Markakis: And Yet Another Contract.

I am almost getting tired of writing about these. Yesterday, after a weekend full of rumors indicating that the two sides were close and a deal inevitable, Nick Markakis and the Baltimore Orioles officially agreed to terms on a six-year, $66.1 million contract.

Markakis was entering his first arbitration year so this contract buys out all three and three free agent years, with a mutual option on a fourth. That’s a lot of open market years and before even looking at the numbers, the value of the salary is sending me alert bells that this is going to be a team-friendly deal.

The projections want to knock some of Markakis’ offensive improvement in 2008 off and peg him closer to his 2007 level, which for a six-year projection seems fine to me. We also want to scale back his plate appearances to account for the possible, perhaps even likely given the contract’s duration, chance that he will miss time at some point. Assuming Markakis sticks in right field, we also have a decent sample size to now estimate his defense, +2 runs per 600 PA, and given his young age, it shouldn’t deteriorate much over the time period in question.

That leaves us with a calculation of +20 runs for replacement, +2 runs for fielding, -7.5 for position and about +23-24 runs for hitting. Totaling those yields ~37 runs above replacement, 3.7 wins and 16-17 million in value. 10% for long term security and the free market six year total is $90 million. Of course, given the 40/60/80 nature of arbitration, the Orioles are not buying Markakis at six years worth of value, but rather at 4.8 years. Given that, the expected value for the contract is $72 million. Actually less than I first thought. It’s still a good deal for the Orioles, but it’s not much of a steal and given that Markakis gets to wrap up a tremendous amount of financial security, you can hardly fault him for taking a slight discount. All in all, looks like a win-win.