There was an unusual flurry of contract extensions handed out last offseason. In March alone, teams guaranteed over $1 billion in new contract extensions to 11 players — Mike Trout’s record-breaking 10-year, $360 million contract was the centerpiece. In all, 26 players signed a new contract extension between the end of the 2018 World Series and the beginning of the regular season with seven more getting ink on the page in early April. It was an unprecedented outbreak of extensions for players young and old (ish). We’ve already seen five contract extensions since the end of the World Series this offseason, including new contracts for Aroldis Chapman, José Abreu, and Luis Robert. Now we have two more to add to the list in David Peralta and Miguel Sanó.
The first was signed on Friday when Peralta agreed to a three-year, $22 million contract extension with the Diamondbacks. The deal buys out the 32-year-old’s final season of arbitration and his first two years of free agency. He won’t receive a raise on his salary from last season ($7 million) like he would have in arbitration, but the guaranteed salary over the next three years makes it a nice trade-off. After suffering an injury to his AC joint in his right shoulder and spending time on the injured list three times in 2019, this contract extension gives Peralta some security if his injury woes continue.
For the Diamondbacks, Peralta represents an important piece of continuity as they enter the second year of their soft reset that started when they traded away Paul Goldschmidt and Zack Greinke. Peralta’s age and injury history precludes him from being considered part of Arizona’s core group of players led by Ketel Marte, but he’s certainly an important part of their roster as they try and compete for the NL Wild Card again. If his shoulder is healthy, his four-win season in 2018 provides a tantalizing glimpse at his potential ceiling. For an average annual value of just over $7 million, this extension could provide some excellent value for the Diamondbacks. It also provides some cost control for the organization in 2021 and 2022 when they have a sizeable group of prospects that could be graduating and the payroll room to supplement their young core with significant free agent additions.
Peralta’s shoulder injury definitely looms large over his future earning potential, but the market for outfielders in baseball’s middle class likely played a large part in convincing him to sign the extension. Just a few weeks ago, Corey Dickerson signed a two-year contract with the Marlins with an AAV of just $8.75 million. In my article covering that signing, I had a table comparing Dickerson with some of the other free agent outfielders on the market this offseason. Adding Peralta to that table makes for an interesting comparison.
Peralta is the oldest of this group by far — he would have reached free agency at the age of 33 next year — but his career numbers compare favorably to Dickerson and the rest of these free agents. If he was able to put together a completely healthy year in 2020, he might have been able to secure a larger payday in free agency, but the guarantee he received from Arizona over the next three years hedges some of the risk in his profile.
The second extension signed on Friday was pretty similar in concept to Peralta’s deal. The Minnesota Twins handed Sanó a three-year, $30 million extension that includes a team option for 2023 that could bump the total guaranteed salary up to $41 million. Entering his second year of arbitration, Sanó’s new contract guarantees him a pretty sizeable raise over his projected arbitration salary while giving the Twins control over his first two years of free agency.
Like Peralta, Sanó has a lengthy injury history that presents some risk to his future earning potential. He’s dealt with a number of issues with his hamstrings and an Achilles injury forced him to miss more than a month of the season in 2019. When he has been healthy, he’s been extremely productive at the plate. After returning from his heel surgery in May, he launched 34 home runs in just 105 games and posted a 137 wRC+. His defensive deficiencies will depress his overall value but his power and ability to get on-base regularly make him a big part of the Twins lineup.
Sanó’s extension, along with the ones signed by Jorge Polanco and Max Kepler last offseason, give the Twins a solid competitive core they can continue to build around. With C.J. Cron out of the picture, Minnesota has the option of moving Sanó over to first base if the Twins manage to, say, entice Josh Donaldson to sign. The Twins may not be done handing out extensions this offseason either. José Berríos and the club couldn’t agree to a salary prior to the arbitration filing deadline on Friday so they’re headed towards a hearing to argue over less than $500,000. Rather than an ugly fight over Berríos’s first big payday, the Twins could approach him with an extension buying out the rest of his arbitration years and a couple of free agent years.
With the arbitration filing deadline past and a bunch of big names heading towards hearings with their clubs, we could see another offseason full of contract extensions as Craig Edwards pointed out in his coverage of the fallout after the deadline. Both Peralta and Sanó set the bar early for some of these players in baseball’s middle class looking for some security in an inconsistent and uncertain free-agent market the past few years.