sign Martinez, the team would end up agreeing to a deal understanding it will come up short of his potential production value. As we know, this is often the cost of doing business in baseball, particularly in regard to nine-figure contracts.

Martinez is going to be a rich man within the next few weeks. He may not sniff the mark set by his bombastic agent, but a nine-figure deal is likely in the cards. For a player profiling as a designated hitter quickly approaching the downside of his age curve, that’s not too bad.

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