Robinson Cano: Looking to the Future

As I've written lately at "Red Bat Readings", the dynamic in baseball as far as transactions are concerned has been changing consistently throughout the last decade. Starting with the story of the early 2000s A's, teams have worked proactively to create the largest return on their investments possible. The primary method of maximizing ROI has been to eliminate the need for the processes of free agency and arbitration. What I mean by this is teams are taking risks by signing players to lengthy, low-cost extensions early in their careers or slightly before the beginning of free agency. We've seen it recently with Paul Goldschmidt, Chris Sale, Allen Craig, Buster Posey, Justin Verlander, Elvis Andrus, and Felix Hernandez, and this is a trend that isn't about to go away. This process combined with the structure and language of the new collective bargaining agreement (CBA) has created an environment where once-dominant figures are finding out that the same old tactics aren't going to work down the road.

I've written before that the changes in this financial environment are having a negative impact on Scott Boras as an agent. While he was still able to land the monstrosity that was Prince Fielder's free agent deal with Detroit, he's also lost plenty of opportunities in the recent past. His apparent mishandling of the Kyle Lohse saga this offseason served as one of many indicators that he might just be on the decline as an agent. Things really came to a head when it was reported that Robinson Cano was leaving Boras for CAA to be represented in part by famous rap artist Jay-Z. It's speculation on my part, but I believe that Cano wound up leaving Boras because he saw his former agent's approach with other players this offseason and didn't want to deal with the sit-and-wait approach, risking not being signed to a deal before spring training 2014. It's really hard to fathom one of Boras' biggest clients in history struggling to find a home in free agency, but recent evidence suggests that it would have been a possibility.

Regardless of who is representing Robinson Cano, one fact is simple: the man is about to land one of the biggest contracts in history. To give some perspective, the last time a player of Cano's caliber (he was a 7.8 WAR player by FanGraphs last year) hit the market as a middle infielder, Alex Rodriguez wound up signing the biggest contract in MLB history at 10 years/ $250 million with Texas back in 2000. What could be in store for Cano? Well, time to project.

For those new to my writing, I am a big fan of projecting player performance and trying to define the complex MLB marketplace. I am fascinated by the ideas that different clubs come up with and how those ideas impact what players and agents are trying to do. Since Cano's status is completely up in the air, I get to show you all both sides of my modeling: a model for a possible Cano extension and a model for a possible Cano free agent contract. However, before I can get to those, it's time to project what Cano will be in the future. Deals for players are getting longer and longer, so let's assume that Cano will use that leverage and ask for eight years on his next deal. Now, Cano will be 31 at the start of the 2014 MLB season (when a new deal would start), so we must keep in mind that he's beyond his prime as a player (for more info, click here). Anyway, here is what I project over Cano's eight potential seasons under a new contract (using FanGraphs WAR):

2014 (31): 6.5

2015 (32): 6.1

2016 (33): 5.5

2017 (34): 4.8

2018 (35): 4.2

2019 (36): 3.5

2020 (37): 2.7

2021 (38): 2.3

For those wondering, "Hey where do you get those numbers?" my response to you is that a lot of it is guesswork. So many things go into a WAR calculation that there's no way to project exactly what he'll produce by that metric. What I can tell you is that Cano's skill set is relatively stable. He has a lot of natural power in his swing, he draws plenty of walks (7% is a good projection there), doesn't strike out much, and he doesn't rely on speed. Combine this offensive skill set and the ability to move off position (I speculate that Cano will end up as a third baseman in the near future due to the strength of his throwing arm), and I feel comfortable using a generous model for Cano. By this model, Cano projects for 35.6 WAR over the life of an eight-year contract.

Projection One: Extension

This is where the fun starts. About a year or so ago, I did some math and concluded that the going rate for MLB extensions was roughly 4.1 million dollars per unit of WAR. After re-configuring before this past off season, I wound up with a model of roughly 4.3 million dollars per unit of WAR. This relatively low-going rate makes it possible for teams to sign players to "cheaper" deals like Sean Marshall, Joey Votto, and Cole Hamels. With Robinson Cano, there is one key thing working for him (he's a year from free agency) and one thing working against him (he's going to be 31). Ultimately I think the former is going to outweigh any negative effects of the latter, so I'm going to bump up my model to 4.5 in this special exception. If Cano produces the projected 35.6 WAR over the life of the contract, my model suggests that a "fair" extension for Cano would be 8 years/$160.2 million. This $20 million AAV would shatter the records for contracts handed out to second basemen.

Projection Two: Free Agency

This is where things get a little dicey. It's hard to know, for now at least, just how much the lucrative television deals being passed around are impacting the free agent market. Combine this with the fact that fewer big name players are getting to free agency every year, and it's possible that my model for free agency is off. However, as a vote of confidence for myself, I'll say that the 5.3 $/WAR ratio for free agents is still applicable to Cano. After all, the new compensation in the latest CBA appears to be having a heavily negative impact on free agents. Under this model, a fair deal for Cano in free agency would be 8 years/$188.7 million. This would give him an AAV of 23.6, which would be well beyond what he would theoretically make in an extension.

Conclusion

There are a few complexities that make this scenario different than most. To start, Cano plays for the Yankees, and they aren't exactly known for signing "fair" market-value contracts. However, the Yankees are reportedly feverishly working to get under the $189 million salary threshold by 2014, and a Cano mega deal would certainly work against that. Right now, the Yankees have six players signed to at least $84 million for the 2014 season, and adding 20 million dollars to that total would make it very difficult for the Yankees to field a fully competitive 25-man roster and still remain under the threshold without having any major holes. Due to this, the one wild card in whether or not a Cano deal can get done is whether or not he's willing to put money off until a later date. If Cano is ok with back loading a deal, then an extension in the Bronx is possible. If he wants his money up front or decides that he simply wants to make more money on the open market, then I suspect he will be the biggest piece on the 2014 free agent market, although this does bring out the risk that Cano could underperform or suffer an injury while playing in 2013. If this were to happen, then Cano would be out of a mega deal, which is why so many players and agents have been willing to sign these recent long-term extensions at prices lower than free agency would bear.

All in all, I am forecasting Robinson Cano to land an 8 year deal for north of $160 million. If all goes well, he will break multiple records and will set the bar for what other second baseman strive to achieve.